-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VJtOsAyteGzo27aSTIw7eKawQhE+kkbUS1viVqRa6GY70Cwrd8mkmAVfLVWtlbBg Jwv6AjC0hohnHs92HV0nTQ== 0000950123-99-001473.txt : 19990223 0000950123-99-001473.hdr.sgml : 19990223 ACCESSION NUMBER: 0000950123-99-001473 CONFORMED SUBMISSION TYPE: SC 14D1 PUBLIC DOCUMENT COUNT: 13 FILED AS OF DATE: 19990222 GROUP MEMBERS: J W CHILDS EQUITY PARTNERS II LP GROUP MEMBERS: RSA ACQUISITION CORP GROUP MEMBERS: RSA HOLDINGS CORP OF DELAWARE SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN SAFETY RAZOR CO CENTRAL INDEX KEY: 0000750339 STANDARD INDUSTRIAL CLASSIFICATION: CUTLERY, HANDTOOLS & GENERAL HARDWARE [3420] IRS NUMBER: 541050207 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: SEC FILE NUMBER: 005-43695 FILM NUMBER: 99547025 BUSINESS ADDRESS: STREET 1: PO BOX 500 CITY: STAUNTON STATE: VA ZIP: 24402-0500 BUSINESS PHONE: 5042488000 MAIL ADDRESS: STREET 1: PO BOX 500 CITY: STAUNTON STATE: VA ZIP: 24402-0500 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN SAFETY RAZOR CO CENTRAL INDEX KEY: 0000750339 STANDARD INDUSTRIAL CLASSIFICATION: CUTLERY, HANDTOOLS & GENERAL HARDWARE [3420] IRS NUMBER: 541050207 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D1 SEC ACT: SEC FILE NUMBER: 005-43695 FILM NUMBER: 99547026 BUSINESS ADDRESS: STREET 1: PO BOX 500 CITY: STAUNTON STATE: VA ZIP: 24402-0500 BUSINESS PHONE: 5042488000 MAIL ADDRESS: STREET 1: PO BOX 500 CITY: STAUNTON STATE: VA ZIP: 24402-0500 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: RSA ACQUISITION CORP CENTRAL INDEX KEY: 0001080059 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D1 BUSINESS ADDRESS: STREET 1: ONE FEDERAL ST 21ST FL CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6177531100 MAIL ADDRESS: STREET 1: RSA HOLDINGS CORP OF DELAWARE STREET 2: ONE FEDERAL ST 21ST FLOOR CITY: BOSTON STATE: MA ZIP: 02110 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: RSA ACQUISITION CORP CENTRAL INDEX KEY: 0001080059 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D1 BUSINESS ADDRESS: STREET 1: ONE FEDERAL ST 21ST FL CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6177531100 MAIL ADDRESS: STREET 1: RSA HOLDINGS CORP OF DELAWARE STREET 2: ONE FEDERAL ST 21ST FLOOR CITY: BOSTON STATE: MA ZIP: 02110 SC 14D1 1 SCHEDULE 14D-1/13D 1 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------------------------------ SCHEDULE 14D-1 Tender Offer Statement Pursuant to Section 14(d)(1) of the Securities Exchange Act of 1934 and Statement on SCHEDULE 13D Under the Securities Exchange Act of 1934 AMERICAN SAFETY RAZOR COMPANY (Name of Subject Company) J.W. CHILDS EQUITY PARTNERS II, L.P.* RSA HOLDINGS CORP. OF DELAWARE RSA ACQUISITION CORP. (Bidders) COMMON STOCK, $0.01 PAR VALUE PER SHARE (Title of Class of Securities) 029362100 (CUSIP Number of Class of Securities) ADAM SUTTIN C/O J.W. CHILDS EQUITY PARTNERS II, L.P. ONE FEDERAL STREET BOSTON, MA 02110 (617) 753-1100 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications on Behalf of Bidders) COPY TO: MARIO A. PONCE, 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*** - --------------------------------------------------------------------------------------------- $177,614,092.13 $35,523 - ---------------------------------------------------------------------------------------------
* J.W. Childs Equity Partners II, L.P. disclaims that it is a 'bidder' for purposes of the Offer within the meaning of rule 14d-1(e) (1). ** Based on the offer to purchase all of the outstanding shares of Common Stock of the Subject Company at $14.125 cash per share, 12,110,049 Shares outstanding and 464,400 options outstanding as of February 12, 1999. *** 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 - ------------------------- ---------------------- CUSIP No. 029362100 Page ---- of---- Pages - ------------------------- ----------------------
- ---------------------------------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON J.W. Childs Equity Partners II, L.P. - ---------------------------------------------------------------------------------------------------------- CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] 2 (b) [ ] - ---------------------------------------------------------------------------------------------------------- SEC USE ONLY 3 - ---------------------------------------------------------------------------------------------------------- SOURCE OF FUNDS 4 BK, OO - ---------------------------------------------------------------------------------------------------------- CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED 5 PURSUANT TO ITEMS 2(d) or 2(e) [ ] - ---------------------------------------------------------------------------------------------------------- CITIZENSHIP OR PLACE OF ORGANIZATION 6 Delaware - ---------------------------------------------------------------------------------------------------------- SOLE VOTING POWER* NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH 7 2,311,654 ----------------------------------------------------------------- SHARED VOTING POWER 8 0 ----------------------------------------------------------------- SOLE DISPOSITIVE POWER 9 0 ----------------------------------------------------------------- SHARED DISPOSITIVE POWER 10 0 - ---------------------------------------------------------------------------------------------------------- AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING 11 PERSON* 2,311,654 - ---------------------------------------------------------------------------------------------------------- CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES 12 CERTAIN SHARES [ ] - ---------------------------------------------------------------------------------------------------------- PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 13 19% (based on 12,110,049 outstanding) - ---------------------------------------------------------------------------------------------------------- TYPE OF REPORTING PERSON 14 CO - ----------------------------------------------------------------------------------------------------------
* Beneficial ownership is based solely on the provisions of the Shareholders Agreement, pursuant to which among other things, certain stockholders of American Safety Razor Company have agreed with the reporting person to grant an irrevocable proxy to RSA Acquisition Corp. to vote the shares shown as beneficially owned by such reporting persons in favor of the Merger and against any action or agreement (other than the Merger Agreement or the transactions contemplated thereby) that would impede, interfere with, delay, postpone or attempt to discourage the Merger or the Offer, all as more fully described herein. Capitalized terms have the meanings assigned thereto herein. 3 - ------------------------- ---------------------- CUSIP No. 029362100 Page ---- of---- Pages - ------------------------- ----------------------
- ---------------------------------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON RSA Holdings Corp. of Delaware - ---------------------------------------------------------------------------------------------------------- CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] 2 (b) [ ] - ---------------------------------------------------------------------------------------------------------- SEC USE ONLY 3 - ---------------------------------------------------------------------------------------------------------- SOURCE OF FUNDS 4 BK, OO - ---------------------------------------------------------------------------------------------------------- CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED 5 PURSUANT TO ITEMS 2(d) or 2(e) [ ] - ---------------------------------------------------------------------------------------------------------- CITIZENSHIP OR PLACE OF ORGANIZATION 6 Delaware - ---------------------------------------------------------------------------------------------------------- SOLE VOTING POWER* NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH 7 2,311,654 ----------------------------------------------------------------- SHARED VOTING POWER 8 0 ----------------------------------------------------------------- SOLE DISPOSITIVE POWER 9 0 ----------------------------------------------------------------- SHARED DISPOSITIVE POWER 10 0 - ---------------------------------------------------------------------------------------------------------- AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING 11 PERSON* 2,311,654 - ---------------------------------------------------------------------------------------------------------- CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES 12 CERTAIN SHARES [ ] - ---------------------------------------------------------------------------------------------------------- PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 13 19% (based on 12,110,049 outstanding) - ---------------------------------------------------------------------------------------------------------- TYPE OF REPORTING PERSON 14 CO - ----------------------------------------------------------------------------------------------------------
* Beneficial ownership is based solely on the provisions of the Shareholders Agreement, pursuant to which among other things, certain stockholders of American Safety Razor Company have agreed with the reporting person to grant an irrevocable proxy to RSA Acquisition Corp. to vote the shares shown as beneficially owned by such reporting persons in favor of the Merger and against any action or agreement (other than the Merger Agreement or the transactions contemplated thereby) that would impede, interfere with, delay, postpone or attempt to discourage the Merger or the Offer, all as more fully described herein. Capitalized terms have the meanings assigned thereto herein. 4 - ------------------------- ---------------------- CUSIP No. 029362100 Page ---- of---- Pages - ------------------------- ----------------------
- ---------------------------------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON RSA Acquisition Corp. - ---------------------------------------------------------------------------------------------------------- CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] 2 (b) [ ] - ---------------------------------------------------------------------------------------------------------- SEC USE ONLY 3 - ---------------------------------------------------------------------------------------------------------- SOURCE OF FUNDS 4 BK, OO - ---------------------------------------------------------------------------------------------------------- CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED 5 PURSUANT TO ITEMS 2(d) or 2(e) [ ] - ---------------------------------------------------------------------------------------------------------- CITIZENSHIP OR PLACE OF ORGANIZATION 6 Delaware - ---------------------------------------------------------------------------------------------------------- SOLE VOTING POWER* NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH 7 2,311,654 ----------------------------------------------------------------- SHARED VOTING POWER 8 0 ----------------------------------------------------------------- SOLE DISPOSITIVE POWER 9 0 ----------------------------------------------------------------- SHARED DISPOSITIVE POWER 10 0 - ---------------------------------------------------------------------------------------------------------- AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING 11 PERSON* 2,311,654 - ---------------------------------------------------------------------------------------------------------- CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES 12 CERTAIN SHARES [ ] - ---------------------------------------------------------------------------------------------------------- PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 13 19% (based on 12,110,049 outstanding) - ---------------------------------------------------------------------------------------------------------- TYPE OF REPORTING PERSON 14 CO - ----------------------------------------------------------------------------------------------------------
