-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, RNbI/QsLL3T0wV2W3F7t0q3JG5ZQJmtIEM+3CdJY73teulLezeBbJamZM1W8TaRs 55h16TTa5fVMSvzj5RJ6fw== 0000950112-95-000873.txt : 19950414 0000950112-95-000873.hdr.sgml : 19950411 ACCESSION NUMBER: 0000950112-95-000873 CONFORMED SUBMISSION TYPE: SC 14D1 PUBLIC DOCUMENT COUNT: 11 FILED AS OF DATE: 19950403 SROS: NYSE GROUP MEMBERS: CEC ACQUISITION CORP. GROUP MEMBERS: INGERSOLL RAND CO SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CLARK EQUIPMENT CO /DE/ CENTRAL INDEX KEY: 0000109710 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL TRUCKS TRACTORS TRAILERS & STACKERS [3537] IRS NUMBER: 380425350 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D1 SEC ACT: 1934 Act SEC FILE NUMBER: 005-14164 FILM NUMBER: 95526519 BUSINESS ADDRESS: STREET 1: 100 N MICHIGAN ST STREET 2: PO BOX 7008 CITY: SOUTH BEND STATE: IN ZIP: 46634 BUSINESS PHONE: 2192390100 MAIL ADDRESS: STREET 1: 100 N MICHIGAN ST P O BOX 7008 STREET 2: 100 N MICHIGAN ST P O BOX 7008 CITY: SOUTH BEND STATE: IN ZIP: 46634 FORMER COMPANY: FORMER CONFORMED NAME: CLARK EQUIPMENT CO DATE OF NAME CHANGE: 19691109 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: INGERSOLL RAND CO CENTRAL INDEX KEY: 0000050485 STANDARD INDUSTRIAL CLASSIFICATION: GENERAL INDUSTRIAL MACHINERY & EQUIPMENT [3560] IRS NUMBER: 135156640 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D1 BUSINESS ADDRESS: STREET 1: 200 CHESTNUT RIDGE RD CITY: WOODCLIFF LAKE STATE: NJ ZIP: 07675 BUSINESS PHONE: 2015730123 MAIL ADDRESS: STREET 1: 200 CHESTNUT RIDGE ROAD CITY: WOODCLIFF LAKE STATE: NJ ZIP: 07675 SC 14D1 1 INGERSOLL-RAND COMPANY SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________ SCHEDULE 14D-1 Tender Offer Statement Pursuant to Section 14(d)(1) of the Securities Exchange Act of 1934 __________________ Clark Equipment Company (Name of Subject Company) CEC Acquisition Corp. Ingersoll-Rand Company (Bidder) Common Stock, $7.50 par value per share (Title of Class of Securities) 18139610 (CUSIP Number of Class of Securities) Patricia Nachtigal, Esq. Vice President and General Counsel Ingersoll-Rand Company World Headquarters 200 Chestnut Ridge Road Woodcliff Lake, New Jersey 07675 Telephone: (201) 573-0123 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications on Behalf of Bidder) Copy to: Robert L. Friedman, Esq. Simpson Thacher & Bartlett 425 Lexington Avenue New York, New York 10017 Telephone: (212) 455-2000 CALCULATION OF FILING FEE Transaction Valuation* Amount of Filing Fee** $1,319,813,418.00 $263,963.00 * Based on the offer to purchase all of the outstanding shares of Common Stock of the Subject Company and the associated Preferred Stock Purchase Rights at $77.00 cash per share, the number of Shares outstanding as reported as of March 13, 1995 in the 1995 Proxy Statement of the Subject Company and the number of options outstanding as of December 31, 1994 as reported in the Annual Report to Stockholders of the Subject Company for the year ended December 31, 1994. ** 1/50 of 1% of Transaction Valuation. / / Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. Amount Previously Paid: Form or Registration No.: Filing Party: Date Filed: 2 This Tender Offer Statement on Schedule 14D-1 relates to the offer by CEC Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of Ingersoll-Rand Company, a New Jersey corporation (the "Parent"), to purchase all of the outstanding shares of Common Stock, $7.50 par value per share (the "Shares"), of Clark Equipment Company, a Delaware corporation (the "Company"), and (unless and until the Purchaser declares that the Rights Condition as defined in the Offer to Purchase referred to below is satisfied) the associated Preferred Stock Purchase Rights (the "Rights") issued pursuant to the Rights Agreement dated as of March 10, 1987, as amended and restated as of August 14, 1990, between the Company and Harris Trust and Savings Bank, as Rights Agent, at a purchase price of $77.00 per Share (and associated Right), net to the seller in cash, without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase dated April 3, 1995 (the "Offer to Purchase"), a copy of which is attached hereto as Exhibit (a)(1), and in the related Letter of Transmittal (which, together with the Offer to Purchase, constitute the "Offer"), a copy of which is attached hereto as Exhibit (a)(2). Item 1. Security and Subject Company. (a) The name of the subject company is Clark Equipment Company. The information set forth in Section 7 ("Certain Information Concerning the Company") of the Offer to Purchase is incorporated herein by reference. (b) The exact title of the class of equity securities being sought in the Offer is Common Stock, $7.50 par value per share, including the associated Preferred Stock Purchase Rights, of the Company. The information set forth in the Introduction (the "Introduction") of the Offer to Purchase is incorporated herein by reference. (c) The information set forth in Section 6 ("Price Range of Shares; Dividends") of the Offer to Purchase is incorporated herein by reference. Item 2. Identity and Background. (a)-(d) and (g) This Statement is filed by the Purchaser and the Parent. The information set forth in Section 8 ("Certain Information Concerning the Purchaser and the Parent") of the Offer to Purchase and in Schedule I thereto is incorporated herein by reference. (e) and (f) During the last five years, neither the Purchaser nor the Parent nor, to the best knowledge of the Purchaser or the Parent, any of the persons listed in Schedule I to the Offer to Purchase (i) has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) was a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting activities subject to, federal or state securities laws or finding any violation of such laws. Item 3. Past Contacts, Transactions or Negotiations with the Subject Company. (a) The information set forth in Section 8 ("Certain Information Concerning the Purchaser and the Parent") of the Offer to Purchase is incorporated herein by reference. Except as set forth in Section 8 of the Offer to Purchase, since January 1, 1992, there have been no transactions which would be required to be disclosed under this Item 3(a) between either the Purchaser or the Parent or, to the best knowledge of the Purchaser and the Parent, any of the persons listed in Schedule I to the Offer to Purchase and the Company or any of its executive officers, directors or affiliates. (b) The information set forth in Section 8 ("Certain Information Concerning the Purchaser and the Parent") and Section 10 ("Background of the Offer; Contacts with the Company") of the Offer to Purchase is incorporated herein by reference. Except as set forth in Section 8 and Section 10 of the Offer to Purchase, since January 1, 1992, there have been no contacts, negotiations or transactions which would be required to be disclosed under Item 3(b) between either the Purchaser or the Parent or any of their respective subsidiaries or, to the best knowledge of the Purchaser and the Parent, any of those persons listed in Schedule 3 I to the Offer to Purchase and the Company or its affiliates concerning a merger, consolidation or acquisition, a tender offer or other acquisition of securities, an election of directors or a sale or other transfer of a material amount of assets. Item 4. Source and Amount of Funds or Other Consideration. (a) and (b) The information set forth in Section 9 ("Source and Amount of Funds") of the Offer to Purchase is incorporated herein by reference. (c) Not applicable. Item 5. Purpose of the Tender Offer and Plans or Proposals of the Bidder. (a)-(g) The information set forth in the Introduction, Section 10 ("Background of the Offer; Contacts with the Company"), Section 11 ("Purpose of the Offer; the Merger; Plans for the Company"), Section 12 ("Dividends and Distributions") and Section 13 ("Effect of the Offer on the Market for the Shares, Stock Exchange Listing and Exchange Act Registration") of the Offer to Purchase is incorporated herein by reference. Item 6. Interest in Securities of the Subject Company. (a) The information set forth in the Introduction and Section 8 ("Certain Information Concerning the Purchaser and the Parent") of and Schedules I and II to the Offer to Purchase is incorporated herein by reference. Except as set forth in the Introduction and Section 8 of and Schedules I and II to the Offer to Purchase, neither the Purchaser nor the Parent nor, to the best knowledge of the Purchaser or the Parent, any of the persons listed in Schedule I to the Offer to Purchase or any associate or majority-owned subsidiary of either the Purchaser or the Parent or any of the persons so listed beneficially owns or has any right to acquire, directly or indirectly, any Shares. (b) The information set forth in the Introduction and Section 8 ("Certain Information Concerning the Purchaser and the Parent") of and Schedules I and II to the Offer to Purchase is incorporated herein by reference. Except as set forth in the Introduction and Section 8 of and Schedules I and II to the Offer to Purchase, neither the Purchaser nor the Parent nor, to the best knowledge of the Purchaser or the Parent, any of the persons or entities referred to above or any executive officer, director or subsidiary of any of the foregoing has effected any transactions in the Shares during the past sixty days. Item 7. Contracts, Arrangements, Understandings or Relationships with Respect to the Subject Company's Securities. The information set forth in the Introduction, Section 8 ("Certain Information Concerning the Purchaser and the Parent"), Section 9 ("Source and Amount of Funds"), Section 10 ("Background of the Offer; Contacts with the Company"), Section 11 ("Purpose of the Offer; the Merger; Plans for the Company") and Section 16 ("Fees and Expenses") of the Offer to Purchase is incorporated herein by reference. Except as set forth in the Introduction and Sections 8, 9, 10, 11 and 16 of the Offer to Purchase, neither the Purchaser nor the Parent, nor, to the best knowledge of the Purchaser or the Parent, any of the persons listed in Schedule I to the Offer to Purchase, has any contract, arrangement, understanding or relationship with any other person with respect to any securities of the Company (including, but not limited to, any contract, arrangement, understanding or relationship concerning the transfer or the voting of any such securities, joint ventures, loans or option arrangements, puts or calls, guarantees of loans, guarantee agreements or any giving or withholding of proxies). Item 8. Persons Retained, Employed or to be Compensated. The information set forth in the Introduction and Section 16 ("Fees and Expenses") of the Offer to Purchase is incorporated herein by reference. 4 Item 9. Financial Statements of Certain Bidders. The information set forth in Section 8 ("Certain Information Concerning the Purchaser and the Parent") of the Offer to Purchase is incorporated herein by reference. Item 10. Additional Information. (a) None. (b) and (c) The information set forth in the Introduction, Section 11 ("Purpose of the Offer; the Merger; Plans for the Company") and Section 15 ("Certain Legal Matters and Regulatory Approvals") of the Offer to Purchase is incorporated herein by reference. (d) The information set forth in Section 9 ("Source and Amount of Funds") and Section 15 ("Certain Legal Matters and Regulatory Approvals") of the Offer to Purchase is incorporated herein by reference. (e) The information set forth in Section 10 ("Background of the Offer; Contacts with the Company") and Section 15 ("Certain Legal Matters and Regulatory Approvals") of the Offer to Purchase is incorporated herein by reference. (f) The information set forth in the Offer to Purchase and the Letter of Transmittal is incorporated herein by reference. Item 11. Material to be Filed as Exhibits. (a) (1) Offer to Purchase dated April 3, 1995. (a) (2) Letter of Transmittal. (a) (3) Notice of Guaranteed Delivery. (a) (4) Letter from the Dealer Manager to Brokers, Dealers, Commercial Banks, Trust Companies and Nominees. (a) (5) Letter to clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Nominees. (a) (6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9. (a) (7) Summary Advertisement as published on April 3, 1995. (a) (8) Press Release issued by the Parent on April 3, 1995. (b) (1) Commitment Letter dated March 31, 1995 to the Parent from The Chase Manhattan Bank (National Association). (c) Not applicable. (d) Not applicable. (e) Not applicable. (f) Not applicable. 5 (g) Complaint in Clark Equipment Company v. Ingersoll-Rand Company, U.S. District Court for the Southern District of New York. SIGNATURE After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this Statement is true, complete and correct. INGERSOLL-RAND COMPANY By: /s/ James E. Perrella --------------------------------- Name: James E. Perrella Title: Chairman, President and Chief Executive Officer CEC ACQUISITION CORP. By: s/ Patricia Nachtigal --------------------------------- Name: Patricia Nachtigal Title: Vice President and Assistant Secretary Date: April 3, 1995 EXHIBIT INDEX Exhibit Page No. Description No. ------- ----------- ---- 11(a)(1) Offer to Purchase dated April 3, 1995 . . . . . . 11(a)(2) Letter of Transmittal . . . . . . . . . . . . . . 11(a)(3) Notice of Guaranteed Delivery . . . . . . . . . . 11(a)(4) Letter from the Dealer Manager to Brokers, Dealers, Commercial Banks, Trust Companies and Nominees . . . . . . . . . . . . . . . . . . . . 11(a)(5) Letter to clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Nominees . 11(a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9 . . 11(a)(7) Summary Advertisement as published on April 3, 1995 . . . . . . . . . . . . . . . . . . . . . . 11(a)(8) Press Release issued by the Parent on April 3, 1995 . . . . . . . . . . . . . . . . . . . . . . 11(b)(1) Commitment Letter dated March 31, 1995 to the Parent from The Chase Manhattan Bank (National Association). . . . . . . . . . . . . . . . . . 11(g) Complaint in Clark Equipment Company v. Ingersoll- Rand Company, U.S. District Court for the Southern District of New York . . . . . . . . . . . . . . EX-11.(A)(1) 2 EXHIBIT 11(a)(1) OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS) OF CLARK EQUIPMENT COMPANY AT $77.00 NET PER SHARE BY CEC ACQUISITION CORP. A WHOLLY OWNED SUBSIDIARY OF INGERSOLL-RAND COMPANY THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, APRIL 28, 1995, UNLESS THE OFFER IS EXTENDED. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS: (1) THERE BEING VALIDLY TENDERED AND NOT PROPERLY WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF SHARES OF COMMON STOCK OF THE COMPANY WHICH CONSTITUTES AT LEAST 51% OF THE VOTING POWER (DETERMINED ON A FULLY DILUTED BASIS) ON THE DATE OF PURCHASE OF ALL SECURITIES OF THE COMPANY ENTITLED TO VOTE GENERALLY IN THE ELECTION OF DIRECTORS OR IN A MERGER; (2) THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE SUPERMAJORITY STOCKHOLDER VOTE SPECIFIED IN THE SUPERMAJORITY VOTING PROVISIONS CONTAINED IN THE COMPANY'S RESTATED CERTIFICATE OF INCORPORATION WOULD NOT (AS A RESULT OF ACTION BY THE COMPANY'S BOARD OF DIRECTORS OR OTHERWISE) BE REQUIRED PRIOR TO THE CONSUMMATION OF THE PROPOSED MERGER DESCRIBED HEREIN OR THAT THE PURCHASER WILL ACQUIRE A SUFFICIENT NUMBER OF SHARES TO INSURE A VOTE IN FAVOR OF SUCH PROPOSED MERGER UNDER SUCH PROVISIONS; (3) THE COMPANY'S PREFERRED STOCK PURCHASE RIGHTS HAVING BEEN REDEEMED BY THE COMPANY'S BOARD OF DIRECTORS OR THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT SUCH PREFERRED STOCK PURCHASE RIGHTS HAVE BEEN INVALIDATED OR ARE OTHERWISE INAPPLICABLE TO, OR THAT THE DILUTIVE PROVISIONS THEREOF WOULD NOT BE TRIGGERED BY, THE OFFER AND THE PROPOSED MERGER DESCRIBED HEREIN; AND (4) THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE RESTRICTIONS ON BUSINESS COMBINATIONS CONTAINED IN SECTION 203 OF THE DELAWARE GENERAL CORPORATION LAW WOULD NOT APPLY TO THE PURCHASER OR THE PARENT IN CONNECTION WITH THE OFFER OR THE PROPOSED MERGER (AS A RESULT OF ACTION BY THE COMPANY'S BOARD OF DIRECTORS, THE OWNERSHIP BY THE PURCHASER UPON CONSUMMATION OF THE OFFER OF AT LEAST 85% OF THE OUTSTANDING VOTING STOCK OF THE COMPANY (OTHER THAN SHARES HELD BY DIRECTORS WHO ARE ALSO OFFICERS AND CERTAIN EMPLOYEE STOCK PLANS OF THE COMPANY) OR OTHERWISE). THE OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS. SEE THE INTRODUCTION AND SECTIONS 1 AND 14. THE DEALER MANAGER FOR THE OFFER IS: MERRILL LYNCH & CO. April 3, 1995 (Continued on next page) (Continued from previous page) IMPORTANT Any stockholder desiring to tender all or any portion of such stockholder's shares of Common Stock, $7.50 par value per share (the "Shares"), and the associated Preferred Stock Purchase Rights (the "Rights"), of the Company should either (1) complete and sign the Letter of Transmittal (or a facsimile thereof) in accordance with the instructions in the Letter of Transmittal, mail or deliver the Letter of Transmittal (or such facsimile) and any other required documents to the Depositary (as defined herein), and either deliver the certificates representing the tendered Shares and, if separate, the certificates representing the associated Rights and any other required documents to the Depositary or tender such Shares (and Rights, if applicable) pursuant to the procedure for book-entry transfer set forth in Section 3 or (2) request such stockholder's broker, dealer, commercial bank, trust company or other nominee to effect the transaction for such stockholder. Stockholders having Shares (and Rights, if applicable) registered in the name of a broker, dealer, commercial bank, trust company or other nominee must contact such broker, dealer, commercial bank, trust company or other nominee if they desire to tender Shares (and Rights, if applicable) so registered. Unless and until the Purchaser declares that the Rights Condition (as defined herein) is satisfied, holders of Shares will be required to tender one Right for each Share tendered in order to effect a valid tender of such Share. A stockholder who desires to tender Shares and Rights and whose certificates representing such Shares (and Rights, if applicable) are not immediately available, or who cannot comply with the procedure for book-entry transfer on a timely basis, may tender such Shares (and Rights, if applicable) by following the procedures for guaranteed delivery set forth in Section 3. Questions and requests for assistance may be directed to Merrill Lynch, Pierce, Fenner & Smith Incorporated (the "Dealer Manager") or to Georgeson & Company Inc. (the "Information Agent") at their respective addresses and telephone numbers set forth on the back cover of this Offer to Purchase. Additional copies of this Offer to Purchase, the Letter of Transmittal and the Notice of Guaranteed Delivery may also be obtained from the Information Agent or from brokers, dealers, commercial banks or trust companies. TABLE OF CONTENTS
PAGE ---- INTRODUCTION............................................................................ 1 THE TENDER OFFER........................................................................ 7 1. Term of the Offer; Expiration Date........................................ 7 2. Acceptance for Payment and Payment for Shares............................. 8 3. Procedure for Tendering Shares and Rights................................. 10 4. Withdrawal Rights......................................................... 13 5. Certain Federal Income Tax Consequences................................... 14 6. Price Range of Shares; Dividends.......................................... 15 7. Certain Information Concerning the Company................................ 16 8. Certain Information Concerning the Purchaser and the Parent............... 18 9. Source and Amount of Funds................................................ 20 10. Background of the Offer; Contacts with the Company........................ 22 11. Purpose of the Offer; the Merger; Plans for the Company................... 29 12. Dividends and Distributions............................................... 36 13. Effect of the Offer on the Market for the Shares, Stock Exchange Listing and Exchange Act Registration........................................... 36 14. Certain Conditions of the Offer........................................... 37 15. Certain Legal Matters and Regulatory Approvals............................ 42 16. Fees and Expenses......................................................... 45 17. Miscellaneous............................................................. 46 Schedule I Directors and Executive Officers of the Purchaser and the Parent Schedule II Parent Purchases of Shares
i To: The Stockholders of CLARK EQUIPMENT COMPANY INTRODUCTION CEC Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of Ingersoll-Rand Company, a New Jersey corporation (the "Parent"), hereby offers to purchase all of the outstanding shares of Common Stock, $7.50 par value per share (the "Shares"), of Clark Equipment Company, a Delaware corporation (the "Company"), and (unless and until the Purchaser declares that the Rights Condition (as defined below) is satisfied) the associated Preferred Stock Purchase Rights (the "Rights") issued pursuant to the Rights Agreement, dated as of March 10, 1987, as amended and restated as of August 14, 1990 (as so amended and restated, the "Rights Agreement"), between the Company and Harris Trust and Savings Bank, as Rights Agent (the "Rights Agent"), at a purchase price of $77.00 per Share (and associated Right), net to the seller in cash without interest thereon, upon the terms and subject to the conditions set forth in this Offer to Purchase and in the related Letter of Transmittal (which together constitute the "Offer"). Unless the context requires otherwise, all references in this Offer to Purchase to "Shares" shall be deemed to refer also to the associated Rights, and all references to "Rights" shall be deemed to include all benefits that may inure to the stockholders of the Company or to holders of the Rights pursuant to the Rights Agreement. Based on publicly available information, the Purchaser believes that one Right is currently associated with each Share. Tendering stockholders will not be obligated to pay brokerage fees or commissions or, subject to Instruction 6 of the Letter of Transmittal, stock transfer taxes on the transfer and sale of Shares and Rights pursuant to the Offer. The Purchaser will pay all fees and expenses of Merrill Lynch, Pierce, Fenner & Smith Incorporated, which is acting as Dealer Manager for the Offer (in such capacity, the "Dealer Manager"), The Bank of New York (the "Depositary") and Georgeson & Company Inc. (the "Information Agent") incurred in connection with the Offer. See Section 16. The purpose of the Offer is to acquire control of, and the entire equity interest in, the Company. The Purchaser intends to propose, and to seek to have the Company consummate as soon as practicable after consummation of the Offer, a merger or similar business combination (the "Merger") with the Purchaser or another direct or indirect subsidiary of the Parent, pursuant to which each then outstanding Share (other than Shares held by the Parent, the Purchaser or any other wholly owned subsidiary of the Parent, Shares held in the treasury of the Company and Shares held by stockholders who properly exercise appraisal rights under Delaware law) would be converted into the right to receive in cash the price per Share paid by the Purchaser pursuant to the Offer. Although the Purchaser will seek to have the Company consummate the Merger as soon as practicable after consummation of the Offer, if the Board of Directors of the Company opposes the Offer and the Merger, certain terms of the Rights and certain provisions of the Delaware General Corporation Law (the "DGCL") and the Company's Restated Certificate of Incorporation (the "Charter") and By-Laws (the "By-Laws") may affect the ability of the Purchaser to obtain control of the Company and to effect the Merger. Accordingly, the timing and details of the Merger will depend on a variety of factors and legal requirements, the actions of the Board of Directors of the Company, the number of Shares acquired by the Purchaser pursuant to the Offer, and whether the Minimum Condition, the Supermajority Charter Condition, the Rights Condition and the Delaware Takeover Statute Condition (each as defined below) are satisfied. On April 3, 1995, the Parent delivered a notice to the Company nominating seven individuals for election as directors at the Company's annual meeting of stockholders scheduled for May 9, 1995. The Parent intends to solicit proxies from stockholders for the purpose of electing the seven director 1 candidates nominated by the Parent in order to insure that the new Board of Directors will take all such actions necessary or appropriate (subject to such directors' fiduciary duties) to approve and effectuate the consummation of the Offer and the Merger, including taking action to execute an agreement and plan of merger and to satisfy the Supermajority Charter Condition, the Rights Condition and the Delaware Takeover Statute Condition. If the seven director candidates nominated by the Parent are not elected at the annual meeting and the conditions to the Offer are not otherwise satisfied, the Parent will explore the other options available to it, including soliciting stockholder demands to call a special meeting of the Company's stockholders for the purpose of electing candidates nominated by the Parent as directors of the Company, adopting resolutions of stockholders instructing the Board of Directors of the Company to approve the Offer and the Merger or taking other actions to insure that the Offer and the Merger will be consummated. Under the Charter and By-Laws, the Company is required to call a special meeting of the stockholders upon the demand of the holders of a majority of the outstanding Shares. THIS OFFER TO PURCHASE DOES NOT CONSTITUTE A SOLICITATION OF A PROXY, CONSENT OR AUTHORIZATION FOR OR WITH RESPECT TO THE ANNUAL MEETING OR ANY SPECIAL MEETING OF THE COMPANY'S STOCKHOLDERS OR ANY ACTION IN LIEU THEREOF. ANY SUCH SOLICITATION WHICH THE PURCHASER MAY MAKE WILL BE MADE ONLY PURSUANT TO SEPARATE PROXY MATERIALS IN COMPLIANCE WITH THE REQUIREMENTS OF SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT"). Upon consummation of the Offer, assuming the Minimum Condition, the Supermajority Charter Condition, the Rights Condition, the Delaware Takeover Statute Condition and the other conditions to the Offer set forth in Section 14 are satisfied, the Purchaser will own sufficient Shares, subject to the procedures described in Section 11, ultimately to remove and/or replace the Company's Board of Directors and to approve the Merger without the vote of any other stockholder. For a discussion of certain appraisal rights available to stockholders upon consummation of the Merger, see Section 11. THE OFFER IS CONDITIONED, AMONG OTHER THINGS, UPON SATISFACTION, IN THE PURCHASER'S SOLE DISCRETION, OF THE FOLLOWING CONDITIONS: (1) THE MINIMUM CONDITION, (2) THE SUPERMAJORITY CHARTER CONDITION, (3) THE RIGHTS CONDITION AND (4) THE DELAWARE TAKEOVER STATUTE CONDITION, EACH OF WHICH IS DESCRIBED BELOW. CERTAIN OTHER CONDITIONS TO THE OFFER ARE DESCRIBED IN SECTION 14. The Minimum Condition. The Offer is subject to the condition (the "Minimum Condition") that there shall have been validly tendered and not properly withdrawn on or prior to the Expiration Date (as defined below) a number of Shares which, together with the Shares owned by the Parent, constitutes at least 51% of the voting power (determined on a fully diluted basis) on the date of purchase of all securities of the Company entitled to vote generally in the election of directors or in a merger. According to the Company's 1995 Proxy Statement (the "1995 Proxy Statement"), 17,132,696 Shares were outstanding at March 13, 1995. According to the Company's Annual Report to Stockholders for the fiscal year ended December 31, 1994 (the "1994 Annual Report"), options covering a total of 7,738 Shares were outstanding under the Company's various stock option plans at December 31, 1994. The Parent currently beneficially owns an aggregate of 274,200 Shares, representing approximately 1.6% of the Shares outstanding based on the number of Shares reported by the Company as outstanding at March 13, 1995. See Section 8. Based on this information, the Purchaser believes that the Minimum Condition will be satisfied if approximately 8,463,475 Shares are validly tendered pursuant to the Offer and not properly withdrawn. According to a Current Report on Form 8-K filed by the Company on February 3, 1995, the Company has been authorized by the Board of Directors to repurchase up to 3,000,000 of its Shares (the "Company Repurchase Plan"). There has been no public announcement by the Company as to how many Shares it has repurchased under the Company Repurchase Plan, if any. If the Company were to have repurchased Shares after March 13, 1995, the number of Shares that would have to be tendered to satisfy the Minimum Condition would be correspondingly reduced. The Purchaser will make a 2 determination as to whether the Minimum Condition has been satisfied based on the best information available to it at the time of determination. If, upon consummation of the Offer, the Purchaser and the Parent together own at least 51% of the outstanding Shares (determined on a fully diluted basis), then the Purchaser and the Parent will own sufficient Shares to enable them to effect stockholder approval of the Merger (subject to the requirements of the Supermajority Charter Provision and the Delaware Takeover Statute described below). The Supermajority Charter Condition. The Offer is subject to the condition (the "Supermajority Charter Condition") that the Purchaser shall be satisfied, in its sole discretion, that the supermajority stockholder vote specified in the Supermajority Charter Provision (as defined below) would not (as a result of action by the Company's Board of Directors or otherwise) be required prior to the consummation of the Merger or that the Purchaser will acquire a sufficient number of Shares to insure a vote in favor of the Merger under such provision. The Charter provides that in addition to any affirmative vote required by applicable law (currently the affirmative vote of holders of at least a majority of the outstanding Shares), the affirmative vote of the holders of at least 80% of the outstanding Shares is required to approve certain business combinations (including the Merger) between the Company and a person who or which, together with its affiliates and associates and persons with whom any of it, its affiliates and associates have an agreement regarding any Shares, is the beneficial owner of more than 10% of the outstanding Shares (an "Interested Stockholder"), unless prior to such person becoming an Interested Stockholder the Company's Board of Directors shall by resolution have approved a memorandum of understanding or a letter of intent with respect to such business combination (the "Supermajority Charter Provision"). The acquisition by the Purchaser in the Offer of a number of Shares which, together with Shares held by the Parent, would be in excess of 10% of the outstanding Shares would make the Purchaser and the Parent "Interested Stockholders" for purposes of the Supermajority Charter Provision. As such, the Purchaser and the Parent could be prohibited from consummating the Merger unless (a) prior to the consummation of the Offer the Company's Board of Directors approves by resolution a memorandum of understanding or a letter of intent with respect to the Merger, (b) immediately following the consummation of the Offer the Purchaser and the Parent own at least 80% of the outstanding Shares or (c) the Merger is otherwise approved by the affirmative vote of the holders of at least 80% of the outstanding Shares. See Section 11. According to the Company's 1995 Proxy Statement, at December 31, 1994 (i) certain employee benefit plans of the Company (the "Company Benefit Plans") held an aggregate of 2,080,689 Shares and (ii) the directors and officers of the Company held an aggregate of approximately 247,530 Shares (not including Shares held through the Company Benefit Plans), for an aggregate of approximately 2,328,219 Shares, or 13.6% of the outstanding Shares. If the Company were to have repurchased Shares under the Company Repurchase Plan, then the Company Benefit Plans and the directors and officers of the Company would hold a correspondingly greater percentage of the outstanding Shares. Based on publicly available information, the Purchaser is unable to determine the number of Shares out of the 2,080,689 Shares beneficially owned by the Company Benefit Plans (i) that may be tendered in the Offer or voted for the Merger at the sole discretion of employee participants thereof or (ii) that may be tendered in the Offer or voted for the Merger at the sole discretion of the trustees thereof. However, according to a Schedule 13G filed with the Securities and Exchange Commission (the "Commission") on January 24, 1995 on behalf of the Company's leveraged employee stock ownership plan (the "LESOP") (one of the Company Benefit Plans), as of December 31, 1994 the LESOP held sole voting power as to 834,494 Shares, shared voting power as to 1,219,502 Shares, sole dispositive power as to no Shares and shared dispositive power as to 834,494 Shares. According to the Company's 1995 Proxy Statement, at December 31, 1994 the LESOP held 2,053,996 Shares. Based on the above information, the Purchaser believes that participants in the LESOP are entitled to voting rights with respect to, and entitled to determine whether to tender, at least 1,219,502 Shares. 3 The Purchaser is hereby requesting that the Company's Board of Directors adopt a resolution approving a memorandum of understanding or a letter of intent with respect to the Merger for purposes of the Supermajority Charter Provision. The Purchaser believes that under the circumstances of the Offer and under applicable law, the Board of Directors of the Company is obligated by its fiduciary responsibilities to so approve the Merger in order to permit the Offer and the Merger to be consummated. However, there can be no assurance that the Board will do so. If the Board does not so approve the Merger but upon consummation of the Offer the Purchaser and the Parent together own at least 80% of the outstanding Shares, then the Purchaser and the Parent would own sufficient Shares to enable them to satisfy the Supermajority Charter Provision and effect stockholder approval of the Merger (subject to the requirements of the Delaware Takeover Statute described below). As indicated above, any action by the Purchaser and the Parent to change the composition of the Board of Directors would be intended to result in the reconstituted Board taking action to approve the Merger in order to satisfy the Supermajority Charter Condition. The Rights Condition. The Offer is subject to the condition (the "Rights Condition") that the Rights shall have been redeemed by the Company's Board of Directors or that the Purchaser shall be satisfied, in its sole discretion, that such Rights have been invalidated or are otherwise inapplicable to, or the dilutive provisions thereof will not be triggered by, the Offer and the Merger. The Rights are described in the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1990 (the "September 1990 Form 10-Q"). The following discussion is based on information contained in the September 1990 Form 10-Q. A more detailed description of the Rights is contained in Section 11. In the event that at any time following a Distribution Date (as defined in Section 11) a person becomes the beneficial owner of 20% or more of the then outstanding Shares (the "Ownership Flip-In"), each holder of a Right will thereafter have the right to purchase, upon exercise thereof at a price subject to adjustment of $80 per Right (the "Purchase Price"), a number of Shares which have a market value of two times the Purchase Price. In the event that at any time following the date (the "Stock Acquisition Date") of a public announcement that a person, entity or group of affiliated or associated persons (an "Acquiring Person") has acquired beneficial ownership of 20% or more of the outstanding Shares, the Company is involved in a merger or other business combination transaction in which it is not the continuing or surviving corporation or in which any or all of the Shares are changed into or exchanged for securities of another party or cash or other property or 50% or more of the Company's assets or earning power is sold (the "Flip-Over"), each holder of a Right will thereafter have the right to purchase, upon the exercise thereof at the Purchase Price, common stock of the acquiring entity or parent thereof which has a market value of two times the Purchase Price. Following an Ownership Flip- In or Flip-Over, any Rights beneficially owned by an Acquiring Person or affiliates or associates of any Acquiring Person will immediately become null and void. The Purchaser believes that the consummation of the Offer likely would trigger the Ownership Flip-In and as a result cause significant dilution to the Purchaser's interest in the Company and render the Offer and the Merger economically unattractive for the Purchaser. However, the Ownership Flip-In and the Flip-Over would not be triggered if a majority of the non-officer directors of the Company who are not affiliated with an Acquiring Person (the "Independent Directors") determine, after receiving advice from one or more investment banking firms, that the acquisition of Shares which would cause an Acquiring Person to become such was pursuant to a tender or exchange offer for all outstanding Shares at a price and on terms which such majority of Independent Directors determines to be fair and otherwise in the best interests of the Company and its stockholders. At any time until 15 days following the Stock Acquisition Date, the Company may redeem the Rights in whole, but not in part, at a price of $.05 per Right, subject to adjustment. Until the Distribution Date, the Rights will be transferred with and only with the Shares. Until the Distribution Date, the surrender for transfer of any of the certificates representing Shares (the "Share Certificates") will also constitute the surrender for transfer of the Rights associated with the Shares represented by such Share Certificates. As soon as practicable following the Distribution Date, separate certificates 4 evidencing the Rights ("Rights Certificates") will be mailed to holders of record of Shares as of the close of business on the Distribution Date. After the Distribution Date, such separate Rights Certificates alone will evidence the Rights. The Purchaser believes that currently the Rights are not exercisable, Rights Certificates have not been issued and the Rights are evidenced by the Share Certificates. The Purchaser believes that under the Rights Agreement, as a result of the commencement of the Offer, the Distribution Date will be as early as April 17, 1995, unless prior to that date the Company's Board of Directors redeems the Rights or takes action to delay the Distribution Date. Unless and until the Purchaser declares that the Rights Condition is satisfied, holders of Shares will also be required to tender one Right for each Share tendered in order to effect a valid tender of such Share. If separate certificates for the Rights are not issued, a tender of Shares will also constitute a tender of associated Rights. The Purchaser further believes that under the circumstances of the Offer and under applicable law, the Board of Directors of the Company is obligated by its fiduciary responsibilities to redeem the Rights or take such other action to invalidate the Rights or otherwise render the Rights inapplicable to, or prevent the dilutive provisions thereof from being triggered by, the Offer and the Merger, in each case in order to permit the Offer and the Merger to be consummated. In addition, the Purchaser believes that under the circumstances of the Offer and under applicable law, the Independent Directors are obligated by their fiduciary responsibilities to make the determination that the Offer is at a price and on terms fair to and otherwise in the best interests of the Company and its stockholders. However, there can be no assurance that the Board or a majority of the Independent Directors will take such action. The Purchaser is hereby requesting that the Company's Board of Directors redeem the Rights or take such other action described above and that the Company's Independent Directors make the determination described above. As indicated above, any action by the Purchaser and the Parent to change the composition of the Board of Directors would be intended to result in the reconstituted Board taking action to redeem the Rights or taking such other action or a majority of the then-Independent Directors making such determination in order to satisfy the Rights Condition. The Delaware Takeover Statute Condition. The Offer is subject to the condition (the "Delaware Takeover Statute Condition") that the Purchaser shall be satisfied, in its sole discretion, that the restrictions on business combinations contained in Section 203 of the DGCL (the "Delaware Takeover Statute") would not apply to the Purchaser or the Parent in connection with the Offer or the Merger (as a result of action by the Company's Board of Directors, the ownership by the Purchaser upon consummation of the Offer of at least 85% of the outstanding voting stock of the Company (other than Shares held by directors who are also officers and certain employee stock plans of the Company) or otherwise). In general, the Delaware Takeover Statute prohibits any person who is the beneficial owner of 15% or more of the outstanding voting stock of a corporation (a "Statutory Interested Stockholder") from engaging in certain business combinations (including the Merger) with such corporation for a period of three years following the date on which such person became a Statutory Interested Stockholder, unless (i) either the transaction by which such person became a Statutory Interested Stockholder or the business combination is approved by the board of directors of the corporation prior to the date on which such person became a Statutory Interested Stockholder, (ii) upon consummation of the transaction which resulted in such person becoming a Statutory Interested Stockholder, such person owned at least 85% of the voting stock outstanding at the time the transaction commenced, excluding shares owned by (a) persons who are both officers and directors of the corporation and (b) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer (all such non-excluded voting stock, "Eligible Voting Stock"), or (iii) subsequent to the date on which such person became a Statutory Interested 5 Stockholder, the business combination is approved by the board of directors of the corporation and authorized by the affirmative vote, at a meeting called for that purpose, of at least two-thirds of the outstanding voting stock not beneficially owned by the Statutory Interested Stockholder or any of its affiliates or associates or by persons who are either directors or officers and also employees of the Statutory Interested Stockholder. Consequently, under the Delaware Takeover Statute, unless the Board of Directors of the Company approves the Offer and the Merger in advance of the consummation of the Offer or the Purchaser acquires 85% of the Eligible Voting Stock upon consummation of the Offer, the Merger could not occur for three years unless it is approved by the holders of two-thirds of the Shares that were not tendered in the Offer or owned by the Purchaser or the Parent. A more detailed description of the Delaware Takeover Statute is contained in Section 11. Whether the Shares held by the Company Benefit Plans are Eligible Voting Stock depends on whether the employee participants thereof have the right to determine confidentially whether the Shares held subject to such plans will be tendered in a tender or exchange offer. Because the provisions of certain Company Benefit Plans are not publicly available, the Purchaser is unable to determine if such Shares held by such plans will be considered for purposes of determining whether the Purchaser acquires 85% of the Eligible Voting Stock of the Company. According to the 1995 Proxy Statement, (i) 17,132,696 Shares were outstanding at March 13, 1995 and (ii) at December 31, 1994, directors who were also officers of the Company held an aggregate of approximately 107,346 Shares (excluding Shares held through the Company Benefit Plans), all other directors and officers of the Company held an aggregate of approximately 140,184 Shares (excluding Shares held through the Company Benefit Plans), and the Company Benefit Plans held an aggregate of 2,080,689 Shares. Assuming that all of the Company Benefit Plans permit the employee participants thereof to determine confidentially whether the Shares held subject to such plans will be tendered in a tender or exchange offer, there are approximately 17,025,350 Shares of Eligible Voting Stock outstanding, of which an aggregate of approximately 13.0% is held by directors or officers of the Company or by the Company Benefit Plans. If the Company were to have repurchased Shares under the Company Repurchase Plan, then the directors or officers of the Company and the Company Benefit Plans would hold a correspondingly greater percentage of the outstanding Eligible Voting Stock. The Purchaser is hereby requesting that the Board of Directors approve the Offer and the Merger for purposes of the Delaware Takeover Statute. Under the circumstances of the Offer and under applicable law, the Purchaser believes that the Board of Directors of the Company is obligated by its fiduciary responsibilities to approve, pursuant to the Delaware Takeover Statute, the acquisition of Shares pursuant to the Offer and the Merger. However, there can be no assurance that the Board of Directors will do so. If the Board does not so approve the Offer and the Merger but upon consummation of the Offer the Purchaser and the Parent together own at least 85% of the Eligible Voting Stock of the Company, then the restrictions on business combinations contained in the Delaware Takeover Statute would not be applicable. As indicated above, any action by the Purchaser and the Parent to change the composition of the Board of Directors would be intended to result in the reconstituted Board taking action to approve the Offer and the Merger in order to satisfy the Delaware Takeover Statute Condition. * * * The Purchaser expressly reserves the right to waive any one or more of the conditions to the Offer. See Sections 11, 14 and 15. In the event the Offer is not consummated, the Purchaser intends to explore all options which may be available to it at such time, which may include without limitation the acquisition of Shares through open market purchases, privately negotiated transactions, another tender offer or exchange offer or otherwise, upon such terms and at such prices as it shall determine, which may be more or less than the price to be paid pursuant to the Offer. The Purchaser also reserves the right to dispose of Shares. THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN IMPORTANT INFORMATION WHICH SHOULD BE READ BEFORE ANY DECISION IS MADE WITH RESPECT TO THE OFFER. 6 THE TENDER OFFER 1. TERM OF THE OFFER; EXPIRATION DATE. Upon the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of such extension or amendment), the Purchaser will accept for payment and pay for all Shares validly tendered on or prior to the Expiration Date and not properly withdrawn as permitted by Section 4. The term "Expiration Date" means 12:00 Midnight, New York City time, on Friday, April 28, 1995, unless and until the Purchaser, in its sole discretion, shall have extended the period during which the Offer is open, in which event the term "Expiration Date" shall mean the latest time and date at which the Offer, as so extended by the Purchaser, shall expire. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, SATISFACTION OF EACH OF THE CONDITIONS SET FORTH ABOVE IN THE INTRODUCTION AND IN SECTION 14. THE PURCHASER RESERVES THE RIGHT (BUT SHALL NOT BE OBLIGATED) TO WAIVE ANY OR ALL OF SUCH CONDITIONS. If by the Expiration Date any or all of such conditions have not been satisfied or waived, the Purchaser reserves the right (but shall not be obligated) (i) to decline to purchase any of the Shares tendered and terminate the Offer, (ii) to waive all of the unsatisfied conditions and, subject to complying with applicable rules and regulations of the Commission, to purchase all Shares validly tendered or (iii) to extend the Offer and, subject to the right of stockholders to withdraw Shares until the Expiration Date, retain the Shares which have been tendered during the period or periods for which the Offer is extended. In the event that the Purchaser waives any of the conditions set forth in Section 14, the Commission may, if the waiver is deemed to constitute a material change to the information previously provided to the stockholders, require that the Offer remain open for an additional period of time and/or that the Purchaser disseminate information concerning such waiver. The Purchaser expressly reserves the right, in its sole discretion, at any time and from time to time, to extend the period during which the Offer is open for any reason, including the occurrence of any of the conditions specified in Section 14, by giving written notice of such extension to the Depositary. During any such extension, all Shares previously tendered and not properly withdrawn will remain subject to the Offer, subject to the rights of a tendering stockholder to withdraw such stockholder's Shares. See Section 4. Subject to the applicable regulations of the Commission, the Purchaser also reserves the right, in its sole discretion, at any time or from time to time to (i) delay acceptance for payment of or, regardless of whether such Shares were theretofore accepted for payment, payment for any Shares pending receipt of any regulatory approvals specified in Section 15, (ii) terminate the Offer (whether or not any Shares have theretofore been accepted for payment) if any of the conditions referred to in Section 14 has not been satisfied or upon the occurrence of any of the events specified in Section 14 and (iii) waive any condition or otherwise amend the Offer in any respect, in each case by giving written notice of such delay, termination, waiver or amendment to the Depositary and by making a public announcement thereof. The Purchaser acknowledges (i) that Rule 14e-1(c) under the Exchange Act requires the Purchaser to pay the consideration offered or return the Shares tendered promptly after the termination or withdrawal of the Offer and (ii) that the Purchaser may not delay acceptance for payment of, or payment for (except as provided in clause (i) of the preceding sentence), any Shares upon the occurrence of any of the conditions specified in Section 14 without extending the period of time during which the Offer is open. Any such extension, delay, termination, waiver or amendment will be followed as promptly as practicable by public announcement thereof, and such announcement in the case of an extension will be made no later than 9:00 A.M., New York City time, on the next business day after the previously scheduled Expiration Date. Without limiting the manner in which the Purchaser may choose to make any public announcement, except as provided by applicable law (including Rules 14d-4(c) and 14d-6(d) 7 under the Exchange Act, which require that material changes be promptly disseminated to holders of Shares), the Purchaser shall have no obligation to publish, advertise or otherwise communicate any such public announcement other than by issuing a release to the Dow Jones News Service. If the Purchaser makes a material change in the terms of the Offer or if it waives a material condition of the Offer, the Purchaser will extend the Offer to the extent required by Rules 14d-4(c) and 14d-6(d) under the Exchange Act. The minimum period during which an offer must remain open following material changes in the terms of the offer, other than a change in price or a change in the percentage of securities sought, will depend upon the facts and circumstances, including the materiality, of the changes. With respect to a change in price or, subject to certain limitations, a change in the percentage of securities sought, a minimum ten business day period from the day of such change is generally required to allow for adequate dissemination to stockholders. Accordingly, if prior to the Expiration Date, the Purchaser decreases the number of Shares being sought, increases or decreases the consideration offered pursuant to the Offer and if the Offer is scheduled to expire at any time earlier than the period ending on the tenth business day from the date that notice of such increase or decrease is first published, sent or given to stockholders, the Offer will be extended at least until the expiration of such ten business day period. For purposes of the Offer, a "business day" means any day other than a Saturday, Sunday or a federal holiday and consists of the time period from 12:01 A.M. through 12:00 Midnight, New York City time. A demand under Delaware law has been made to the Company for its list of stockholders and security position listings for the purpose of disseminating the Offer to holders of Shares and communicating with stockholders regarding proxy solicitations in connection with the upcoming annual meeting. Upon compliance by the Company with such request, this Offer to Purchase and the related Letter of Transmittal and, if required, other relevant materials will be mailed to record holders of Shares whose names appear on the Company's stockholder list and will be furnished to brokers, dealers, commercial banks, trust companies and similar persons whose names, or the names of whose nominees, appear on the stockholder list or who are listed as participants in a clearing agency's security position listing for subsequent transmittal to beneficial owners of Shares. On April 3, 1995, a request pursuant to Rule 14d-5 under the Exchange Act for use of the Company's stockholder list and security position listings was also made to the Company. 2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES. Upon the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of any such extension or amendment), the Purchaser will accept for payment and will pay for all Shares validly tendered and not properly withdrawn on or prior to the Expiration Date as soon as practicable after the later to occur of (i) the Expiration Date and (ii) the satisfaction or waiver of the conditions of the Offer set forth in Section 14, including without limitation the expiration or termination of the waiting period applicable to the acquisition of Shares pursuant to the Offer under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act") and satisfaction of any applicable foreign regulatory requirements. In addition, subject to applicable rules of the Commission, the Purchaser expressly reserves the right to delay acceptance for payment of or payment for Shares pending receipt of any other regulatory approvals specified in Section 15. The Parent intends to file on the date hereof with the Federal Trade Commission (the "FTC") and the Antitrust Division of the Department of Justice (the "Antitrust Division") a Premerger Notification and Report Form under the HSR Act with respect to the Offer. Accordingly, the waiting period under the HSR Act applicable to the Offer will expire at 11:59 P.M., New York City time, on Tuesday, April 18, 1995, unless prior to the expiration or termination of the waiting period, the FTC or the Antitrust Division extends the waiting period by requesting additional information from the Parent. If such a request is made, the waiting period applicable to the Offer will expire on the tenth calendar day after the date of substantial compliance by the Parent with such request. Thereafter, the waiting period may only be extended by court order. The waiting period under the HSR Act may be terminated by the 8 FTC and the Antitrust Division prior to its expiration. For information with respect to approvals required to be obtained prior to the consummation of the Offer, including under the HSR Act and under applicable regulations within the European Economic Area (the "EEA"), see Section 15. In all cases, payment for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of (i) Share Certificates for such Shares and, if applicable, Rights Certificates, or timely confirmation (a "Book-Entry Confirmation") of a book-entry transfer of such Shares and, if applicable, Rights into the Depositary's account at The Depository Trust Company, the Midwest Securities Trust Company or the Philadelphia Depository Trust Company (each a "Book-Entry Transfer Facility" and, collectively, the "Book-Entry Transfer Facilities") pursuant to the procedures set forth in Section 3, (ii) the Letter of Transmittal (or a facsimile thereof), properly completed and duly executed, with any required signature guarantees, or an Agent's Message (as defined below) in connection with a book-entry transfer, and (iii) any other documents required by the Letter of Transmittal. The term "Agent's Message" means a message transmitted by a Book-Entry Transfer Facility to and received by the Depositary and forming a part of a Book-Entry Confirmation, which states that such Book-Entry Transfer Facility has received an express acknowledgment from the participant in such Book-Entry Transfer Facility tendering the Shares and, if applicable, Rights which are the subject of such Book-Entry Confirmation, that such participant has received and agrees to be bound by the terms of the Letter of Transmittal and that the Purchaser may enforce such agreement against such participant. Unless and until the Purchaser declares that the Rights Condition is satisfied, if Rights Certificates have been distributed to holders of Shares, such holders are required to tender, or make book-entry transfer of, Rights Certificates representing a number of Rights equal to the number of Shares being tendered in order to effect a valid tender of such Shares. For purposes of the Offer, the Purchaser will be deemed to have accepted for payment (and thereby purchased) Shares validly tendered and not properly withdrawn as, if and when the Purchaser gives oral or written notice to the Depositary of the Purchaser's acceptance for payment of such Shares pursuant to the Offer. Upon the terms and subject to the conditions of the Offer, payment for Shares accepted for payment pursuant to the Offer will be made by deposit of the purchase price therefor with the Depositary, which will act as agent for tendering stockholders for the purpose of receiving payments from the Purchaser and transmitting such payments to stockholders whose Shares have been accepted for payment. UNDER NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE FOR SHARES BE PAID, REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN MAKING SUCH PAYMENT. If for any reason whatsoever acceptance for payment of or payment for any Shares tendered pursuant to the Offer is delayed or the Purchaser is unable to accept for payment or pay for Shares tendered pursuant to the Offer, then without prejudice to the Purchaser's rights set forth herein, the Depositary may nevertheless, on behalf of the Purchaser and subject to Rule 14e-l(c) under the Exchange Act, retain tendered Shares and such Shares may not be withdrawn except to the extent that the tendering stockholder is entitled to and duly exercises withdrawal rights as described in Section 4. If any tendered Shares are not accepted for payment for any reason or if Share Certificates are submitted for more Shares than are tendered, Share Certificates evidencing unpurchased or untendered Shares will be returned without expense to the tendering stockholder (or, in the case of Shares tendered by book-entry transfer into the Depositary's account at a Book-Entry Transfer Facility pursuant to the procedures set forth in Section 3, such Shares will be credited to an account maintained at such Book-Entry Transfer Facility), in each case with the related Rights Certificates, if any, as promptly as practicable following the expiration, termination or withdrawal of the Offer. IF PRIOR TO THE EXPIRATION DATE THE PURCHASER INCREASES THE CONSIDERATION OFFERED TO STOCKHOLDERS PURSUANT TO THE OFFER, SUCH INCREASED CONSIDERATION WILL BE PAID TO ALL STOCKHOLDERS WHOSE SHARES ARE 9 PURCHASED PURSUANT TO THE OFFER, WHETHER OR NOT SUCH SHARES WERE TENDERED OR ACCEPTED FOR PAYMENT PRIOR TO SUCH INCREASE IN CONSIDERATION. The Purchaser reserves the right to transfer or assign, in whole or from time to time in part, to one or more of its affiliates the right to purchase all or any portion of the Shares and Rights tendered pursuant to the Offer, but any such transfer or assignment will not relieve the Purchaser of its obligations under the Offer and will in no way prejudice the rights of tendering stockholders to receive payment for Shares validly tendered and accepted for payment pursuant to the Offer. 3. PROCEDURE FOR TENDERING SHARES AND RIGHTS. Except as set forth below, in order for Shares and, prior to the Distribution Date, Rights to be validly tendered pursuant to the Offer, the Letter of Transmittal (or a facsimile thereof), properly completed and duly executed, together with any required signature guarantees, or an Agent's Message in connection with a book-entry delivery of Shares and Rights, and any other documents required by the Letter of Transmittal, must be received by the Depositary at one of its addresses set forth on the back cover of this Offer to Purchase on or prior to the Expiration Date and either (i) Share Certificates and Rights Certificates, if applicable, evidencing tendered Shares and Rights must be received by the Depositary at such address or such Shares and Rights 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 on or prior to the Expiration Date, or (ii) the guaranteed delivery procedures described below must be complied with. If the Purchaser declares that the Rights Condition is satisfied, the Purchaser will not require delivery of Rights Certificates. Unless and until the Purchaser declares that the Rights Condition is satisfied, holders of Shares will be required to tender one Right for each Share tendered in order to effect a valid tender of such Share. ACCORDINGLY, STOCKHOLDERS WHO SELL THEIR RIGHTS SEPARATELY FROM THEIR SHARES AND DO NOT OTHERWISE ACQUIRE RIGHTS MAY NOT BE ABLE TO SATISFY THE REQUIREMENTS OF THE OFFER FOR A VALID TENDER OF SHARES. Rights Certificates. If the Distribution Date has occurred and Rights Certificates have been distributed to such holders prior to the date of tender pursuant to the Offer, Rights Certificates representing a number of Rights equal to the number of Shares being tendered must be delivered to the Depositary or, if available, a Book-Entry Confirmation must be received by the Depositary with respect thereto, in order for such Shares to be validly tendered. If the Distribution Date has occurred and Rights Certificates have not been distributed prior to the time Shares are tendered pursuant to the Offer, Rights may be tendered prior to a stockholder receiving Rights Certificates by use of the guaranteed delivery procedures described below. A tender of Shares without Rights Certificates constitutes an agreement by the tendering stockholder to deliver Rights Certificates representing a number of Rights equal to the number of Shares tendered pursuant to the Offer to the Depositary within five business days after the date such Rights Certificates are distributed. If the Rights Condition is not satisfied, the Purchaser reserves the right to require that the Depositary receive such Rights Certificates or a Book-Entry Confirmation with respect to such Rights prior to accepting Shares for payment, if the Distribution Date occurs prior to the Expiration Date. In that event, payment for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of, or Book-Entry Confirmation with respect to, among other things, Rights Certificates, if Rights Certificates have been distributed to holders of Shares. See Section 1. THE METHOD OF DELIVERY OF SHARE CERTIFICATES OR RIGHTS CERTIFICATES AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER FACILITY, IS AT THE OPTION AND RISK OF THE TENDERING STOCKHOLDER AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO INSURE TIMELY DELIVERY. Book-Entry Transfer. The Depositary will make a request to establish accounts with respect to the Shares at the Book-Entry Transfer Facilities for purposes of the Offer within two business days after the 10 date of this Offer to Purchase. Any financial institution that is a participant in the system of any Book-Entry Transfer Facility may make book-entry delivery of Shares by causing such Book-Entry Transfer Facility to transfer such Shares into the Depositary's account at such Book-Entry Transfer Facility in accordance with such Book-Entry Transfer Facility's procedures for such transfer. However, although delivery of Shares may be effected through book-entry transfer at a Book-Entry Transfer Facility, the Letter of Transmittal (or a facsimile thereof), properly completed and duly executed, together with any required signature guarantees, or an Agent's Message in connection with a book-entry transfer, and any other documents required by the Letter of Transmittal, 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 on or prior to the Expiration Date, or the guaranteed delivery procedures described below must be complied with. If the Distribution Date occurs, to the extent that the Rights become eligible for book-entry transfer under procedures established by a particular Book-Entry Transfer Facility, the Depositary will make a request to establish an account with respect to the Rights at such Book-Entry Transfer Facility as soon as practicable. If book-entry delivery of Rights is available, the foregoing book-entry transfer procedure will also apply to Rights. However, no assurance can be given that book-entry delivery of Rights will be available. If book-entry delivery is not available and if separate Rights Certificates have been issued, a tendering stockholder is not relieved of delivery requirements hereunder and thus will be required to tender Rights by means of actual physical delivery of Rights Certificates to the Depositary or pursuant to the guaranteed delivery procedures set forth below. DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH SUCH BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY. Signature Guarantees. Signatures on Letters of Transmittal must be guaranteed by a firm which is a bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of the Securities Transfer Agents Medallion Program (each of the foregoing being referred to as an "Eligible Institution"), except in cases where Shares or Rights are tendered (i) by a registered holder of Shares and Rights 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 Instruction 1 of the Letter of Transmittal. If the Share Certificates or Rights Certificates are registered in the name of a person other than the signer of the Letter of Transmittal, or if payment is to be made, or Share Certificates or Rights Certificates not accepted for payment or not tendered are to be returned, to a person other than the registered holder, the Share Certificates or Rights Certificates, as the case may be, must be endorsed or accompanied by appropriate stock powers, in either case, signed exactly as the name of the registered holder appears on such certificates, with the signatures on such certificates or stock powers guaranteed as aforesaid. See Instructions 1 and 5 of the Letter of Transmittal. If Share Certificates and Rights Certificates are forwarded separately to the Depositary, a properly completed and duly executed Letter of Transmittal (or a facsimile thereof) must accompany each such delivery. Guaranteed Delivery. If a stockholder desires to tender Shares and Rights pursuant to the Offer and such stockholder's Share Certificates or Rights Certificates are not immediately available (including because Rights Certificates have not yet been distributed by the Company), or such stockholder cannot deliver the Share Certificates or Rights Certificates and all other required documents to reach the Depositary on or prior to the Expiration Date, or such stockholder cannot complete the procedure for delivery by book-entry transfer on a timely basis, such Shares and Rights may nevertheless be tendered, provided that all of the following conditions are satisfied: (i) such tender is made by or through an Eligible Institution; 11 (ii) a properly completed and duly executed Notice of Guaranteed Delivery substantially in the form made available by the Purchaser is received by the Depositary as provided below on or prior to the Expiration Date; and (iii) the Share Certificates or Rights Certificates, as the case may be (or a Book-Entry Confirmation), representing all tendered Shares or Rights, in proper form for transfer, in each case together with the Letter of Transmittal (or a facsimile thereof) properly completed and duly executed, with any required signature guarantees (or, in the case of a book-entry transfer, an Agent's Message) and any other documents required by the Letter of Transmittal are received by the Depositary within (x) in the case of Shares, five New York Stock Exchange, Inc. ("NYSE") trading days after the date of execution of such Notice of Guaranteed Delivery or (y) in the case of Rights, a period ending on the later of (1) five NYSE trading days after the date of execution of such Notice of Guaranteed Delivery and (2) five business days after the date the Rights Certificates are distributed to stockholders of the Company. The Notice of Guaranteed Delivery may be delivered by hand or transmitted by telegram, telex, facsimile transmission or mail to the Depositary and must include a guarantee by an Eligible Institution and a representation that the stockholder owns the Shares and, if applicable, Rights tendered within the meaning of, and that the tender of the Shares and, if applicable, Rights effected thereby complies with, Rule 14e-4 under the Exchange Act, each in the form set forth in such Notice of Guaranteed Delivery. Notwithstanding any other provision hereof, payment for Shares accepted for payment pursuant to the Offer will in all cases be made only after timely receipt by the Depositary of Share Certificates for, or of Book-Entry Confirmation with respect to, such Shares, and if the Distribution Date has occurred, Rights Certificates for, or a Book-Entry Confirmation if available with respect to, the associated Rights (unless the Purchaser elects, in its sole discretion, to make payment for such Shares pending receipt of the Rights Certificates for, or a Book-Entry Confirmation with respect to, such Rights), a properly completed and duly executed Letter of Transmittal (or a facsimile thereof), together with any required signature guarantees (or, in the case of a book-entry transfer, an Agent's Message), and any other documents required by the Letter of Transmittal. Accordingly, payment might not be made to all tendering stockholders at the same time and will depend upon when Share Certificates (or Rights Certificates) or Book-Entry Confirmations of such Shares (or Rights, if available) are received into the Depositary's account at a Book-Entry Transfer Facility. If the Rights Condition is satisfied, the guaranteed delivery procedure with respect to Rights Certificates and the requirement for the tender of Rights will no longer apply. Appointment as Proxy. By executing the Letter of Transmittal, a tendering stockholder irrevocably appoints designees of the Purchaser and each of them 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 and Rights tendered by such stockholder and accepted for payment by the Purchaser (and with respect to any and all other Shares or Rights or other securities issued or issuable in respect of such Shares on or after the date hereof). All such powers of attorney and proxies shall be considered irrevocable and coupled with an interest in the tendered Shares and Rights. Such appointment will be effective when, and only to the extent that, the Purchaser accepts such Shares and Rights for payment. Upon such acceptance for payment, all prior powers of attorney and proxies given by such stockholder with respect to such Shares and Rights (and such other shares and securities) will be revoked without further action, and no subsequent powers of attorney and proxies may be given nor any subsequent written consents executed (and, if given or executed, will not be deemed effective). The designees of the Purchaser will, with respect to the Shares and Rights (and such other shares and securities) for which such appointment is effective, be empowered to exercise all voting and other rights of such stockholder as they in their sole discretion may deem proper at any annual or special meeting of the Company's stockholders or any adjournment or postponement thereof, 12 by written consent in lieu of any such meeting or otherwise. The Purchaser reserves the right to require that, in order for Shares and Rights to be deemed validly tendered, immediately upon the Purchaser's payment for such Shares and Rights, the Purchaser must be able to exercise full voting rights with respect to such Shares, Rights and other securities, including voting at any meeting of stockholders. Determination of Validity. All questions as to the validity, form, eligibility (including time of receipt) and acceptance for payment of any tender of Shares and Rights will be determined by the Purchaser in its sole discretion, which determination shall be final and binding on all parties. The Purchaser reserves the absolute right to reject any and all tenders determined by it not to be in proper form or the acceptance for payment of which may in the opinion of its counsel be unlawful. The Purchaser also reserves the absolute right to waive any of the conditions of the Offer or any defect or irregularity in any tender of Shares and Rights of any particular stockholder whether or not similar defects or irregularities are waived in the case of other stockholders. No tender of Shares will be deemed to have been validly made until all defects and irregularities have been cured or waived. None of the Purchaser, the Parent, any of their affiliates or assigns, the Dealer Manager, the Depositary, the Information Agent or any other person will be under any duty to give notification of any defects or irregularities in tenders or incur any liability for failure to give any such notification. The Purchaser's interpretation of the terms and conditions of the Offer (including the Letter of Transmittal and the instructions thereto) will be final and binding. BACKUP FEDERAL INCOME TAX WITHHOLDING AND SUBSTITUTE FORM W-9. UNDER THE "BACKUP WITHHOLDING" PROVISIONS OF FEDERAL INCOME TAX LAW, THE DEPOSITARY MAY BE REQUIRED TO WITHHOLD 31% OF THE AMOUNT OF ANY PAYMENTS OF CASH PURSUANT TO THE OFFER. IN ORDER TO AVOID BACKUP WITHHOLDING, EACH STOCKHOLDER SURRENDERING SHARES IN THE OFFER MUST PROVIDE THE PAYOR OF SUCH CASH WITH SUCH STOCKHOLDER'S CORRECT TAXPAYER IDENTIFICATION NUMBER ("TIN") ON A SUBSTITUTE FORM W-9 AND CERTIFY UNDER PENALTIES OF PERJURY THAT SUCH TIN IS CORRECT AND THAT SUCH STOCKHOLDER IS NOT SUBJECT TO BACKUP WITHHOLDING. CERTAIN STOCKHOLDERS (INCLUDING AMONG OTHERS ALL CORPORATIONS AND CERTAIN FOREIGN INDIVIDUALS AND ENTITIES) ARE NOT SUBJECT TO BACKUP WITHHOLDING. IF A STOCKHOLDER DOES NOT PROVIDE ITS CORRECT TIN OR FAILS TO PROVIDE THE CERTIFICATIONS DESCRIBED ABOVE, THE INTERNAL REVENUE SERVICE ("IRS") MAY IMPOSE A PENALTY ON SUCH STOCKHOLDER AND PAYMENT OF CASH TO SUCH STOCKHOLDER PURSUANT TO THE OFFER MAY BE SUBJECT TO BACKUP WITHHOLDING. ALL STOCKHOLDERS SURRENDERING SHARES PURSUANT TO THE OFFER SHOULD COMPLETE AND SIGN THE SUBSTITUTE FORM INCLUDED IN THE LETTER OF TRANSMITTAL TO PROVIDE THE INFORMATION AND CERTIFICATION NECESSARY TO AVOID BACKUP WITHHOLDING (UNLESS AN APPLICABLE EXEMPTION EXISTS AND IS PROVED IN A MANNER SATISFACTORY TO THE DEPOSITARY). NONCORPORATE FOREIGN STOCKHOLDERS SHOULD COMPLETE AND SIGN A FORM W-8, CERTIFICATE OF FOREIGN STATUS, A COPY OF WHICH MAY BE OBTAINED FROM THE DEPOSITARY, IN ORDER TO AVOID BACKUP WITHHOLDING. SEE INSTRUCTION 9 OF THE LETTER OF TRANSMITTAL. Other Requirements. The Purchaser's acceptance for payment of Shares and, if applicable, Rights tendered pursuant to any of the procedures described above will constitute a binding agreement between the tendering stockholder and the Purchaser upon the terms and subject to the conditions of the Offer, including the tendering stockholder's representation and warranty that the stockholder is the holder of the Shares within the meaning of, and that the tender of the Shares and Rights complies with, Rule 14e-4 under the Exchange Act. 4. WITHDRAWAL RIGHTS. Tenders of Shares and Rights made pursuant to the Offer are irrevocable, except that Shares and Rights tendered pursuant to the Offer may be withdrawn at any time on or prior to the Expiration Date and, unless theretofore accepted for payment by the Purchaser pursuant to the Offer, may also be withdrawn at any time after June 1, 1995 (or such later date as may apply in case the Offer is extended). If the Purchaser extends the Offer, is delayed in its acceptance for payment of Shares and Rights or is unable to purchase Shares and Rights validly tendered pursuant to the Offer for any reason, then without prejudice to the Purchaser's rights under the Offer, the Depositary may nevertheless, on behalf of the Purchaser, retain tendered Shares and Rights and such Shares and Rights may not be withdrawn except to the extent that tendering stockholders are entitled to withdrawal rights 13 as described in this Section 4. Any such delay will be accompanied by an extension of the Offer to the extent required by law. For a withdrawal to be effective, a written, telegraphic, telex or facsimile transmission notice of withdrawal must be timely received by the Depositary at one of its addresses set forth on the back cover of this Offer to Purchase. Any notice of withdrawal must specify the name of the person who tendered the Shares or Rights to be withdrawn, the number of Shares or Rights to be withdrawn and the name of the registered holder, if different from that of the person who tendered such Shares or Rights. If Share Certificates or Rights Certificates to be withdrawn have been delivered or otherwise identified to the Depositary, then prior to the physical release of such certificates, the serial numbers shown on such certificates must be submitted to the Depositary and the signatures on the notice of withdrawal must be guaranteed by an Eligible Institution unless such Shares or Rights have been tendered for the account of any Eligible Institution. If Shares or Rights have been tendered pursuant to the procedure for book-entry transfer as set forth in Section 3, 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 or Rights, in which case a notice of withdrawal will be effective if delivered to the Depositary by any method of delivery described in the first sentence of this paragraph. A withdrawal of Shares or Rights shall also constitute a withdrawal of the associated Rights or Shares, as applicable. All questions as to the form and validity (including time of receipt) of any notice of withdrawal will be determined by the Purchaser, in its sole discretion, whose determination will be final and binding. None of the Purchaser, the Parent, any of their affiliates or assigns, the Dealer Manager, the Depositary, the Information Agent or any other person will be under any duty to give notification of any defects or irregularities in any notice of withdrawal or incur any liability for failure to give any such notification. Withdrawals of Shares and Rights may not be rescinded. Any Shares or Rights properly withdrawn will thereafter be deemed not to have been validly tendered for purposes of the Offer. However, withdrawn Shares or Rights may be re-tendered at any time prior to the Expiration Date by following one of the procedures described in Section 3. 5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES. The summary of tax consequences set forth below is for general information only and is based on the law as currently in effect. The tax treatment of each stockholder will depend in part upon such stockholder's particular situation. Special tax consequences not described herein may be applicable to particular classes of taxpayers, such as financial institutions, broker-dealers, persons who are not citizens or residents of the United States, stockholders who acquired their Shares through the exercise of an employee stock option or otherwise as compensation, and persons who received payments in respect of options to acquire Shares. ALL STOCKHOLDERS SHOULD CONSULT WITH THEIR OWN TAX ADVISORS AS TO THE PARTICULAR TAX CONSEQUENCES OF THE OFFER AND THE MERGER TO THEM, INCLUDING THE APPLICABILITY AND EFFECT OF THE ALTERNATIVE MINIMUM TAX AND ANY STATE, LOCAL OR FOREIGN INCOME AND OTHER TAX LAWS AND CHANGES IN SUCH TAX LAWS. The receipt of cash pursuant to the Offer or the Merger will be a taxable transaction for Federal income tax purposes under the Internal Revenue Code of 1986, as amended, and may also be a taxable transaction under applicable state, local, foreign income or other tax laws. Generally, a tendering stockholder will recognize gain or loss in an amount equal to the difference between the cash received by the stockholder pursuant to the Offer or the Merger and the stockholder's adjusted tax basis in the Shares and the Rights tendered by the stockholder and purchased pursuant to the Offer or the Merger. For Federal income tax purposes, such gain or loss will be a capital gain or loss if the Shares are a capital asset in the hands of the stockholder, and a long-term capital gain or loss if the stockholder's holding period is more than one year as of the date the Purchaser accepts such Shares for payment pursuant to the Offer or the effective date of the Merger, as the case may be. There are limitations on the deductibility of capital losses. 14 Proposals have recently been introduced in the House of Representatives and the Senate to reduce the effective tax rates applicable to net long-term capital gains. Additionally, the proposals would further limit the deduction for long-term capital losses. These proposals would apply generally to transactions effected after December 31, 1994. Therefore, if these proposals were enacted into law, gains from sales of Shares pursuant to the Offer which constituted long-term capital gains would generally be taxed at reduced effective tax rates. However, there can be no assurance that these proposals will be enacted and, if enacted, the effective dates of the proposals or the particular type of transactions or assets to which the proposals apply could be modified. If the proposals were enacted with an effective date subsequent to the Expiration Date of the Offer, sales of Shares pursuant to the Offer which constituted long-term capital gains would be taxed at the higher rates currently in effect. Shareholders should consult their tax advisors about the impact of this proposed legislation. 6. PRICE RANGE OF SHARES; DIVIDENDS. According to the 1994 Annual Report, the Shares are listed and traded principally on the NYSE. The following table sets forth, for the quarters indicated, the high and low sales prices per Share on the NYSE as reported in the 1994 Annual Report with respect to periods occurring in 1993 and 1994 and as reported by the Dow Jones News Service thereafter, and the amount of cash dividends paid or declared per share for each quarter based on publicly available sources.