* Beneficial ownership is based solely on the provisions of the Shareholders Agreement, pursuant to which among other things, certain stockholders of American Safety Razor Company have agreed with the reporting person to grant an irrevocable proxy to RSA Acquisition Corp. to vote the shares shown as beneficially owned by such reporting persons in favor of the Merger and against any action or agreement (other than the Merger Agreement or the transactions contemplated thereby) that would impede, interfere with, delay, postpone or attempt to discourage the Merger or the Offer, all as more fully described herein. Capitalized terms have the meanings assigned thereto herein. 5 This Tender Offer Statement on Schedule 14D-1 relates to the offer by RSA Acquisition Corp., a Delaware corporation (the "Purchaser"), a wholly owned subsidiary of RSA Holdings Corp. of Delaware, a Delaware corporation ("Parent"), to purchase all of the outstanding shares of Common Stock, $0.01 par value per share (the "Shares"), of American Safety Razor Company, a Delaware corporation (the "Company"), at a purchase price of $14.125 per Share, net to the seller in cash, without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase dated February 22, 1999 (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, as amended from time to time, constitute the "Offer"), a copy of which is attached hereto as Exhibit (a)(2). RSA Holdings Corp. of Delaware is a wholly owned subsidiary of J.W. Childs Equity Partners II, L.P. ITEM 1. SECURITY AND SUBJECT COMPANY. (a) The name of the subject company is American Safety Razor 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, par value $0.01 per share, 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, Parent, JWCP, JWC Advisors, JWC Associates and JWC Inc.") 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) and (b) The information set forth in Section 8 "Certain Information Concerning the Purchaser, Parent, JWCP, JWC Advisors, JWC Associates and JWC Inc."), Section 10 ("Background of the Offer; Contacts with the Company") and Section 11 ("The Merger Agreement; The Shareholders Agreement") of the Offer to Purchase and in Exhibit (c)(1) of this Schedule 14D-1 is incorporated herein by reference. 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)-(e) The information set forth in the Introduction, Section 10 ("Background of the Offer; Contacts with the Company"), Section 11 ("The Merger Agreement; The Shareholders Agreement"), Section 12 ("Purpose of the Offer; the Merger; Plans for the Company") and Section 13 ("Dividends and Distributions") of the Offer to Purchase is incorporated herein by reference. i 6 (f)-(g) The information set forth in Section 14 ("Effect of the Offer on the Market for the Shares, Nasdaq Listing and Exchange Act Registration") of the Offer to Purchase is incorporated herein by reference. ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY. (a) and (b) The information set forth in the Introduction, Section 11 ("The Merger Agreement; The Shareholders Agreement"), Section 8 ("Certain Information Concerning the Purchaser and the Parent") and Schedule I to the Offer to Purchase is incorporated herein by reference. ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO THE SUBJECT COMPANY'S SECURITIES. The information set forth in the Introduction, Section 8 ("Certain Information Concerning the Purchaser, Parent, JWCP, JWC Advisors, JWC Associates and JWC Inc."), Section 10 ("Background of the Offer; Contacts with the Company"), Section 11 ("The Merger Agreement; The Shareholders Agreement") and Section 12 ("Purpose of the Offer; the Merger; Plans for the Company") of the Offer to Purchase is incorporated herein by reference. ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED. The information set forth in the Introduction and Section 17 ("Fees and Expenses") of the Offer to Purchase is incorporated herein by reference. ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS. The information set forth in Section 8 ("Certain Information Concerning the Purchaser, Parent, JWCP, JWC Advisors, JWC Associates and JWC Inc.") of the Offer to Purchase is incorporated herein by reference. ITEM 10. ADDITIONAL INFORMATION. (a) None. (b) and (c) The information set forth in Section 16 ("Certain Legal Matters and Regulatory Approvals") of the Offer to Purchase is incorporated herein by reference. (d) The information set forth in Section 14 ("Effect of the Offer on the Market for the Shares, Nasdaq Listing and Exchange Act Registration") and Section 16 ("Certain Legal Matters and Regulatory Approvals") of the Offer to Purchase is incorporated herein by reference. (e) None. (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 February 22, 1999. (a) (2) Letter of Transmittal. (a) (3) Notice of Guaranteed Delivery. (a) (4) Letter from the Dealer Managers 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 February 22, 1999. ii 7 (a) (8) Press Release issued by the Company on February 15, 1999. (b) (1) Commitment Letter, dated as of February 12, 1999, to the Purchaser from NationsBank, N.A., NationsBanc Montgomery Securities LLC and DLJ Capital Funding, Inc. (b) (2) Commitment Letter, dated February 12, 1999, from J.W. Childs Equity Partners II, L.P. to the Parent. (c) (1) Agreement and Plan of Merger, dated as of February 12, 1999, by and among the Parent, the Purchaser and the Company. (c) (2) Shareholders Agreement, dated as of February 12, 1999, by and among the Parent, the Purchaser and certain stockholders of the Company. iii 8 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. RSA Holdings Corp. of Delaware By: /s/ B. LANE MACDONALD ------------------------------------ Name: B. Lane MacDonald Title: Vice President and Secretary RSA Acquisition Corp. By: /s/ B. LANE MACDONALD ------------------------------------ Name: B. Lane MacDonald Title: Vice President and Secretary J.W. Childs Equity Partners II, L.P. By: J.W. Childs Advisors II, L.P., its general partner By: J.W. Childs Associates, L.P., its general partner By: J.W. Childs Associates, Inc., its general partner By: /s/ STEVEN G. SEGAL --------------------------- Name: Steven G. Segal Title: Senior Managing Director Date: February 22, 1999 iv 9 EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION - -------- ----------- 11(a)(1) Offer to Purchase dated February 22, 1999 11(a)(2) Letter of Transmittal 11(a)(3) Notice of Guaranteed Delivery 11(a)(4) Letter from the Dealer Managers 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 February 22, 1999 11(a)(8) Press Release issued by the Company on February 15, 1999 11(b)(1) Commitment Letter, dated as of February 12, 1999, to the Purchaser from NationsBank, N.A., NationsBanc Montgomery Securities LLC and DLJ Capital Funding, Inc. 11(b)(2) Commitment Letter, dated February 12, 1999, from J.W. Childs Equity Partners II, L.P. to the Parent 11(c)(1) Agreement and Plan of Merger, dated as of February 12, 1999, by and among the Parent, the Purchaser and the Company 11(c)(2) Shareholders Agreement, dated as of February 12, 1999, by and among the Parent, the Purchaser and certain stockholders of the Company
v EX-99.11.A.1 2 OFFER TO PURCHASE 1 EXHIBIT 11(A)(1) OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK OF AMERICAN SAFETY RAZOR COMPANY AT $14.125 NET PER SHARE BY RSA ACQUISITION CORP. A WHOLLY OWNED SUBSIDIARY OF RSA HOLDINGS CORP. OF DELAWARE THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, MARCH 19, 1999 UNLESS THE OFFER IS EXTENDED. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY TENDERED AND NOT PROPERLY WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF SHARES OF COMMON STOCK WHICH CONSTITUTES MORE THAN 50% OF THE VOTING POWER (DETERMINED ON A FULLY DILUTED BASIS) ON THE DATE OF PURCHASE OF ALL OF THE SECURITIES OF AMERICAN SAFETY RAZOR COMPANY ENTITLED TO VOTE GENERALLY IN THE ELECTION OF DIRECTORS OR IN A MERGER. THE OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS. SEE THE INTRODUCTION AND SECTIONS 1 AND 15. THE BOARD OF DIRECTORS OF AMERICAN SAFETY RAZOR COMPANY HAS UNANIMOUSLY DETERMINED THAT THE MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING EACH OF THE OFFER AND THE MERGER, ARE FAIR TO AND IN THE BEST INTERESTS OF THE STOCKHOLDERS OF AMERICAN SAFETY RAZOR COMPANY AND RECOMMENDS THAT HOLDERS OF SHARES ACCEPT THE OFFER AND TENDER THEIR SHARES TO RSA ACQUISITION CORP. ------------------------ IMPORTANT Any stockholder desiring to tender all or any portion of such stockholder's Shares (as defined herein) of American Safety Razor 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 any other required documents to the Depositary or tender such Shares 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 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 so registered. A stockholder who desires to tender Shares and whose certificates representing such Shares are not immediately available, or who cannot comply with the procedure for book-entry transfer on a timely basis, may tender such Shares by following the procedures for guaranteed delivery set forth in Section 3. Questions and requests for assistance may be directed to Donaldson, Lufkin & Jenrette Securities Corporation or NationsBanc Montgomery Securities LLC (each a "Dealer Manager") or to MacKenzie Partners, 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. ------------------------ The Dealer Managers for the Offer are: DONALDSON, LUFKIN & JENRETTE NATIONSBANC MONTGOMERY SECURITIES LLC February 22, 1999 2 TABLE OF CONTENTS
PAGE ---- INTRODUCTION................................................ 1 THE TENDER OFFER............................................ 3 1. Terms of the Offer, Expiration Date.................... 3 2. Acceptance for Payment and Payment for Shares.......... 4 3. Procedure for Tendering Shares......................... 5 4. Withdrawal Rights...................................... 8 5. Certain Federal Income Tax Consequences................ 8 6. Price Range of Shares; Dividends....................... 9 7. Certain Information Concerning the Company............. 10 8. Certain Information Concerning the Purchaser, Parent, JWCP, JWC Advisors, JWC Associates and JWC Inc......... 11 9. Source and Amount of Funds............................. 12 10. Background of the Offer; Contacts with the Company..... 12 11. The Merger Agreement; The Shareholders Agreement....... 14 12. Purpose of the Offer; the Merger; Plans for the Company.................................................. 22 13. Dividends and Distributions............................ 24 14. Effect of the Offer on the Market for the Shares, Nasdaq Listing and Exchange Act Registration........... 24 15. Certain Conditions of the Offer........................ 26 16. Certain Legal Matters and Regulatory Approvals......... 27 17. Fees and Expenses...................................... 29 18. Miscellaneous.......................................... 30