HIGH LOW DIVIDENDS ------------- ------------- --------- Year Ended December 31, 1993: First Quarter..................................................... $ 24 1/8 $ 19 5/8 $ -- Second Quarter.................................................... 34 3/4 22 1/2 -- Third Quarter..................................................... 48 1/2 34 1/4 -- Fourth Quarter.................................................... 53 3/4 45 1/8 -- Year Ended December 31, 1994: First Quarter..................................................... 65 5/8 50 1/8 -- Second Quarter.................................................... 69 1/8 55 3/4 -- Third Quarter..................................................... 71 1/8 59 1/4 -- Fourth Quarter.................................................... 70 3/4 51 1/8 -- Year Ended December 31, 1995: First Quarter..................................................... 84 49 1/8 --
On March 31, 1995, the last full trading day prior to announcement of the Offer, the closing sale price per Share reported on the NYSE was $82 1/2. On March 27, 1995, the day prior to the Parent's issuance of the press release announcing the transmission of a letter to the Company containing a proposal to acquire the Company in a transaction in which stockholders would receive between $75 and $77 per Share in cash, the closing sale price per Share reported on the NYSE was $52 5/8. The Offer represents a 52% premium over the $50 1/2 closing sale price per Share reported on the NYSE on March 14, 1995, the last full trading day before the Parent first contacted the Company to convey its proposal to acquire the Company at a price of between $75 and $77 per Share in cash. STOCKHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE SHARES. The Rights are currently attached to the outstanding Shares and may not be traded separately. As a result of the commencement of the Offer, the Distribution Date may be as early as April 17, 1995, after which the Rights could begin trading separately from the Shares. See Section 11. IN SUCH EVENT, STOCKHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION, IF ANY, FOR THE RIGHTS. Unless and until the Purchaser declares that the Rights Condition is satisfied, holders of Shares will be required to tender one Right for each Share tendered in order to effect a valid tender of such Share. Accordingly, stockholders who sell their Rights separately from their Shares and do not otherwise acquire Rights may not be able to satisfy the requirements of the Offer for a valid tender of Shares. 15 7. CERTAIN INFORMATION CONCERNING THE COMPANY. The information concerning the Company contained in this Offer to Purchase, including financial information, has been taken from or based upon publicly available documents and records on file with the Commission and other public sources. The summary information concerning the Company in this Section 7 and elsewhere in this Offer to Purchase is derived from the 1994 Annual Report and other publicly available information. The summary information set forth below is qualified in its entirety by reference to such reports (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 reports and documents filed by the Company with the Commission and other publicly available information. Although the Purchaser and the Parent do not have any knowledge that would indicate that any statements contained herein based upon such reports are untrue, neither the Purchaser nor the Parent assumes any responsibility for the accuracy or completeness of the information contained therein, or for any failure by the Company to disclose events that may have occurred and may affect the significance or accuracy of any such information but which are unknown to the Purchaser and the Parent. General. The Company is a Delaware corporation and is the successor to certain corporations, the first of which was organized in 1902. The Company's principal executive offices are located at 100 North Michigan Street, P.O. Box 7008, South Bend, Indiana 46634. The telephone number of the Company at such offices is (219) 239-0100. The Company's business, together with its subsidiaries, is the design, manufacture and sale of compact construction machinery, asphalt paving equipment, axles and transmissions for off-highway equipment and golf carts and utility vehicles. The Company's Melroe Company Business Unit ("Melroe") is the leading manufacturer of skid steer loaders and also manufactures compact excavators and a limited line of agricultural equipment domestically, all of which it distributes throughout the world to, among others, the construction and agricultural industries under the trademarks "Melroe" and "Bobcat". Melroe products are also manufactured by a licensee in Australia. The Company's Clark-Hurth Components Company Business Unit ("Clark-Hurth") manufactures off-highway axles and transmissions in the United States, Belgium and Italy for sale throughout the world to the construction, mining and material handling equipment industries. Clark-Hurth products are also manufactured by a licensee in South Africa. The Company maintains engineering staffs at each of its principal manufacturing facilities which are supplemented by laboratories to engage in engineering and product development activities, including product testing, materials research and process development. On May 13, 1994, the Company completed the purchase of the Blaw-Knox Construction Equipment Corporation ("Blaw-Knox") and related assets in the United Kingdom. Blaw-Knox is a leading manufacturer of asphalt pavers which are sold in North America and other world markets. On March 17, 1995, the Company completed the acquisition of Club Car, Inc. ("Club Car"), which designs, manufactures, markets and services electric and gasoline golf cars for recreational use and similar off-road utility vehicles for golf, commercial and industrial use. On March 6, 1995, the Company announced that it had signed a definitive agreement to sell its 50% interest in VME Group N.V. ("VME") to AB Volvo of Sweden ("Volvo") for $573 million. VME is a joint venture between the Company and Volvo which manufactures and sells construction and earth-moving equipment. Financial Information. Set forth below are certain selected consolidated financial data for the Company's last three fiscal years which were derived from the 1994 Annual Report as well as selected consolidated financial data for 1994 shown on a pro forma basis to give effect to the Company's acquisition of Club Car which were derived from the Company's Current Report on Form 8-K filed with the Commission for March 13, 1995 (the "March 13 Form 8-K"). More comprehensive financial information is included in the reports (including management's discussion and analysis of financial condition and results of operations) and other documents filed by the Company with the Commission, 16 and the following financial data is qualified in its entirety by reference to such reports and other documents including the financial information and related notes contained therein. Such reports and other documents may be examined and copies thereof may be obtained from the offices of the Commission and the NYSE in the manner set forth below. CLARK EQUIPMENT COMPANY SELECTED CONSOLIDATED FINANCIAL DATA (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
PRO FORMA FOR CLUB CAR ACQUISITION FOR THE YEAR ENDED DECEMBER 31, FOR THE YEAR ENDED ---------------------------------- DECEMBER 31, 1994(A) 1994 1993 1992 -------------------- ---------- ---------- -------- INCOME STATEMENT DATA Net Sales.................................. $1,138,400 $ 946,599 $ 692,022 $658,535 Income from Continuing Operations.......... 61,200 62,815 21,579 12,016 Income (Loss) from Discontinued Operations................................. 99,120 20,290 (38,058) ---------- ---------- -------- Income (Loss) before Effect of Changes in Accounting Principles...................... 161,935 41,869 (26,042) Effect of Accounting Changes--Income Taxes...................................... 0 6,150 92,000 ---------- ---------- -------- Net Income................................. $ 161,935 $ 48,019 $ 65,958 ---------- ---------- -------- ---------- ---------- -------- INCOME (LOSS) PER SHARE From Continuing Operations................. $3.52 $3.61 $1.24 $0.69 From Discontinued Operations............... 5.69 1.17 (2.19) From Effect of Accounting Changes.......... 0.00 0.35 5.31 ---------- ---------- -------- Net Income................................. 9.30 2.76 3.81 ---------- ---------- -------- ---------- ---------- -------- Average Number of Shares Used to Compute Net Income per Share....................... 17,400 17,412 17,421 17,334 BALANCE SHEET DATA (AT PERIOD END) Working Capital............................ $ 182,600 $ 290,517 $ 255,006 $199,608 Total Assets............................... 1,361,800 1,193,899 1,003,274 958,691 Total Liabilities.......................... 909,600 741,739 735,121 706,104 Total Stockholders' Equity................. 452,200 452,160 268,153 252,587
- ------------ (a) Pro forma balance sheet and pro forma income statement data are as presented in the Pro Forma Financial Information sections of the March 13 Form 8-K and are rounded to the nearest 100,000 (except per Share amounts). The Shares are registered under the Exchange Act. Accordingly, the Company is subject to the informational filing requirements of the Exchange Act and in accordance therewith is obligated to file periodic reports, proxy statements and other information with the Commission relating to its business, financial condition and other matters. Information as of particular dates concerning the Company's directors and officers, their remuneration, options granted to them, the principal holders of the Company's securities and any material interest of such persons in transactions with the Company is required to be disclosed in such proxy statements and distributed to the Company's stockholders and filed with the Commission. Such reports, proxy statements and other information should be available for inspection at the public reference facilities of the Commission located in Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and should also be available for inspection and copying at prescribed rates at the regional offices of the Commission located at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661, and Seven World Trade Center, Suite 1300, New York, New York 10048. Copies of this material may also be obtained by mail, upon payment of the 17 Commission's customary fees, from the Commission's principal office at 450 Fifth Street, N.W., Washington, D.C. 20549. In addition, such material should also be available for inspection at the library of the New York Stock Exchange, 20 Broad Street, New York, New York 10005. Except as otherwise noted in this Offer to Purchase, all of the information with respect to the Company set forth in this Offer to Purchase has been derived from publicly available information. 8. CERTAIN INFORMATION CONCERNING THE PURCHASER AND THE PARENT. The Purchaser, a Delaware corporation and a wholly owned subsidiary of the Parent, was organized in connection with the Offer and has not carried on any activities to date other than those incident to its formation and the commencement of the Offer. The Parent is a New Jersey corporation organized in 1905. The Parent, together with its subsidiaries, manufactures and sells primarily industrial machinery and capital equipment, including compressors, bearings, pumps, engine starting systems, power tools, rock drills, construction equipment, automotive components and door hardware. The Parent believes that it is one of the leading manufacturers in the world of a broad line of air compression systems, anti-friction bearings, construction equipment, air tools and pumps. In addition, it believes it is also an important factor in domestic markets for locks and other door hardware products. Products are sold primarily under the Parent's name and also under other names including Torrington, Fafnir, Klemm, Schlage, CPM, LCN Closers, Von Duprin, Aro, ABG, Ingersoll-Dresser Pumps, Pacific, Worthington, Jeumont-Schneider Pumps and Pleuger. The Parent is involved in two ventures with Dresser Industries, Inc.: Dresser-Rand Company, which manufactures and sells reciprocating compressors and turbomachinery worldwide and in which the Parent has a 49% interest, and Ingersoll-Dresser Pump Company, which manufactures and sells industrial pumps and in which the Parent has a 51% interest. The Parent also maintains extensive research, engineering and development facilities for experimenting, testing and developing high quality products. The name, citizenship, business address, principal occupation or employment, and five year employment history of each of the directors and executive officers of the Purchaser and the Parent and certain other information are set forth in Schedule I hereto. Set forth below are certain selected consolidated financial data relating to the Parent and its subsidiaries for the Parent's last three fiscal years which have been derived from the financial statements contained in the Parent's Annual Report on Form 10-K for the fiscal year ended December 31, 1994 filed by the Parent with the Commission. More comprehensive financial information is included in the reports (including management's discussion and analysis of financial condition and results of operations) and other documents filed by the Parent with the Commission, and the following financial data is qualified in its entirety by reference to such reports and other documents, including the financial information and related notes contained therein. Such reports and other documents may be examined and copies thereof may be obtained from the offices of the Commission and the NYSE in the same manner as set forth with respect to information about the Company in Section 7. 18 INGERSOLL-RAND COMPANY SELECTED CONSOLIDATED FINANCIAL DATA (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
FOR THE YEAR ENDED DECEMBER 31, -------------------------------------- 1994 1993 1992 ---------- ---------- ---------- INCOME STATEMENT DATA Net Sales.............................................. $4,507,470 $4,021,071 $3,783,787 Earnings Before Effect of Accounting Changes........... 211,140 163,524 115,594 Effect of Accounting Changes........................... 0 (21,000) (350,000) ---------- ---------- ---------- Net Earnings (Loss).................................... $ 211,140 $ 142,524 $ (234,406) ---------- ---------- ---------- ---------- ---------- ---------- EARNINGS PER SHARE Earnings Before Effect of Accounting Changes........... $2.00 $1.56 $1.11 Net Earnings (Loss).................................... 2.00 1.36 (2.25) Average Number of Shares Outstanding for EPS Calculation............................................ 105,458 104,992 104,341 BALANCE SHEET DATA (AT PERIOD END) Working Capital........................................ $ 962,810 $ 877,836 $ 887,816 Total Assets........................................... 3,596,921 3,375,332 3,387,552 Total Liabilities...................................... 2,065,579 2,025,507 2,094,177 Total Shareowners' Equity.............................. 1,531,342 1,349,825 1,293,375
The Parent currently beneficially owns an aggregate of 274,200 Shares, representing approximately 1.6% of the 17,132,696 Shares reported by the Company as outstanding at March 13, 1995, all of which Shares were acquired by the Parent in the transactions described in Schedule II. Except as described in this Offer to Purchase and in Schedules I and II, none of the Purchaser, the Parent nor, to the best knowledge of the Purchaser and the Parent, any of the persons listed on Schedule I hereto or any associate or majority-owned subsidiary of the Purchaser, the Parent or any of the persons so listed, beneficially owns or has a right to acquire directly or indirectly any Shares, and none of the Purchaser, the Parent nor, to the best knowledge of the Purchaser and the Parent, any of the persons or entities referred to above, or any of the respective executive officers, directors or subsidiaries of any of the foregoing, has effected any transactions in the Shares during the past 60 days. Various divisions, subsidiaries and affiliates of the Parent purchase products from or sell products to various divisions and subsidiaries of the Company, in all cases in amounts which are not material. Except as set forth in this Offer to Purchase, neither the Purchaser nor the Parent or, to the best knowledge of the Purchaser and the Parent, any of the persons listed on Schedule I hereto, has any contract, arrangement, understanding or relationship with any other person with respect to any securities of the Company, including but not limited to contracts, arrangements, understandings or relationships concerning the transfer or voting of such securities, joint ventures, loan or option arrangements, puts or calls, guarantees of loans, guarantees against loss or the giving or withholding of proxies. Except as set forth in this Offer to Purchase, neither the Purchaser nor the Parent or, to the best knowledge of the Purchaser and the Parent, any of the persons listed on Schedule I hereto, has had since January 1, 1992 any business relationships or transactions with the Company or any of its executive officers, directors or affiliates that are required to be reported under the rules and regulations of the Commission applicable to the Offer. Except as set forth in this Offer to Purchase, since January 1, 1992 there have been no contacts, negotiations or transactions between any of the Parent, the Purchaser or, to the best knowledge of the Purchaser and the Parent, any of the persons listed in Schedule I hereto, on the one hand, and the Company or its affiliates, on the other hand, concerning a merger, consolidation or 19 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. 9. SOURCE AND AMOUNT OF FUNDS. The total amount of funds required by the Purchaser to purchase all of the outstanding Shares and pay related fees and expenses is expected to be approximately $1.34 billion. The Purchaser will obtain such funds through capital contributions by the Parent and/or various wholly-owned direct or indirect subsidiaries of the Parent. The Parent and/or such subsidiaries will obtain such funds through borrowings from commercial banks and from its general corporate funds. The Parent has accepted a commitment letter (the "Commitment Letter") from The Chase Manhattan Bank (National Association) ("Chase"), which provides that so long as the Offer has been consummated on or before August 31, 1995 Chase will provide to the Parent, on specified terms and subject to specified conditions, $1.35 billion, a portion of which may be provided by a syndicate of banks and/or other financial institutions acceptable to the Parent and Chase, and will act as administrative agent (the "Administrative Agent") for the Facility. The Commitment Letter contemplates a five-year reducing revolving credit facility in the amount of $1.35 billion (the "Facility"). The proceeds of the Facility may be used by the Parent to finance the Offer and the Merger and to pay related fees, commissions and expenses. The Facility will be guaranteed by the Purchaser until the consummation of the Merger. The Facility will be secured, on an equal and ratable basis with the Parent's $400 million Credit Agreement dated as of October 31, 1994 (the "Existing Credit Agreement") and any other long-term notes or debentures that by their express terms so require, by a pledge of all the capital stock of, and the Parent's advances to, the Purchaser. Such security shall be released on or after the Initial Facility Reduction Date (as defined below), upon receipt by the Administrative Agent of a certificate of the Parent that no default exists under the Facility. The Facility will be reduced to $1.0 billion on the date (the "Initial Facility Reduction Date") which is the earlier of (i) 45 days after the consummation of the Merger or (ii) 180 days after the consummation of the Offer. The remaining Facility will be reduced at the end of the second, third, fourth and fifth years after the consummation of the Offer by $100 million, $200 million, $300 million and $400 million, respectively. Upon the issuance by the Parent or any of its subsidiaries for cash of any debt maturing on or after the Facility's maturity date (other than refinancing of existing debt of foreign subsidiaries or of certain debt of the Parent and other than up to $25 million of domestic economic development financing) or of any equity (in each case, other than inter-company), the Facility will be reduced by an amount equal to the net cash proceeds of such debt or equity financing. Loans under the Facility ("Loans") must be repaid on the date of any such reduction to the extent the amount of outstanding Loans exceeds the amount of the Facility as so reduced. Until the earlier of completion of the primary syndication or 30 days after consummation of the Offer, the Loans will bear interest, at the Parent's option, at Chase's Base Rate or at a rate determined through a competitive bid process among the lenders based on a spread above or below LIBOR or a fixed rate (a "Bid Rate"). Thereafter, the Loans will bear interest at the Parent's option at Chase's Base Rate, a Bid Rate or at specified spreads above a CD rate or LIBOR (adjusted for reserves). Loans bearing interest at LIBOR will be for interest periods of 1, 2, 3, 6, 9 or 12 month periods, and loans bearing interest at the CD Rate will be for interest periods of 30, 60, 90, 180, 270 or 360 days, at the Parent's option (9 or 12 month and 270 or 360 day interest periods to be acceptable to all lenders except in the case of Bid Rate LIBOR Loans). Bid Rate Loans bearing interest at a fixed rate may be made for any period up to 360 days. All interest will be paid at the end of the applicable interest period or quarterly, whichever is earlier. Chase's commitment to provide the Facility may be terminated in the event of certain customary events as follows: (a) if (i) the terms of the Offer or the Merger are changed in any manner, (ii) information provided to Chase by or on behalf of the Parent proves to be inaccurate or incomplete in any respect, (iii) any adverse change occurs or (iv) any additional information is disclosed to or 20 discovered by Chase, that in case of clauses (i) through (iv) Chase deems to be materially adverse in respect of the condition (financial or otherwise), business, operations, assets or liabilities of the Parent and its subsidiaries taken as a whole or the Company and its subsidiaries taken as a whole, (b) failure to pay any of the fees payable to Chase or the lenders in connection with the Facility and (c) any material adverse change in loan syndication or capital market conditions generally. The conditions precedent to the initial borrowing under the Facility include (a) execution and delivery of satisfactory loan documentation, (b) the lenders' reasonable satisfaction with the terms and conditions of the Offer, (c) the principal conditions to the consummation of the Offer having been satisfied and not having been waived, provided that conditions which must be satisfied to the satisfaction of the Purchaser must also be fulfilled to the satisfaction of lenders in their reasonable determination, and (d) the Shares having been accepted for payment pursuant to the Offer in accordance with the terms of the Offer. It is a further condition precedent to the initial borrowing under the Facility that after giving effect to the consummation of the Offer, the Purchaser shall own and control that number of Shares as shall be necessary to permit the Purchaser to approve the Merger without the affirmative vote or approval of any other shareholders. In addition, the Offer and financing must be in compliance with applicable law, and all licenses, consents and approvals necessary to consummate the Offer and the Merger must be in full force and effect, in order for the initial borrowing under the Facility to occur. Conditions to each extension of credit under the Facility will be reasonably consistent with those contained in the Existing Credit Agreement. The definitive documentation relating to the Facility also will contain representations, warranties, covenants and events of default and conditions reasonably consistent with those contained in the Existing Credit Agreement and other provisions customary for transactions of this type. In addition, the Facility will contain covenants that (a) total subsidiary (other than inter-company) debt will not exceed $600 million at any time that the Parent's senior unsecured long-term debt rating is below investment-grade, (b) until the Initial Facility Reduction Date, total debt of the Parent and its subsidiaries (including the Company and its subsidiaries) will not exceed $2.5 billion and (c) consolidated shareholders' equity of the Parent and its subsidiaries will not be less than $1.1 billion plus a certain percentage of cumulative net earnings and a certain percentage of cumulative net proceeds of equity issuances, in each case after December 31, 1994. The Parent has agreed to pay specified fees to Chase and the lenders in connection with the Facility. The Parent also has agreed to pay certain expenses of, and provide customary indemnities to, Chase and (under certain circumstances) the other lenders under the Facility. The foregoing summary of the source and amount of funds is qualified in its entirety by reference to the text of the Commitment Letter, a copy of which is filed as an exhibit to the Tender Offer Statement on Schedule 14D-1 of the Purchaser and the Parent filed with the Commission in connection with the Offer (the "Schedule 14D-l") and is incorporated herein by reference and may be inspected in the same manner as set forth in Section 7. When definitive agreements relating to the Facility are executed, copies will be filed as exhibits to amendments to the Schedule 14D-1. As noted above, the Facility will be reduced to $1.0 billion on the earlier of 45 days after consummation of the Merger or 180 days after consummation of the Offer. At that time, Parent intends to repay the amount by which the Facility exceeds $1.0 billion (which amount is presently expected to be $350 million) in the following manner. The Parent intends to use up to $150 million of cash and cash equivalents that it has on hand and/or, if the Merger has been consummated, up to $350 million of cash and cash equivalents which the Company will then have on hand (including some of the proceeds which the Company will shortly be receiving from the sale of its 50% interest in VME (see Section 7)), to fund the entire amount of such repayment. If the Merger has not been consummated, or if it has but the Company's cash and cash equivalents on hand are not sufficient to fund the entire amount of such required repayment not funded out of the Parent's cash and cash equivalents on hand, the Parent intends to obtain the remaining funds necessary to effect such repayment from the proceeds of private 21 placements under a commercial paper program of the Parent or other borrowings by the Parent, including possible drawdowns under the Existing Credit Agreement. The Parent anticipates that the remainder of the Facility will be repaid with internally generated funds, including those of the Company if the Merger is consummated, and from the proceeds of future borrowings or other debt or equity financings. At this time, no specific plans or arrangements have been made for any such future borrowings or other financings. However, after consummation of the Merger, the Parent intends to explore various possible plans for long-term debt financing that might be considered to refinance part of the Facility and any commercial paper issuances or other borrowings that were used to refinance part of the Facility as noted above. 10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY. For more than one year prior to the Offer, members of the Parent's senior management have considered potential transactions which could enhance the value of the Parent for its stockholders, including the possibility of a strategic acquisition of another industrial company or business such as the Company. The Parent developed an extensive list of potential acquisition candidates and then gradually narrowed the list of potential candidates by applying various acquisition criteria. Detailed analysis was then performed on a select group of companies to help narrow the list of potential acquisition candidates even further. In January 1995, the Parent's discussions regarding possible acquisitions began to focus particularly on the Company and actions were taken to effect a more formal analysis of the Company. On March 15, 1995, James E. Perrella, Chairman, President and Chief Executive Officer of the Parent, had a telephone conversation with Leo J. McKernan, Chairman, President and Chief Executive Officer of the Company. Mr. Perrella said that he had called Mr. McKernan to propose that the Parent acquire the Company in an all-cash merger transaction in which the stockholders of the Company would receive between $75.00 and $77.00 in cash per share. Mr. McKernan immediately replied that the Company was "not interested" in any transaction with the Parent and Mr. McKernan then terminated the phone call. On March 15, 1995, Mr. Perrella sent the following letter to Mr. McKernan and to each of the Company's directors: March 15, 1995 Mr. Leo J. McKernan Chairman, President and Chief Executive Officer Clark Equipment Company 100 North Michigan Street South Bend, Indiana 46634 Dear Leo: I was disappointed that you did not give me the chance to explain fully our proposal when we spoke today. I would have much preferred to convey to you personally everything that I wanted to say, but since I was unable to do so, I am sending this letter to set forth our specific proposal. Ingersoll-Rand Company proposes to acquire Clark Equipment Company in a merger transaction in which Clark's stockholders would receive between $75.00 and $77.00 in cash for each share of outstanding Clark common stock. We think the lower end of that range is the appropriate price, but I would like to meet with you to give you the opportunity to convince us that the higher end of the range is justified. 22 We believe our proposal presents an extremely attractive opportunity for Clark's stockholders, who at $75.00 per share would receive a premium of 50% over today's closing market price of Clark common stock. We and our financial advisors believe that Clark's stockholders will enthusiastically support our proposal. We have been studying Clark for some time and we are extremely impressed with the businesses you have so ably built up and the manner in which they complement Ingersoll-Rand's businesses. We believe the complementary aspects of our two companies' products, customers and distribution capabilities would enable the combined entity to be an even more effective competitor in the global marketplace. Our proposal visualizes the negotiation and execution of a mutually acceptable definitive merger agreement, the operation of Clark in the ordinary course of business and the taking of the various actions by Clark's Board necessary to facilitate the completion of the transaction. Our proposal also assumes Clark's consummation of the sale of its 50% interest in VME to Volvo on substantially the terms previously announced. Our antitrust counsel has studied the two companies' businesses and we do not believe that our proposal gives rise to any meaningful antitrust concerns. We are confident that any antitrust issues would readily be resolved. Finally, based on our discussions with Ingersoll-Rand's principal senior lender, we are also confident that the necessary financing for this transaction can easily be arranged. We hope that you and your Board of Directors will view this proposal as we do--a unique opportunity for Clark's stockholders to realize full value for their shares in a transaction that can quickly be consummated. We are prepared to meet with you and your advisors to answer any questions that you may have about our proposal and to proceed expeditiously to negotiate a definitive merger agreement with you. My purpose in sending this letter is to provide you and your fellow directors with information about our proposal and to express our sincere desire to work together with you to reach agreement on a transaction that can be presented to Clark's stockholders as the joint effort of Ingersoll-Rand's and Clark's Boards of Directors and management. At this point, therefore, we hope that our discussions can remain a private matter between us. Needless to say, it is important that we hear from you as soon as practicable as to your Board's views about our proposal. Sincerely, James E. Perrella Chairman, President and Chief Executive Officer cc: Members of the Board of Directors of Clark Equipment Company On March 20, 1995, Mr. McKernan telephoned Mr. Perrella and informed him that the Company would give serious consideration to the Parent's proposal, and that he would convene a special meeting of the Company's Board of Directors within the upcoming week to consider the proposal. 23 On March 21, 1995, Mr. Perrella sent the following letter to Mr. McKernan: March 21, 1995 Mr. Leo J. McKernan Chairman, President and Chief Executive Officer Clark Equipment Company 100 North Michigan Street South Bend, Indiana 46634 Dear Leo: I appreciated your phone call yesterday. I think it would be in our mutual best interests for us to continue to stay in touch with each other as events unfold. We hope you will be able to convene your Board as soon as possible this week since time is so important. But we certainly hope that Monday would be the latest possible date for your Board meeting. When it does meet, we hope that your Board will view this proposal as we do--as an unusual opportunity for Clark's stockholders to realize full value for their shares in a transaction that will create a company that will be uniquely positioned in the global marketplace. I want to stress my desire to meet with you to discuss our proposal and answer any questions that you may have about it. I would like to give you the opportunity to show us how the higher end of the range that I mentioned in my March 15 letter might be justified. Thanks again for your call. Sincerely, James E. Perrella On March 23, 1995, Mr. McKernan telephoned Mr. Perrella to report that the Company's Board would be meeting on Monday, March 27, 1995 to consider the Parent's proposal. 24 On March 28, 1995, Mr. Perrella received the following letter (the "March 27 Clark Letter") from Mr. McKernan: March 27, 1995 Mr. James E. Perrella Chairman, President and Chief Executive Officer Ingersoll-Rand Company 200 Chestnut Ridge Road Woodcliff Lake, NJ 07675 Dear Mr. Perrella: The Board of Directors of Clark Equipment Company met today to consider your letter of March 15, 1995. During the meeting, we considered the views of our financial and legal advisors and other issues we deemed appropriate. Although the Board of Directors appreciates your interest in Clark Equipment Company as a strategic acquisition, the Board of Directors unanimously reaffirmed its long-standing position that the Company is not for sale. We therefore decline your proposal. The management team at Clark, with the full support of the Board, has been successfully implementing a strategic plan which has benefited our shareholders materially. As a result of our efforts, Clark Equipment Company enjoys an outstanding reputation with its shareholders, customers and the financial community. The management and Board of Directors of Clark believe that our shareholders will continue to benefit materially from our commitment to stay the course of our strategic plan. Thank you again for your expression of interest in Clark. The Board of Directors requests that this letter remain confidential and that it shall serve as an appropriate final response to your inquiry. Sincerely, Leo J. McKernan Following receipt of Mr. McKernan's letter, Mr. Perrella telephoned Mr. McKernan on March 28, 1995 to urge Mr. McKernan and the Company's Board to reconsider their rejection of the Parent's proposal. Mr. McKernan reiterated the Board's position that the Company was not for sale. Later that day, Mr. Perrella sent the letter set forth below to Mr. McKernan and the Parent issued the following press release: Woodcliff Lake, N.J. (March 28, 1995)--Ingersoll-Rand Company announced today that it had submitted a proposal to Clark Equipment Company for the acquisition of Clark in a merger transaction in which Clark's stockholders would receive between $75 and $77 in cash per share. A letter sent today by James E. Perrella, Chairman, President and Chief Executive Officer of Ingersoll-Rand, to Clark's Chairman is attached. Ingersoll-Rand first submitted its acquisition proposal to Clark on March 15, 1995. Clark advised Ingersoll-Rand today that at a meeting held on March 27, 1995 Clark's Board of Directors had rejected Ingersoll-Rand's proposal. 25 Here is the full text of Ingersoll-Rand's letter: March 28, 1995 Mr. Leo J. McKernan Chairman, President and Chief Executive Officer Clark Equipment Company 100 North Michigan Street South Bend, Indiana 46634 Dear Leo: We are surprised and disappointed that Clark Equipment Company's Board has rejected our acquisition proposal and "reaffirmed its long-standing position that the Company is not for sale." We would have thought that an acquisition proposal at a 50% premium over the price at which Clark common stock has recently been trading--and a price exceeding Clark's all time high stock price--would have led to a more constructive dialogue between us. But as I have mentioned to you, we have proposed a transaction that is so compelling for the stockholders of both of our companies that we feel obligated to pursue it notwithstanding your Board's rejection. Because we are confident that Clark's stockholders will enthusiastically support our proposal, we are sending this letter to you and also releasing it publicly. Ingersoll-Rand Company proposes to acquire Clark in a merger transaction in which Clark's stockholders would receive between $75.00 and $77.00 in cash for each share of outstanding Clark common stock. We think the lower end of that range is the appropriate price, but as you know we have repeatedly offered to meet with you to give you the opportunity to convince us that the higher end of that range is justified. We have been studying Clark for some time and we are extremely impressed with the businesses you have so ably built up and the manner in which they complement Ingersoll-Rand's businesses. We believe the complementary aspects of our two companies' products, customers and distribution capabilities would enable the combined entity to be an even more effective competitor in the global marketplace. Our offer is subject to the negotiation and execution of a mutually acceptable definitive merger agreement, the operation of Clark in the ordinary course of business, the taking of the various actions by Clark's Board necessary to facilitate the completion of the transaction and the absence of any actions by Clark's Board which would frustrate our offer. Our proposal also assumes Clark's consummation of the sale of its 50% interest in VME to Volvo on substantially the terms previously announced or, if not consummated, the continued effectiveness of Clark's announced agreement with Volvo without any change in its terms. Our antitrust counsel has studied the two companies' businesses and we do not believe that our proposal gives rise to any meaningful antitrust concerns. We are confident that any antitrust issues would readily be resolved. Finally, based on our discussions with our senior lenders, we are also confident that the necessary financing for the transaction can easily be arranged. I still would like to meet with you at your earliest convenience to discuss our proposal and to proceed with negotiations leading to the execution of a definitive merger agreement. We believe that your Board of Directors should reconsider our proposal and view it as we do--as a unique opportunity for Clark's stockholders to realize full value for their shares in a transaction that can quickly be consummated. 26 We hope to hear from you promptly. Sincerely, James E. Perrella Later in the evening on March 28, 1995, the Company issued the following press release: South Bend, Ind. (March 28, 1995)--Clark Equipment Company said today that its Board of Directors met on March 27, 1995 to review a letter received from Ingersoll-Rand proposing an acquisition of the company. After consulting with Clark's financial and legal advisors, the Board of Directors unanimously determined to decline Ingersoll-Rand's unsolicited proposal. The Board reaffirmed its long standing position that Clark is not for sale and its commitment to implement successfully its strategic plan. This plan has included the recent acquisitions of Club Car and Blaw-Knox and the impending divestiture of its 50 percent interest in VME Group for $573 million. Clark Chairman Leo J. McKernan stated that Ingersoll-Rand's proposal is entirely inadequate. "Clark's share price reached a high of $71 only five months ago. I believe this is an opportunistic attempt to buy Clark during a temporary decline in the price of Clark's shares," added Mr. McKernan. (A copy of McKernan's letter to James E. Perrella, Chairman, President and CEO of Ingersoll-Rand, declining the offer follows.) Clark's press release then included the text of the March 27 Clark Letter set forth above. On March 29, 1995, the Company filed suit against the Parent in the United States District Court for the Southern District of New York alleging that the acquisition by the Parent of the Company would violate the federal antitrust laws and seeking preliminary and permanent injunctions barring the Parent from proceeding with the acquisition. See Section 15 for additional information about this suit. On March 30, 1995, the Parent issued the following press release: Woodcliff Lake, N.J. (March 28, 1995)--Ingersoll-Rand Company said it had been sued by Clark Equipment Company in Federal District Court in New York City. The suit alleges that Ingersoll-Rand's proposed acquisition of Clark violates the U.S. antitrust laws because of overlap between the two companies in the manufacture and distribution of asphalt pavers. Thomas F. McBride, Senior Vice President and Chief Financial Officer, said: "Clark's lawsuit is nothing more than a diversionary tactic. Clark knows as well as we do that any antitrust issues which may arise from the paver overlap between our two companies can readily be resolved. Ingersoll-Rand's 1994 domestic revenues from the relevant product line were below $10 million out of 1994 total revenues of $4.5 billion." 27 On March 31, 1995, the Parent sent to the Company a demand under Delaware law for the Company's list of stockholders and security position listings. On April 3, 1995, the Purchaser commenced the Offer and the Parent delivered a notice to the Company nominating seven individuals for election as directors at the Company's annual meeting of stockholders scheduled for May 9, 1995. On April 3, 1995, Mr. Perrella also sent the following letter to Mr. McKernan: April 3, 1995 Mr. Leo J. McKernan Chairman, President and Chief Executive Officer Clark Equipment Company 100 North Michigan Street South Bend, Indiana 46634 Dear Leo: Over the past two and a half weeks, Ingersoll-Rand has made repeated efforts to meet with Clark in an attempt to negotiate the terms of a merger transaction that could be presented to Clark's stockholders as the joint effort of both companies' Boards and managements. But rather than recognize its fiduciary responsibility to explore further a possible transaction on the basis we have proposed, the only response from Clark has been to state its long-standing position that Clark is not for sale and to file a lawsuit against us. The Company's actions leave us with only one alternative. Today we are commencing a tender offer to acquire all outstanding shares of Clark common stock at $77.00 in cash per share and we are sending a letter notifying you that we are nominating seven individuals for election as directors of Clark at Clark's May 9 annual meeting of stockholders. We regret that we have to resort to these actions; we would have greatly preferred to enter into negotiations with you in an effort to reach agreement on a merger transaction. But even though we have commenced a tender offer, we continue to be interested in meeting with you to negotiate the terms of a transaction that can be approved by your Board. When your Board recognizes that its fiduciary duties require consideration of the sale of Clark, please call me. Sincerely, James E. Perrella Chairman, President and Chief Executive Officer 28 11. PURPOSE OF THE OFFER; THE MERGER; PLANS FOR THE COMPANY. The purpose of the Offer is to acquire control of, and the entire equity interest in, the Company. The Merger. The Purchaser intends to propose, and to seek to have the Company consummate, the Merger as soon as practicable after consummation of the Offer. However, certain terms of the Rights and certain provisions of the DGCL, the Charter and the By-Laws may affect the ability of the Purchaser to obtain control of the Company and to consummate the Merger. Accordingly, the timing and details of the Merger will depend on a variety of factors and legal requirements, the actions of the Board of Directors of the Company, the number of Shares acquired by the Purchaser pursuant to the Offer and whether the Minimum Condition, the Supermajority Charter Condition, the Rights Condition and the Delaware Takeover Statute Condition have been satisfied. Board Approval. Except in the case of a short form merger in accordance with the DGCL described below, the DGCL requires that the Merger be approved by the Company's Board of Directors. As described above, the Parent and the Purchaser have previously requested and continue to request that the Company's Board of Directors approve the Merger and believe that the Company's Board of Directors is obligated by its fiduciary responsibilities to do so. On April 3, 1995, the Parent delivered a notice to the Company nominating seven individuals for election as directors at the Company's annual meeting of stockholders scheduled for May 9, 1995. The Parent intends to solicit proxies from stockholders for the purpose of electing the seven director candidates nominated by the Parent, in order that the new Board of Directors would take all such actions necessary or appropriate (subject to such directors' fiduciary duties) to approve and effectuate the consummation of the Offer and the Merger, including taking action to execute an agreement and plan of merger and to satisfy the Supermajority Charter Condition, the Rights Condition and the Delaware Takeover Statute Condition. If the seven director candidates nominated by the Parent are not elected at the annual meeting and the conditions to the Offer are not otherwise satisfied, the Parent will explore the other options available to it, including soliciting stockholder demands to call a special meeting of the Company's stockholders for the purpose of electing candidates nominated by the Parent as directors of the Company, adopting resolutions of stockholders instructing the Board of Directors of the Company to approve the Offer and the Merger or taking other actions to insure that the Offer and the Merger will be consummated. Under the Charter and By-Laws, the Company is required to call a special meeting of the stockholders upon the demand of the holders of a majority of the outstanding Shares. The Parent and the Purchaser may also consider the possible commencement of litigation seeking to eliminate obstacles to the consummation of the Offer and the Merger. There are currently seven members of the Company's Board of Directors. The directors are elected to the Board of Directors for a term of one year at each annual meeting of the Company. The DGCL provides that any director, or the entire Board of Directors, may be removed from office by the affirmative majority vote of the outstanding Shares entitled to vote for directors. The vacancy caused by any such removal may be filled at such meeting by the vote of the holders of a plurality of the Shares present in person or by proxy and entitled to vote, except that any vacancy not so filled may be filled by a majority of the remaining directors. Under the DGCL, the amendment of any provision of the Charter requires a resolution of the Board of Directors and the affirmative vote of a majority of the outstanding Shares entitled to vote, except that the Charter provides that the Supermajority Charter Provision may not be amended without the affirmative vote or consent of 80% of the Shares entitled to vote in elections of directors. The By-Laws provide that they may be amended by the stockholders or Board of Directors at a meeting with notice duly given of the proposed amendment or by unanimous written consent of the Board of Directors. If all the conditions to the Offer are satisfied even though the Company's Board of Directors does not take the actions requested by the Purchaser to approve the Offer and the Merger, and if the Parent 29 is unsuccessful in seeking election of the seven director candidates nominated by the Parent to the Company's Board of Directors at the upcoming annual meeting, then the Parent and the Purchaser presently intend to request as soon as practicable following consummation of the Offer that some or all of the then-current members of the Board of Directors resign and to cause nominees of the Parent or the Purchaser to be elected to fill the resulting vacancies. Should such request be refused, the Parent and the Purchaser intend to take such action as may be necessary and lawful to secure control of the Board of Directors of the Company. Such action may include calling a special meeting of the stockholders of the Company, which the Purchaser will have the power to effect without the action of any other stockholder as a result of it having acquired a majority of the outstanding Shares through consummation of the Offer. In the event the Purchaser obtains control of the Company's Board of Directors, the Purchaser would expect to seek approval of the Merger as soon as practicable thereafter, consistent with the fiduciary obligations of the Board. THIS OFFER TO PURCHASE DOES NOT CONSTITUTE A SOLICITATION OF A PROXY, CONSENT OR AUTHORIZATION FOR OR WITH RESPECT TO THE ANNUAL MEETING OR ANY SPECIAL MEETING OF THE COMPANY'S STOCKHOLDERS OR ANY ACTION IN LIEU THEREOF. ANY SUCH SOLICITATION WHICH THE PURCHASER MAY MAKE WILL BE MADE ONLY PURSUANT TO SEPARATE PROXY MATERIALS IN COMPLIANCE WITH THE REQUIREMENTS OF SECTION 14(A) OF THE EXCHANGE ACT. Stockholder Approval. The DGCL requires that unless otherwise provided by the Company's Charter, the Merger be approved by the affirmative vote of the holders of at least a majority of the outstanding Shares. The Minimum Condition requires that there shall have been validly tendered and not properly withdrawn on or prior to the Expiration Date a number of Shares which, together with the Shares owned by the Parent, constitutes at least 51% of the voting power (determined on a fully diluted basis) on the date of purchase of all securities entitled to vote generally in the election of directors or in a merger. Upon consummation of the Offer and assuming the Minimum Condition is satisfied, the Purchaser will own sufficient Shares to enable it to effect stockholder approval of the Merger (subject to the requirements of the Supermajority Charter Provision and the Delaware Takeover Statute) with the affirmative vote of the Shares owned by it. THE OFFER IS CONDITIONED UPON THE MINIMUM CONDITION BEING SATISFIED. Supermajority Charter Provision. The Charter provides that, in addition to any affirmative vote required by applicable law, the affirmative vote of the holders of at least 80% of the outstanding Shares is required to approve certain business combinations (including the Merger) between the Company and an Interested Stockholder, unless prior to such person becoming an Interested Stockholder the Company's Board of Directors shall by resolution have approved a memorandum of understanding or a letter of intent with respect to such business combination. The Supermajority Charter Condition requires that the Purchaser shall be satisfied, in its sole discretion, that the supermajority stockholder vote specified in the Supermajority Charter Provision would not (as a result of action by the Company's Board of Directors or otherwise) be required prior to the consummation of the Merger or that the Purchaser will acquire a sufficient number of Shares to insure a vote in favor of the Merger under such provision. The Purchaser is hereby requesting that the Company's Board of Directors adopt a resolution approving a memorandum of understanding or a letter of intent with respect to the Merger for purposes of the Supermajority Charter Provision. The Purchaser believes that under the circumstances of the Offer and under applicable law, the Board of Directors of the Company is obligated by its fiduciary responsibilities to so approve the Merger in order to permit the Offer and the Merger to be consummated. However, there can be no assurance that the Board will do so. If the Board does not so approve the Merger but upon consummation of the Offer the Purchaser and the Parent together own at least 80% of the outstanding Shares, then the Purchaser and the Parent will own sufficient Shares to enable them to satisfy the Supermajority Charter Provision and effect stockholder approval of the Merger (subject to the requirements of the Delaware Takeover Statute). THE OFFER IS CONDITIONED UPON THE SUPERMAJORITY CHARTER CONDITION BEING SATISFIED. 30 The foregoing description of the Charter and the By-Laws is qualified in its entirety by reference to the text of the Charter and By-Laws, copies of which have been filed by the Company as exhibits to documents filed with the Commission and may be obtained in the manner described in Section 7. The Rights. The following discussion is based on information contained in the September 1990 Form 10-Q. Although the Purchaser and the Parent do not have any knowledge (except as otherwise described herein) that would indicate that any statements contained herein based upon such document are untrue, neither the Purchaser nor the Parent assumes any responsibility for the accuracy or completeness of the information contained in such document, or for any failure by the Company to disclose events that may have occurred and may affect the significance or accuracy of any such information but which are unknown to the Purchaser and the Parent. On March 10, 1987, the Board of Directors of the Company, declared a dividend distribution of one Right for each outstanding Share to the stockholders of record at the close of business on March 20, 1987 (the "Record Date"). Each Right entitles the registered holder to purchase from the Company a unit consisting of one one-hundredth of a share (a "Unit") of Series A Junior Participating Preferred Stock, $1.00 par value (the "Preferred Stock"), at a Purchase Price of $80 per Unit, subject to adjustment. On March 20, 1987, each outstanding Share received one Right. As long as the Rights are attached to the Shares, the Company will issue one Right for each Share issued between the Record Date and the Distribution Date so that all such Shares will have attached Rights. Initially, Rights are attached to all Share Certificates outstanding and no separate Right Certificates are distributed. A "Distribution Date" for the Rights will occur upon the earlier of (i) the fifteenth day after the Stock Acquisition Date or (ii) the tenth business day (or such later date as may be determined by the Board of Directors) after the date of the commencement of a tender offer or exchange offer if upon consummation thereof the person or group proposing such offer would be the beneficial owner of 30% or more of the outstanding Shares. Until the Distribution Date, the Rights will be transferred with and only with Share Certificates and new Share Certificates issued upon transfer or new issuances of Shares after March 20, 1987 until the Distribution Date (or earlier redemption or expiration of the Rights) will contain a notation incorporating the Rights Agreement by reference. Until the Distribution Date (or earlier redemption or expiration of the Rights), the surrender for transfer of any Share Certificate will also constitute the transfer of the Rights associated with the Shares represented by such Share Certificate. The Rights are not exercisable until the Distribution Date (or the expiration of the Company's redemption rights, as described below) and will expire on March 20, 1997, unless earlier redeemed by the Company as described below. As soon as practicable following the Distribution Date, separate Rights Certificates will be mailed to holders of record of the Shares as of the close of business on the Distribution Date. After the Distribution Date, such separate Rights Certificates alone will evidence the Rights. In the event that at any time following the Distribution Date a person (other than the Company, any subsidiary of the Company or any employee benefit plan of the Company or any of its subsidiaries) becomes the beneficial owner of 20% or more of the then outstanding Shares (the "Ownership Flip-In"), each holder of a Right will thereafter have the right to purchase, upon exercise thereof at the Purchase Price, Shares which have a market value of two times the Purchase Price. However, such right will not be triggered if a majority of Independent Directors determine, after receiving advice from one or more investment banking firms, that the acquisition of Shares which would cause an Acquiring Person to become such was pursuant to a tender or exchange offer for all outstanding Shares at a price and on terms which such majority of Independent Directors determines to be fair and otherwise in the best interests of the Company and its stockholders (the "Approved Tender Offer Exception"). 31 In the event that at any time following the Stock Acquisition Date the Company is involved in a merger or other business combination transaction in which it is not the continuing or surviving corporation or in which any or all of the Shares are changed into or exchanged for securities of another party or cash or other property or 50% or more of the Company's assets or earning power is sold (the "Flip-Over"), each holder of a Right will thereafter have the right to purchase, upon the exercise thereof at the Purchase Price, common stock of the acquiring entity or parent thereof which has a value of two times the Purchase Price, subject to the same Approved Tender Offer Exception. Following the occurrence of an Ownership Flip-In or Flip-Over, any Rights beneficially owned by an Acquiring Person or its affiliates or associates will immediately become null and void. The Purchase Price payable and the number of Shares or other securities or property issuable upon exercise of Rights are subject to adjustment from time to time to prevent dilution (i) in the event of a stock dividend on or a subdivision, combination or reclassification of the Preferred Stock or the Shares, (ii) upon the grant to holders of the Preferred Stock of certain rights or warrants to subscribe for Preferred Stock or convertible securities at less than the current market price of the Preferred Stock or (iii) upon the distribution to holders of the Preferred Stock of evidences of indebtedness or assets (excluding dividends payable in Preferred Stock) or cash (excluding regular quarterly cash dividends) or of subscription rights or warrants (other than those referred to above). With certain exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments require an adjustment of at least 1% in the Purchase Price. No fractional Units will be issued and in lieu thereof an adjustment in cash will be made based on the market price of the Preferred Stock on the last trading date prior to the date of issuance of a Right. At any time until the fifteenth day following the Stock Acquisition Date, the Company may redeem the Rights in whole but not in part at a price (the "Redemption Price") of $.05 per Right, subject to adjustment. The concurrence of a majority of the Continuing Directors (as defined below) is required to redeem the Rights if the redemption occurs (i) on or after a time a person becomes an Acquiring Person or (ii) on or after the date of a change (resulting from a proxy or consent solicitation) in a majority of the directors in office at the commencement of such solicitation if any person who is a participant in such solicitation is or might become an Acquiring Person unless, concurrent with such solicitation, such person (or one or more of its affiliates or associates) is making a cash tender offer for all shares of common stock not beneficially owned by such person (or by its affiliates and associates) (the "Cash Tender Offer Exception"). The term "Continuing Director" means any member of the Company's Board of Directors who was a member of the Board prior to the date of the Rights Agreement or has been subsequently elected to the Board if such person was recommended or approved by a majority of the Continuing Directors, but does not include an Acquiring Person or any representative thereof. Because the Purchaser is making a cash tender offer for all outstanding Shares, it believes that the Cash Tender Offer Exception applies and thus the redemption of the Rights following the election of its nominees to the Board of Directors of the Company will not require the concurrence of a majority of the Continuing Directors. Immediately upon the action of the Board of Directors of the Company ordering redemption of the Rights, the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price. Rights will not be exercisable prior to the expiration of the Company's right of redemption described above. Until a Right is exercised, it will not entitle the holder thereof to any rights as a stockholder of the Company, including without limitation the right to vote or to receive dividends. The terms of the Rights other than certain provisions relating to the principal economic terms of the Rights may be amended by the Board of Directors of the Company, but after any person becomes an Acquiring Person in certain circumstances the concurrence of the Continuing Directors will be required to amend the Rights. 32 Under the Rights Agreement, as a result of the commencement of the Offer, the Distribution Date will be as early as April 17, 1995, unless prior to such date the Company's Board of Directors redeems the Rights or takes action to delay the Distribution Date. The Purchaser believes that the consummation of the Offer likely would trigger the Ownership Flip-In and as a result cause significant dilution to the Purchaser's interest in the Company and render the Offer and the Merger economically unattractive for the Purchaser. The Rights Condition requires that the Rights shall have been redeemed by the Company's Board of Directors or that the Purchaser shall be satisfied, in its sole discretion, that the Rights have been invalidated or are otherwise inapplicable to, or the dilutive provisions thereof will not be triggered by, the Offer and the Merger. The Purchaser believes that under the circumstances of the Offer and under applicable law, the Board of Directors of the Company is obligated by its fiduciary responsibilities to redeem the Rights or take such other action to invalidate the Rights or otherwise render the Rights inapplicable to, or prevent the dilutive provisions thereof from being triggered by, the Offer and the Merger, in each case in order to permit the Offer and the Merger to be consummated. In addition, the Purchaser believes that under the circumstances of the Offer and under applicable law, the Independent Directors are obligated by their fiduciary responsibilities to make the determination that the Offer is at a price and on terms fair to and otherwise in the best interests of the Company and its stockholders. However, there can be no assurance that the Board or a majority of the Independent Directors will take any such action. The Purchaser is hereby requesting that the Company's Board of Directors redeem the Rights or take such other action described above and that the Company's Independent Directors make the determination described above. UNLESS THE RIGHTS ARE REDEEMED, HOLDERS OF SHARES WILL ALSO BE REQUIRED TO TENDER ONE RIGHT FOR EACH SHARE TENDERED IN ORDER TO EFFECT A VALID TENDER OF SUCH SHARE. If separate certificates for the Rights are not issued, a tender of Shares will also constitute a tender of associated Rights. THE OFFER IS CONDITIONED UPON THE RIGHTS CONDITION BEING SATISFIED. Delaware Takeover Statute. In general, the Delaware Takeover Statute prohibits any person who is the beneficial owner of 15% or more of the outstanding voting stock of a corporation from engaging in certain business combinations (including the Merger) with such corporation for a period of three years following the date on which such person became a Statutory Interested Stockholder, unless: (i) either the transaction by which such person became a Statutory Interested Stockholder or the business combination is approved by the board of directors of the corporation prior to the date on which such person became a Statutory Interested Stockholder; (ii) upon consummation of the transaction which resulted in the stockholder becoming an Statutory Interested Stockholder, the stockholder owned at least 85% of the voting stock outstanding at the time the transaction commenced, excluding shares owned by (a) persons who are both officers and directors of the corporation and (b) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or (iii) subsequent to the date on which such person became a Statutory Interested Stockholder, the business combination is approved by the board of directors of the corporation and authorized by the affirmative vote, at a meeting called for that purpose, of at least two-thirds of the outstanding voting stock not beneficially owned by the Statutory Interested Stockholder or any of its affiliates or associates or by persons who are either directors or officers and also employees of the Statutory Interested Stockholder. The Delaware Takeover Statute Condition will be satisfied if prior to the acceptance for payment of Shares pursuant to the Offer, the Company's Board of Directors approves the Offer and the Merger with respect to the Company or if the Purchaser acquires 85% of the Eligible Voting Stock of the Company. The Parent hereby requests that the Company's Board of Directors approve the Offer and the Merger for all purposes, including the Delaware Takeover Statute. Under the circumstances of the 33 Offer and under applicable law, the Purchaser believes that the Board of Directors of the Company is obligated by its fiduciary responsibilities to approve, pursuant to the Delaware Takeover Statute, the acquisition of Shares pursuant to the Offer and the Merger. However, there can be no assurance that the Board of Directors will do so. If the Board does not so approve the Offer and the Merger but upon consummation of the Offer the Purchaser and the Parent together own at least 85% of the Eligible Voting Stock of the Company, then the restrictions on business combinations contained in the Delaware Takeover Statute would not be applicable. THE OFFER IS CONDITIONED UPON THE DELAWARE TAKEOVER STATUTE CONDITION BEING SATISFIED. Short Form Merger. Under the DGCL and subject to the Delaware Takeover Statute, a parent corporation owning at least 90% of the outstanding shares of each class of a subsidiary corporation may merge the subsidiary corporation into itself without the approval of the stockholders of the parent corporation or of the board of directors or stockholders of the subsidiary corporation. In the event that the Purchaser owns more than 90% of the Shares following the consummation of the Offer and assuming that the Delaware Takeover Statute Condition and the Rights Condition have been satisfied, the Purchaser may elect to consummate a short form merger in accordance with the DGCL. If the Purchaser does not own 90% or more of the Shares following consummation of the Offer, it may seek to purchase additional Shares in the open market or otherwise in order to reach the 90% threshold for the Shares. Appraisal Rights in Connection with the Offer. Stockholders do not have appraisal rights as a result of the Offer. However, if the Merger is consummated, stockholders of the Company at the time of the Merger who do not vote in favor of the Merger will have the right under the DGCL to dissent and demand appraisal of, and receive payment in cash of the fair value of, their Shares outstanding immediately prior to the effective date of the Merger in accordance with Section 262 of the DGCL. Under the DGCL, dissenting stockholders who comply with the applicable statutory procedures will be entitled to receive a judicial determination of the fair value of their Shares (exclusive of any element of value arising from the accomplishment or expectation of such merger or similar business combination) and to receive payment of such fair value in cash. Any such judicial determination of the fair value of such Shares could be based upon considerations other than or in addition to the price paid in the Offer and the Merger and the market value of the Shares. In Weinberger v. UOP, Inc., the Delaware Supreme Court stated, among other things, that "proof of value by any techniques or methods which are generally considered acceptable in the financial community and otherwise admissible in court" should be considered in an appraisal proceeding. Stockholders should recognize that the value so determined could be higher or lower than the price per Share paid pursuant to the Offer or the consideration per Share to be paid in the Merger or other similar business combination. In addition, several decisions by Delaware courts have held that in certain circumstances a controlling stockholder of a corporation involved in a merger has a fiduciary duty to other stockholders that requires that the merger be fair to other stockholders. In determining whether a merger is fair to minority stockholders, Delaware courts have considered, among other things, the type and amount of the consideration to be received by the stockholders and whether there was fair dealing among the parties. The Delaware Supreme Court stated in Weinberger and Rabkin v. Philip A. Hunt Chemical Corp. that the remedy ordinarily available to minority stockholders in a cash-out merger is the right to appraisal described above. However, a damages remedy or injunctive relief may be available if a merger is found to be the product of procedural unfairness, including fraud, misrepresentation or other misconduct. 34 THE FOREGOING SUMMARY OF THE RIGHTS OF OBJECTING STOCKHOLDERS DOES NOT PURPORT TO BE A COMPLETE STATEMENT OF THE PROCEDURES TO BE FOLLOWED BY STOCKHOLDERS DESIRING TO EXERCISE ANY AVAILABLE APPRAISAL RIGHTS. THE PRESERVATION AND EXERCISE OF APPRAISAL RIGHTS REQUIRE STRICT ADHERENCE TO THE APPLICABLE PROVISIONS OF THE DELAWARE LAW. The foregoing description of the DGCL is not necessarily complete and is qualified in its entirety by reference to the DGCL. Rule 13e-3. The Commission has adopted Rule 13e-3 under the Exchange Act which is applicable to certain "going private" transactions and which may under certain circumstances be applicable to the Merger following the purchase of Shares pursuant to the Offer in which the Purchaser seeks to acquire any remaining Shares. Rule 13e-3 should not be applicable to the Merger if the Merger is consummated within one year after the expiration or termination of the Offer and the price paid in the Merger is not less than the per Share price paid pursuant to the Offer. However, in the event that the Purchaser is deemed to have acquired control of the Company pursuant to the Offer and if the Merger is consummated more than one year after completion of the Offer or an alternative acquisition transaction is effected whereby stockholders of the Company receive consideration less than that paid pursuant to the Offer, in either case at a time when the Shares are still registered under the Exchange Act, the Purchaser may be required to comply with Rule 13e-3 under the Exchange Act. If applicable, Rule 13e-3 would require, among other things, that certain financial information concerning the Company and certain information relating to the fairness of the Merger or such alternative transaction and the consideration offered to minority stockholders in the Merger or such alternative transaction, be filed with the Commission and disclosed to stockholders prior to consummation of the Merger or such alternative transaction. The purchase of a substantial number of Shares pursuant to the Offer may result in the Company being able to terminate its Exchange Act registration. See Section 13. If such registration were terminated, Rule 13e-3 would be inapplicable to any such future Merger or such alternative transaction. Other. The timing and details of the Merger will depend on a variety of factors and legal requirements, the action of the Company's Board of Directors and the number of Shares acquired by the Purchaser pursuant to the Offer and whether the Minimum Condition, the Supermajority Charter Condition, the Rights Condition and the Delaware Takeover Statute Condition are satisfied or waived. Although the Purchaser has proposed the Merger to the Company and seeks to have the Company consummate the Merger as soon as practicable after consummation of the Offer, the Purchaser can give no assurance that the Merger will be consummated or as to the timing of the Merger if it is consummated. Although the Purchaser has proposed the Merger on the terms described above, it is possible that as a result of substantial delays in the Purchaser's ability to effect the Merger, information hereafter obtained by the Purchaser, changes in general economic or market conditions or in the business, operations or financial condition or prospects of the Company, any of the Minimum Condition, the Supermajority Charter Condition, the Rights Condition and/or the Delaware Takeover Statute Condition not being satisfied or any other currently unforeseen factors, the Merger may not be so proposed, may be delayed or abandoned or may be proposed on different terms. Although it has no current intention to do so, the Purchaser expressly reserves the right to propose a Merger on terms other than those described above and the right to withdraw any Merger proposal. The Purchaser reserves the right to purchase, following consummation or termination of the Offer, additional Shares or Rights in the open market, in privately negotiated transactions, in another tender offer or exchange offer or otherwise. In addition, in the event that the Purchaser decides not to propose the Merger, to propose a Merger on terms other than those described above or to withdraw any Merger previously proposed, the Purchaser will evaluate its other alternatives. Such alternatives could include purchasing additional Shares or Rights in the open market, in privately negotiated transactions, in another tender offer or exchange offer or otherwise, or taking no further action to acquire additional Shares or Rights. Any additional purchases of Shares or Rights could be at a price greater or less than the price to be paid for Shares and Rights in the Offer and could be for cash or other consideration. 35 Alternatively, the Purchaser and the Parent may sell or otherwise dispose of any or all Shares or Rights acquired pursuant to the Offer or otherwise. Such transactions may be effected on terms and at prices then determined by the Purchaser and the Parent, which may vary from the price paid for Shares and Rights in the Offer. Plans for the Company. The Parent does not have any current plans to dispose of any businesses or other assets of the Company or to effect any changes in its operations, except that it will consider possible changes in the Company's headquarters operations. If the Parent acquires control of the Company, it intends to conduct a further review of the Company and its subsidiaries and their respective assets, businesses, corporate structure, capitalization, operations, properties, policies, management and personnel. After such review, it is possible that the Parent might modify its current plans not to dispose of any businesses or other assets of the Company and not to effect any changes in the Company's operations other than as described above. Except as described in this Offer to Purchase, none of the Purchaser, the Parent nor, to the best knowledge of the Purchaser and the Parent, any of the persons listed on Schedule I have any present plans or proposals that would relate to or result in an extraordinary corporate transaction such as a merger, reorganization or liquidation involving the Company or any of its subsidiaries or a sale or other transfer of a material amount of assets of the Company or any of its subsidiaries, any material change in the capitalization or dividend policy of the Company or any other material change in the Company's corporate structure or business or the composition of its Board of Directors or management. 12. DIVIDENDS AND DISTRIBUTIONS. If the Company should, during the pendency of the Offer, split, combine or otherwise change the Shares or its capitalization, or disclose that it has taken any such action, then without prejudice to the Purchaser's rights under Section 14, the Purchaser may make such adjustments to the purchase price and other terms of the Offer as it deems appropriate to reflect such split, combination or other change. If on or after March 15, 1995 (except to the extent publicly disclosed by the Company with specificity in documents filed with the Commission prior to March 31, 1995), the Company should declare or pay any cash or stock dividend or other distribution on, or issue any rights with respect to, the Shares that is payable or distributable to stockholders of record on a date prior to the transfer to the name of the Purchaser or the nominee or transferee of the Purchaser on the Company's stock transfer records of such Shares that are purchased pursuant to the Offer (except that if the Rights are redeemed by the Board of Directors in accordance with the terms of the Rights Agreement, tendering stockholders who are holders of record as of the applicable record date will be entitled to receive and retain the redemption price of $.05 per Right in accordance with the Rights Agreement), then without prejudice to the Purchaser's rights under Section 14, (i) the purchase price payable per Share by the Purchaser pursuant to the Offer will be reduced to the extent any such dividend or distribution is payable in cash and (ii) any non-cash dividend, distribution (including additional Shares) or right received and held by a tendering stockholder shall be required to be promptly remitted and transferred by the tendering stockholder to the Depositary for the account of the Purchaser, accompanied by appropriate documentation of transfer. Pending such remittance or appropriate assurance thereof, the Purchaser will, subject to applicable law, be entitled to all rights and privileges as owner of any such non-cash dividend, distribution or right and may withhold the entire purchase price or deduct from the purchase price the amount or value thereof, as determined by the Purchaser in its sole discretion. 13. EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES, STOCK EXCHANGE LISTING AND EXCHANGE ACT REGISTRATION. The purchase of Shares pursuant to the Offer will reduce the number of Shares that might otherwise trade publicly and will reduce the number of holders of Shares. This could adversely affect the liquidity and market value of the remaining Shares held by the public. 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 and may therefore be delisted from the NYSE. According to the NYSE's published guidelines, the NYSE would consider delisting the Shares if, among other things: (i) the 36 number of record holders of 100 or more Shares should fall below 1,200; (ii) the number of publicly held Shares (exclusive of holdings of the Parent and the Purchaser and any other subsidiaries or affiliates of the Parent and of officers or directors of the Company or their immediate families or other concentrated holdings of 10% or more ("Excluded Holdings")) should fall below 600,000; or (iii) the aggregate market value of such publicly held Shares (exclusive of Excluded Holdings) should fall below $5,000,000. According to the 1994 Annual Report, as of December 31, 1994 there were 2,076 holders of record of Shares. 