SCHEDULE I Certain Information Regarding the Directors and Executive Officers of the Purchaser, Parent and J.W. Childs i 3 To: The Stockholders of American Safety Razor Company INTRODUCTION RSA Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of RSA Holdings Corp. of Delaware, a Delaware corporation (the "Parent"), hereby offers to purchase all of the outstanding shares of Common Stock, par value $0.01 per share (the "Shares"), of American Safety Razor Company, a Delaware corporation (the "Company"), at a purchase price of $14.125 per Share, net to the seller in cash without interest thereon, upon the terms and subject to the conditions set forth in this Offer to Purchase and in the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). RSA Holdings Corp. of Delaware is a wholly owned subsidiary of J.W. Childs Equity Partners II, L.P. 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 pursuant to the Offer. The Purchaser will pay all fees and expenses of Donaldson, Lufkin & Jenrette Securities Corporation and NationsBanc Montgomery Securities LLC, each of which is acting as Dealer Manager for the Offer (in such capacity, each a "Dealer Manager"), Continental Stock Transfer & Trust Co., which is acting as the Depositary (in such capacity, the "Depositary") and MacKenzie Partners, Inc. (in such capacity, the "Information Agent") incurred in connection with the Offer. See Section 17. The Board of Directors of the Company (the "Board of Directors") has unanimously determined that the Merger Agreement (as defined below) and the transactions contemplated thereby, including each of the Offer and the Merger (as defined below), are fair to and in the best interests of the stockholders of the Company and recommends that the holders of the Shares accept the offer and tender their Shares to the Purchaser. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY TENDERED AND NOT PROPERLY WITHDRAWN PRIOR TO THE EXPIRATION DATE (AS DEFINED IN SECTION 1) A NUMBER OF SHARES WHICH CONSTITUTES MORE THAN 50% OF THE VOTING POWER (DETERMINED ON A FULLY-DILUTED BASIS), ON THE DATE OF PURCHASE, OF ALL THE SECURITIES OF THE COMPANY ENTITLED TO VOTE GENERALLY IN THE ELECTION OF DIRECTORS OR IN A MERGER (THE "MINIMUM CONDITION"). SEE SECTIONS 1 AND 15. IF THE PURCHASER PURCHASES NOT LESS THAN THAT NUMBER OF SHARES NEEDED TO SATISFY THE MINIMUM CONDITION, IT WILL BE ABLE TO EFFECT THE MERGER WITHOUT THE AFFIRMATIVE VOTE OF ANY OTHER STOCKHOLDER OF THE COMPANY. SEE SECTION 12. The Offer is being made pursuant to an Agreement and Plan of Merger, dated as of February 12, 1999 (the "Merger Agreement"), among the Parent, the Purchaser and the Company. The Merger Agreement provides, among other things, for the making of the Offer by the Purchaser, and further provides that, following the completion of the Offer, upon the terms and subject to the conditions of the Merger Agreement and the Delaware General Corporation Law (the "DGCL"), the Purchaser will be merged with and into the Company (the "Merger"). Following the Merger, the Company will continue as the surviving corporation (the "Surviving Corporation") and become a wholly owned subsidiary of the Parent, and the separate corporate existence of the Purchaser will cease. Certain stockholders of the Company, including certain executive officers of the Company and certain partners, principals, officers, directors, employees and affiliates of The Jordan Company ("TJC"), representing approximately 19% of the issued and outstanding Shares (on a fully diluted basis) of the Company (the "Principal Holders") have contractually agreed, among other things, to tender their Shares in the Offer, provide the Purchaser with an irrevocable proxy and otherwise support the transaction with the Purchaser. See Section 11 for a discussion of the arrangements with the Principal Holders. Pursuant to the Merger Agreement, the Company agrees, if and to the extent permitted by law, at the request of the Purchaser and subject to the terms of the Merger Agreement, to take all necessary and appropriate actions to cause the Merger to become effective as soon as reasonably practicable after the purchase of the Shares pursuant to the Offer, without a meeting of the Company's stockholders in accordance with the DGCL. See Section 11. 1 4 At the effective time of the Merger (the "Effective Time"), each Share issued and outstanding immediately prior to the Effective Time (other than any Shares held by the Parent, the Purchaser, any wholly owned subsidiary of the Parent or the Purchaser, in the treasury of the Company or by any wholly owned subsidiary of the Company, which Shares, by virtue of the Merger, shall be canceled and shall cease to exist with no payment being made with respect thereto, and other than Dissenting Shares (as defined)) shall be converted into the right to receive in cash the Offer price (the "Merger Price"), payable to the holder thereof without interest, upon surrender of the certificate formerly representing such Share. The Company has represented to the Parent that as of February 12, 1999, (i) there were 12,110,049 Shares issued and outstanding and (ii) 750,000 Shares reserved for issuance upon the exercise of outstanding stock options of which options to purchase 464,400 Shares were outstanding. Based upon the foregoing, the Purchaser believes that approximately 6,287,226 Shares constitute a majority of the outstanding Shares on a fully diluted basis. The Merger Agreement is more fully described in Section 11. Certain federal income tax consequences of the sale of the Shares pursuant to the Offer and the exchange of Shares for the Merger Price pursuant to the Merger are described in Section 5. 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. 2 5 THE TENDER OFFER 1. TERMS 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, March 19, 1999, unless and until the Purchaser, in its discretion (but subject to the terms and conditions of the Merger Agreement), 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 THE MINIMUM CONDITION AND THE EXPIRATION OR TERMINATION OF ALL WAITING PERIODS IMPOSED BY THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1996, AS AMENDED, AND THE REGULATIONS THEREUNDER (THE "HSR ACT"). THE OFFER IS NOT CONDITIONED ON THE RECEIPT OF FINANCING. SEE SECTION 15, WHICH SETS FORTH IN FULL THE CONDITIONS TO THE OFFER. SUBJECT TO THE PROVISIONS OF THE MERGER AGREEMENT, INCLUDING THE PROVISIONS OF THE MERGER AGREEMENT SET FORTH IN THE NEXT PARAGRAPH, AND THE APPLICABLE RULES AND REGULATIONS OF THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION"), THE PURCHASER RESERVES THE RIGHT, IN ITS SOLE DISCRETION, TO WAIVE ANY OR ALL CONDITIONS TO THE OFFER AND TO MAKE ANY OTHER CHANGES IN THE TERMS AND CONDITIONS OF THE OFFER. SUBJECT TO THE PROVISIONS OF THE MERGER AGREEMENT, AND THE APPLICABLE RULES AND REGULATIONS OF THE COMMISSION, IF BY THE EXPIRATION DATE ANY OR ALL OF SUCH CONDITIONS TO THE OFFER HAVE NOT BEEN SATISFIED, THE PURCHASER RESERVES THE RIGHT (BUT SHALL NOT BE OBLIGATED) TO (I) TERMINATE THE OFFER AND RETURN ALL TENDERED SHARES TO TENDERING STOCKHOLDERS, (II) WAIVE SUCH UNSATISFIED CONDITIONS AND PURCHASE ALL SHARES VALIDLY TENDERED OR (III) EXTEND THE OFFER, AND, SUBJECT TO THE TERMS OF THE OFFER (INCLUDING THE RIGHTS OF STOCKHOLDERS TO WITHDRAW THEIR SHARES), RETAIN THE SHARES WHICH HAVE BEEN TENDERED, UNTIL THE OFFER, AS SO EXTENDED BY THE PURCHASER, SHALL EXPIRE. Subject to the applicable rules and regulations of the Commission and the terms of the Merger Agreement, the Purchaser expressly reserves the right, in its sole discretion, at any time and from time to time, and regardless of whether or not any of the events set forth in Section 15 shall have occurred or shall have been determined by the Purchaser to have occurred, to (i) extend the period of time during which the Offer is open and thereby delay acceptance for payment of, and the payment for, any Shares, by giving oral or written notice of such extension to the Depositary and (ii) amend the Offer in any respect by giving oral or written notice of such amendment to the Depositary. Under the terms of the Merger Agreement, however, without the prior written consent of the Company, the Purchaser will not decrease the price per Share payable in the Offer, change the form of consideration payable in the Offer, decrease the number of Shares sought to be purchased in the Offer, change the Offer conditions, waive the Minimum Condition, impose additional conditions to the Offer, except as otherwise provided in the Merger Agreement, extend the initial Expiration Date or amend any other terms of the Offer in any manner adverse to the holders of any Shares. The Purchaser shall have no obligation to pay interest on the purchase price of tendered Shares, including in the event the Purchaser exercises its right to extend the period of time during which the Offer is open. The rights reserved by the Purchaser in this paragraph are in addition to the Purchaser's rights to terminate the Offer pursuant to Section 15. The Merger Agreement provides that, subject to the terms and conditions of the Offer and the Merger Agreement and the satisfaction or waiver (to the extent permitted) of all the conditions to the Offer as of the Expiration Date, the Purchaser will accept for payment and pay for all Shares validly tendered and not withdrawn pursuant to the Offer as soon as practicable after the Expiration Date. If the conditions to the Offer are not satisfied or waived by the Purchaser as of the Expiration Date, Purchaser will extend the Offer from time to time for the shortest time periods permitted by law and which it reasonably believes are necessary until the consummation of the Offer; provided that notwithstanding the satisfaction of the conditions to the Offer, the Parent and the Purchaser shall have the right, after consultation with the Company, to extend the Offer until up to April 2, 1999, notwithstanding the prior satisfaction of the conditions to the Offer. Any 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 in accordance with Rule 14e-1(d) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), no later than 9:00 A.M., New York City time, on the next business day after the previously scheduled Expiration Date. 3 6 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 14(d)-6(d) 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 disseminate additional tender offer material and extend the Offer to the extent required by Rules 14d-4(c), 14d-6(d) and 14e-1 under the Exchange Act. The minimum period during which 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. 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. The Company has provided the Purchaser with the Company's stockholder list and security position listings for the purpose of disseminating the Offer to holders of Shares. This Offer to Purchase and the related Letter of Transmittal and other relevant materials will be mailed by the Purchaser to record holders of Shares and furnished to brokers, dealers, commercial banks, trust companies and similar persons whose names, or the names of whose nominees, appear on the stockholder list or, if applicable, who are listed as participants in a clearing agency's security position listing, for subsequent transmittal to beneficial owners of Shares. 2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES. 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 15, including without limitation the expiration or termination of the waiting period applicable to the acquisition of Shares pursuant to the Offer under the HSR Act. 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 16. Any such delays will be effected in compliance with Rule 14e-1(c) under the Exchange Act. For information with respect to approvals and filings required to be obtained or made prior to the consummation of the Offer, including under the HSR Act, see Section 16. 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 such Shares ("Share Certificates") or timely confirmation (a "Book-Entry Confirmation") of a book-entry transfer of such Shares into the Depositary's account at The Depository Trust Company (the "Book-Entry Transfer Facility") 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 the Book-Entry Transfer Facility to and received by the Depositary and forming a part of a Book-Entry Confirmation, which states that the Book-Entry Transfer Facility has received an express acknowledgment from the participant in the Book-Entry Transfer Facility tendering the Shares that such participant has received and agrees to be bound by the terms of the Letter of Transmittal and that the Purchaser may enforce such agreement against such participant. 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 4 7 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-1(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 the Book-Entry Transfer Facility pursuant to the procedures set forth in Section 3, such Shares will be credited to an account maintained at the Book Entry Transfer Facility), as promptly as practicable following the expiration, termination or withdrawal of the Offer. The Parent and the Purchaser reserve the right to transfer or assign to one or more of their affiliates all or any of their rights with the permission of the Company, which will not be unreasonably withheld, but any such transfer or assignment will not relieve the Parent or Purchaser of their obligations under the Offer. In the event that the aggregate consideration to be received by a holder pursuant to the Offer for such holder's Shares equals an amount that includes one-half of one cent, such amount will be rounded up to the nearest whole cent. 3. PROCEDURE FOR TENDERING SHARES. Valid Tenders. Except as set forth below, in order for Shares 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 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 evidencing tendered Shares must be received by the Depositary at such address or such Shares must be tendered pursuant to the procedure for book-entry transfer described below and a Book-Entry Confirmation must be received by the Depositary, in each case on or prior to the Expiration Date, or (ii) the guaranteed delivery procedures described below must be complied with. Book-Entry Transfer. The Depositary will make a request to establish an account with respect to the Shares at the Book-Entry Transfer Facility for purposes of the Offer within two business days after the date of this Offer to Purchase. Any financial institution that is a participant in the system of the Book-Entry Transfer Facility may make book-entry delivery of Shares by causing the Book-Entry Transfer Facility to transfer such Shares into the Depositary's account at the Book-Entry Transfer Facility in accordance with the Book-Entry Transfer Facility's procedures for such transfer. However, although delivery of Shares may be effected through book-entry transfer at the 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. DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH THE BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY. THE METHOD OF DELIVERY OF SHARE CERTIFICATES AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE 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 (INCLUDING, IN THE CASE OF BOOK- 5 8 ENTRY TRANSFER, BY BOOK-ENTRY CONFIRMATION). IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY. Signature Guarantees. Signatures on Letters of Transmittal must be guaranteed by 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 are tendered (i) by a registered holder of Shares who has not completed either the box labeled "Special Payment Instructions" or the box labeled "Special Delivery Instructions" on the Letter of Transmittal or (ii) for the account of an Eligible Institution. See Instructions 1 and 5 of the Letter of Transmittal. If the Share 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 not accepted for payment or not tendered are to be returned, to a person other than the registered holder, the Share Certificates 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 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 pursuant to the Offer and such stockholder's Share Certificates are not immediately available, or such stockholder cannot deliver the Share 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 may nevertheless be tendered, provided that all of the following conditions are satisfied: (i) such tender is made by or through an Eligible Institution; (ii) a properly completed and duly executed Notice of Guaranteed Delivery substantially in the form 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 a Book-Entry Confirmation), representing all tendered Shares in proper form for transfer, 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 three Nasdaq National Market trading days after the date of execution of such Notice of Guaranteed Delivery. 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 tendered within the meaning of, and that the tender of the Shares 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, 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 Book-Entry Confirmations of such Shares are received into the Depositary's account at the Book-Entry Transfer Facility. 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, 6 9 with full power of substitution, in the manner set forth in the Letter of Transmittal, to the full extent of such stockholder's rights with respect to the Shares tendered by such stockholder and accepted for payment by the Purchaser (and with respect to any and all other Shares, other securities or rights 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. 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 powers of attorney and proxies given by such stockholder with respect to such Shares (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 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, by written consent in lieu of any such meeting or otherwise. The Purchaser reserves the right to require that, in order for Shares to be deemed validly tendered, immediately upon the Purchaser's payment for such Shares, the Purchaser must be able to exercise full voting rights with respect to such Shares 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 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 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 Managers, 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, unless an exemption applies, 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. 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 of 31%. All stockholders surrendering Shares pursuant to the Offer should complete and sign the substitute Form W-9 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). Certain stockholders (including among others all corporations and certain foreign individuals and entities) are not subject to backup withholding. 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 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 complies with, Rule 14e-4 under the Exchange Act. 7 10 4. WITHDRAWAL RIGHTS. Tenders of Shares made pursuant to the Offer are irrevocable, except that Shares tendered pursuant to the Offer may be withdrawn at any time 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 April 22, 1999. If the Purchaser extends the Offer, is delayed in its acceptance for payment of Shares or is unable to purchase Shares 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 such Shares may not be withdrawn except to the extent that tendering stockholders are entitled to withdrawal rights as described in this Section 4. Any such delay in acceptance for payment 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 to be withdrawn, the number of Shares to be withdrawn and the name of the registered holder, if different from that of the person who tendered such Shares. If Share 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 have been tendered for the account of any Eligible Institution. If Shares 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, 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. 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. The Purchaser reserves the absolute right to reject any and all withdrawals determined by it not to be in proper form. The Purchaser also reserves the absolute right to waive any defect or irregularity in any withdrawal of Shares of any particular stockholder whether or not similar defects or irregularities are waived in the case of the other stockholders. No withdrawal 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 Managers, 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 may not be rescinded. Any Shares properly withdrawn will thereafter be deemed not to have been validly tendered for purposes of the Offer. However, withdrawn Shares 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 following is a discussion of the material United States federal income tax consequences relating to the sale or exchange of Shares pursuant to the Offer and/or the Merger. Unless otherwise indicated, this summary deals only with U.S. Stockholders (as defined below) who hold their Shares as capital assets. This discussion is based on the Internal Revenue Code of 1986, as amended (the "Code"), the proposed, temporary and final Treasury regulations promulgated thereunder, and any relevant administrative rulings or pronouncements or judicial decisions, all as in effect on the date hereof and all of which are subject to change, possibly with retroactive effect. This discussion does not address all of the tax consequences that may be relevant to a particular Stockholder in light of that Stockholder's specific circumstances, nor does it discuss the U.S. federal income tax consequences that may be applicable to certain types of Stockholders, such as Stockholders who have received their Shares pursuant to the exercise of employee stock options or otherwise as compensation, dealers in securities, financial institutions, tax-exempt entities, life insurance companies, persons holding their Shares as a part of a hedging, integrated, conversion or constructive sale transaction or as part of a straddle, or persons whose functional currency is not the U.S. dollar, who may be subject to special rules and/or limitations under the Code which are not discussed below. In addition, the following discussion does not discuss the alternative minimum tax consequences, if any, of the 8 11 sale or exchange of Shares pursuant to the Offer or the Merger, or the state, local or foreign tax consequence of such sale or exchange of Shares. For purposes of this discussion, (i) the term "Stockholder" refers to a beneficial owner of Shares, (ii) the term "U.S. Stockholder" means a Stockholder who is (a) a citizen or resident of the United States, (b) a corporation or partnership created or organized in the United States or under the laws of the United States or any political subdivision thereof, (c) an estate the income of which is subject to United States federal income taxation regardless of its source or (d) a trust which is subject to the supervision of a court within the United States and the control of one or more United States persons (as defined in Section 7701 (a)(30) of the Code), and (iii) the term "Non-U.S. Stockholder" means a Stockholder who is not a U.S. Stockholder. 