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 and prices for such Shares could be adversely affected. If the NYSE were to delist the Shares, it is possible that such Shares would continue to trade on other securities exchanges or in the over-the-counter market and that price quotations would be reported by such exchanges or through the National Association of Securities Dealers Automated Quotation System ("NASDAQ") or other sources. However, the extent of the public market for the Shares and the availability of such quotations would depend upon such factors as the number of stockholders and/or the aggregate market value of the Shares remaining at such time, the interest in maintaining a market in the Shares on the part of securities firms, the possible termination of registration under the Exchange Act as described below and other factors. The Purchaser cannot predict whether the reduction in the number of Shares that might otherwise trade publicly would have an adverse or beneficial effect on the market price for or marketability of the Shares. The Shares are currently "margin securities" under the rules 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 for the purpose of buying, carrying, or trading in securities ("purpose loans"). Depending upon factors similar to those described above with respect to stock exchange listing and market quotations, 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 purpose loans made by brokers. The Shares, along with certain of the Company's other securities, are currently registered under the Exchange Act. The purchase of Shares pursuant to the Offer may result in the Shares becoming eligible for deregistration under the Exchange Act. Registration of the Shares may be terminated upon application of the Company to the Commission if the Shares are not listed on a national securities exchange and there are fewer than 300 record holders. The termination of the registration of the Shares under the Exchange Act would substantially reduce the information required to be furnished by the Company to holders of the Shares and would make certain provisions of the Exchange Act, such as the short-swing profit recovery provisions of Section 16(b), the requirement of furnishing a proxy statement in connection with stockholders' meetings and the requirements of Rule 13e-3 under the Exchange Act with respect to "going private" transactions, no longer applicable to the Shares. Furthermore, "affiliates" of the Company and persons holding "restricted securities" of the Company may be deprived of the ability to dispose of the securities pursuant to Rule 144 under the Securities Act of 1933. If registration of the Shares under the Exchange Act were terminated, the Shares would no longer be "margin securities" or eligible for NASDAQ reporting. The Purchaser intends to seek to cause the Company to terminate the registration of the Shares as soon after the consummation of the Offer or Merger as the requirements for termination of registration are met. 14. CERTAIN CONDITIONS OF THE OFFER. Notwithstanding any other provision of the Offer, the Purchaser shall not be required to accept for payment or, subject to any applicable rules and regulations of the Commission, including Rule 14e-l(c) under the Exchange Act (relating to the Purchaser's obligation to pay for or return tendered Shares promptly after termination or withdrawal of the Offer), pay for any Shares or Rights tendered pursuant to the Offer, and may postpone the acceptance for payment or, subject to the restriction referred to above, payment for any Shares or Rights tendered 37 pursuant to the Offer, and may amend or terminate the Offer (whether or not any Shares have theretofore been purchased or paid for) if, in the sole judgment of the Purchaser, the Minimum Condition, the Supermajority Charter Condition, the Rights Condition or the Delaware Takeover Statute Condition shall not have been satisfied or if, at any time on or after March 15, 1995 and prior to the acceptance for payment of or payment for Shares, any one or more of the events listed below shall have occurred or shall be determined by the Parent or the Purchaser to have occurred (except for any such events occurring between March 15, 1995 and March 31, 1995 which shall have been publicly disclosed prior to March 31, 1995): (a) there shall have been threatened, instituted or pending any action, proceeding, claim or application by any government or governmental regulatory or administrative authority or agency, domestic, foreign or supranational, or by any other person, domestic or foreign, before any court or governmental, regulatory or administrative agency, authority or tribunal, domestic, foreign or supranational, that (i) challenges or seeks to make illegal, to delay or otherwise directly or indirectly to restrain or prohibit, or which is likely to impose, in the sole judgment of the Purchaser, voting, procedural, price or other requirements in addition to those required by the provisions of the DGCL described in Section 11 and federal securities law in connection with the acquisition of Shares by the Purchaser or any of its affiliates, the making of the Offer, the acceptance for payment of or payment for Shares by the Purchaser or any of its affiliates or the consummation of the Merger or any other business combination involving the Company or the performance of any of the contracts or other arrangements entered into by the Purchaser or any of its affiliates in connection with the acquisition of the Company, seeking to obtain any material damages as a result thereof or otherwise directly or indirectly relating to the Offer or the Merger or such other business combination, (ii) seeks to restrain, prohibit or limit the exercise of full rights of ownership or operation by the Purchaser or any of its affiliates of all or any portion of the business or assets of the Company or any of its subsidiaries or the Purchaser or any of its affiliates or to compel the Purchaser or any of its affiliates to dispose of or to hold separately all or any portion of the business or assets of the Company or any of its subsidiaries or the Purchaser or any of its affiliates, (iii) seeks to impose or confirm limitations on the ability of the Purchaser or any of its affiliates effectively to acquire or hold or to exercise full rights of ownership of Shares, including without limitation the right to vote the Shares acquired or owned by the Parent or the Purchaser or any of its affiliates on all matters properly presented to the stockholders of the Company, or the right to vote any shares of capital stock of any subsidiary directly or indirectly owned by the Company, (iv) seeks to require divestiture by the Parent or the Purchaser or any of its affiliates of any Shares, (v) might result, in the sole judgment of the Purchaser, in a diminution of the benefits expected to be derived by the Purchaser or any of its affiliates as a result of the Offer or the Merger or any other business combination involving the Company, or in a diminution of the value of the Shares or the Company or any of its subsidiaries to the Purchaser or any of its affiliates or (vi) challenges or adversely affects the financing of the Offer or the Merger or any other business combination involving the Company; or (b) other than the application of the waiting periods under the HSR Act and the necessity for the approvals and other actions by any domestic (federal and state) or foreign or supranational governmental, administrative or regulatory agency described in Section 15, there shall have been proposed, sought, promulgated, enacted, entered, enforced or deemed applicable to the Offer, the Merger or any other business combination involving the Company, by any government or governmental, regulatory or administrative agency or authority or by any court or tribunal, in each case whether domestic, foreign or supranational, any statute, rule, regulation, judgment, decree, decision, order or injunction that, in the sole judgment of the Purchaser, might, directly or indirectly, result in any of the consequences referred to in clauses (i) through (vi) of paragraph (a) above; or 38 (c) any change (or any condition, event or development involving a prospective change) shall have occurred or been threatened in the business, properties, assets, liabilities, stockholders' equity, financial condition, capitalization, licenses, franchises, permits, operations, results of operations or prospects of the Company or any of its subsidiaries or affiliates (or the Purchaser shall have become aware thereof) or in general economic or financial market conditions in the United States or abroad that, in the sole judgment of the Purchaser, is or may be materially adverse to the Company or any of its subsidiaries or affiliates, or the Purchaser shall have become aware of any facts that, in the sole judgment of the Purchaser, have or may have material adverse significance with respect to either the value of the Company or any of its subsidiaries or affiliates or the value of the Shares to the Parent or the Purchaser or any of its affiliates; or (d) there shall have occurred (i) any general suspension of trading in, or limitation on prices for, securities on any national securities exchange or in the United States over-the-counter market, (ii) the declaration of a banking moratorium or any suspension of payments in respect of banks in the United States, (iii) any material adverse change (or any existing or threatened condition, event or development involving a prospective material adverse change) in United States or any other currency exchange rates or a suspension of, or a limitation on, the markets therefor, (iv) any other material adverse change in the market price of the Shares or in the United States securities or financial markets generally, including without limitation a decline of at least 15% in either the Dow Jones Average of Industrial Stocks or the Standard & Poor's 500 index from April 3, 1995 through the date of termination or expiration of the Offer, (v) the commencement of a war, armed hostilities or other international or national calamity directly or indirectly involving the United States, (vi) any limitation (whether or not mandatory) by any governmental authority or any other event that, in the sole judgment of the Purchaser, may have material adverse significance with respect to the extension of credit by banks or other lending institutions or the financing of the Offer or the Merger or any other business combination involving the Company or (vii) in the case of any of the situations described in clauses (i) through (vi) above existing at the time of the commencement of the Offer, a material acceleration or worsening thereof; or (e) a tender or exchange offer for some or all of the Shares shall have been publicly proposed to be made or shall have been made by another person (including the Company or any of its subsidiaries or affiliates), or it shall have been publicly disclosed or the Purchaser shall have otherwise deemed that (i) any person, entity (including the Company or any of its subsidiaries or affiliates) or "group" (within the meaning of Section 13(d)(3) of the Exchange Act) shall have acquired or proposed to acquire beneficial ownership of more than 10% of any class or series of capital stock of the Company (including the Shares) through the acquisition of stock, the formation of a group or otherwise, or shall have been granted any option, right or warrant, conditional or otherwise, to acquire beneficial ownership of more than 10% of any class or series of capital stock of the Company (including the Shares) other than acquisitions for bona fide arbitrage purposes only and other than as disclosed in a Schedule 13D or 13G on file with the Commission prior to March 31, 1995, (ii) any such person, entity or group which, prior to such date, had filed such a Schedule with the Commission, shall have acquired or proposed to acquire, through the acquisition of stock, the formation of a group or otherwise, beneficial ownership of additional shares of any class or series of capital stock of the Company (including the Shares) constituting 2% or more of any such class or series, or shall have been granted any option, right or warrant, conditional or otherwise, to acquire beneficial ownership of shares of any class or series of capital stock of the Company (including the Shares) constituting 2% or more of any such class or series, (iii) any person, entity or group shall have entered into a definitive agreement or an agreement in principle or made a proposal with respect to a tender or exchange offer for some or all the Shares or a merger, consolidation or other business combination with or involving the Company or any of its subsidiaries or affiliates or (iv) any person, entity or group shall have filed a Notification and Report Form under the HSR Act or made a public announcement reflecting an intent to acquire 39 the Company or any of its subsidiaries or any assets or securities of the Company or any of its subsidiaries; or (f) the Company or any of its subsidiaries shall have, directly or indirectly, (i) split, combined or otherwise changed, or authorized or proposed the split, combination or other change of, the Shares or its capitalization, (ii) acquired or otherwise caused a reduction in the number of, or authorized or proposed the acquisition or other reduction in the number of, any outstanding Shares (other than as part of the repurchase of up to 3,000,000 Shares under the Company Repurchase Plan announced by the Company on February 3, 1995 (but only if each such repurchase is made at a price per Share less than or equal to the purchase price per Share offered hereby) and other than a redemption of the Rights in accordance with the terms of the Rights Agreement as publicly disclosed to be in effect on March 15, 1995) or other securities of the Company or any subsidiary thereof, (iii) issued, distributed or sold, or authorized, proposed or announced the issuance, distribution or sale of, (A) any additional Shares, shares of any other class or series of capital stock, other voting securities, or any securities convertible into or exchangeable or exercisable for any of the foregoing, or options, rights or warrants, conditional or otherwise, to acquire any of the foregoing, except for the issuance of up to 7,738 Shares assumed to be reserved for issuance prior to December 31, 1994 pursuant to the exercise of then outstanding employee stock options, in accordance with their terms or (B) any other securities or rights in respect of, in lieu of or in substitution or exchange for any shares of its capital stock, (iv) permitted the issuance or sale of any shares of any class of capital stock or other debt or equity securities of any subsidiary of the Company or any securities convertible into or exchangeable or exercisable for any of the foregoing, (v) declared, paid or proposed to declare or pay any dividend or other distribution, whether payable in cash, securities or other property, on, or in respect of, any Shares (other than a distribution of the Rights Certificates or a redemption of the Rights in accordance with the Rights Agreement as publicly disclosed to be in effect on March 15, 1995), (vi) altered or proposed to alter any material term of any outstanding security of the Company or any of its subsidiaries (including the Rights), (vii) issued, distributed or sold, or authorized or proposed the issuance, distribution or sale of, any debt securities or securities convertible into or exchangeable or exercisable for debt securities or any rights, warrants or options entitling the holder thereof to purchase or otherwise acquire any debt securities, or otherwise incurred, authorized or proposed the incurrence of, any debt other than in the ordinary course of business and consistent with past practice or any debt containing burdensome covenants, (viii) authorized, recommended, proposed, effected or announced its intention to engage in any merger (other than the Merger), consolidation, liquidation, dissolution, business combination, acquisition (including by way of exchange) of assets or securities, disposition (including by way of exchange) of assets or securities, joint venture, any release or relinquishment of any material contract or other rights of the Company or any of its affiliates or any comparable event not in the ordinary course of business, (ix) authorized, recommended, proposed or announced its intent to enter into, or entered into any agreement or arrangement with any person, entity or group that in the sole judgment of the Purchaser, has or may have material adverse significance with respect to the value of the Company or any of its affiliates, or the value of the Shares to the Purchaser or any of its affiliates, (x) amended or proposed, adopted or authorized any amendment (other than any amendment which provides that the Rights are inapplicable to the Offer and the Merger) to the Charter or the By-Laws or similar organizational documents of the Company or any of its subsidiaries or the Rights Agreement or the Purchaser shall have learned that the Company or any of its subsidiaries shall have proposed or adopted any such amendment which shall not have been previously disclosed, (xi) entered into or amended any employment, severance or similar agreement, arrangement or plan with or for the benefit of any employee of the Company or any of its subsidiaries (other than in the ordinary course of business) or so as to provide for increased or accelerated benefits to employees as a result of or in connection with the making of the Offer, the acceptance for payment of or payment for Shares by the Purchaser or the consummation by the Purchaser or any of its affiliates of the Merger or any other business combination involving 40 the Company, (xii) except as may be required by law, taken any action to terminate or amend any employee benefit plan (as defined in Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended) of the Company or any of its affiliates, or the Purchaser shall have become aware of any such action which shall not have been previously disclosed, or (xiii) agreed in writing or otherwise to take any of the foregoing actions; or (g) the Purchaser shall become aware (i) that any material contractual right of the Company or any of its subsidiaries shall be impaired or otherwise adversely affected or that any material amount of indebtedness of the Company or any of its subsidiaries shall become accelerated or otherwise become due or become subject to acceleration prior to its stated due date, in each case with or without notice or the lapse of time or both, as a result of or in connection with the Offer or the consummation by the Purchaser or any of its affiliates of the Merger or any other business combination involving the Company, (ii) of any covenant, term or condition in any of the instruments or agreements of the Company or any of its subsidiaries that, in the sole judgment of the Purchaser, is or may be (whether considered alone or in the aggregate with other such covenants, terms or conditions) materially adverse to either the value of the Company or any of its subsidiaries (including without limitation any event of default that may occur as a result of or in connection with the Offer, the consummation by the Purchaser or any of its affiliates of the Merger or any other business combination involving the Company) or the value of the Shares to the Purchaser or any of its affiliates or the consummation by the Purchaser or any of its affiliates of the Merger or any other business combination involving the Company, or (iii) that any report, document, instrument, financial statement or schedule of the Company filed with the Commission contained, when filed, an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading; or (h) any waiting periods under the HSR Act applicable to the purchase of Shares pursuant to the Offer shall not have expired or been terminated, or any approval, permit, authorization or consent of any domestic or foreign or supranational governmental, administrative or regulatory agency (federal, state, local, provincial or otherwise) (including those described or referred to in Section 15) which is required or believed to be appropriate shall not have been obtained on terms satisfactory to the Parent in its sole discretion; or (i) (i) the Purchaser or any of its affiliates shall have entered into a definitive agreement or announced an agreement in principle with respect to the Merger or any other business combination with the Company or any of its affiliates or the purchase of any material portion of the securities or assets of the Company or any of its subsidiaries or (ii) the Purchaser or any of its affiliates and the Company shall have agreed that the Purchaser shall amend or terminate the Offer or postpone the payment for the Shares pursuant thereto; or (j) (i) the Company shall not have consummated the sale of its 50% interest in VME for cash proceeds of not less than $573 million and (ii) the definitive agreement to sell such interest to Volvo described in the Company's Current Report on Form 8-K filed with the Commission on March 6, 1995 shall have been cancelled or terminated, or shall have been amended in a manner that, or shall have been the subject of any other action that, in the sole judgment of the Purchaser, is or may be adverse to the Company, or shall otherwise no longer remain in full force and effect; which, in the sole judgment of the Purchaser with respect to each and every matter referred to above and regardless of the circumstances (including any action or inaction by the Purchaser or any of its affiliates) giving rise to any such condition, makes it inadvisable to proceed with the Offer or with such acceptance for payment of or payment for Shares. The foregoing conditions are for the sole benefit of the Purchaser and may be waived by the Purchaser in whole or in part at any time and from time to time in its sole discretion. Any determination by the Purchaser concerning the events described above shall be final and binding upon all parties 41 including tendering stockholders. The failure by the Purchaser at any time to exercise any of the foregoing rights shall not be deemed a waiver of any such right and each such right shall be deemed an ongoing right which may be asserted at any time and from time to time. A public announcement will be made of a material change in, or waiver of, such conditions, to the extent required by Rules 14d-4(c) and 14d-6(d) under the Exchange Act, and the Offer will be extended in connection with any such change or waiver to the extent required by such rules. 15. CERTAIN LEGAL MATTERS AND REGULATORY APPROVALS. General. Except as set forth below, based upon its examination of publicly available filings by the Company with the Commission and other publicly available information concerning the Company, neither the Purchaser nor the Parent is aware of any licenses or other regulatory permits that appear to be material to the business of the Company and its subsidiaries, taken as a whole, that might be adversely affected by the Purchaser's acquisition of Shares (and the indirect acquisition of the stock of the Company's subsidiaries) as contemplated herein, or of any filings, approvals or other actions by or with any domestic (federal or state), foreign or supranational governmental authority or administrative or regulatory agency that would be required prior to the acquisition of Shares (or the indirect acquisition of the stock of the Company's subsidiaries) by the Purchaser pursuant to the Offer as contemplated herein. Should any such approval or other action be required, it is the Purchaser's present intention to seek such approval or action. However, the Purchaser does not presently intend to delay the purchase of Shares tendered pursuant to the Offer pending the receipt of any such approval or the taking of any such action (subject to the Purchaser's right to delay or decline to purchase Shares if any of the conditions in Section 14 shall have occurred). There can be no assurance that any such approval or other action, if needed, would be obtained without substantial conditions or that adverse consequences might not result to the business of the Company, the Parent or the Purchaser or that certain parts of the businesses of the Company, the Parent or the Purchaser might not have to be disposed of or held separate or other substantial conditions complied with in order to obtain such approval or other action or in the event that such approval was not obtained or such other action was not taken, any of which could cause the Purchaser to elect to terminate the Offer without the purchase of the Shares thereunder. The Purchaser's obligation under the Offer to accept for payment and pay for Shares is subject to certain conditions, including conditions relating to the legal matters discussed in this Section 15. See Section 14. State Takeover Laws. A number of states have adopted takeover laws and regulations which purport to varying degrees to be applicable to attempts to acquire securities of corporations which are incorporated in such states or which have or whose business operations have substantial economic effects in such states, or which have substantial assets, security holders, principal executive offices or principal places of business therein. To the extent that certain provisions of certain of these state takeover statutes purport to apply to the Offer, the Purchaser believes that such laws conflict with federal law and constitute an unconstitutional burden on interstate commerce. In 1982, the Supreme Court of the United States, in Edgar v. Mite Corp., invalidated on constitutional grounds the Illinois Business Takeovers Act, which as a matter of state securities law made takeovers of corporations meeting certain requirements more difficult, and the reasoning in such decision is likely to apply to certain other state takeover statutes. However, in 1987, in CTS Corp. v. Dynamics Corp. of America, the Supreme Court of the United States held that the State of Indiana could, as a matter of corporate law and in particular those aspects of corporate law concerning corporate governance, constitutionally disqualify a potential acquiror from voting on the affairs of a target corporation without the prior approval of the remaining stockholders, provided that such laws were applicable only under certain conditions. Subsequently, in TLX Acquisition Corp. v. Telex Corp., a federal district court in Oklahoma ruled that the Oklahoma statutes were unconstitutional insofar as they applied to corporations incorporated outside Oklahoma in that they would subject such corporations to inconsistent regulations. Similarly, in Tyson Foods, Inc. v. McReynolds, a federal district court in Tennessee ruled that four Tennessee takeover statutes were unconstitutional as applied to corporations incorporated outside Tennessee. This decision was affirmed by the United States Court of Appeals for the Sixth Circuit. In December 1988, a federal district court in Florida held in Grand Metropolitan PLC v. Butterworth that the provisions of the Florida Affiliated Transactions Act and the Florida Control Share Acquisition Act were unconstitutional as applied to corporations incorporated outside of Florida. 42 Except as described herein, the Purchaser has not attempted to comply with any state takeover statutes in connection with the Offer. The Purchaser reserves the right to challenge the validity or applicability of any state law allegedly applicable to the Offer and nothing in this Offer to Purchase nor any action taken in connection herewith is intended as a waiver of that right. In the event that any state takeover statute is found applicable to the Offer, the Purchaser might be unable to accept for payment or purchase Shares tendered pursuant to the Offer or be delayed in continuing or consummating the Offer. In such case, the Purchaser may not be obligated to accept for purchase, or pay for, any Shares tendered. See Section 14. Antitrust. Under the HSR Act and the rules that have been promulgated thereunder by the FTC, certain acquisition transactions may not be consummated unless certain information has been furnished to the Antitrust Division and the FTC and certain waiting period requirements have been satisfied. The acquisition of Shares pursuant to the Offer is subject to such requirements. See Section 2. The Parent intends to file on the date hereof with the FTC and the Antitrust Division a Premerger Notification and Report Form in connection with the purchase of Shares pursuant to the Offer. Under the provisions of the HSR Act applicable to the Offer, the purchase of Shares pursuant to the Offer may not be consummated until the expiration of a 15-calendar day waiting period following the filing by the Parent. Accordingly, the waiting period under the HSR Act applicable to such purchases of Shares pursuant to the Offer will expire at 11:59 p.m., New York City time, on Tuesday, April 18, 1995, unless such waiting period is extended by a request from the FTC or the Antitrust Division for additional information or documentary material prior to the expiration of the waiting period. If either the FTC or the Antitrust Division were to request additional information or documentary material from the Parent, the waiting period would expire at 11:59 p.m., New York City time, on the tenth calendar day after the date of substantial compliance by the Parent with such request. Thereafter, the waiting period could be extended only by court order. If the acquisition of Shares is delayed pursuant to a request by the FTC or the Antitrust Division for additional information or documentary material pursuant to the HSR Act, the Offer may, but need not, be extended and in any event the purchase of and payment for Shares will be deferred until ten days after the request is substantially complied with, unless the waiting period is sooner terminated by the FTC and the Antitrust Division. See Section 2. Only one extension of such waiting period pursuant to a request for additional information is authorized by the HSR Act and the rules promulgated thereunder, except by court order. Any such extension of the waiting period will not give rise to any withdrawal rights not otherwise provided for by applicable law. See Section 4. Although the Company is required to file certain information and documentary material with the Antitrust Division and the FTC in connection with the Offer, neither the Company's failure to make such filings nor a request from the Antitrust Division or the FTC for additional information or documentary material made to the Company will extend the waiting period. The FTC and the Antitrust Division frequently scrutinize the legality under the antitrust laws of transactions such as the proposed acquisition of Shares by the Purchaser pursuant to the Offer. At any time before or after the purchase by the Purchaser of Shares pursuant to the Offer, either of the FTC and the Antitrust Division could take such action under the antitrust laws as it deems necessary or desirable in the public interest, including seeking to enjoin the purchase of Shares pursuant to the Offer or seeking the divestiture of Shares purchased by the Purchaser or the divestiture of substantial assets of the Parent, its subsidiaries or the Company. Private parties and state attorneys general may also bring legal action under federal or state antitrust laws under certain circumstances. Based upon an examination of publicly available information relating to the businesses in which the Company and its subsidiaries are engaged, the Purchaser has determined that the Company and the Parent both produce and distribute similar product lines in certain geographic areas. In particular, both the Company and the Parent manufacture and distribute asphalt pavers. Although the Purchaser believes that the acquisition of Shares pursuant to the Offer would not violate the antitrust laws, there can be no assurance that a challenge to the Offer on antitrust grounds will not be made or, if such 43 challenge is made, what the outcome will be. Should the FTC or the Antitrust Division raise antitrust concerns, the Purchaser would be prepared, in order to expedite the Offer or the Merger, to consider the divestiture of certain assets to deal with those concerns. There is no guarantee that the Purchaser and the FTC or the Antitrust Division would reach an agreement with respect to such divestiture. See Section 14 for certain conditions to the Offer, including conditions with respect to litigation and certain government actions. On March 29, 1995, the Company initiated litigation (the "Antitrust Litigation") against the Parent in the United States District Court for the Southern District of New York. The Antitrust Litigation claims that the Parent's acquisition of the Company would be in violation of the federal antitrust laws and asks the court to enter preliminary and permanent injunctions barring the Parent from proceeding with the transaction. In addition, the Antitrust Litigation seeks a judgment declaring that the proposed acquisition violates the federal antitrust laws. The Antitrust Litigation alleges that the proposed acquisition will substantially lessen competition in the market for asphalt pavers, which are manufactured and distributed by both the Company and the Parent. The Parent believes the Antitrust Litigation is without merit since any antitrust issues which may arise from the paver overlap can readily be resolved. The Parent's 1994 domestic revenues from the relevant product line were below $10 million out of total 1994 revenues of $4.5 billion. EEA Merger Regulation. According to publicly available information, the Purchaser conducts substantial operations within the EEA and certain of the individual member states of the EEA. Regulation (EEC) No. 4064/89 (the "Merger Regulation") and Article 57 of the EEA Agreement require that notices of concentrations with a "Community dimension" be provided to the European Commission for review and approval for compatibility with the common market prior to being put into effect. The Offer would be deemed to have a "Community dimension" if the combined aggregate worldwide consolidated annual revenues of both the Parent and the Company exceed ECU 5 billion, if the Community-wide annual revenues of each of the Parent and the Company exceed ECU 250 million, and if both the Parent and the Company do not receive more than two-thirds of their respective Community-wide revenues from one and the same member state. Based upon publicly available information, the Purchaser believes that the Offer may be considered to have a "Community dimension." If the Offer falls within the Merger Regulation, the European Commission, as opposed to individual member states, has exclusive jurisdiction to review it, subject to certain exceptions. Under the Merger Regulation, a concentration that meets the foregoing criteria requires the filing of a notification in a prescribed form with the European Commission. This filing must normally be made within seven days of the earlier of the announcement of a public bid, the conclusion of the relevant agreement or acquisition of a controlling interest. Transactions subject to the filing requirements of the Merger Regulation are normally suspended automatically until three weeks after receipt of the notification. The European Commission may extend the suspension period for such period as it finds necessary to make a final decision. However, in the case of a public bid the bidder may acquire shares of the target company during the suspension period (provided that the transaction has been duly notified to the European Commission), but may not vote such shares until after the end of the suspension period unless the European Commission grants permission to do so in order to maintain the full value of the bidder's investment. The European Commission must decide whether to initiate proceedings within one month after the receipt of the notification, subject to certain extensions for holidays or if an individual member state has requested a referral of the transaction (or part of it) to itself. If proceedings are initiated, the European Commission must reach a decision in the proceedings within four months of the commencement of the proceedings. If the European Commission fails to reach a decision within either of these time periods the transaction will be deemed to be compatible with the common market. 44 If the European Commission declares the Offer to be incompatible with the common market, it may prevent the consummation of the transaction, order a divestiture if the transaction has already been consummated or impose conditions or other obligations. Based upon an examination of publicly available information relating to the businesses in which the Company and its subsidiaries are engaged, the Purchaser does not believe that the acquisition of the Company pursuant to the Offer would be found to be incompatible with the common market. In the event that the transaction is found not to be subject to the Merger Regulation, various national merger control regimes of the member states of the EEA may apply, resulting in the possibility that it may be necessary or desirable to obtain approvals from the various national authorities. Based upon an examination of publicly available information relating to the businesses in which the Company and its subsidiaries are engaged, the Purchaser believes that if any approval from any such national authority should be required, it would not preclude the consummation of the Offer or the Merger. There can be no assurance that a challenge to the Offer will not be made pursuant to the Merger Regulation or alternatively, if applicable, pursuant to the merger regulations of one or more of the various member states or, if such a challenge is made, what the outcome will be. See Section 14. Other Foreign Approvals. Based on publicly available information, it appears that the Company also owns property or conducts business in other foreign countries and jurisdictions outside the EEA. In connection with the acquisition of the Shares pursuant to the Offer, the laws of certain of those foreign countries and jurisdictions may require the filing of information with, or the obtaining of the approval of, governmental authorities in such countries and jurisdictions. The governments in such countries and jurisdictions might attempt to impose additional conditions on the Company's operations conducted in such countries and jurisdictions as a result of the acquisition of the Shares pursuant to the Offer. There can be no assurance that the Purchaser will be able to cause the Company or its subsidiaries to satisfy or comply with such laws or that compliance or non-compliance will not have adverse consequences for the Company or any subsidiary after purchase of the Shares pursuant to the Offer. Margin Credit Regulations. Federal Reserve Board Regulations G, T, U and X (the "Margin Credit Regulations") restrict the extension or maintenance of credit for the purpose of buying or carrying margin stock, including the Shares, if the credit is secured directly or indirectly thereby. Such secured credit may not be extended or maintained in an amount that exceeds the maximum loan value of the margin stock. Under the Margin Credit Regulations, the Shares are presently margin stock and the maximum loan value thereof is generally 50% of their current market value. The definition of "indirectly secured" contained in the Margin Credit Regulations provides that the term does not include an arrangement with a customer if the lender in good faith has not relied upon margin stock as collateral in extending or maintaining the particular credit. 16. FEES AND EXPENSES. Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill Lynch") is acting as Dealer Manager in connection with the Offer and serving as financial advisor to the Parent and the Purchaser in connection with the proposed acquisition of the Company. The Parent has paid to Merrill Lynch fees of $950,000 and has agreed to pay to Merrill Lynch an additional fee of $4,450,000 upon the consummation of the Offer or a merger or other business combination with, or acquisition of 50% or more of the Shares or of all or substantially all of the assets of, the Company. The Parent and the Purchaser will also reimburse Merrill Lynch for reasonable out-of-pocket expenses, including reasonable attorneys' fees, and have also agreed to indemnify Merrill Lynch against certain liabilities and expenses in connection with the Offer, including certain liabilities under the federal securities laws. The Purchaser has retained Georgeson & Company Inc. to act as the Information Agent and The Bank of New York to act as the Depositary in connection with the Offer. The Information Agent may contact holders of Shares by mail, telephone, telex, telegraph and personal interview and may request brokers, dealers and other nominee stockholders to forward the Offer materials to beneficial owners. The Information Agent and the Depositary will receive reasonable and customary compensation for 45 services relating to the Offer and will be reimbursed for certain out-of-pocket expenses. The Purchaser and the Parent have also agreed to indemnify the Information Agent and the Depositary against certain liabilities and expenses in connection with the Offer, including certain liabilities under the federal securities laws. The Purchaser will not pay any fees or commissions to any broker or dealer or any other person for soliciting tenders of Shares pursuant to the Offer (other than to the Dealer Manager, the Information Agent and the Depositary). Brokers, dealers, commercial banks and trust companies will, upon request, be reimbursed by the Purchaser for customary mailing and handling expenses incurred by them in forwarding offering materials to their customers. 17. MISCELLANEOUS. The Offer is being made solely by this Offer to Purchase and the related Letter of Transmittal and is being made to all holders of Shares. The Purchaser is not aware of any state where the making of the Offer is prohibited by administrative or judicial action pursuant to any valid state statute. If the Purchaser becomes aware of any valid state statute prohibiting the making of the Offer or the acceptance of Shares pursuant thereto, the Purchaser will make a good faith effort to comply with any such state statute. If after such good faith effort, the Purchaser cannot comply with such state statute, the Offer will not be made to nor will tenders be accepted from or on behalf of the holders of Shares in such state. In any jurisdiction where the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer shall be deemed to be made on behalf of the Purchaser by the Dealer Manager or one or more registered brokers or dealers that are licensed under the laws of such jurisdiction. The Purchaser and the Parent have filed with the Commission a Schedule 14D-1 (including exhibits) pursuant to Rule 14d-3 under the Exchange Act, furnishing certain additional information with respect to the Offer. Such statement and any amendments thereto, including exhibits, may be inspected and copies may be obtained from the offices of the Commission (except that they will not be available at the regional offices of the Commission) in the manner set forth in Section 7 of this Offer to Purchase. NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION ON BEHALF OF THE PURCHASER OR THE PARENT NOT CONTAINED HEREIN OR IN THE LETTER OF TRANSMITTAL AND IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. CEC Acquisition Corp. April 3, 1995 46 SCHEDULE I DIRECTORS AND EXECUTIVE OFFICERS OF THE PURCHASER AND THE PARENT 1. Directors and Executive Officers of the Purchaser. The name and position with the Purchaser of each director and executive officer of the Purchaser are set forth below. The other required information with respect to each such person is set forth under "Directors and Executive Officers of the Parent" below. All directors and executive officers listed below are citizens of the United States. NAME POSITION - ----------------------------------------------- --------------------------- Thomas F. McBride.............................. Director and President William G. Mulligan............................ Director Patricia Nachtigal............................. Director, Vice President and Assistant Secretary William J. Armstrong........................... Treasurer Ronald G. Heller............................... Secretary 2. Directors and Executive Officers of the Parent. The name, business address, present principal occupation or employment and material occupations, positions, offices or employments during the last five years of each director and executive officer of the Parent and certain other information are set forth below. Unless otherwise indicated, the business address of each such director and executive officer is 200 Chestnut Ridge Road, Woodcliff Lake, New Jersey 07675. Unless otherwise indicated, each occupation set forth opposite an individual's name refers to employment with the Parent. All directors and executive officers listed below are citizens of the United States, except that Cedric E. Ritchie is a citizen of Canada and Frederick W. Hadfield is a citizen of the United Kingdom.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND MATERIAL OCCUPATIONS, POSITIONS, OFFICES NAME AND ADDRESS OR EMPLOYMENT HELD DURING THE LAST FIVE YEARS - --------------------------------------------- --------------------------------------------- Donald J. Bainton............................ Director since 1993; Chairman, Chief Continental Can Company Executive Officer and a director of One Aerial Way Continental Can Co., Inc., an industrial Sysosset, New York 11791 packaging company which also provides engineering, architectural and surveying services, since 1983; director of General Public Utilities Corporation. Theodore H. Black............................ Director since 1988; former Chairman and Chief Executive Officer (1988-1993); President (1988-1992); director of CPC International, Inc., McDermott International, Inc. and General Public Utilities Corporation. Brendan T. Byrne............................. Director since 1988; member of law firm of Carella, Byrne, Bain, Gilfillan, Carella, Byrne, Bain, Gilfillan, Cecchi and Cecchi and Stewart Stewart since 1982; Governor of State of 6 Becker Farm Road New Jersey (1974-1982); director of Roseland, New Jersey 07068 Elizabethtown Water Co., Chelsea GCA Realty, Inc. and Bell Atlantic-New Jersey, Inc.
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PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND MATERIAL OCCUPATIONS, POSITIONS, OFFICES NAME AND ADDRESS OR EMPLOYMENT HELD DURING THE LAST FIVE YEARS - --------------------------------------------- --------------------------------------------- Joseph P. Flannery........................... Director since 1986; Chairman, President and Uniroyal Holding, Inc. Chief Executive Officer of Uniroyal 70 Great Hill Road Holding, Inc., a holding company, since Naugatuck, Connecticut 06770 1986; partner in Clayton & Dubilier, an investment firm, (1988-1990); Chairman, President and Chief Executive Officer of Uniroyal, Inc., a manufacturer of chemicals, tires, engineered products and leisure products (1982-1986); director of APS, Inc., Arvin Industries, Inc., K Mart Corporation, Newmont Gold Company, Newmont Mining Corporation and The Scotts Company. Constance J. Horner.......................... Director since 1994; Guest Scholar at The The Brookings Institution Brookings Institution since 1993; Assistant 1775 Massachusetts Ave. NW to the President and Director of Washington, D.C. 20036 Presidential Personnel at the White House (1991-1993); Deputy Secretary, U.S. Department of Health and Human Services (1989-1991); director of Pfizer, Inc. and The Prudential Insurance Company of America. Alexander H. Massad.......................... Director since 1982; director of Maxim Engineers, Inc., Research Applications Inc. and Texas Commerce Bank-Austin; director of Mobil Corporation (1977-1986); director and Executive Vice President of Mobil Oil Corporation (1976-1986). James E. Perrella............................ Chairman, President and Chief Executive Officer since 1993 (President since 1992); Director since 1992; Executive Vice President (1982-1992); director of Cincinnati Milacron Inc. John E. Phipps............................... Director since 1970; private investor; director of W.R. Grace & Co. Donald E. Procknow........................... Director since 1973; former Vice Chairman, Chief Operating Officer and director of AT&T Technologies, Inc. (formerly Western Electric Company, Inc.), a telecommunications company (1984-1986); Chief Executive Officer of Western Electric Company (1972-1984); director of The Prudential Insurance Company of America (until April 6, 1995). Cedric E. Ritchie............................ Director since 1987; Chairman of the The Bank of Nova Scotia Executive Committee of The Bank of Nova 44 King Street West Scotia since 1993; Chairman of the Board Toronto, Ontario M5H 1H1 and Chief Executive Officer of The Bank of Nova Scotia from 1974 to January 1995 (Chairman of the Board) and January 1993 (Chief Executive Officer); director of J. Ray McDermott S.A., MacMillan Bloedel Limited, Moore Corporation Limited and Nova Corporation of Alberta. William G. Mulligan.......................... Executive Vice President since 1988.