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 sale or exchange of Shares pursuant to the Offer or the Merger will be a taxable transaction for U.S. federal income tax purposes. A tendering U.S. Stockholder generally will recognize gain or loss on such sale or exchange of Shares in an amount equal to the difference between the cash received by such U.S. Stockholder pursuant to the Offer or the Merger and the U.S. Stockholder's adjusted tax basis in the Shares exchanged therefor. Gain or loss will be calculated separately for each block of Shares (i.e., Shares acquired at the same cost in a single transaction) tendered and purchased pursuant to the Offer or converted in the Merger, as the case may be. For federal income tax purposes, such gain or loss generally will be capital gain or loss and generally will be long-term capital gain or loss if the relevant U.S. Stockholder held his, her or its Shares for more than one year as of the date the Purchaser accepts such Shares for payment pursuant to the Offer or as of the effective date of the Merger, as the case may be. The long-term capital gains of individuals, estates and certain trusts generally are eligible for reduced rates of taxation. Capital losses generally must be used only to offset capital gains. Any gain realized by a Non-U.S. Stockholder upon the sale or exchange of Shares pursuant to the Offer and/or the Merger generally will not be subject to U.S. federal income or withholding tax unless (i) such gain is effectively connected with a U.S. trade or business conducted by the Non-U.S. Stockholder in the United States, (ii) in the case of a Non-U.S. Stockholder who is an individual, such individual is present in the United States for 183 days or more in the taxable year during which the Purchaser accepts such Shares for payment pursuant to the Offer or which includes the effective date of the Merger, as the case may be, and certain other conditions are met, or (iii) in the case of a Non-U.S. Stockholder who directly, indirectly or constructively owns more than 5% of the Shares at any time during the five year period ending on the date the relevant Shares are disposed of, the Company is or has been a "U.S. real property holding corporation" within the meaning of Section 897(c)(2) of the Code (which the Company does not expect to be the case). 6. PRICE RANGE OF SHARES; DIVIDENDS. According to the Company's 1997 Annual Report on Form 10-K for the fiscal year ended December 31, 1997 (the "1997 Annual Report"), the Shares are listed and traded on the Nasdaq National Market ("Nasdaq") under the symbol "RAZR." The following table sets forth, for the quarters indicated, the high and low sales prices per Share on Nasdaq with respect to periods occurring in 1997, 1998 and 1999 as reported by the Dow Jones News Service. According to the 1997 Annual Report, the Company has not paid any dividends on the Shares since its initial public offering.
HIGH LOW ----- ----- YEAR ENDED DECEMBER 31, 1997: First Quarter............................................ 15.75 12.88 Second Quarter........................................... 18.13 13.38 Third Quarter............................................ 19.38 16.00 Fourth Quarter........................................... 20.75 16.25
9 12
HIGH LOW ----- ----- YEAR ENDED DECEMBER 31, 1998: First Quarter............................................ 23.25 17.50 Second Quarter........................................... 18.38 11.00 Third Quarter............................................ 14.75 8.63 Fourth Quarter........................................... 12.63 8.13 YEAR ENDED DECEMBER 31, 1999: First Quarter (through February 19, 1999)................ 13.88 9.88
On February 12, 1999, the last full trading day prior to announcement of the Offer, the closing sale price per Share reported on Nasdaq was $9 7/8. On February 19, 1999, the last full trading day before commencement of the Offer, the closing sale price per Share reported on Nasdaq was $13.75. STOCKHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE SHARES. 7. CERTAIN INFORMATION CONCERNING THE COMPANY. Except as otherwise noted in this Offer to Purchase, 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 Company's 1997 Annual Report, the Company's Quarterly Reports on Form 10-Q for the quarters ended March 31, 1998, June 30, 1998 and September 30, 1998 (together, the "1998 Quarterly Reports") 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 was incorporated under the laws of the State of Delaware on June 7, 1977. The Company is listed on Nasdaq and is a designer, manufacturer and marketer of store, value and premium-brand consumer products. The Company has three product segments which consist of (i) razors and blades, sales of which are broken into three product lines: shaving razors and blades, bladed hand tools and blades, and specialty industrial and medical blades, (ii) cotton and foot care products and (iii) custom bar soaps. The Company distributes its products to the retail and professional trades in the United States and in selected international markets. The Company's principal executive offices are located at One Razor Blade Lane, P.O. Box 979, Verona, Virginia 24482. The telephone number of the Company at such offices is (540) 248-8000. Financial Information. Set forth below is certain selected consolidated financial data for the Company which was derived from the 1997 Annual Report and the 1998 Quarterly Reports. 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, 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 Nasdaq in the manner set forth below. 10 13 AMERICAN SAFETY RAZOR COMPANY SELECTED CONSOLIDATED FINANCIAL DATA (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
FOR THE NINE MONTHS ENDED FOR THE FISCAL YEAR ENDED ----------------- ---------------------------- SEPTEMBER 30, DECEMBER 31, DECEMBER 31, 1998 1997 1996 INCOME STATEMENT DATA Net sales...................................... $220,433 $296,607 $260,636 Cost of sales.................................. $150,223 $196,991 $169,949 Income before income taxes..................... $ 10,921 $ 24,639 $ 21,598 Net income..................................... $ 6,585 $ 15,069 $ 13,173 Basic earnings per share....................... $ 0.54 $ 1.25 $ 1.09 Weighted average number of shares outstanding................................. 12,107 12,094 12,093 Diluted earnings per share..................... $ 0.54 $ 1.23 $ 1.09 Weighted average number of shares outstanding (on a diluted basis)........................ 12,246 12,255 12,139 BALANCE SHEET DATA (AT PERIOD END) Total assets................................... $262,839 $254,081 $229,997 Long-term obligations, including current portion..................................... $127,275 $123,612 $112,181 Total stockholders' equity..................... $ 66,519 $ 59,439 $ 44,523
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. The Company is required to disclose in such proxy statements certain 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. 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. Such reports, proxy statements and other information may also be obtained at the Web site that the Commission maintains at http://www.sec.gov. Copies of this material may also be obtained by mail, upon payment of the Commission's customary fees, from the Commission's principal office at 450 Fifth Street, N.W., Washington, D.C. 20549. Such materials should also be available for inspection at the library of Nasdaq, 1735 K Street, N.W., Washington, D.C. 20006. 8. CERTAIN INFORMATION CONCERNING THE PURCHASER, PARENT, JWCP, JWC ADVISORS, JWC ASSOCIATES AND JWC INC. The Purchaser, a Delaware corporation and a direct, wholly owned subsidiary of Parent, was organized in connection with the Offer and the Merger and has not carried on any activities to date other than those incident to its formation and the commencement of the Offer. The Parent, a Delaware corporation and a direct wholly owned subsidiary of J.W. Childs Equity Partners, II L.P., a Delaware limited partnership ("JWCP"), was organized in connection with the Offer and the Merger and has not carried on any activities to date other than those incident to its formation and the commencement of the Offer. JWCP was organized in 1998. JWCP was established to make privately negotiated equity investments in leveraged buyouts and recapitalizations of small and middle-market growth companies in partnership with management. The General Partner of JWCP is J.W. Childs Advisors II, L.P., a Delaware limited partnership ("JWC Advisors"), controlled, through an intermediate limited partnership, J.W. Childs Associates, L.P. ("JWC Associates"), by J.W. Childs Associates, Inc. ("JWC Inc."). JWCP, JWC Advisors, JWC Associates and JWC Inc. are collectively referred to as "J.W. Childs." 11 14 The principal executive offices of the Purchaser, the Parent and J.W. Childs are located at One Federal Street, 21(st) Floor, Boston, Massachusetts 02110. The name, citizenship, business address, present principal occupation or employment, and five year employment history of each of the directors and executive officers of the Purchaser, the Parent and J.W. Childs and are set forth in Schedule I hereto. Except as described in this Offer to Purchase, none of the Purchaser, the Parent, J.W. Childs or, to their best knowledge, any of the persons listed on Schedule I hereto or any associate or majority-owned subsidiary of the Purchaser, the Parent, J.W. Childs 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, J.W. Childs or, to their best knowledge, 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. 9. SOURCE AND AMOUNT OF FUNDS. The aggregate amount to be paid to effect the Offer and the Merger (including the payments of fees and expenses related thereto) will be approximately $188.6 million. A total of approximately $310.8 million to $313.3 million is expected to be required to (i) fund payment of the cash consideration in the Offer and the Merger, (ii) repay or repurchase certain indebtedness of the Company (including pursuant to the Debt Offer (as defined in Section 11 ("The Merger Agreement; The Shareholders Agreement -- The Debt Offer")) and (iii) pay the fees and expenses incurred in connection with such transactions and the financings thereof. It is currently contemplated that the transactions contemplated by the Merger Agreement will be funded either by (a) (i) approximately $165.8 million of borrowings by the Company pursuant to a senior secured credit facility (the "New Credit Facility") with a group of financial institutions led by NationsBank, N.A., NationsBanc Montgomery Securities LLC and DLJ Capital Funding, Inc., which facilities provide for aggregate commitments of up to $190 million, up to $165 million of which will be available in the form of term loans and $25 million of which will be available in the form of a revolving credit facility, (ii) approximately $55 million of unsecured, pay-in-kind debt issued by the Parent to JWCP or one of its affiliates (the "JWC Note") and (iii) approximately $90 million in equity investment contributions made by JWCP or one of its affiliates, to the Parent (the "Equity Investment") or (b) (i) approximately $123.3 million of borrowings by the Company under the New Credit Facility, (ii) approximately $100 million in gross proceeds from the issuance by the Company of new senior subordinated notes (the "New Notes") and (iii) the Equity Investment. If the Debt Offer is not consummated, the financing required for such transactions will be $208.6 million and will be funded by (i) approximately $63.6 million of borrowings by the Company pursuant to the New Credit Facility, (ii) the JWC Note and (iii) the Equity Investment. 