I-2
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND MATERIAL OCCUPATIONS, POSITIONS, OFFICES NAME AND ADDRESS OR EMPLOYMENT HELD DURING THE LAST FIVE YEARS - --------------------------------------------- --------------------------------------------- J. Frank Travis.............................. Executive Vice President since January 1994; Vice President (1990-December 1993). Thomas F. McBride............................ Senior Vice President and Chief Financial Officer since May 1993; Senior Vice President and Comptroller (February 1992- May 1993); Vice President and Comptroller, (1981-1992). William J. Armstrong......................... Vice President since 1986 and Treasurer since 1983. Paul L. Bergren.............................. Vice President and President of the Air Compressor Group since 1992; Vice President/General Manager--Centrifugal Compressor Division (1989-1992). Frederick W. Hadfield........................ Vice President and President of Ingersoll- Dresser Pump Company since March 1994; Vice President (1979-March 1994). Daniel E. Kletter............................ Vice President since 1990. Patricia Nachtigal........................... Vice President and General Counsel since 1991; Secretary and Managing Attorney (1988- 1991). Allen M. Nixon............................... Vice President since February 1995 and President of Bearing and Components Group since 1994; Vice President/General Manager--Torrington Needle Bearings Division (1983-1994). James R. O'Dell.............................. Vice President since 1988. Donald H. Rice............................... Vice President since February 1995; Executive Director--Human Resources (1994-February 1995); Vice President--Human Resources of Bearings and Components Group (1988-1993). Larry H. Pitsch.............................. Vice President since 1990. Gerald E. Swimmer............................ Vice President since 1982. R. Barry Uber................................ Vice President since 1990. Ronald G. Heller............................. Secretary and Assistant General Counsel since 1991; Assistant General Counsel (1988-1991).
3. Ownership of Shares by Directors and Executive Officers. Mr. Mulligan currently owns 2,000 Shares which he acquired more than two years ago. To the best knowledge of the Purchaser and the Parent, none of the other persons listed on this Schedule I beneficially owns or has a right to acquire directly or indirectly any Shares, and none of the persons listed on this Schedule I has effected any transactions in the Shares during the past 60 days. I-3 SCHEDULE II PARENT PURCHASES OF SHARES (ALL PURCHASES WERE MADE ON THE OPEN MARKET) NUMBER PRICE PER DATE OF SHARES SHARE - -------- --------- ------------ 2/15/95 5,000 54 1/8 10,000 54 14,600 53 7/8 2/21/95 8,000 55 2/22/95 8,400 55 1/4 5,000 55 1/8 2,000 55 2/23/95 15,000 55 3/8 5,000 55 1/4 5,000 55 1/8 5,000 55 5,000 54 7/8 2/24/95 3,200 54 7/8 5,000 54 3/4 10,000 54 5/8 5,000 54 1/2 NUMBER PRICE PER DATE OF SHARES SHARE - -------- --------- ------------ 2/27/95 5,000 54 1/2 5,000 54 3/8 30,000 54 20,300 53 7/8 2/28/95 15,000 53 7/8 10,000 53 3/4 10,000 53 5/8 10,000 53 1/2 3/1/95 20,000 54 1/4 10,000 54 1/8 3/2/95 7,600 54 1/8 5,000 54 5,000 53 7/8 10,100 53 3/4 --------- TOTAL: 274,200 II-1 Facsimile copies of the Letter of Transmittal, properly completed and duly executed, will be accepted. The Letter of Transmittal, certificates for Shares and/or Rights and any other required documents should be sent or delivered by each stockholder of the Company or his broker, dealer, commercial bank, trust company or other nominee to the Depositary as follows: The Depositary for the Offer is: THE BANK OF NEW YORK By Mail: By Facsimile Transmission: By Hand or Overnight Delivery: Tender & Exchange Department (for Eligible Institutions Tender & Exchange Department P.O. Box 11248 only) 101 Barclay Street Church Street Station (212) 815-6213 Receive and Deliver Window New York, NY 10286-1243 For Information Telephone: New York, NY 10286 (800) 507-9357
Any questions and requests for assistance may be directed to the Information Agent or the Dealer Manager at their respective telephone numbers and addresses listed below. Additional copies of this Offer to Purchase, the Letter of Transmittal and the Notice of Guaranteed Delivery may also be obtained from the Information Agent. You may also contact your broker, dealer, commercial bank or trust company for assistance concerning the Offer. The Information Agent for the Offer is: LOGO Wall Street Plaza New York, NY 10005 Banks and Brokers Call Collect: (212) 440-9800 All Other Call Toll-Free: (800) 223-2064 The Dealer Manager for the Offer is: MERRILL LYNCH & CO. World Financial Center North Tower New York, NY 10281-1305 (212) 236-4723 (Call Collect) EX-11.(A)(2) 3 EXHIBIT 11(a)(2) LETTER OF TRANSMITTAL TO TENDER SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS) OF CLARK EQUIPMENT COMPANY PURSUANT TO THE OFFER TO PURCHASE DATED APRIL 3, 1995 BY CEC ACQUISITION CORP. A WHOLLY OWNED SUBSIDIARY OF INGERSOLL-RAND COMPANY THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, APRIL 28, 1995 UNLESS THE OFFER IS EXTENDED. The Depositary for the Offer is: The Bank of New York By Mail: By Facsimile Transmission: By Hand or Overnight Delivery: Tender & Exchange Department (for Eligible Institutions only) Tender & Exchange Department P.O. Box 11248 (212) 815-6213 101 Barclay Street Church Street Station Confirm by Telephone: Receive and Deliver Window New York, NY 10286-1243 (800) 507-9357 New York, NY 10286
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE, OR TRANSMISSIONS OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN AS SET FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY. THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. This Letter of Transmittal is to be completed by stockholders either if certificates for Shares or Rights (as such terms are defined below) are to be forwarded herewith or, unless an Agent's Message (as defined in Section 2 of the Offer to Purchase) is utilized, if tenders of Shares or Rights are to be made by book-entry transfer into the account of The Bank of New York, as Depositary (the "Depositary"), at The Depository Trust Company ("DTC"), the Midwest Securities Trust Company ("MSTC") or the Philadelphia Depository Trust Company ("PDTC") (each a "Book-Entry Transfer Facility" and collectively the "Book-Entry Transfer Facilities") pursuant to the procedures set forth in Section 3 of the Offer to Purchase (as defined below). Stockholders who tender Shares or Rights by book-entry transfer are referred to herein as "Book-Entry Stockholders". Unless and until CEC Acquisition Corp., a Delaware corporation (the "Purchaser"), declares that the Rights Condition (as defined in the Offer to Purchase) is satisfied, holders of Shares will be required to tender one Right for each Share tendered in order to effect a valid tender of such Share. If the Distribution Date (as defined in the Offer to Purchase) has not occurred prior to the time Shares are tendered pursuant to the Offer, a tender of Shares will also constitute a tender of the associated Rights. See Section 3 of the Offer to Purchase. If the Distribution Date has occurred, and certificates representing Rights (the "Rights Certificates") have been distributed to holders of Shares, such holders of Shares will be required to tender Rights Certificates representing a number of Rights equal to the number of Shares being tendered in order to effect a valid tender of such Shares. Holders of Shares and Rights whose certificates for such Shares (the "Share Certificates") and, if applicable, Rights Certificates are not immediately available or who cannot deliver their Share Certificates or, if applicable, Rights Certificates and all other required documents to the Depositary prior to the Expiration Date (as defined in Section 1 of the Offer to Purchase), or who cannot complete the procedure for book-entry transfer on a timely basis, must tender their Shares and Rights according to the guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase. See Instruction 2. DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY. DESCRIPTION OF SHARES TENDERED NAME(S) & ADDRESS(ES) OF REGISTERED HOLDER(S) (PLEASE FILL IN, IF BLANK, EXACTLY AS SHARES CERTIFICATE(S) AND SHARE(S) TENDERED NAME(S) APPEAR(S) ON CERTIFICATE(S)) (ATTACH ADDITIONAL SIGNED LIST IF NECESSARY) TOTAL NUMBER SHARES OF SHARES NUMBER OF CERTIFICATE REPRESENTED BY SHARES NUMBER(S)* CERTIFICATE(S)* TENDERED** Total Shares..................................
* Need not be completed by Book-Entry Stockholders. ** Unless otherwise indicated, all Shares represented by certificates delivered to the Depositary will be deemed to have been tendered. See Instruction 4. DESCRIPTION OF RIGHTS TENDERED* NAME(S) & ADDRESS(ES) OF REGISTERED HOLDER(S) (PLEASE FILL IN, IF BLANK, EXACTLY AS RIGHTS CERTIFICATE(S) AND RIGHT(S) TENDERED NAME(S) APPEAR(S) ON CERTIFICATE(S)) (ATTACH ADDITIONAL SIGNED LIST IF NECESSARY) TOTAL NUMBER OF RIGHTS RIGHTS REPRESENTED BY NUMBER OF CERTIFICATE RIGHTS RIGHTS NUMBER(S)** CERTIFICATE(S)** TENDERED*** Total Rights..................................
* Need not be completed if the Distribution Date (as defined below) has not occurred. ** Need not be completed by Book-Entry Stockholders. *** Unless otherwise indicated, all Rights represented by certificates delivered to the Depositary will be deemed to have been tendered. See Instruction 4. / / CHECK HERE IF SHARES ARE BEING TENDERED BY BOOK-ENTRY TRANSFER MADE TO AN ACCOUNT MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER FACILITY AND COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN A BOOK-ENTRY TRANSFER FACILITY MAY DELIVER SHARES BY BOOK-ENTRY TRANSFER): Name of Tendering Institution ________________________________________________________________ Check box of Book-Entry Transfer Facility (check one): / / The Depository Trust Company / / Midwest Securities Trust Company / / Philadelphia Depository Trust Company Account Number ___________________Transaction Code Number ____________________ / / CHECK HERE IF SHARES ARE BEING TENDERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING: Name(s) of Registered Owner(s): ____________________________________________ Window Ticket Number (if any): _____________________________________________ Date of Execution of Notice of Guaranteed Delivery: ________________________ Name of Institution that Guaranteed Delivery: ______________________________ If delivered by Book-Entry Transfer, check box of Book-Entry Transfer Facility (check one): / / The Depository Trust Company / / Midwest Securities Trust Company / / Philadelphia Depository Trust Company Account Number __________________ Transaction Code Number __________________ / / CHECK HERE IF RIGHTS ARE BEING TENDERED BY BOOK-ENTRY TRANSFER MADE TO AN ACCOUNT MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER FACILITY AND COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN A BOOK-ENTRY TRANSFER FACILITY MAY DELIVER RIGHTS BY BOOK-ENTRY TRANSFER): Name of Tendering Institution ______________________________________________ Check box of Book-Entry Transfer Facility (check one): / / The Depository Trust Company / / Midwest Securities Trust Company / / Philadelphia Depository Trust Company Account Number ___________________ Transaction Code Number __________________ / / CHECK HERE IF RIGHTS ARE BEING TENDERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING: Name(s) of Registered Owner(s): ____________________________________________ Window Ticket Number (if any): _____________________________________________ Date of Execution of Notice of Guaranteed Delivery: ________________________ Name of Institution that Guaranteed Delivery: ______________________________ If delivered by Book-Entry Transfer, check box of Book-Entry Transfer Facility (check one): / / The Depository Trust Company / / Midwest Securities Trust Company / / Philadelphia Depository Trust Company Account Number ____________________ Transaction Code Number __________________ NOTE: SIGNATURES MUST BE PROVIDED BELOW PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY Ladies and Gentlemen: The undersigned hereby tenders to CEC Acquisition Corp., a Delaware corporation (the "Purchaser"), a wholly owned subsidiary of Ingersoll-Rand Company, a New Jersey corporation ("Parent"), the above-described shares of Common Stock, $7.50 par value per share (the "Shares"), of Clark Equipment Company, a Delaware corporation (the "Company"), and (unless and until the Purchaser declares that the Rights Condition (as defined in the Offer to Purchase described below) is satisfied), the associated Preferred Stock Purchase Rights (the "Rights") issued pursuant to the Rights Agreement, dated as of March 10, 1987, as amended and restated as of August 14, 1990 (as so amended and restated, the "Rights Agreement"), between the Company and Harris Trust and Savings Bank, as Rights Agent (the "Rights Agent"), at a purchase price of $77.00 per Share (and associated Right), net to the seller in cash without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase dated April 3, 1995 (the "Offer to Purchase") and in this Letter of Transmittal (which together constitute the "Offer"). Unless the context requires otherwise, all references to Shares shall be deemed to refer also to the associated Rights, and all references to Rights shall be deemed to include all benefits that may inure to the stockholders of the Company or to holders of the Rights pursuant to the Rights Agreement. The undersigned understands that the Purchaser reserves the right to transfer or assign, in whole or from time to time in part, to one or more of its affiliates, the right to purchase all or any portion of the Shares and Rights tendered pursuant to the Offer, receipt of which is hereby acknowledged. The undersigned understands that if the Distribution Date (as defined in the Offer to Purchase) has occurred and certificates representing Rights (the "Rights Certificates") have been distributed to holders of Shares prior to the date of tender of the Shares and Rights tendered herewith, Rights Certificates representing a number of Rights equal to the number of Shares being tendered herewith must be delivered to the Depositary (as defined below) or, if available, a Book-Entry Confirmation (as defined herein) received with respect thereto, in order for the Shares tendered herewith to be validly tendered. If the Distribution Date has occurred and Rights Certificates have not been distributed prior to the time Shares and Rights are tendered herewith, the undersigned agrees to deliver Rights Certificates representing a number of Rights equal to the number of Shares tendered herewith to The Bank of New York (the "Depositary") within five business days after the date such Rights Certificates are distributed. A tender of shares without Rights Certificates constitutes an agreement by the tendering stockholder to deliver Rights Certificates representing a number of Rights equal to the number of Shares tendered pursuant to the Offer to the Depositary within five business days after the date such Rights Certificates are distributed. The undersigned understands that if the Rights Condition is not satisfied the Purchaser reserves the right to require that the Depositary receive such Rights Certificates prior to accepting Shares for payment. In that event, payment for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of, among other things, Rights Certificates, if Rights Certificates have been distributed to holders of Shares. Subject to, and effective upon, acceptance for payment for the Shares and Rights tendered herewith in accordance with the terms of the Offer, the undersigned hereby sells, assigns and transfers to, or upon the order of, the Purchaser all right, title and interest in and to all of the Shares and Rights that are being tendered hereby and any and all dividends, distributions (including additional Shares) or rights declared, paid or issued with respect to the tendered Shares on or after April 3, 1995 and payable or distributable to the undersigned on a date prior to the transfer to the name of the Purchaser or nominee or transferee of the Purchaser on the Company's stock transfer records of the Shares tendered herewith (except that if the Rights are redeemed by the Company's Board of Directors in accordance with the terms of the Rights Agreement, tendering stockholders who are holders of record as of the applicable record date will be entitled to receive and retain the redemption price of $.05 per Right in accordance with the Rights Agreement) (collectively, a "Distribution"), and appoints the Depositary the true and lawful agent and attorney-in-fact of the undersigned with respect to such Shares and Rights (and any Distribution) with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest) to (a) deliver such Share Certificates (as defined herein) and Rights Certificates (and any Distribution) or transfer ownership of such Shares and Rights (and any Distribution) on the account books maintained by a Book-Entry Transfer Facility, together in either case with appropriate evidences of transfer, to the Depositary for the account of the Purchaser, (b) present such Shares and Rights (and any Distributions) for transfer on the books of the Company and (c) receive all benefits and otherwise exercise all rights of beneficial ownership of such Shares and Rights (and any Distribution), all in accordance with the terms and subject to the conditions of the Offer. The undersigned irrevocably appoints designees of the Purchaser as such stockholder's proxy, with full power of substitution, to the full extent of such stockholder's rights with respect to the Shares and Rights tendered by such stockholder and accepted for payment by the Purchaser and with respect to any and all other Shares or other securities issued or issuable in respect of such Shares on or after April 3, 1995. Such appointment will be effective when, and only to the extent that, the Purchaser accepts such Shares for payment. Upon such acceptance for payment, all prior proxies given by such stockholder with respect to such Shares and Rights (and such other shares and securities) will be revoked without further action, and no subsequent proxies may be given nor any subsequent written consents executed (and, if given or executed, will not be deemed effective). The designees of the Purchaser will be empowered to exercise all voting and other rights of such stockholder as they in their sole discretion may deem proper at any annual or special meeting of the Company's stockholders or any adjournment or postponement thereof, by written consent in lieu of any such meeting or otherwise. The Purchaser reserves the right to require that, in order for Shares and Rights to be deemed validly tendered, immediately upon the Purchaser's payment for such Shares the Purchaser must be able to exercise full voting rights with respect to such Shares and Rights. The undersigned hereby represents and warrants that (a) the undersigned has full power and authority to tender, sell, assign and transfer the Shares and Rights tendered hereby (and any Distribution) and (b) when the Shares and Rights are accepted for payment by the Purchaser, the Purchaser will acquire good, marketable and unencumbered title to the Shares and Rights (and any Distribution), free and clear of all liens, restrictions, charges and encumbrances, and the same will not be subject to any adverse claim. The undersigned, upon request, will execute and deliver any additional documents deemed by the Depositary or the Purchaser to be necessary or desirable to complete the sale, assignment and transfer of the Shares and Rights tendered hereby (and any Distribution). In addition, the undersigned shall promptly remit and transfer to the Depositary for the account of the Purchaser any and all Distributions in respect of the Shares and Rights tendered hereby, accompanied by appropriate documentation of transfer; and pending such remittance or appropriate assurance thereof, the Purchaser will be, subject to applicable law, entitled to all rights and privileges as owner of any such Distribution and may withhold the entire purchase price or deduct from the purchase price the amount or value thereof, as determined by the Purchaser in its sole discretion. All authority herein conferred or agreed to be conferred shall not be affected by and shall survive the death or incapacity of the undersigned and any obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned. Tenders of Shares and Rights made pursuant to the Offer are irrevocable, except that Shares and Rights tendered pursuant to the Offer may be withdrawn at any time prior to the Expiration Date (as defined in the Offer to Purchase) and, unless theretofore accepted for payment by the Purchaser pursuant to the Offer, may also be withdrawn at any time after June 1, 1995. See Section 4 of the Offer to Purchase. The undersigned understands that tenders of Shares and Rights pursuant to any of the procedures described in Section 3 of the Offer to Purchase and in the instructions hereto will constitute a binding agreement between the undersigned and the Purchaser upon the terms and subject to the conditions set forth in the Offer, including the undersigned's representation that the undersigned owns the Shares and Rights being tendered. Unless otherwise indicated herein under "Special Payment Instructions", please issue the check for the purchase price and/or issue or return any certificate(s) for Shares and Rights not tendered or not accepted for payment in the name(s) of the registered holder(s) appearing under "Description of Shares Tendered" and "Description of Rights Tendered", respectively. Similarly, unless otherwise indicated herein under "Special Delivery Instructions", please mail the check for the purchase price and/or any certificate(s) for Shares and Rights not tendered or not accepted for payment (and accompanying documents, as appropriate) to the address(es) of the registered holder(s) appearing under "Description of Shares Tendered" and "Description of Rights Tendered", respectively. In the event that both the Special Delivery Instructions and the Special Payment Instructions are completed, please issue the check for the purchase price and/or any certificate(s) for Shares and Rights not tendered or accepted for payment in the name of, and deliver such check and/or such certificates to, the person or persons so indicated. Unless otherwise indicated herein under "Special Payment Instructions", please credit any Shares and Rights tendered herewith by book-entry transfer that are not accepted for payment by crediting the account at the Book-Entry Transfer Facility (as defined herein) designated above. The undersigned recognizes that the Purchaser has no obligation, pursuant to the Special Payment Instructions, to transfer any Shares or Rights from the name(s) of the registered holder(s) thereof if the Purchaser does not accept for payment any of the Shares or Rights so tendered. SPECIAL PAYMENT INSTRUCTIONS (SEE INSTRUCTIONS 1, 5, 6 AND 7) To be completed ONLY if certificate(s) for Shares and Rights not tendered or not accepted for payment and/or the check for the purchase price of Shares and Rights accepted for payment are to be issued in the name of someone other than the undersigned or if Shares or Rights tendered by book-entry transfer which are not accepted for payment are to be returned by credit to an account maintained at a Book-Entry Transfer Facility. Issue: / / check / / certificates to: Name............................................................................ (PLEASE PRINT) Address......................................................................... ............................................................................... (INCLUDE ZIP CODE) ............................................................................... (TAX ID. OR SOCIAL SECURITY NO.) (SEE SUBSTITUTE FORM W-9 ON THE REVERSE SIDE) Credit Shares and Rights tendered by book-entry transfer that are not accepted for payment to (Check one): / / The Depository Trust Company / / Midwest Securities Trust Company / / Philadelphia Depository Trust Company ............................................................................... (DTC, MSTC OR PDTC ACCOUNT NO.) SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 1, 5, 6 AND 7) To be completed ONLY if certificate(s) for Shares and Rights not tendered or not accepted for payment and/or the check for the purchase price of Shares and Rights accepted for payment are to be sent to someone other than the undersigned or to the undersigned at an address other than that shown above. Mail: / / check / / certificates to: Name............................................................................ (PLEASE PRINT) Address......................................................................... ............................................................................... (INCLUDE ZIP CODE) ............................................................................... (TAX ID. OR SOCIAL SECURITY NO.) (SEE SUBSTITUTE FORM W-9 ON THE REVERSE SIDE) SIGN HERE SIGN AND COMPLETE SUBSTITUTE FORM W-9 ON REVERSE SIGN HERE .............................................................................. HERE .............................................................................. (SIGNATURES(S) OF HOLDERS(S)) DATED:................................................................., 1995 (Must be signed by the registered holder(s) exactly as name(s) appear(s) on Share Certificate(s) or Rights Certificate(s) or on a security position list- ing or by person(s) authorized to become registered holder(s) by certificates and document transmitted herewith. If signature is by trustees,executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, please provide the following information and see Instruction 5.) Name(s)....................................................................... .............................................................................. (Please Print) Capacity (Full Title)......................................................... Address....................................................................... .............................................................................. (Include Zip Code) Area Code and Telephone Number................................................ Tax Identification or social Security No............................................................ COMPLETE SUBSTITUTE FORM W-9 ON REVERSE Guarantee of Signature(s) (See Instructions 1 and 5) Authorized Signature.......................................................... Name.......................................................................... Name of Firm.................................................................. (Please Print) Address....................................................................... (Include Zip Code) Area Code and Telephone Number................................................ DATED:.................................................................., 1995
INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER 1. GUARANTEE OF SIGNATURES. No signature guarantee is required on this Letter of Transmittal (a) if this Letter of Transmittal is signed by the registered holder(s) of Shares and Rights (which term, for purposes of this document, shall include any participant in a Book-Entry Transfer Facility whose name appears on a security position listing as the owner of Shares and/or Rights) tendered herewith, unless such holder(s) has completed either the box entitled "Special Payment Instructions" or the box entitled "Special Delivery Instructions" above, or (b) if such Shares and/or Rights are tendered for the account of a firm which is a bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of the Securities Transfer Agents Medallion Program (each of the foregoing being referred to as an "Eligible Institution"). In all other cases, all signatures on this Letter of Transmittal must be guaranteed by an Eligible Institution. See Instruction 5 of this Letter of Transmittal. 2. REQUIREMENTS OF TENDER. This Letter of Transmittal is to be completed by stockholders either if certificates are to be forwarded herewith or, unless an Agent's Message is utilized, if tenders are to be made pursuant to the procedure for tender by book-entry transfer set forth in Section 3 of the Offer to Purchase. Share Certificates, or timely confirmation (a "Book-Entry Confirmation") of a book-entry transfer of such Shares into the Depositary's account at a Book-Entry Transfer Facility, as well as this Letter of Transmittal (or a facsimile hereof), properly completed and duly executed, with any required signature guarantees, or an Agent's Message in connection with a book-entry transfer, and any other documents required by this Letter of Transmittal, must be received by the Depositary at one of its addresses set forth herein prior to the Expiration Date (as defined in Section 1 of the Offer to Purchase) and, unless and until the Purchaser declares that the Rights Condition (as defined in the Offer to Purchase) is satisfied, Rights Certificates or timely confirmation of a book-entry transfer of Rights into the Depositary's account at a Book-Entry Transfer Facility, if available (together with, if Rights are forwarded separately from Shares, a properly completed and duly executed Letter of Transmittal (or a facsimile hereof) with any required signature guarantees, or an Agent's Message in the case of a book-entry delivery, and any other documents required by this Letter of Transmittal), must be received by the Depositary at one of its addresses set forth herein prior to the Expiration Date or, if later, within five business days after the date such Rights Certificates are distributed. Stockholders whose Share Certificates or Rights Certificates are not immediately available (including Rights Certificates that have not yet been distributed by the Company) or who cannot deliver their Share Certificates or Rights Certificates and all other required documents to the Depositary prior to the Expiration Date or who cannot complete the procedure for delivery by book-entry transfer on a timely basis may tender their Shares and Rights by properly completing and duly executing a Notice of Guaranteed Delivery pursuant to the guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase. Pursuant to such procedure: (i) such tender must be made by or through an Eligible Institution; (ii) a properly completed and duly executed Notice of Guaranteed Delivery, substantially in the form made available by the Purchaser, must be received by the Depositary prior to the Expiration Date; (iii) the Share Certificates (or a Book-Entry Confirmation) representing all tendered Shares, in proper form for transfer, in each case together with the Letter of Transmittal (or a facsimile thereof), properly completed and duly executed, with any required signature guarantees (or, in the case of a book-entry delivery, an Agent's Message) and any other documents required by this Letter of Transmittal, must be received by the Depositary within five New York Stock Exchange, Inc. ("NYSE") trading days after the date of execution of such Notice of Guaranteed Delivery; and (iv) unless and until the Purchaser declares that the Rights Condition is satisfied, the Rights Certificates, if issued, representing the appropriate number of Rights or a Book Entry Confirmation, if available, in each case together with a properly completed and duly executed Letter of Transmittal (or a facsimile thereof), with any required signature guarantees (or, in the case of a book-entry delivery, an Agent's Message) and any other documents required by this Letter of Transmittal, must be received by the Depositary within five NYSE trading days after the date of execution of such Notice of Guaranteed Delivery or, if later, five NYSE trading days after Rights Certificates are distributed to stockholders, all as provided in Section 3 of the Offer to Purchase. If Share Certificates and Rights Certificates are forwarded separately to the Depositary, a properly completed and duly executed Letter of Transmittal must accompany each such delivery. THE METHOD OF DELIVERY OF SHARE CERTIFICATES OR OF RIGHTS CERTIFICATES AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER FACILITY, IS AT THE OPTION AND RISK OF THE TENDERING STOCKHOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY. No alternative, conditional or contingent tenders will be accepted and no fractional Shares and Rights will be purchased. All tendering stockholders, by execution of this Letter of Transmittal (or a facsimile hereof), waive any right to receive any notice of the acceptance of their Shares and Rights for payment. 3. INADEQUATE SPACE. If the space provided herein is inadequate, the certificate numbers and/or the number of Shares and Rights and any other required information should be listed on a separate signed schedule attached hereto. 4. PARTIAL TENDERS. (Not Applicable to Book-Entry Stockholders) If fewer than all the Shares evidenced by any Share Certificate submitted are to be tendered, fill in the number of Shares which are to be tendered in the box entitled "Number of Shares Tendered". If fewer than all the Rights evidenced by any Rights Certificates submitted are to be tendered, fill in the number of Rights which are to be tendered in the box entitled "Number of Rights Tendered". In such cases, new Share Certificates or Rights Certificates, as the case may be, for the Shares or Rights that were evidenced by your old Share Certificates or Rights Certificates, but were not tendered by you, will be sent to you, unless otherwise provided in the appropriate box on this Letter of Transmittal, as soon as practicable after the Expiration Date. All Shares represented by Share Certificates and all Rights represented by Rights Certificates delivered to the Depositary will be deemed to have been tendered unless otherwise indicated. 5. SIGNATURES ON LETTER OF TRANSMITTAL, STOCK POWERS AND ENDORSEMENTS. If this Letter of Transmittal is signed by the registered holder(s) of the Shares and Rights tendered hereby, the signature(s) must correspond with the name(s) as written on the face of the certificate(s) without alteration, enlargement or any change whatsoever. If any of the Shares and Rights tendered hereby are owned of record by two or more joint owners, all such owners must sign this Letter of Transmittal. If any of the tendered Shares and Rights are registered in different names on several certificates, it will be necessary to complete, sign and submit as many separate Letters of Transmittal as there are different registrations of certificates. If this Letter of Transmittal or any certificates or stock powers are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, and proper evidence satisfactory to the Purchaser of their authority so to act must be submitted. If this Letter of Transmittal is signed by the registered holder(s) of the Shares and Rights listed and transmitted hereby, no endorsements of certificates or separate stock powers are required unless payment is to be made to or certificates for Shares or Rights not tendered or not purchased are to be issued in the name of a person other than the registered holder(s). Signatures on such certificates or stock powers must be guaranteed by an Eligible Institution. If this Letter of Transmittal is signed by a person other than the registered holder(s) of the certificate(s) listed, the certificate(s) must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name(s) of the registered holder(s) appear on the certificate(s). Signatures on such certificates or stock powers must be guaranteed by an Eligible Institution. Unless and until the Purchaser declares the Rights Condition to be satisfied, if Rights Certificates have been distributed to holders of Shares, such holders are required to tender Rights Certificate(s) representing a number of Rights equal to the number of Shares tendered in order to effect a valid tender of such Shares. It is necessary that stockholders follow all signature requirements of this Instruction 5 with respect to the Rights in order to tender such Rights. 6. STOCK TRANSFER TAXES. Except as otherwise provided in this Instruction 6, the Purchaser will pay any stock transfer taxes with respect to the transfer and sale of Shares and Rights to it or its order pursuant to the Offer. If, however, payment of the purchase price is to be made to, or if certificate(s) for Shares and Rights not tendered or accepted for payment are to be registered in the name of, any person other than the registered holder(s), or if tendered certificate(s) are registered in the name of any person other than the person(s) signing this Letter of Transmittal, the amount of any stock transfer taxes (whether imposed on the registered holder(s) or such person) payable on account of the transfer to such person will be deducted from the purchase price unless satisfactory evidence of the payment of such taxes or an exemption therefrom, is submitted. Except as otherwise provided in this Instruction 6, it will not be necessary for transfer tax stamps to be affixed to the certificate(s) listed in this Letter of Transmittal. 7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check is to be issued in the name of, and/or certificates for Shares and Rights not tendered or not accepted for payment are to be issued or returned to, a person other than the signer of this Letter of Transmittal or if a check and/or such certificates are to be returned to a person other than the person(s) signing this Letter of Transmittal or to an address other than that shown in this Letter of Transmittal, the appropriate boxes on this Letter of Transmittal must be completed. A Book-Entry Stockholder may request that Shares and/or Rights not accepted for payment be credited to such account maintained at a Book-Entry Transfer Facility as such Book-Entry Stockholder may designate under "Special Payment Instructions". If no such instructions are given, such Shares or Rights not accepted for payment will be returned by crediting the account at the Book-Entry Transfer Facility designated above. 8. WAIVER OF CONDITIONS. The conditions of the Offer may be waived by the Purchaser in whole or in part at any time and from time to time in its sole discretion. 9. 31% BACKUP WITHHOLDING; SUBSTITUTE FORM W-9. Under U.S. Federal income tax law, a stockholder whose tendered Shares or Rights are accepted for payment is required to provide the Depositary with such stockholder's correct taxpayer identification number ("TIN") on Substitute Form W-9 below. If the Depositary is not provided with the correct TIN, the Internal Revenue Service may subject the stockholder or other payee to a $50 penalty. In addition, payments that are made to such stockholder or other payee with respect to Shares or Rights purchased pursuant to the Offer may be subject to 31% backup withholding. Certain stockholders (including, among others, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements. In order for a foreign individual to qualify as an exempt recipient, the stockholder must submit a Form W-8, signed under penalties of perjury, attesting to that individual's exempt status. A Form W-8 can be obtained from the Depositary. See the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for more instructions. If backup withholding applies, the Depositary is required to withhold 31% of any such payments made to the stockholder or other payee. Backup withholding is not an additional tax. Rather, the tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, a refund may be obtained from the Internal Revenue Service. The box in Part 3 of the Substitute Form W-9 may be checked if the tendering stockholder has not been issued a TIN and has applied for a TIN or intends to apply for a TIN in the near future. If the box in Part 3 is checked, the stockholder or other payee must also complete the Certificate of Awaiting Taxpayer Identification Number below in order to avoid backup withholding. Notwithstanding that the box in Part 3 is checked and the Certificate of Awaiting Taxpayer Identification Number is completed, the Depositary will withhold 31% of all payments made prior to the time a properly certified TIN is provided to the Depositary. The stockholder is required to give the Depositary the TIN (e.g., social security number or employer identification number) of the record owner of the Shares and Rights or of the last transferee appearing on the transfers attached to, or endorsed on, the Shares and Rights. If the Shares or Rights are in more than one name or are not in the name of the actual owner, consult the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for additional guidance on which number to report. 10. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions or requests for assistance may be directed to the Dealer Manager or the Information Agent at their respective addresses and telephone numbers set forth below. Additional copies of the Offer to Purchase, this Letter of Transmittal and the Notice of Guaranteed Delivery may also be obtained from the Information Agent or from brokers, dealers, commercial banks or trust companies. 11. LOST, DESTROYED OR STOLEN CERTIFICATES. If any certificate representing Shares or Rights has been lost, destroyed or stolen, the stockholder should promptly notify the Depositary. The stockholder will then be instructed as to the steps that must be taken in order to replace the certificate. This Letter of Transmittal and related documents cannot be processed until the procedures for replacing lost or destroyed certificates have been followed. IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A FACSIMILE HEREOF), TOGETHER WITH CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER OR THE NOTICE OF GUARANTEED DELIVERY, AND ALL OTHER REQUIRED DOCUMENTS, MUST BE RECEIVED BY THE DEPOSITARY PRIOR TO THE EXPIRATION DATE. PAYER'S NAME: THE BANK OF NEW YORK SUBSTITUTE PART 1--PLEASE PROVIDE YOUR TIN IN THE BOX AT Social Security Number THE RIGHT AND CERTIFY BY SIGNING AND or Employer Identification Number FORM W-9 DATING BELOW. Department of the Treasury, Internal Revenue Service PAYER'S REQUEST FOR TAXPAYER IDENTIFICATION NUMBER ("TIN") Part 2--Certification--Under penalties of perjury, I certify that: (1) The number shown on this form is my correct Taxpayer Identification Number (or I am waiting for a number to be issued to me) and (2) I am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (the "IRS") that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding. Certification Instructions--You must cross out item (2) above if you have been notified by the IRS that you are currently subject to backup withholding because of under-reporting interest or dividends on your tax return. However, if after being notified by the IRS that you were subject to backup witholding you received another notification from the IRS that you are no longer subject to backup withholding, do not cross out such Item (2). PART 3-- SIGN HERE Signature............................. Date............................., 1995 Awaiting TIN / /
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF SUBSTITUTE FORM W-9. CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (1) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service Center or Social Security Administration Office, or (2) I intend to mail or deliver an application in the near future. I understand that if I do not provide a taxpayer identification number by the time of payment, 31% of all reportable payments made to me will be withheld. Signature .................................... Date .................................... , 1995
The Information Agent for the Offer is: [GEORGESON & COMPANY INC.] Wall Street Plaza New York, New York 10005 1-800-223-2064 (Toll Free) The Dealer Manager for the Offer is: MERRILL LYNCH & CO. World Financial Center North Tower New York, New York 10281-1305 (212) 236-4723 (Call Collect) April 3, 1995 EX-11.(A)(3) 4 EXHIBIT 11(a)(3) NOTICE OF GUARANTEED DELIVERY TO TENDER SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS) OF CLARK EQUIPMENT COMPANY As set forth in Section 3 of the Offer to Purchase described below, this instrument or one substantially equivalent hereto must be used to accept the Offer (as defined below) if certificates for Shares (as defined below) or the associated Preferred Stock Purchase Rights (the "Rights") are not immediately available or the certificates for Shares or Rights and all other required documents cannot be delivered to the Depositary prior to the Expiration Date (as defined in Section 1 of the Offer to Purchase) or if the procedure for delivery by book-entry transfer cannot be completed on a timely basis. This instrument may be delivered by hand or transmitted by facsimile transmission or mail to the Depositary. The Depositary for the Offer is: THE BANK OF NEW YORK By Mail: By Facsimile Transmission: By Hand or Overnight Delivery: Tender & Exchange Department (for Eligible Institutions Tender & Exchange Department P.O. Box 11248 only) 101 Barclay Street Church Street Station (212) 815-6213 Receive and Deliver Window New York, NY 10286-1243 Confirm by Telephone: New York, NY 10286 (800) 507-9357
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. This form is not to be used to guarantee signatures. If a signature on a Letter of Transmittal is required to be guaranteed by an Eligible Institution under the instructions thereto, such signature guarantee must appear in the applicable space provided in the signature box in the Letter of Transmittal. Ladies and Gentlemen: The undersigned hereby tender(s) to CEC Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Ingersoll-Rand Company, a New Jersey corporation, upon the terms and subject to the conditions set forth in the Offer to Purchase dated April 3, 1995 (the "Offer to Purchase"), and in the related Letter of Transmittal (which together constitute the "Offer"), receipt of which is hereby acknowledged, the number of shares of Common Stock, $7.50 par value per share (the "Shares"), and the number of Rights, indicated below of Clark Equipment Company, a Delaware corporation, pursuant to the guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase. Signature(s) ......................... Address(es) ........................... Name(s) of Record Holders ............................. ...................................... ZIP CODE PLEASE TYPE OR PRINT Area Code and Tel. No(s) .... Check one box if Shares and Rights will be tendered by book-entry transfer) Number of Shares and Rights .......... Certificate Nos. (If Available) / / The Depository Trust Company ....................................... ........................................ / / Midwest Securities Trust Company ........................................ / / Philadelphia Depository Trust Company Dated ............................, 1995 Account Number .............. .............................
GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE) The undersigned, a firm which is a bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of the Securities Transfer Agents Medallion Program, (a) represents that the above named person(s) "own(s)" the Shares and/or Rights tendered hereby within the meaning of Rule 14e-4 under the Securities Exchange Act of 1934, as amended ("Rule 14e-4"), (b) represents that such tender of Shares complies with Rule 14e-4, (c) guarantees to deliver to the Depositary either the certificates evidencing all tendered Shares, in proper form for transfer, or to deliver Shares pursuant to the procedure for book-entry transfer into the Depositary's account at The Depository Trust Company, the Midwest Securities Trust Company or the Philadelphia Depository Trust Company (each a "Book-Entry Transfer Facility"), in either case together with the Letter of Transmittal (or a facsimile thereof), properly completed and duly executed, with any required signature guarantees or an Agent's Message (as defined in the Offer to Purchase) in the case of a book-entry delivery, and any other required documents, all within five New York Stock Exchange, Inc. ("NYSE") trading days after the date hereof and (d) guarantees, if applicable, to deliver certificates representing the Rights ("Rights Certificates") in proper form for transfer, or to deliver such Rights pursuant to the procedure for book-entry transfer into the Depositary's account at a Book-Entry Transfer Facility together with, if Rights are forwarded separately, the Letter of Transmittal (or a facsimile thereof), properly completed and duly executed with any required signature guarantees or an Agent's Message (as defined in the Offer to Purchase) in the case of a book-entry delivery, and any other required documents, all within five NYSE trading days after the date hereof or, if later, five business days after Rights Certificates are distributed to holders of Shares. ..................................... ............................... NAME OF FIRM AUTHORIZED SIGNATURE ..................................... Name .............................. ADDRESS PLEASE TYPE OR PRINT ..................................... Title ............................. ZIP CODE Dated ........................, 1995 AREA CODE AND TEL. NO. ............... NOTE: DO NOT SEND CERTIFICATES FOR SHARES OR RIGHTS WITH THIS NOTICE. CERTIFICATES SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL. EX-11.(A)(4) 5 EXHIBIT 11(a)(4) WORLD FINANCIAL CENTER NORTH TOWER NEW YORK, NEW YORK 10281-1305 (212) 236-4723 (CALL COLLECT) [MERRILL LYNCH LOGO] OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS) OF CLARK EQUIPMENT COMPANY AT $77.00 NET PER SHARE BY CEC ACQUISITION CORP. A WHOLLY OWNED SUBSIDIARY OF INGERSOLL-RAND COMPANY THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, APRIL 28, 1995 UNLESS THE OFFER IS EXTENDED. April 3, 1995 To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees: We have been appointed by CEC Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of Ingersoll-Rand Company, a New Jersey corporation (the "Parent"), to act as Dealer Manager in connection with the Purchaser's offer to purchase for cash all the outstanding shares of Common Stock, par value $7.50 per share (the "Shares"), of Clark Equipment Company, a Delaware corporation (the "Company"), and (unless and until the Purchaser declares the Rights Condition (as defined in the Offer to Purchase) is satisfied) the associated Preferred Stock Purchase Rights (the "Rights") issued pursuant to the Rights Agreement, dated as of March 10, 1987, as amended and restated as of August 14, 1990 (as so amended and restated, the "Rights Agreement"), between the Company and Harris Trust and Savings Bank, as Rights Agent, at a purchase price of $77.00 per Share (and associated Right), net to the seller in cash without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated April 3, 1995 (the "Offer to Purchase") and in the related Letter of Transmittal (which together constitute the "Offer") enclosed herewith. Unless and until the Purchaser declares that the Rights Condition is satisfied, holders of Shares will be required to tender one Right for each Share tendered in order to effect a valid tender of such Share. If the Distribution Date (as defined in the Offer to Purchase) has not occurred prior to the time Shares are tendered pursuant to the Offer, a tender of Shares will constitute a tender of the associated Rights. If the Distribution Date has occurred and certificates representing Rights ("Rights Certificates") have been distributed by the Company to holders of Shares, such holders of Shares shall be required to tender Rights Certificates representing a number of Rights equal to the number of Shares being tendered in order to effect valid tender of such Shares. Holders of Shares and Rights whose certificates for such Shares (the "Share Certificates") and, if applicable, Rights Certificates are not immediately available or who cannot deliver their Share Certificates or, if applicable, their Rights Certificates, and all other required documents to the Depositary (as defined below) prior to the [MERRILL LYNCH LOGO] Expiration Date (as defined in the Offer to Purchase), or who cannot complete the procedures for book-entry transfer on a timely basis, must tender their Shares and Rights according to the guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase. Unless the context otherwise requires, all references to Shares shall include the associated Rights. All references to the Rights shall include all benefits that may inure to holders of Rights pursuant to the Rights Agreement. Please furnish copies of the enclosed materials to those of your clients for whose accounts you hold Shares registered in your name or in the name of your nominee. The Offer is conditioned upon, among other things: (1) there being validly tendered and not properly withdrawn prior to the expiration of the Offer a number of Shares which constitutes at least 51% of the voting power (determined on a fully diluted basis) on the date of purchase of all securities of the Company entitled to vote generally in the election of directors or in a merger; (2) the Purchaser being satisfied, in its sole discretion, that the supermajority stockholder vote specified in the supermajority voting provisions contained in the Company's Restated Certificate of Incorporation would not (as a result of action by the Company's Board of Directors or otherwise) be required prior to the consummation of the Merger (as defined in the Offer to Purchase) or that the Purchaser will acquire a sufficient number of shares to insure a vote in favor of the Merger under such provisions; (3) the Rights having been redeemed by the Company's Board of Directors or the Purchaser being satisfied, in its sole discretion, that the Rights have been invalidated or are otherwise inapplicable to, or that the dilutive provisions thereof would not be triggered by, the Offer and the Merger; and (4) the Purchaser being satisfied, in its sole discretion, that the restrictions on business combinations contained in Section 203 of the Delaware General Corporation Law would not apply to the Purchaser or the Parent in connection with the Offer or the Merger (as a result of action by the Company's Board of Directors, the ownership by the Purchaser upon consummation of the Offer of at least 85% of the outstanding voting stock of the Company (other than shares held by directors who are also officers and certain employee stock plans of the Company) or otherwise). The Offer is also subject to other terms and conditions. See the Introduction and Sections 1 and 14 of the Offer to Purchase. Enclosed herewith for your information and forwarding to your clients are copies of the following documents: 1. The Offer to Purchase, dated April 3, 1995. 2. The green Letter of Transmittal to tender Shares for your use and for the information of your clients. Facsimile copies of the Letter of Transmittal may be used to tender Shares. 3. The gold Notice of Guaranteed Delivery for Shares and Rights to be used to accept the Offer if Share Certificates or Rights Certificates are not immediately available or if such certificates and all other required documents cannot be delivered to The Bank of New York (the "Depositary") by the Expiration Date or if the procedure for book-entry transfer cannot be completed by the Expiration Date. 4. A gray printed form of letter which may be sent to your clients for whose accounts you hold Shares registered in your name or in the name of your nominee, with space provided for obtaining such clients' instructions with regard to the Offer. 5. Guidelines of the Internal Revenue Service for Certification of Taxpayer Identification Number on Substitute Form W-9. 6. A return envelope addressed to The Bank of New York, the Depositary. YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, APRIL 28, 1995 UNLESS THE OFFER IS EXTENDED. [MERRILL LYNCH LOGO] In order to take advantage of the Offer, (i) a duly executed and properly completed Letter of Transmittal and any required signature guarantees, or an Agent's Message (as defined in the Offer to Purchase) in connection with a book-entry delivery of Shares or Rights, and other required documents should be sent to the Depositary, and (ii) either Share Certificates, and if applicable, Rights Certificates, representing the tendered Shares (and, if applicable, tendered Rights) should be delivered to the Depositary, or such Shares (and, if applicable, tendered Rights) should be tendered by book-entry transfer into the Depositary's account maintained at one of the Book-Entry Transfer Facilities (as described in the Offer to Purchase), all in accordance with the instructions set forth in the Letter of Transmittal and the Offer to Purchase. If holders of Shares wish to tender, but it is impracticable for them to forward their Share Certificates or, if applicable, Rights Certificates, or other required documents on or prior to the Expiration Date or to comply with the book-entry transfer procedures on a timely basis, a tender may be effected by following the guaranteed delivery procedures specified in Section 3 of the Offer to Purchase. The Purchaser will not pay any commissions or fees to any broker, dealer or other person (other than the Dealer Manager, the Depositary and Georgeson & Company Inc. (the "Information Agent") (as described in the Offer to Purchase)) for soliciting tenders of Shares pursuant to the Offer. The Purchaser will, however, upon request, reimburse you for customary clerical and mailing expenses incurred by you in forwarding any of the enclosed materials to your clients. The Purchaser will pay or cause to be paid any stock transfer taxes payable on the transfer of Shares to it, except as otherwise provided in Instruction 6 of the Letter of Transmittal. Any inquiries you may have with respect to the Offer should be addressed to Merrill Lynch & Co., the Dealer Manager, or the Information Agent, at their respective addresses and telephone numbers set forth on the back cover of the Offer to Purchase. Additional copies of the enclosed materials may be obtained from the Information Agent. Very truly yours, MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY OTHER PERSON THE AGENT OF THE PURCHASER, THE PARENT, THE DEALER MANAGER, THE COMPANY, THE DEPOSITARY OR THE INFORMATION AGENT, OR ANY AFFILIATE OF ANY OF THEM, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENT OR USE ANY DOCUMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE ENCLOSED DOCUMENTS AND THE STATEMENTS CONTAINED THEREIN. EX-11.(A)(5) 6 EXHIBIT 11(a)(5) OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS) OF CLARK EQUIPMENT COMPANY AT $77.00 NET PER SHARE BY CEC ACQUISITION CORP. A WHOLLY OWNED SUBSIDIARY OF INGERSOLL-RAND COMPANY THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, APRIL 28, 1995, UNLESS THE OFFER IS EXTENDED. To Our Clients: Enclosed for your consideration is an Offer to Purchase dated April 3, 1995 (the "Offer to Purchase"), and the related Letter of Transmittal relating to an offer by CEC Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of Ingersoll-Rand Company, a New Jersey corporation (the "Parent"), to purchase all of the outstanding shares of Common Stock, $7.50 par value per share (the "Shares"), of Clark Equipment Company, a Delaware corporation (the "Company"), and (unless and until the Purchaser declares that the Rights Condition (as defined in the Offer to Purchase) is satisfied) the associated Preferred Stock Purchase Rights (the "Rights") issued pursuant to the Rights Agreement, dated as of March 10, 1987, as amended and restated as of as of August 14, 1990 (as so amended and restated, the "Rights Agreement"), between the Company and Harris Trust and Savings Bank, as Rights Agent, at a purchase price of $77.00 per Share (and associated Right), net to the seller in cash without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase and in the related Letter of Transmittal (which together constitute the "Offer"). Unless the context requires otherwise, all references to "Shares" shall be deemed to refer also to the associated Rights. We are the holder of record of Shares held by us for your account. A tender of such Shares can be made only by us as the holder of record and pursuant to your instructions. The Letter of Transmittal is furnished to you for your information only and cannot be used by you to tender Shares held by us for your account. Unless and until the Purchaser declares that the Rights Condition (as defined below) is satisfied, if certificates representing Rights (the "Rights Certificates") have been distributed to holders of Shares, such holders are required to tender Rights Certificate(s) representing a number of Rights equal the number of Shares being tendered in order to effect a valid tender of such Shares. Based on the Company's filings with the Securities and Exchange Commission (the "Commission"), until the Distribution Date (as defined in the Offer to Purchase), the surrender for transfer of any of the certificates representing Shares (the "Share Certificates") will also constitute the surrender for transfer of the Rights associated with the Shares represented by such Share Certificates. Based on the Company's filings with the Commission, as soon as practicable following the Distribution Date, the Rights Certificates will be mailed to holders of record of Shares as of the close of business on the Distribution Date; after the Distribution Date, such separate Rights Certificates alone will evidence the Rights. See Section 3 of the Offer to Purchase. We request instructions as to whether you wish to have us tender on your behalf any or all of such Shares held by us for your account, pursuant to the terms and subject to the conditions set forth in the Offer to Purchase. Your instructions to tender Shares held by us for your account will also constitute a direction to us to tender a number of Rights held by us for your account equal to the number of Shares tendered. Your attention is directed to the following: 1. The tender price is $77.00 per share, net to the seller in cash without interest thereon. 2. The Offer is made for all of the outstanding Shares. 3. The Offer and withdrawal rights will expire at 12:00 Midnight, New York City time, on Friday, April 28, 1995 unless the Offer is extended. 4. The Offer is conditioned upon, among other things: (1) there being validly tendered and not properly withdrawn prior to the expiration of the Offer a number of Shares which constitutes at least 51% of the voting power (determined on a fully diluted basis) on the date of purchase of all securities of the Company entitled to vote generally in the election of directors or in a merger; (2) the Purchaser being satisfied, in its sole discretion, that the supermajority stockholder vote specified in the supermajority voting provisions contained in the Company's Restated Certificate of Incorporation would not (as a result of action by the Company's Board of Directors or otherwise) be required prior to the consummation of the Merger (as defined in the Offer to Purchase) or that the Purchaser will acquire a sufficient number of shares to insure a vote in favor of the Merger under such provisions, (3) the Rights having been redeemed by the Company's Board of Directors or the Purchaser being satisfied, in its sole discretion, that the Rights have been invalidated or are otherwise inapplicable to, or that the dilutive provisions thereof would not be triggered by, the Offer and the Merger; and (4) the Purchaser being satisfied, in its sole discretion, that the restrictions on business combinations contained in Section 203 of the Delaware General Corporation Law would not apply to the Purchaser or the Parent in connection with the Offer or the Merger (as a result of action by the Company's Board of Directors, the ownership by the Purchaser upon consummation of the Offer of at least 85% of the outstanding voting stock of the Company (other than shares held by directors who are also officers and certain employee stock plans of the Company) or otherwise). The Offer is also subject to other terms and conditions. See the Introduction and Sections 1 and 14 of the Offer to Purchase. 5. Tendering shareholders will not be obligated to pay brokerage fees or commissions or, except as set forth in Instruction 6 of the Letter of Transmittal, stock transfer taxes on the purchase of Shares pursuant to the Offer. The Offer is being made solely by the Offer to Purchase and the related Letter of Transmittal and is being made to all holders of Shares. The Purchaser is not aware of any state where the making of the Offer is prohibited by administrative or judicial action pursuant to any valid state statute. If the Purchaser becomes aware of any valid state statute prohibiting the making of the Offer or the acceptance of Shares pursuant thereto, the Purchaser will make a good faith effort to comply with any such state statute. If, after such good faith effort, the Purchaser cannot comply with such state statute, the Offer will not be made to nor will tenders be accepted from or on behalf of the holders of Shares in such state. In any jurisdiction where the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer shall be deemed to be made on behalf of the Purchaser by the Dealer Manager or one or more registered brokers or dealers that are licensed under the laws of such jurisdiction. If you wish to have us tender any or all of the Shares held by us for your account, please instruct us by completing, executing and returning to us the instruction form contained in this letter. If you authorize a tender of your Shares, all such Shares will be tendered unless otherwise specified in such instruction form. Your instructions should be forwarded to us in ample time to permit us to submit a tender on your behalf prior to the expiration of the Offer. INSTRUCTIONS WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS) OF CLARK EQUIPMENT COMPANY The undersigned acknowledge(s) receipt of your letter enclosing the Offer to Purchase dated April 3, 1995 (the "Offer to Purchase") and the related Letter of Transmittal pursuant to an offer by CEC Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Ingersoll-Rand Company, a New Jersey corporation, to purchase all outstanding shares of Common Stock, $7.50 par value per share (the "Shares"), of Clark Equipment Company, a Delaware corporation, and (unless and until the Purchaser declares that the Rights Condition (as defined in the Offer to Purchase) is satisfied) the associated Preferred Stock Purchase Rights (the "Rights"). This will instruct you to tender the number of Shares and Rights indicated below (or, if no number is indicated below, all Shares and Rights) which are held by you for the account of the undersigned, upon the terms and subject to the conditions set forth in the Offer to Purchase and in the related Letter of Transmittal furnished to the undersigned. Number of Shares (and Rights) to be SIGN HERE Tendered* .......................................... .......................Shares (and Rights) .......................................... Dated.................................,1995 Signature(s) .......................................... Please print names(s) .......................................... Address .......................................... Area Code and Telephone Number .......................................... Tax Identification or Social Security Number
- ------------ * Unless otherwise indicated, it will be assumed that all of your Shares (and Rights) held by us for your account are to be tendered. EX-11.(A)(6) 7 EXHIBIT 11(a)(6) GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE PAYER.--Social Security numbers have nine digits separated by two hyphens; i.e. 000-00-0000. Employer identification numbers have nine digits separated by only one hyphen: i.e. 00-0000000. The table below will help determine the number to give the payer. - ------------------------------------------------------ FOR THIS TYPE OF ACCOUNT: GIVE THE SOCIAL SECURITY NUMBER OF-- - ------------------------------------------------------ 1. An individual's account The individual 2. Two or more individuals The actual owner of (joint account) the account or, if combined funds, any one of the individuals(1) 3. Husband and wife (joint The actual owner of account) the account or, if joint funds, either person(1) 4. Custodian account of a The minor(2) minor (Uniform Gift to Minors Act) 5. Adult and minor (joint The adult or, if the account) minor is the only contributor, the minor(1) 6. Account in the name of The ward, minor, or guardian or committee incompetent person(3) for a designated ward, minor or incompetent person 7. a. The usual revocable The grantor-trustee(1) savings trust account (grantor is also trustee) b. So-called trust The actual owner(1) account that is not a legal or valid trust under State law 8. Sole proprietorship The owner(4) account - ------------------------------------------------------ FOR THIS TYPE OF ACCOUNT: GIVE THE EMPLOYER IDENTIFICATION NUMBER OF-- - ------------------------------------------------------ 9. A valid trust, estate, The legal entity (Do or pension trust not furnish the identifying number of the personal representative or trustee unless the legal entity itself is not designated in the account title.)(5) 10. Corporate account The corporation 11. Religious charitable, The organization or educational organization account 12. Partnership account The partnership held in the name of the business 13. Association, club, or The organization other tax-exempt organization 14. A broker or registered The broker or nominee nominee 15. Account with the The public entity Department of Agriculture in the name of a public entity (such as a State or local government, school district, or prison) that receives agricultural program payments - -------------------------------------------------------------------------------- (1) List first and circle the name of the person whose number you furnish. (2) Circle the minor's name and furnish the minor's social security number. (3) Circle the ward's, minor's or incompetent person's name and furnish such person's social security number. (4) Show the name of the owner. (5) List first and circle the name of the legal trust, estate, or pension trust. NOTE: If no name is circled when there is more than one name, the number will be considered to be that of the first name listed. GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 PAGE 2 OBTAINING A NUMBER If you don't have a taxpayer identification number or you don't know your number, obtain Form SS-5, Application for a Social Security Number Card, or Form SS-4, Application for Employer Identification Number, at the local office of the Social Security Administration or the Internal Revenue Service and apply for a number. PAYEE EXEMPT FROM BACKUP WITHHOLDING Payees specifically exempted from backup withholding on ALL payments include the following: . A corporation. . A financial institution. . An organization exempt from tax under section 501(a), or an individual retirement plan. . The United States or any agency or instrumentality thereof. . A State, the District of Columbia, a possession of the United States, or any subdivision or instrumentality thereof. . A foreign government, a political subdivision of a foreign government, or any agency or instrumentality thereof. . An international organization or any agency, or instrumentality thereof. . A registered dealer in securities or commodities registered in the U.S. or a possession of the U.S. . A real estate investment trust. . A common trust fund operated by a bank under section 584(a). . An exempt charitable remainder trust, or a nonexempt trust described in section 4947(a)(1). . An entity registered at all times under the Investment Company Act of 1940. . A foreign central bank of issue. Payments of dividends and patronage dividends not generally subject to backup withholding include the following: . Payments to nonresident aliens subject to withholding under section 1441. . Payments to partnerships not engaged in a trade or business in the U.S. and which have at least one nonresident partner. . Payments of patronage dividends where the amount received is not paid in money. . Payments made by certain foreign organizations. . Payments made to a nominee Payments of interest to generally subject to backup withholding include the following: . Payments of interest on obligations issued by individuals. Note: You may be subject to backup withholding if this interest is $600 or more and is paid in the course of the payer's trade or business and you have not provided your correct taxpayer identification number to the payer. . Payments of tax-exempt interest (including exempt-interest dividends under section 852). . Payments described in section 6049(b)(5) to non-resident aliens. . Payments on tax-free covenant bonds under section 1451. . Payments made by certain foreign organizations. . Payments made to a nominee Exempt payees described above should file Form W-9 to avoid possible erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO THE PAYER, IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO SIGN AND DATE THE FORM. Certain payments other than interest, dividends, and patronage dividends, that are not subject to information reporting are also not subject to backup withholding. For details, see the regulations under sections 6041, 6041(a), 6045, and 6050A. PRIVACY ACT NOTICE.--Section 6109 requires most recipients of dividend, interest, or other payments to give taxpayer identification numbers to payers who must report the payments to IRS. The IRS uses the numbers for identification purposes. Payers must be given the numbers whether or not recipients are required to file a tax return. Beginning January 1, 1984, payers must generally withhold 20% of taxable interest, dividend, and certain other payments to a payee who does not furnish a taxpayer identification number to a payer. Certain penalties may also apply. PENALTIES (1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER.--If you fail to furnish your taxpayer identification number to a payer, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect. (2) FAILURE TO REPORT CERTAIN DIVIDEND AND INTEREST PAYMENTS.--If you fail to include any portion of an includible payment for interest, dividends, or patronage dividends in gross income, such failure will be treated as being due to negligence and will be subject to a penalty of 5% on any portion of an under-payment attributable to that failure unless there is clear and convincing evidence to the contrary. (3) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.--If you make a false statement with no reasonable basis which results in no imposition of backup withholding, you are subject to a penalty of $500. (4) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.--Falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE SERVICE EX-11.(A)(7) 8 EXHIBIT 11(a)(7) This announcement is neither an offer to purchase nor a solicitation of an offer to sell Shares. The Offer is made solely by the Offer to Purchase dated April 3, 1995 and the related Letter of Transmittal and is being made to all holders of Shares. The Purchaser is not aware of any state where the making of the Offer is prohibited by administrative or judicial action pursuant to a state statute. If the Purchaser becomes aware of any state where the making of the Offer is prohibited, the Purchaser will make a good faith effort to comply with any such statute or seek to have such statute declared inapplicable to the Offer. If, after such good faith effort, the Purchaser cannot comply with any applicable statute, the Offer will not be made to (nor will tenders be accepted from or on behalf of) the holders of Shares in such state. In those jurisdictions whose securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer shall be deemed to be made on behalf of the Purchaser by Merrill Lynch, Pierce, Fenner & Smith Incorporated or one or more registered brokers or dealers licensed under the laws of such jurisdictions. Notice of Offer to Purchase for Cash All Outstanding Shares of Common Stock (including the Associated Preferred Stock Purchase Rights) of Clark Equipment Company at $77 Net Per Share by CEC Acquisition Corp. a wholly owned subsidiary of Ingersoll-Rand Company CEC Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of Ingersoll-Rand Company, a New Jersey corporation (the "Parent"), hereby offers to purchase all of the outstanding shares of common stock, $7.50 par value per share (the "Shares"), of Clark Equipment Company, a Delaware corporation (the "Company"), and (unless and until the Purchaser declares that the Rights Condition (as defined below) is satisfied) the associated Preferred Stock Purchase Rights (the "Rights") issued pursuant to the Rights Agreement, dated as of March 10, 1987, as amended and restated as of August 14, 1990, between the Company and Harris Trust and Savings Bank, as Rights Agent (as so amended and restated, the "Rights Agreement"), at a purchase price of $77.00 per Share (and associated Right) net to the seller in cash without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase dated April 3, 1995 (the "Offer to Purchase") and in the related Letter of Transmittal (which together constitute the "Offer"). Unless the context requires otherwise, all references to Shares shall be deemed to refer also to the associated Rights, and all references to Rights shall be deemed to include all benefits that may inure to the stockholders of the Company or to holders of Rights pursuant to the Rights Agreement. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, APRIL 28, 1995, UNLESS THE OFFER IS EXTENDED. The Offer is conditioned upon, among other things, (1) there being validly tendered and not properly withdrawn prior to the expiration of the Offer a number of Shares which constitutes at least 51% of the voting power (determined on a fully diluted basis) on the date of purchase of all securities of the Company entitled to vote generally in the election of directors or in a merger; (2) the Purchaser being satisfied, in its sole discretion, that the supermajority stockholder vote specified in the supermajority voting provisions contained in the Company's Restated Certificate of Incorporation would not (as a result of action by the Company's Board of Directors or otherwise) be required prior to the consummation of the proposed Merger described below or that the Purchaser will acquire a sufficient number of Shares to insure a vote in favor of such Merger under such provisions; (3) the Company's Preferred Stock Purchase Rights having been redeemed by the Company's Board of Directors or the Purchaser being satisfied, in its sole discretion, that such Preferred Stock Purchase Rights have been invalidated or are otherwise inapplicable to, or that the dilutive provisions thereof would not be triggered by, the Offer and the proposed Merger described below (the "Rights Condition"); and (4) the Purchaser being satisfied, in its sole discretion, that the restrictions on business combinations contained in Section 203 of the Delaware General Corporation Law would not apply to the Purchaser or the Parent in connection with the Offer or the proposed Merger described below (as a result of action by the Company's Board of Directors, the ownership by the Purchaser upon consummation of the Offer of at least 85% of the outstanding voting stock of the Company (other than shares held by directors who are also officers and certain employee stock plans of the Company) or otherwise). The Offer is also subject to other terms and conditions. See the Introduction and Sections 1 and 14 of the Offer to Purchase. The purpose of the Offer is to acquire control of, and the entire equity interest in, the Company. The Purchaser intends to propose, and to seek to have the Company consummate as soon as practicable after consummation of the Offer, a merger or similar business combination (the "Merger") with the Purchaser or another direct or indirect subsidiary of the Parent, pursuant to which each then outstanding Share (other than Shares held by the Parent, the Purchaser or any other wholly owned subsidiary of the Parent, Shares held in the treasury of the Company and Shares held by stockholders who properly exercise appraisal rights under Delaware law) would be converted into the right to receive in cash the price per Share paid by the Purchaser pursuant to the Offer. The consummation of the Merger would be subject to a number of factors (including satisfaction of various conditions) discussed in the Introduction and in Sections 11 and 14 of the Offer to Purchase. Section 11 of the Offer to Purchase also discusses certain appraisal rights available to stockholders upon consummation of the Merger. Unless and until the Purchaser declares that the Rights Condition is satisfied, if certificates representing Rights ("Rights Certificates") have been distributed to holders of Shares, such holders will be required to tender Rights Certificates representing a number of Rights equal to the number of Shares being tendered in order to effect a valid tender of such Shares. For purposes of the Offer the Purchaser will be deemed to have accepted for payment (and thereby purchased) Shares validly tendered and not properly withdrawn as, if and when the Purchaser gives oral or written notice to the Depositary (as defined in the Offer to Purchase) of the Purchaser's acceptance for payment of such Shares pursuant to the Offer. Upon the terms and subject to the conditions of the Offer, payment for Shares accepted for payment pursuant to the Offer will be made by deposit of the purchase price therefor with the Depositary, which will act as agent for tendering stockholders for the purpose of receiving payments from the Purchaser and transmitting such payments to stockholders whose Shares have been accepted for payment. Under no circumstance will interest on the purchase price for Shares be paid, regardless of any delay in making such payment. In all cases, payment for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of (i) certificates representing shares ("Share Certificates") and, if applicable, Rights Certificates, or timely confirmation of a book-entry transfer of such Shares and Rights into the Depositary's account at The Depository Trust Company, the Midwest Securities Trust Company or the Philadelphia Depository Trust Company (each a "Book-Entry Transfer Facility") pursuant to the procedures set forth in Section 3 of the Offer to Purchase; (ii) the Letter of Transmittal (or a facsimile thereof) properly completed and duly executed, with any required signature guarantees, or an Agent's Message (as defined in Section 2 of the Offer to Purchase) in connection with a book-entry transfer, and (iii) any other documents required by the Letter of Transmittal. The Purchaser expressly reserves the right, in its sole discretion, at any time and from time to time, to extend the period during which the Offer is open for any reason, including the occurrence of any of the events specified in Section 14 of the Offer to Purchase, by giving written notice of such extension to the Depositary. Any such extension will be followed as promptly as practicable by public announcement to be made no later than 9:00 A.M., New York City time, on the next business day after the previously scheduled Expiration Date. The term "Expiration Date" means 12:00 Midnight, New York City time, on Friday, April 28, 1995, unless and until the Purchaser, in its sole discretion, shall have extended the period during which the Offer is open, in which event the term "Expiration Date" shall mean the latest time and date at which the Offer, as so extended by the Purchaser, shall expire. Tenders of Shares and Rights made pursuant to the Offer are irrevocable, except that Shares and Rights tendered pursuant to the Offer may be withdrawn at any time on or prior to the Expiration Date and, unless theretofore accepted for payment by the Purchaser pursuant to the Offer, may also be withdrawn at any time after June 1, 1995. For a withdrawal to be effective, a written telegraphic, telex or facsimile transmission notice of withdrawal must be timely received by the Depositary at one of its addresses set forth on the back cover of the Offer to Purchase. Any such notice of withdrawal must specify the name of the person who tendered the Shares or Rights to be withdrawn, the number of Shares or Rights to be withdrawn and the name of the registered holder, if different from that of the person who tendered such Shares or Rights. If Share Certificates or Rights Certificates to be withdrawn have been delivered or otherwise identified to the Depositary, then, prior to the physical release of such certificates, the serial numbers shown on such certificates must be submitted to the Depositary and the signatures on the notice of withdrawal must be guaranteed by an Eligible Institution (as defined in Section 3 of the Offer to Purchase) unless such Shares or Rights have been tendered for the account of any Eligible Institution. If Shares or Rights have been tendered pursuant to the procedure for book-entry transfer as set forth in Section 3 of the Offer to Purchase, 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 or Rights, in which case a notice of withdrawal will be effective if delivered to the Depositary by any method of delivery described in the second sentence of this paragraph. A withdrawal of Shares or Rights shall also constitute a withdrawal of the associated Rights or Shares as applicable. All questions as to the term and validity (including time of receipt) of any notice of withdrawal will be determined by the Purchaser, in its sole discretion, whose determination will be final and binding. The information required to be disclosed by Rule 14d-6(e)(1)(vii) of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended, is contained in the Offer to Purchase and is incorporated herein by reference. A demand under Delaware law has been made to the Company for its list of stockholders and security position listings for the purpose of, among other things, disseminating the Offer to holders of Shares. Upon compliance by the Company with such request, the Offer to Purchase and the related Letter of Transmittal and, if required, other relevant materials will be mailed to record holders of Shares and Rights whose names appear on the Company's list of stockholders and will be furnished to brokers, dealers, commercial banks, trust companies and similar persons whose names, or the names of whose nominees, appear on the list of stockholders, or who are listed as participants in a clearing agency's security position listing for subsequent transmittal to beneficial owners of Shares. A request pursuant to Rule 14d-5 under the Exchange Act for use of the Company's stockholder list and security position listings is also being made to the Company. The Offer to Purchase and the related Letter of Transmittal contain important information which should be read before any decision is made with respect to the Offer. Questions and requests for assistance may be directed to the Dealer Manager or the Information Agent as set forth below. Requests for copies of the Offer to Purchase and the related Letter of Transmittal and all other tender offer materials may be directed to the Information Agent, and copies will be furnished promptly at the Purchaser's expense. The Purchaser will not pay any fees or commissions to any broker or dealer or any other person (other than the Dealer Manager and the Information Agent) for soliciting tenders of Shares and Rights pursuant to the Offer. The Information Agent for the Offer is: [Georgeson & Company Inc. Logo] Wall Street Plaza 88 Pine Street New York, New York 10005 1-800-223-2064 (Toll Free) The Dealer Manager for the Offer is: Merrill Lynch & Co. World Financial Center North Tower New York, New York 10281-1305 (212) 236-4723 (Call Collect) April 3, 1995 EX-11.