10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY. On October 24, 1997, the Company engaged PaineWebber Incorporated ("PaineWebber") as its financial advisor to evaluate strategic alternatives available to the Company, including a possible sale transaction. As part of this engagement, PaineWebber solicited interest from a select group of potential purchasers approved by the Company's Board of Directors. In early December 1997, a representative of PaineWebber contacted a representative of J.W. Childs regarding a potential interest in purchasing the Company. On December 4, 1997, J.W. Childs executed a customary confidentiality and standstill agreement with respect to the exchange of non-public information between the Company and J.W. Childs. Following the execution of the confidentiality and standstill agreement, J.W. Childs conducted a preliminary due diligence investigation of the Company and decided not to pursue a transaction. On May 13, 1998, after conducting an extensive sale process, the Board of Directors determined that it was not in the best interest of the Company's stockholders to continue to pursue a sale transaction at that time. On or about November 17, 1998, representatives of J.W. Childs contacted a representative of PaineWebber regarding its renewed interest in the Company and submitted to representatives of TJC an initial non-binding indication of interest to acquire 100% of the Company at $13.50 to $14.50 per share. 12 15 Following the receipt of J.W. Childs' initial indication of interest, a representative of TJC advised PaineWebber of its renewed interest in pursuing a sale transaction. Subsequently, PaineWebber contacted selected parties potentially interested in purchasing the Company. On December 17, 1998, following an initial due diligence investigation, J.W. Childs submitted a revised offer of $14.00 per share. Subsequent to this revised offer, the Company and its legal counsel prepared and delivered to J.W. Childs an initial draft of the Merger Agreement and the Shareholders Agreement. Throughout December 1998 and January 1999, representatives of J.W. Childs conducted an extensive due diligence investigation of the Company, including but not limited to the business, operations and financial conditions as well as numerous discussions with members of the Company's senior management. During this period of time, TJC, PaineWebber and the Company's legal advisors continued to negotiate with J.W. Childs and its legal counsel regarding the terms of the transaction. On February 1, 1999, following further discussions between J.W. Childs, PaineWebber and TJC, J.W. Childs submitted a final offer of $14.125 per share. On February 7, 1999, the Company's Board of Directors held a telephonic meeting to consider the proposed transaction. At the meeting, the Board of Directors reviewed the terms of the proposed transaction and the provisions contained in the draft Merger Agreement and the Shareholders Agreement, and the other related agreements, including the agreements pertaining to the financing arrangements for the Offer and the Merger. The Company's Board of Directors also reviewed a summary of the sale process compiled by PaineWebber. The Company's legal counsel reviewed with the Company's Board of Directors the current terms contained in the draft agreements. In addition to discussing these terms, the presentation by legal counsel included a discussion of the fiduciary duties of the Company's Board of Directors. After discussion, the Company's Board of Directors directed management of the Company to continue discussions with representatives of J.W. Childs in respect of the remaining issues in the draft agreements that were not yet resolved. On February 11, 1999, the Company's Board of Directors held a telephonic meeting to consider the proposed merger transaction. Members of the Company's senior management, the Company's legal counsel and its financial advisors updated the Company's Board of Directors of the results of the negotiations that had occurred since the February 7, 1999 meeting of the Company's Board of Directors. At the meeting, a representative of PaineWebber presented in detail a financial analysis of the Company and the proposed transaction, and presented orally, which was confirmed in writing on February 12, 1999, that the consideration to be received by the Company's stockholders, other than the Purchaser and the Parent, is fair from a financial point of view, subject to the assumptions stated therein. The full text of the written opinion of PaineWebber containing the assumptions made, the matters considered and the scope of the review undertaken in rendering such opinion, as well as the limitations of such opinion, is included with the Company's solicitation/ recommendation statement on Schedule 14D-9, which is being mailed to stockholders concurrently with this Offer to Purchase. Stockholders are urged to read the full text of such opinion in conjunction with the Offer. After discussion and consideration, the Company's Board of Directors voted unanimously to approve the Merger, the Merger Agreement and all of the related transactions, subject to the satisfactory negotiation of certain terms of the financing and the completion of due diligence by J.W. Childs. Also on February 11, 1999, the Company's disinterested directors discussed the Merger Agreement and certain affiliate agreements including the Financial Advisory Agreement between the Company and TJC. In connection with the Financial Advisory Agreement the Company would have been obligated to pay to TJC up to 2% of the aggregate consideration paid in any transaction involving the Company. With the advice of PaineWebber, considering the typical and appropriate fees currently paid to financial advisors in similar transactions, the Company and TJC entered into an Amended and Restated Financial Advisory Agreement dated as of February 12, 1999 which provided for a lump sum payment of 2.5 million. This lump sum payment, representing approximately 0.8% of the total consideration payable in the Offer, is payable upon the consummation of the Offer. The disinterested directors unanimously approved the form of this Amended and Restated Financial Advisory Agreement. 13 16 The Merger Agreement, the Shareholders Agreement and other related transaction documents were executed and delivered by each of the Parent, the Purchaser and the Company after the close of business on February 12, 1999, following the satisfactory negotiation of certain terms of the financing and the completion of due diligence by J.W. Childs. On February 15, 1999, the Merger was publicly announced jointly by J.W. Childs and the Company. 11. THE MERGER AGREEMENT; THE SHAREHOLDERS AGREEMENT. The following is a summary of the Merger Agreement and the Shareholders Agreement among the Parent, the Purchaser and the Principal Holders (the "Shareholders Agreement"), which summaries are qualified in their entirety by reference to the Merger Agreement, the Shareholders Agreement and such other agreements which are filed as exhibits to the Tender Offer Statement on Schedule 14D-1. The Offer. The Merger Agreement provides for the commencement of the Offer as soon as practicable, and in any event within five business days from the date of the execution of the Merger Agreement. The obligation of the Purchaser to accept for payment or pay for any Shares tendered pursuant to the Offer is subject to the satisfaction or waiver (to the extent permitted by the Merger Agreement) of the conditions set forth in Section 15 (the "Offer Conditions"). The Parent or the Purchaser may waive any such condition in whole or in part and make any other changes in the terms and conditions of the Offer, subject to the terms of the Merger Agreement. Under the terms of the Merger Agreement, without the prior written consent of the Company, the Purchaser will not decrease the price per Share payable in the Offer, change the form of consideration payable in the Offer, decrease the number of Shares sought to be purchased in the Offer, change the Offer Conditions, waive the Minimum Condition, impose additional conditions to the Offer, except as otherwise provided in the Merger Agreement, extend the initial Expiration Date or amend any other terms of the Offer in any manner adverse to the holders of any Shares. The Purchaser shall have no obligation to pay interest on the purchase price of tendered Shares, including in the event the Purchaser exercises its right to extend the period of time during which the Offer is open. The rights reserved by the Purchaser in this paragraph are in addition to the Purchaser's rights to terminate the Offer pursuant to Section 15. The Merger Agreement provides that, subject to the terms and conditions of the Offer and the Merger Agreement and the satisfaction or waiver (to the extent permitted) of all the Offer Conditions as of the Expiration Date, the Purchaser will accept for payment and pay for all Shares validly tendered and not withdrawn pursuant to the Offer as soon as practicable after the Expiration Date. If the Offer Conditions are not satisfied or waived by the Purchaser as of the Expiration Date, the Purchaser will extend the Offer from time to time for the shortest time periods permitted by law and which it reasonably believes are necessary until the consummation of the Offer; provided that notwithstanding the satisfaction of the Offer Conditions, the Parent and the Purchaser shall have the right, after consultation with the Company, to extend the Offer until up to April 2, 1999, notwithstanding the prior satisfaction of the Offer Conditions. Composition of the Board of Directors After the Offer. The Merger Agreement provides that, promptly upon the consummation of the Offer, and from time to time thereafter, Parent shall be entitled to designate such number of directors, rounded up to the next whole number, on the Board as is equal to the product of the total number of directors on the Board (determined after giving effect to the directors elected pursuant to this sentence) multiplied by the percentage that the aggregate number of Shares beneficially owned by Parent or its affiliates bears to the total number of fully diluted Shares then outstanding, and the Company shall promptly take all actions necessary to cause Parent's designees to be so elected, including, if necessary, seeking the resignations of one or more existing directors or increasing the size of the Board; provided, however, that prior to the Effective Time, the Board shall always have at least three members who are neither officers, directors, stockholders or designees of the Purchaser or any of its affiliates. The Merger. The Merger Agreement provides that, upon the terms and subject to the satisfaction or waiver of the conditions thereof (and including those described in Section 15) and in accordance with the DGCL, at the Effective Time, the Purchaser shall be merged with and into the Company. Following the Merger, the separate corporate existence of the Purchaser shall cease and the Company shall continue as the 14 17 surviving corporation. At the Parent's election, any direct or indirect subsidiary of the Parent other than the Purchaser may be merged with and into the Company instead of the Purchaser. Certificate of Incorporation, By-laws, Directors and Officers After the Merger. The Merger Agreement provides that the certificate of incorporation of the Company, as in effect immediately prior to the Effective Time, shall be the certificate of incorporation of the Surviving Corporation until thereafter amended in accordance with its terms and applicable law. At the Effective Time, the By-Laws of the Purchaser shall be the By-Laws of the Surviving Corporation until thereafter amended in accordance with their terms and applicable law. The Merger Agreement further provides that the directors of the Purchaser immediately prior to the Effective Time shall be the initial directors of the Surviving Corporation and shall hold office until their respective successors are duly elected and qualified, or their earlier death, resignation or removal. The officers of the Company immediately prior to the Effective Time shall be the initial officers of the Surviving Corporation, in each case until their respective successors are duly elected and qualified, or their earlier death, resignation