(A)(8) 9 EXHIBIT 11(a)(8) Thomas F. McBride Senior Vice President For Immediate Release and Chief Financial Officer (201) 573-3486 INGERSOLL-RAND ANNOUNCES CASH TENDER OFFER FOR CLARK EQUIPMENT AT $77 PER SHARE Woodcliff Lake, N.J. (April 3, 1995) -- Ingersoll-Rand Company announced today that it has commenced a tender offer for all outstanding shares of common stock of Clark Equipment Company at $77 per share in cash. Ingersoll-Rand also said it is delivering a notice to Clark today nominating a slate of seven directors to replace the Clark directors who will be up for election at Clark's annual meeting scheduled for May 9, 1995. Ingersoll-Rand said it is taking this action to ensure that Clark's Board of Directors will take all necessary actions to approve Ingersoll-Rand's tender offer and permit it to be consummated. James E. Perrella, Chairman, President and Chief Executive Officer of Ingersoll-Rand, said: "Last week, Clark's Board of Directors rejected our invitation to negotiate a merger agreement between Clark and Ingersoll-Rand. We think Clark's stockholders should have the opportunity to decide for themselves whether to accept our proposal." "We have taken the further step of nominating seven directors to replace the Clark directors who are up for election at the upcoming annual meeting scheduled for May 9. 1995. Ingersoll-Rand's director nominees are all committed to take all steps necessary to permit Ingersoll-Rand's tender offer and proposed merger to proceed, including redeeming Clark's stockholder rights plan and approving the tender offer and proposed merger for purposes of the Delaware takeover law and supermajority voting provisions in Clark's certificate of incorporation," Mr. Perrella said. A letter sent today by Mr. Perrella to Leo J. McKernan, Chairman of Clark, is set forth below:: April 3, 1995 Chairman, President and Chief Executive Officer Clark Equipment Company 100 North Michigan Street South Bend, Indiana 46634 Dear Leo: Over the past two and a half weeks, Ingersoll-Rand has made repeated efforts to meet with Clark in an attempt to negotiate the terms of a merger transaction that could be presented to Clark's stockholders as the joint effort of both companies' Board and managements. But rather than recognize its fiduciary responsibility to explore further a possible transaction on the basis we have proposed, the only response from Clark has been to state its long-standing position that Clark is not for sale and to file a lawsuit against us. The Company's actions leave us with only one alternative. Today we are commencing a tender offer to acquire all outstanding shares of Clark common stock at $77.00 in cash per share and we are sending a letter notifying you that we are nominating seven individuals for election as directors of Clark at Clark's May 9 annual meeting of stockholders. We regret that we have to resort to these actions; we would have greatly preferred to enter into negotiations with you in an effort to reach agreement on a merger transaction. But even though we have commenced a tender offer, we continue to be interested in meeting with you to negotiate the terms of a transaction that can be approved by your Board. When your Board recognizes that its fiduciary duties require consideration of the sale of Clark, please call me. Sincerely, /s/ James E. Perrella Chairman, President and Chief Executive Officer The tender offer and withdrawal rights thereunder will expire at 12:00 Midnight, New York City time, on Friday, April 28, 1995, unless the tender offer is extended. # # # Additional Contact: Clark & Weinstock (212) 953-2550 ----------------- Davis Weinstock Gene Donati Carol Phethean This press release does not constitute a solicitation of a proxy, consent or authorization for or with respect to the annual meeting of the Company's stockholders or any action in lieu thereof. Any such solicitation which Ingersoll-Rand may make will be made only pursuant to separate proxy materials in compliance with the requirements of Section 14(a) of the Securities Exchange Act of 1934, as amended. EX-11.(B)(1) 10 EXHIBIT 11(b)(1) March 31, 1995 Ingersoll-Rand Company 200 Chestnut Ridge Road Woodcliff Lake, New Jersey Attention: Thomas F. McBride -- Senior Vice President and Chief Financial Officer Ladies and Gentlemen: You have advised The Chase Manhattan Bank (National Association) ("Chase") that Ingersoll-Rand Company (the "Company") proposes to form a ----- ------- wholly-owned subsidiary (the "Purchaser") to make a public tender offer (the --------- "Tender Offer") to acquire (the "Acquisition") all of the issued and ------------ ----------- outstanding capital stock of a public company disclosed to Chase (the "Target"), to be followed by the merger of the Purchaser with and into the ------ Target (the "Merger" and, collectively with the Acquisition, the ------ "Transactions"). ------------ We understand that senior bank financing of up to $1,350,000,000 is required to finance the consummation of the Transactions, including the payment of fees, commissions and expenses payable in connection therewith, of which only $1,000,000,000 is to be available from and after the earlier of (i) the date 45 days after the effective date of the Merger (the "Merger ------ Effective Date") and (ii) the date 180 days after the Tender Offer Closing -------------- Date (defined below) for working capital and other general corporate purposes of the Company and its subsidiaries. Chase is pleased to offer a commitment to provide the full amount of the required senior bank financing, all on the terms and conditions described herein, in the Term Sheet annexed hereto as Exhibit A (the "Term ---- Sheet") and in the letter of even date herewith (the "Fee Letter") addressed ----- ---------- by Chase to you providing, among other things, for certain fees relating to the senior bank financing (such required senior bank financing is hereinafter referred to as the "Facility"). Chase's commitment is subject to the -------- negotiation, execution and exchange of mutually satisfactory definitive credit documentation. Chase reserves the right to arrange, directly or indirectly through one or more of Commitment Letter ----------------- -2- its affiliates (including Chase Securities, Inc.), a syndicate of banks and/or other financial institutions acceptable to the Company and Chase (including Chase, the "Lenders") to provide a portion of the Facility; and ------- Chase shall be relieved of its commitment to provide the Facility to the extent that other Lenders commit to provide a portion of the Facility. Chase has submitted this letter after reviewing certain historical financial statements and other information provided to Chase by you and your financial advisor. Chase may terminate its obligations under the preceding paragraph to provide the Facility: (a) if (i) the terms of the Transactions are changed in any manner, (ii) any information submitted to Chase by you or on your behalf proves to have been inaccurate or incomplete in any respect, (iii) any adverse change occurs or (iv) any additional information is disclosed to or discovered by Chase, that, in the case of each of (i), (ii), (iii) and (iv) above, Chase deems materially adverse in respect of the condition (financial or otherwise), business, operations, assets or liabilities of the Company and its subsidiaries taken as a whole or the Target and its subsidiaries taken as a whole; (b) if any of the fees provided for by the Fee Letter are not paid when due or the Company breaches any of its other undertakings in the Fee Letter; or (c) if any material adverse change shall occur in loan syndication or capital market conditions generally. You hereby indemnify and hold harmless each of Chase and the other Lenders and each director, officer, employee and affiliate thereof (each, an "indemnified person") from and against any and all losses, claims, damages, ------------------ liabilities (or actions or other proceedings commenced or threatened in respect thereof) and expenses that arise out of, result from or in any way relate to this letter, the Term Sheet or the Fee Letter, or in connection with the Transactions or the other transactions contemplated hereby or the provision or syndication of the Facility, and to reimburse each indemnified person, upon its demand, for any legal or other expenses incurred in connection with investigating, defending or participating in any such loss, claim, damage, liability or action or other proceeding (whether or not such indemnified person is a party to any action or proceeding out of which any such expenses arise), other than any of the foregoing claimed by any indemnified person to the extent incurred by reason of the gross negligence or willful misconduct of such person. Neither Chase nor any other Lender shall be responsible or liable to the Company or any other person for any consequential damages that may be alleged as a result of this letter. In addition, you hereby agree to reimburse Chase from time to time upon Chase's demand for Chase's reasonable out-of-pocket costs and expenses (including, without limitation, reasonable legal fees and expenses, appraisal fees and printing, Commitment Letter ----------------- -3- reproduction, document delivery, communication and publicity costs) incurred in connection with the syndication of the Facility and the preparation, review, negotiation, execution and delivery of this letter, the Term Sheet, the Fee Letter, the definitive credit documentation and the other documents relating to the Transactions. Your obligations under this paragraph shall survive any termination of Chase's obligations under this letter and shall be effective regardless of whether the definitive credit documentation is executed. In accordance with market practice, an information package containing relevant information concerning the Facility, the Company and its subsidiaries, the Target and its subsidiaries and the Transactions will be provided, on a confidential basis, by the Company to potential lenders and participants. Chase will be pleased to assist the Company in the preparation of this package. The Company agrees to cooperate, and to cause the management of the Company to cooperate, with Chase in effecting the syndication of the Facility (including participation in a reasonable number of meetings with potential lenders and participants). Chase will manage all aspects of the primary syndication process, including, without limitation, the invitation and timing of offers to potential lenders and participants, the acceptance of commitments and the amounts of commitments accepted. From the date of delivery of this letter by Chase until the earlier of (i) the date 30 days after the Tender Offer Closing Date and (ii) Chase advises you that primary syndication of the Facility has been completed, you will ensure that, other than the Facility, no financing for the Company and its subsidiaries shall be syndicated or privately placed among any financial institutions that would have a detrimental effect upon the Transactions or the primary syndication of the Facility. You acknowledge that Chase and its affiliates may be providing financing or other services to other companies in respect of which you or your affiliates may have conflicting interests. Chase and its affiliates will not use confidential information obtained from you by virtue of the transactions contemplated by this letter or their other relationships with you in connection with the engagements of Chase and its affiliates with other companies, and Chase and its affiliates will not furnish any such information to such other companies. You also acknowledge that Chase and its affiliates have no obligation to use in connection with the transactions contemplated by this letter, or to furnish to you or any of your affiliates, confidential information obtained from other companies. Commitment Letter ----------------- -4- This letter is delivered to you upon the condition that, prior to your acceptance of this offer, neither the existence of this letter, the Term Sheet or the Fee Letter nor any of their contents shall be disclosed by you except (i) as may be compelled to be disclosed in a judicial or administrative proceeding or as otherwise required by law or (ii) on a confidential and "need to know" basis, to your directors, officers, employees, advisors and agents. Chase shall have the right to review and approve all public announcements and filings relating to the Transactions that refer to Chase or the other Lenders before they are made (such approval not to be unreasonably withheld). Chase's offer set forth in this letter will terminate at 11:00 p.m. (New York City time) on April 2, 1995 unless you accept this letter and the Fee Letter at or prior to that time by signing and returning to Chase counterparts of this letter and the Fee Letter. Chase's commitment under this letter, if accepted by you, will in any event terminate at 5:00 p.m. (New York City time) on August 31, 1995 if the initial acquisition of shares under the Tender Offer (the "Tender Offer Closing Date") and the initial ------------------------- borrowing under the Facility shall not have occurred on or prior to such date. This letter and the Fee Letter may be executed in any number of counterparts, each of which shall be an original and all of which, when taken together, shall constitute one agreement, and this letter, the Term Sheet and the Fee Letter may not be assigned by you without the prior written consent of Chase and may not be amended or any provision hereof or thereof waived or modified except by an instrument in writing signed by each of the parties hereto. No person or entity (including, without limitation, Target and its affiliates) other than the parties hereto shall have any rights under or be entitled to rely upon this letter, the Term Sheet or the Fee Letter. This letter, the Term Sheet and the Fee Letter shall be governed by and construed in accordance with the law of the State of New York. Commitment Letter ----------------- -5- We look forward to working with you to complete the Transactions. THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION) By /s/ Patricia B. Bril --------------------------- Title: Patricia B. Bril Managing Director ACCEPTED AND AGREED: INGERSOLL-RAND COMPANY By /s/ Thomas F. McBride -------------------------- Title: Senior Vice President and Chief Financial Officer Date: April 2, 1995 Commitment Letter ----------------- EXHIBIT A TERM SHEET Capitalized terms used herein and not defined herein have the meanings set forth in the letter (the "Commitment Letter") to which ----------------- this Term Sheet is annexed. Borrower Ingersoll-Rand Company (the "Company"). -------- ------- Guarantor Purchaser/until Merger Effective Date. --------- Administrative Agent Chase. ----- Purpose To fund capital contributions and/or advances ------- by the Company to the Purchaser required to consummate the Transactions, and to pay related fees, commissions and expenses. Type and Amount of the Facility $1,350,000,000 reducing revolving credit --------------- facility. Chase's Commitment $1,350,000,000 ------------------ Final Maturity Five years after the Tender Offer Closing -------------- Date. Amortization The Facility shall reduce to $1,000,000,000 ------------ on the earlier of (i) the date 45 days after the Merger Effective Date and (ii) the date 180 days after the Tender Offer Closing Date (the "Initial Facility Reduction Date"). The ------------------------------- remaining Facility shall reduce annually starting two years after the Tender Offer Closing Date by $100,000,000 at the end of the second year, by $200,000,000 at the end of the third year, by $300,000,000 at the end of the fourth year and by $400,000,000 at the end of the fifth year. Availability Drawings may be made at any time from the ------------ Tender Offer Closing Date to but excluding the Final Maturity. Security The Facility, the Company's $400,000,000 -------- Credit Agreement dated as of October 31, 1994 (the "Existing Credit Agreement") and any ------------------------- other long-term notes or debentures that by Term Sheet ---------- -2- their express terms require it will be equally and ratably secured by a pledge of all of the capital stock of, and the Company's advances to, the Purchaser. At any time on or after the Initial Facility Reduction Date the Administrative Agent shall release the security promptly upon receipt from the Company of a certification referring to the security and certifying that no default has occurred and is continuing. Interest Prior to the earlier of (i) completion of -------- primary syndication and (ii) 30 days after the Tender Offer Closing Date, at the Company's option Base Rate and Competitive Bid. Thereafter, at the Company's option, Base Rate, LIBOR, CD and Competitive Bid loans will be available as follows: A. Base Rate Option ---------------- Interest shall be at the Base Rate of Chase, calculated on the basis of the actual number of days elapsed in a year of 365/366 days (or 360 days when the Fed Funds Rate controls the Base Rate), payable quarterly in arrears. The Base Rate is defined as the higher of (i) the Federal Funds Rate, as published by the Federal Reserve Bank of New York plus 1/2 of 1%, and (ii) the prime commercial lending rate of Chase, as announced from time to time at its head office. Base Rate drawings shall be made available on a same-day basis if requested prior to 10:00 A.M. New York time and shall be in minimum amounts of $10,000,000 or any integral multiple of $1,000,000 in excess thereof. B. LIBOR Option ------------ Interest shall be determined for periods ("Interest Periods") of one, two, three ---------------- or six months (as selected by the Company) and, if agreeable to all of the Lenders, nine or twelve months, and shall be at an annual rate equal to the London Interbank Offered Rate ("LIBOR") ----- for the corresponding deposits of U.S. Term Sheet ---------- -3- Dollars plus the applicable Interest Margin specified below. LIBOR will be determined at the start of each Interest Period by the Administrative Agent from the Reuters Screen LIBO Page. Interest will be paid at the end of each Interest Period or quarterly, whichever is earlier, and will be calculated on the basis of the actual number of days elapsed in a year of 360 days. LIBOR will be adjusted for Regulation D reserve requirements. LIBOR drawings shall require three business days' prior notice and shall be in minimum amounts of $10,000,000 or any integral multiple of $5,000,000 in excess thereof. C. CD Option --------- Interest shall be determined for Interest Periods of 30, 60, 90 or 180 days (as selected by the Company) and, if agreeable to all of the Lenders, 270 or 360 days and shall be at an annual rate equal to the Adjusted Certificate of Deposit Rate ("CD Rate") ------- for each Interest Period plus the applicable Interest Margin specified below. Interest will be paid at the end of each Interest Period or quarterly, whichever is earlier, and will be calculated on the basis of the actual number of days elapsed in a year of 360 days. The CD Rate will be determined at the start of each Interest Period by the Agent from H.15(519) published by the Federal Reserve Board, adjusted for Regulation D reserve requirements and Federal Deposit Insurance Corporation premiums. CD drawings shall require two business days' notice and shall be in minimum amounts of $10,000,000 or any integral multiple of $5,000,000 in excess thereof. D. Competitive Bid Option ---------------------- The Company may request the Administrative Agent to solicit competitive bids from the Lenders Term Sheet ---------- -4- through an auction for borrowings priced either (i) at a margin above or below LIBOR or (ii) at an Absolute Interest Rate, substantially on the terms and conditions of the provisions for money market borrowings under the Existing Credit Agreement. LIBOR bids may be requested for 1, 2, 3, 6, 9 or 12 months periods and Absolute bids may be requested for periods up to and including 360 days. Interest on LIBOR and Absolute bids will be paid at the end of each Interest Period or quarterly, whichever is earlier. Lenders may bid, at their own discretion, for amounts up to the total Facility amount, regardless of their pro rata commitments. Competitive Bid Rate loans will be allotted to the bidding Lenders in order of effective cost, starting from the lowest cost and rising to the highest acceptable cost. The Company shall be under no obligation to accept all or any of the bids received from the Lenders. Outstandings under the Facility will be defined as the sum of the Competitive Bid Rate Borrowings plus committed borrowings. Each Lender will be obligated to fund committed borrowings equal to their pro rata share regardless of the amount of Competitive Bid Borrowings held by it. The Competitive Bid Option shall be available for borrowings of a minimum of $10,000,000 and multiples of $5,000,000 in excess thereof up to a maximum of the Facility. Competitive bids require four business days notice for LIBOR bids and one business day notice for Absolute Rate bids. The Company will pay to the Administrative Agent a fee of $1,000 for each Competitive Bid solicitation. Interest on any amount not paid when due will accrue at a rate of 2% in excess of the Base Rate and will be payable on demand. Term Sheet ---------- -5- Facility Fee Facility fee shall accrue on the daily ------------ aggregate amount of the commitments under the Facility (whether or not utilized), for each day from and including the date of the definitive credit agreement to but excluding the date such commitment is terminated, at the rate specified below. Facility Fee and Interest Margins The applicable facility fee and interest ---------------- margins shall be as follows: I II III IV V VI - -- --- -- - -- Rating A or A2 A- and A3 BBB+ and Baa1 BBB and Baa2 BBB- and Baa3 < BBB- or < Baa3 or NR Level Facility .08% .10% .135% .17% .20% .275% Fee CD .295% .325% .365% .40% .45% .475% Margin LIBOR .17% .20% .24% .275% .325% .35% Margin
Pricing for the Facility shall be at Rating Level VI until the Initial Facility Reduction Date. Following the Initial Facility Reduction Date, so long as either Moody's Investor Services and Standard and Poor's have not announced revised or reaffirmed the senior unsecured long-term debt ratings of the Company, pricing shall be at Rating Level IV. Thereafter, pricing shall be determined according to the lower of the Company's outstanding senior unsecured long-term debt ratings as established by Moody's Investor Services and Standard and Poor's, except that the higher rating shall apply in the case in which the Company's ratings are A and A3 or A- and A2; provided that, if the rating level as first so established after the Initial Facility Reduction Date is below Rating Level IV, such lower Rating Level will apply retroactively from the Initial Facility Reduction Date. Voluntary Facility Reductions and Prepayments Permitted in whole or in part, with prior ----------- notice but without premium or penalty (except for LIBOR or CD breakage costs, if any), in minimum amounts of $25,000,000 and multiples of $5,000,000 in excess thereof. Competitive Bid loans may not be prepaid. Mandatory Facility Reductions Upon the issuance by the Company or any of ---------- its subsidiaries for cash of any debt maturing on or after the Final Maturity (other than (i) refinancing of existing debt of foreign subsidiaries or of the Company's $75,000,000 8 1/4% Notes due 1996 and (ii) up to $25,000,000 of domestic economic development financing) or of any equity (other than in each case inter-company), the Facility shall be reduced by an amount equal to the net cash proceeds thereof. Term Sheet ---------- -6- Application of Facility Reductions Until the Facility is reduced to ---------- $1,000,000,000, all voluntary and mandatory Facility reductions will reduce the amount by which the Facility is scheduled to be reduced on the Initial Facility Reduction Date. Thereafter, the amount of any voluntary or mandatory Facility reduction will reduce the remaining regularly scheduled reductions ratably. Documentation The Facility will be subject to the ------------- negotiation, execution and delivery of a definitive credit agreement (including schedules, exhibits and ancillary documentation) and related pledge agreement, guarantee and other support documentation satisfactory to the Lenders. Such credit agreement will contain representations and warranties, funding and yield protection provisions (including, without limitation, a requirement for compensation for the cost of compliance by the Lenders with capital adequacy and similar requirements), conditions precedent, covenants, events of default reasonably consistent with those contained in the Existing Credit Agreement and other provisions determined to be appropriate for transactions of this type, including (without limitation) the following: A. Conditions Precedent Conditions precedent to the initial --------- borrowing under the Facility will include (without limitation): 1. Terms and conditions of the Tender Offer shall be in form and substance satisfactory to the Lenders in their reasonable determination (including, without limitation, conditions that (i) any "poison pill" of the Target be redeemed or otherwise rendered inapplicable to the Tender Offer, (ii) Section 203 of the Delaware General Corporation Law not prevent the Merger from being consummated within 180 days after the Tender Term Sheet ---------- -7- Offer Closing Date and (iii) the Purchaser shall own and control the number of shares of the Target's common stock as shall be necessary to approve the Merger without the affirmative vote or approval of any other shareholders); the principal conditions to the consummation of the Tender Offer shall have been satisfied and shall not have been waived (for which purpose conditions that must be fulfilled to the satisfaction of the Purchaser must also be fulfilled to the satisfaction of the Lenders in their reasonable determination); and the tendered shares shall have been accepted for payment pursuant to the Tender Offer in accordance with the terms of the Tender Offer. 2. There shall have been accepted for payment pursuant to the Tender Offer sufficient shares of the Target for the Purchaser to be able to approve the consummation of the Merger without the affirmative vote of any other shareholder(s) of the Target. 3. The Lenders' satisfaction that all necessary licenses, permits and governmental and third-party filings, consents and approvals for the Acquisition and the Merger have been obtained and remain in full force and effect. 4. The Tender Offer and the financing thereof shall be in compliance with all laws and regulations (including, without limitation, the margin regulations). Conditions precedent to each extension of credit under the Facility will be reasonably consistent with those contained in the Existing Credit Agreement. Term Sheet ---------- -8- B. Covenants Covenants will be reasonably consistent --------- with those contained in the Existing Credit Agreement; provided that (a) at any time that the Company's senior unsecured long-term debt is rated below BBB- by S&P or below Baa3 by Moody's, subsidiary debt (other than inter- company debt) shall not exceed $600,000,000 in the aggregate, (b) until the Initial Facility Reduction Date, total debt of the Company and its subsidiaries (including the Target and its subsidiaries) will not exceed $2,500,000,000 and (c) consolidated shareholders' equity of the Company and its subsidiaries will be not less than the sum of (i) $1,100,000,000 plus (ii) 40% of cumulative quarterly consolidated net earnings since December 31, 1994 plus (iii) 75% of the cumulative additions to consolidated shareholders' equity resulting from equity issuances after December 31, 1994. Calculations for minimum consolidated shareholders' equity will be adjusted to eliminate the effect of one time pre-tax non-cash special charges to income during the period of 18 months after the Tender Offer Closing Date of up to $50,000,000 in connection with the Acquisition. C. Events of Default Events of Default will be reasonably ------- consistent with those contained in the Existing Credit Agreement. Assignments and Participations Rights reasonably consistent with those -------------- contained in the Existing Credit Agreement. Expenses and Indemnification As specified in the Commitment Letter. --------------- Term Sheet ---------- -9- Majority Lenders 66-2/3%. ---------------- Governing Law The law of the State of New York ------------- Chase's New York Counsel Milbank, Tweed, Hadley & McCloy ---------------- Term Sheet ---------- EX-11.(G) 11 EXHIBIT 11(g) Richard J. Holwell (RJH-5098) Robert M. Kelly (RMK-7204) WHITE & CASE 1155 Avenue of the Americas New York, New York 10036 Telephone: (212) 819-8200 Attorneys for Plaintiff Clark Equipment Company UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK -----------------------------------x : CLARK EQUIPMENT COMPANY, : 95 Civ. 2130 (CSH) : Plaintiff, : : -against- : : INGERSOLL-RAND COMPANY, : COMPLAINT --------- : Defendant. : : -----------------------------------x Plaintiff, Clark Equipment Company ("Clark") complaining against defendant, Ingersoll-Rand Company ("Ingersoll"), alleges as follows: NATURE OF THE ACTION -------------------- 1. This action arises from an offer to purchase Clark's stock which was publicly announced by defendant on March 28, 1995. 2. Plaintiff claims that the offer, if consummated, will violate the federal antitrust laws. 3. Plaintiff seeks an injunction prohibiting defendant from taking any further action to acquire control of Clark. 2 JURISDICTION AND VENUE ---------------------- 4. This Court has subject matter jurisdiction pursuant to Section 16 of the Clayton Act, 15 U.S.C. Sec. 26, and Sections 1331 and 1337 of the Judicial Code, 28 U.S.C. Sec.Sec. 1331 and 1337. 5. Venue is proper in this District pursuant to Section 12 of the Clayton Act, 15 U.S.C. Sec. 22, and Section 1391 of the Judicial Code, 28 U.S.C. Sec. 1391. Plaintiff and defendant both transact business in this District. THE PARTIES ----------- 6. Plaintiff Clark is a corporation organized and existing under the laws of Delaware and having its principal place of business in Indiana. Clark is engaged in the business of designing, manufacturing and selling various machinery and equipment, including self-propelled asphalt paving equipment. Clark is a publicly held corporation and its stock is listed and traded on the New York Stock Exchange. 7. Defendant Ingersoll is a corporation organized and existing under the laws of New Jersey and having its principal place of business in New Jersey. Ingersoll is engaged in the business of designing, manufacturing and selling various machinery and equipment, including self-propelled asphalt paving equipment. Ingersoll is a publicly held corporation and its stock is listed and traded on the New York Stock Exchange. 3 THE ASPHALT PAVING INDUSTRY --------------------------- 8. One of the principal lines of business in which both plaintiff Clark and defendant Ingersoll are engaged is the design, manufacture and sale of self-propelled asphalt paving equipment. 9. Asphalt paving equipment is used principally for purposes of paving roads and highways. The bulk of the work for which such equipment is used consists of public works projects that are performed by private contractors pursuant to competitive bidding awards. In addition, a lesser proportion of asphalt paving equipment is sold directly to governmental agencies for highway and road maintenance purposes. A certain portion of asphalt paving work (which is usually done by private paving contractors) consists of paving large parking lots. Finally, a certain proportion of asphalt paving work (which is typically done by private paving contractors using a different type of equipment) consists of paving small projects such as driveways, bike and golf paths and small parking lots. 10. Due to differences in applications, the asphalt paving equipment industry can be divided into distinct market segments depending upon the size of the equipment manufactured and sold. 11. For purposes of this lawsuit, the relevant product market consists of large asphalt pavers, i.e., those weighing more than approximately 15,000 pounds. Asphalt pavers in this market classification are used for large scale projects such as road paving, highway construction, and large parking lots. 4 12. For purposes of this lawsuit, the relevant geographic market consists of all asphalt pavers in the relevant product market which are sold for use in the United States. The relevant product market and the relevant geographic market will hereafter be referred to collectively as "the Relevant Market." 13. Within the Relevant Market, there are two separate product submarkets: (1) asphalt pavers weighing approximately 15,000 to 30,000 pounds and (2) asphalt pavers weighing more than 30,000 pounds. For purposes of this lawsuit, the relevant product submarket market consists of asphalt pavers weighing approximately 15,000 to 30,000 pounds. The relevant product submarket will hereafter be referred to as "the Relevant Submarket." 14. Plaintiff Clark and defendant Ingersoll are direct competitors in the Relevant Market and Submarket. 15. Plaintiff Clark is the largest supplier of asphalt pavers in the Relevant Market and Submarket. Plaintiff presently controls a market share of approximately 30 percent of the Relevant Market and more than 45 percent of the Relevant Submarket. 16. Defendant Ingersoll presently controls a market share of approximately 10 percent of the Relevant Market and more than 25 percent of the Relevant Submarket. 17. The Relevant Market is highly concentrated. In addition to Clark and Ingersoll, only three other companies compete in the Relevant Market: (1) Caterpillar Paving Products, Inc. (including its wholly-owned subsidiary Barber-Greene Company), (2) Cedarapids, Inc. (which is a wholly-owned 5 subsidiary of Raytheon Company), and (3) Roadtec, Inc. (which is a wholly-owned subsidiary of Astec Industries, Inc.). 18. The Relevant Submarket is even more concentrated. In addition to Clark and Ingersoll, only two companies compete in the Relevant Submarket: Caterpillar and Cedarapids. 19. In addition to the unusually high levels of concentration, the Relevant Market and Submarket have significant barriers to entry. For example, it is necessary to have access to a well-developed dealer network in order to compete effectively in this market. Due to the high cost of downtime and machine malfunction, customers insist on a reliable dealer network to service machines and supply replacement parts. Dealers normally handle one supplier's product line exclusively and, because of the importance of parts sales, dealers have a strong incentive to stay with an existing supplier with an established market share rather than switch to a new supplier. The resulting lack of access to an established distribution network was a significant factor in the unsuccessful attempt of several foreign manufacturers to enter the U.S. market. 20. The cost and inconvenience of having to train operators and maintenance personnel in new equipment, customer loyalty to established product lines, and interchange of replacement parts with existing product base also constitute significant barriers to entry in the Relevant Market and Submarket. 21. Should Ingersoll acquire Clark, the level of concentration in both the Relevant Market and Submarket would radically increase. The combined entity would have a market share of more than 50 percent in the Relevant Market and more 6 than 65 percent of the Relevant Submarket. In light of these market shares and given the significant barriers to entry in the industry, the proposed acquisition would substantially lessen competition and tend to create a monopoly in the Relevant Market and Submarket. THE OFFER --------- 22. On March 28, 1995, defendant Ingersoll publicly announced that it had made an offer to acquire control of Clark. James Perrella, Ingersoll's Chairman and Chief Executive Officer, sent a letter to Clark indicating that Ingersoll intended to proceed with its offer. The letter was publicly released by Ingersoll on March 28, 1995, and on March 29, 1995, Ingersoll's intention to launch a hostile tender offer was widely reported in the press, including both The Wall Street Journal and The New York Times. 23. If the tender offer is allowed to proceed and Clark is acquired by Ingersoll, there will be a massive reduction of competition in, and defendant's total domination and monopolization of, both the Relevant Market and the Relevant Submarket. FIRST CLAIM FOR RELIEF ---------------------- (Violation of Section 7 of the Clayton Act) ------------------- 24. Plaintiff repeats the allegations contained in paragraphs 1 through 23. 25. Clark and Ingersoll are both engaged in commerce and in activities affecting commerce. 7 26. The effect of the proposed acquisition of Clark by Ingersoll will be substantially to lessen competition and tend to create a monopoly in the Relevant Market and Submarket. 27. Defendant is thereby threatening to violate Section 7 of the Clayton Act, 15 U.S.C. Sec. 18. 28. Plaintiff will sustain irreparable injury by reason of defendant's threatened violation of the antitrust laws and is entitled to the relief requested herein. 29. Plaintiff has no adequate remedy at law. SECOND CLAIM FOR RELIEF ----------------------- (Violation of Section 2 of the Sherman Act) ----------------------- 30. Plaintiff repeats the allegations contained in paragraphs 1 through 29. 31. Defendant, acting with specific intent to do so, is attempting to monopolize the Relevant Market and Submarket. 32. There is a dangerous probability that defendant will achieve monopoly power in the Relevant Market and Submarket through its actions. 33. As a result of the forgoing acts, defendant has violated and, unless enjoined by this Court, will continue to violate Section 2 of the Sherman Act, 15 U.S.C. Sec. 2. 34. Plaintiff will sustain irreparable injury by reason of defendants' violation of the antitrust laws and is entitled to the relief requested herein. 35. Plaintiff has no adequate remedy at law. WHEREFORE, plaintiff respectfully prays that judgment be entered as follows: 8 (a) Declaring that the proposed acquisition of plaintiff by defendant violates Section 7 of the Clayton Act and Section 2 of the Sherman Act; (b) Preliminarily and permanently enjoining defendant, its officers, directors, employees and agents, and all other persons acting on their behalf or in concert with them, from proceeding with the proposed tender offer; (c) Granting plaintiff its costs and disbursements in this action, including attorneys' fees; and (d) Granting plaintiff such other and further relief as the Court deems appropriate. Dated: New York, New York March 29, 1995 WHITE & CASE By: /s/ Richard J. Holmwell ----------------------------- Richard J. Holwell (RJM-5098) Robert M. Kelly (RMK-7204) 1155 Avenue of the Americas New York, New York 10036 Telephone (212) 819-8200 Attorneys for Plaintiff Clark Equipment Company -----END PRIVACY-ENHANCED MESSAGE-----