or removal; provided that, promptly upon the payment by the Purchaser for Shares pursuant to the Offer, any partners, officers or affiliates of TJC who are also officers of the Company immediately prior to the Effective Time shall resign as officers of the Company. Conversion of Shares. Pursuant to the Merger Agreement, at the Effective Time, each Share issued and outstanding immediately prior to the Effective Time (other than any Shares held by Parent, the Purchaser, any wholly owned subsidiary of the Parent or the Purchaser, in the treasury of the Company or by any wholly owned subsidiary of the Company, which Shares, by virtue of the Merger, shall be canceled and shall cease to exist with no payment being made with respect thereto, and other than Dissenting Shares) shall be converted into the right to receive in cash the Offer price (the "Merger Price"), payable to the holder thereof, and without interest, upon surrender of the certificate formerly representing such Share. Conversion of Options. The Merger Agreement provides that, immediately prior to the Effective Time, each outstanding stock option granted under the Company's stock option plan, whether or not then exercisable or vested, shall become fully exercisable and vested and shall be canceled by the Company, and the holder thereof shall be entitled to receive immediately following the Effective Time from the Company in consideration for such cancellation an amount in cash equal to the product of (a) the excess of the Merger Price over the exercise price per Share thereof and (b) the number of Shares subject to such stock option (net of taxes required by law to be withheld with respect thereto). Dissenting Shares. The Merger Agreement provides that Shares outstanding immediately prior to the Effective Time and held by a holder who has not voted in favor of or consented to the Merger and who demands in writing appraisal of such Shares in accordance with Section 262 of the DGCL if such Section 262 provides for appraisal rights for such Shares in the Merger ("Dissenting Shares") shall not be converted into the right to receive the Merger Price, but shall be entitled to receive the consideration as shall be determined pursuant to Section 262 of the DGCL, unless and until such holder fails to perfect or withdraws or otherwise loses his right to appraisal and payment under the DGCL. If, after the Effective Time, any such holder fails to perfect or withdraws or loses his right to appraisal, such Dissenting Shares shall thereupon be treated as if they had been converted as of the Effective Time into the right to receive the Merger Price, if any, to which such holder is entitled, without interest or dividends thereon. The Company shall give Parent prompt notice of any demands received by the Company for appraisal of Shares, withdrawals of such demands and any other instruments served pursuant to the DGCL and received by the Company and, prior to the Effective Time, Parent shall have the right to direct all negotiations and proceedings with respect to such demands. Prior to the Effective Time, the Company shall not, except with the prior written consent of Parent, make any payment with respect to, or settle or offer to settle, any such demands. Stockholders Meeting. The Merger Agreement provides that if required, the Company, acting through its Board of Directors, shall, in accordance with applicable law, (i) duly call, give notice of, convene and hold a special meeting of its stockholders (the "Special Meeting") as soon as practicable following the consummation of the Offer for the purpose of considering and taking action upon the Merger Agreement; (ii) prepare and file with, and use its reasonable best efforts to have cleared by, the SEC a preliminary proxy statement relating to the Merger and the Merger Agreement and use its reasonable efforts (x) to obtain and furnish the 15 18 information required to be included by the SEC in the Proxy Statement (as hereinafter defined) and, after consultation with Parent, to respond promptly to any comments made by the SEC with respect to the preliminary proxy statement and cause a definitive proxy statement (the "Proxy Statement") to be mailed to its stockholders and (y) to obtain the necessary approvals of the Merger and the Merger Agreement by its stockholders; and (iii) subject to the fiduciary obligations of the Board under applicable law as determined in good faith by a majority of the Board based on the advice of independent outside legal counsel, (A) include in the Proxy Statement the recommendation of the Board that stockholders of the Company vote in favor of the approval of the Merger and the adoption of the Merger Agreement and the written opinion of the Company's financial advisor that the consideration to be received by the stockholders of the Company pursuant to the Offer and the Merger is fair to such stockholders and (B) use its reasonable best efforts to obtain the necessary adoption of the Merger Agreement. Pursuant to the Merger Agreement, Parent also agrees that it will vote, or cause to be voted, all of the Shares then owned by it, the Purchaser or any of its other subsidiaries in favor of the approval of the Merger and the adoption of the Merger Agreement. The Merger Agreement provides that, notwithstanding the foregoing, in the event that Parent, the Purchaser or any other subsidiary of Parent shall acquire at least 90% of the outstanding Shares pursuant to the Offer, the parties thereto agree to take all necessary and appropriate action to cause the Merger to become effective as soon as practicable after the consummation of the Offer, without a meeting of stockholders of the Company, in accordance with Section 253 of the DGCL. Conduct of Business Pending the Merger. The Company has agreed that, during the period from the date of the Merger Agreement to the Effective Time, except pursuant to the terms of the Merger Agreement or unless Parent shall otherwise agree in writing, the Company will, and will cause each of its subsidiaries to conduct its operations only in, and the Company and its subsidiaries shall not take any action other than in, the ordinary course of business consistent with past practice and in compliance with applicable laws. The Company has also agreed that the Company and each of its subsidiaries shall use commercially reasonable efforts to preserve intact their business organization, to keep available the services of their present officers and key employees, and to preserve their present relationships with customers, suppliers and other persons with which they have significant business relations, except, in each case, as would not have a Material Adverse Effect (as defined below) on the Company. Without limiting the generality of the foregoing and except as otherwise expressly contemplated by the Merger Agreement, the Company has agreed that the Company and its subsidiaries shall refrain from taking various actions without the Parent's prior written consent until the Effective Time. These prohibitions cover, among other things, limitations on making changes to their organizational documents, selling their capital stock, declaring or paying any dividend or other distribution, making changes in their capital stock, increasing the compensation payable to directors, officers and employees (except in the ordinary course of business consistent with past practices), increasing or granting any severance or termination pay (except to the extent required under existing plans, policies or agreements), engaging in any material corporate transaction, including acquisitions, incurring debt outside the ordinary course of business consistent with past practices, entering into, renewing or amending contracts and making capital expenditures beyond specified limits, selling, leasing, licensing or disposing of any material assets (outside the ordinary course of business), changing accounting or tax policies, settling any material litigation or any litigation which relates to the transactions contemplated by the Merger Agreement, changing the key management structure of the Company or any of its subsidiaries, transferring or granting any rights to intellectual property, taking any action reasonably likely to expose the Company to any claim that the Company has violated applicable laws, rules or regulations, adopting a plan of complete or partial dissolution or liquidation, merger, restructuring, recapitalization or other reorganization of the Company or any of its active subsidiaries, paying or discharging any claims, liabilities or obligations outside the ordinary course of business consistent with past practices, entering into any collective bargaining agreement and taking any actions that would make any of the representations and warranties of the Company contained in the Merger Agreement untrue and incorrect or result in any of the Offer Conditions not being satisfied. Access to Information. Pursuant to the Merger Agreement from the date thereof to the Effective Time, the Company shall, and shall cause its subsidiaries, and each of their respective officers, directors, employees, 16 19 counsel, advisors and representatives (collectively, the "Company Representatives") to, provide the Parent and the Purchaser and their respective officers, employees, counsel, advisors and representatives and financing sources (collectively, the "Parent Representatives") reasonable access, consistent with applicable law, at all reasonable times to the offices and other facilities and to the books and records of the Company and its subsidiaries, and will permit the Parent and the Purchaser to make inspections of such as either of them may reasonably require, and will cause the Company Representatives and the Company's subsidiaries to furnish Parent, the Purchaser and the Parent Representatives to the extent available with such other information with respect to the business and operations of the Company and its subsidiaries as the Parent and the Purchaser may from time to time reasonably request. Efforts. The Merger Agreement provides that, subject to the terms and conditions thereof, each of the parties thereto shall use its reasonable best efforts to ensure that the conditions set forth in the Merger Agreement are satisfied and to consummate and make effective the transactions contemplated by the Offer, the Merger and the Merger Agreement as promptly as practicable. The Company shall also provide all reasonable cooperation in connection with any financing of the Offer and the Merger. Public Announcements. So long as the Merger Agreement is in effect, the Parent, the Purchaser and the Company agree to consult with each other before issuing any press release or otherwise making any public statement with respect to the transactions contemplated by the Merger Agreement and shall not issue any such press release or make any such public statement prior to such consultation, except as may be required by law or any listing agreement with any securities exchange. Employment Benefits Matters. The Merger Agreement provides that from and after the Effective Time, the Parent shall cause the Company to honor and continue to maintain in full force and effect all employee benefit arrangements to which the Company or any of its subsidiaries is presently a party, including but not limited to the agreements existing on the date thereof between the Company and certain executives of the Company, provided that nothing in the Merger Agreement shall restrict or limit the Company ability to amend or terminate any employee benefit plan. Pursuant to the Merger Agreement the Parent has agreed to cause the Company to take such actions as are necessary so that, for a period of at least one year from the Effective Time, employees of the Company and its subsidiaries (excluding employees covered by collective bargaining agreements) will be provided cash compensation employee benefit and incentive compensation and similar plans and programs as will provide compensation and benefits which in the aggregate are substantially comparable to those provided to such employees by specified employee benefit plans; provided, however, that neither the Parent nor the Company shall have any obligation to provide benefits substantially comparable to any plan providing equity awards or awards based on equity awards. The Merger Agreement further provides that in any termination or layoff of (i) any employee as of the Effective Time as a result of the transactions contemplated by the Merger Agreement or (ii) any employee of the Company as of the Effective Time after the Effective Time, the Parent will cause the Company to comply fully, if applicable, with the Worker Adjustment and Retraining Notification Act of 1988 ("WARN") and all other applicable foreign, federal, state and local laws, including those prohibiting discrimination and requiring notice to employees. The Company shall not, and shall cause its subsidiaries not to, at any time prior to 60 days after the Effective Time, effectuate a "plant closing" or "mass layoff" as those terms are defined in WARN affecting in whole or in part any facility, site of employment, operating unit or employee of the Company or any subsidiary without complying fully with the requirements of WARN. The Parent will bear the cost of compliance with (or failure to comply with) any such laws. Indemnification. The Merger Agreement provides that the Certificate of Incorporation and By-laws of the Company after the Merger shall contain provisions no less favorable with respect to indemnification than are set forth in the Certificate of Incorporation and By-laws of the Company prior to the Merger, and these provisions are not to be amended, repealed or otherwise modified for a period of six years from the Effective Time in any manner that would adversely affect the rights thereunder of individuals who at the Effective Time were directors, officers or employees of the Company. 17 20 The Merger Agreement also provides that for six years from and after the Effective Time, the Parent will or will cause the Company to indemnify and hold harmless each present and former director, officer and employee of the Company, against any costs or expenses (including reasonable attorneys' fees), judgments, fines, losses, claims, damages or liabilities (collectively, "Costs") (but only to the extent such Costs are not otherwise covered by insurance and paid) incurred in connection with any claim, action, suit, proceeding or investigation, whether civil, criminal, administrative or investigative, arising out of or pertaining to matters existing or occurring at or prior to the Effective Time, including, in any event, in connection with the Offer, the Merger and the Merger Agreement, whether asserted or claimed prior to, at or after the Effective Time, to the fullest extent permitted under applicable law (and the Parent shall, or shall cause the Company to, also advance expenses as incurred to the fullest extent permitted under applicable law, provided the person to whom expenses are advanced provides an undertaking to repay such advances if it is ultimately determined that such person is not entitled to indemnification). The Merger Agreement also provides that from and after the Effective Time, the Parent agrees that the Company shall use its reasonable best efforts to cause to be maintained in effect for not less than six years from the Effective Time the current policies of the directors' and officers' liability insurance maintained by the Company with respect to matters occurring prior to the Effective Time; provided that the Company may substitute therefor policies of at least the same coverage containing terms and conditions which are no less advantageous and provided that such substitution shall not result in any gaps or lapses in coverage with respect to matters occurring prior to the Effective Time; and provided, further, that the Company shall not be required to pay an annual premium in excess of 200% of the last annual premium paid by the Company prior to the date thereof and, if the Company is unable to obtain the insurance required by the Merger Agreement, it shall obtain as much comparable insurance as possible for an annual premium equal to such maximum amount. No Solicitation of Transactions. The Merger Agreement provides that prior to the Effective Time, the Company shall not, and shall not authorize or permit any of its or its subsidiaries' directors, officers, employees, agents, advisors or representatives, directly or indirectly, to (a) solicit, initiate or encourage or knowingly facilitate the submission of any inquiries or the making of any proposal (a "Takeover Proposal") with respect to any acquisition or purchase of a substantial amount of the assets of the Company and its subsidiaries, taken as a whole, or of over 15% of any class of equity securities or convertible securities of the Company or any tender offer (including a self tender offer) or exchange offer that if consummated would result in any person beneficially owning 15% or more of any class of equity securities or convertible securities of the Company or any of its subsidiaries, or any merger, consolidation or business combination, recapitalization, reclassification, liquidation, dissolution or similar transaction involving the Company or any of its subsidiaries, other than the transactions contemplated by the Merger Agreement, the Shareholders Agreement, or any other transaction the consummation of which would reasonably be expected to impede, interfere with, prevent or materially delay the Offer or the Merger or which would reasonably be expected to materially dilute the benefits to the Parent and the Purchaser of the Offer or the Merger (each an "Acquisition Transaction"), (b) negotiate, explore or otherwise participate in discussions with any person (other than the Parent, the Purchaser or their respective directors, officers, employees, agents and representatives), and including any parties with which the Company has previously engaged in discussions or negotiations with respect to any Acquisition Transaction, or furnish to any person (other than the Parent, the Purchaser or their respective directors, officers, employees, agents and representatives) any information with respect to its business, properties or assets or any of the foregoing, or otherwise cooperate in any way with, or assist or participate in, facilitate or encourage, any effort or attempt by any other person (other than the Parent, the Purchaser or their respective directors, officers, employees, agents and representatives) to do or seek any of the foregoing or (c) enter into any agreement, arrangement or understanding with respect to, or endorse, any Takeover Proposal; provided, however, that the foregoing shall not prohibit the Company from (i) prior to the consummation of the Offer (A) furnishing information pursuant to a confidentiality letter (provided for informational proposes to the Parent), with terms no less favorable than the Confidentiality Agreement, concerning the Company and its businesses, properties or assets to a third party who has made an unsolicited bona fide written Takeover Proposal, or (B) engaging in discussions or negotiations with such a third party who has made an unsolicited bona fide written Takeover Proposal or (ii) following receipt of an unsolicited bona fide written Takeover Proposal but prior to consummation of the Offer, failing to make or withdrawing or 18 21 modifying its recommendation of the Merger Agreement, but in each case referred to in the foregoing clauses (i) and (ii) only to the extent that the Board of Directors of the Company shall have concluded in good faith, on the basis of advice from outside legal counsel and the Company's financial advisors, that (A) such Takeover Proposal is more favorable to the stockholders of the Company than the transactions contemplated by the Merger Agreement (taking into account all legal, financial, regulatory and other aspects of the proposal and the person making the proposal) and (B) such action is necessary in order for the Board of Directors to comply with its fiduciary duties to the stockholders of the Company under applicable law; provided, further, that the Board of Directors of the Company shall not take any of the foregoing actions referred to in clauses (i) and (ii) until after notice to the Parent and the Purchaser with respect to such action and the Board of Directors shall continue to advise the Parent and the Purchaser after taking such action. Nothing in the Merger Agreement shall prevent the Board from taking, and disclosing to the Company's stockholders, a position contemplated by Rules 14d-9 and 14e-2 promulgated under the Exchange Act with regard to any tender offer. In addition, if the Board of Directors of the Company receives an unsolicited Transaction Proposal or any inquiry with respect to or which could lead to any Takeover Proposal, then the Company shall promptly inform the Parent and the Purchaser orally and in writing of the terms and conditions of such proposal and the identity of the person making it. Special Meeting. The Company shall take no action unless compelled by legal process to call a special meeting of stockholders of the Company except in accordance with the Merger Agreement unless and until the Merger Agreement has been terminated in accordance with its terms. Disposition of Litigation. The Merger Agreement provides that the Company will not settle any litigation currently pending, or commenced after the date thereof, against the Company or any of its directors by any stockholder of the Company relating to the Offer or the Merger Agreement, without the prior written consent of the Parent. The Merger Agreement further provides that the Company will not voluntarily cooperate with any third party which has sought or may thereafter seek to restrain or prohibit or otherwise oppose the Offer or the Merger and will cooperate with the Parent and the Purchaser to resist any such effort to restrain or prohibit or otherwise oppose the Offer or the Merger. State Takeover Laws. The Company shall, upon the request of the Purchaser, take all reasonable steps to assist in any challenge by the Purchaser to the validity or applicability to the transactions contemplated by the Merger Agreement, including the Offer and the Merger and the Shareholder's Agreement, of any state or foreign takeover law. Restatement of Financial Advisory Agreement. The Merger Agreement provides that the Company has amended and restated the Financial Advisory Agreement, dated July 12, 1995, between the Company and TJC Management Corp. (the "Financial Advisory Agreement") in consideration of the payment of fees of not more than $2.5 million to TJC Management (the "TJC Amount") in accordance with a payment letter acceptable to Parent (the "TJC Letter"). The parties acknowledged in the Merger Agreement that the TJC Amount is paid in consideration of services in connection with the Merger Agreement, as well as the transactions contemplated thereby, and such amendment and restatement constitute conditions of the Purchaser's willingness to enter into the Merger Agreement. The Debt Offer. Pursuant to the Merger Agreement, the Company shall, as soon as practicable after the date thereof, commence an offer to purchase (the "Debt Offer") all of the Company's outstanding 9 7/8% Series B Senior Notes due 2005 (the "Senior Notes"). The Debt Offer is subject to a number of conditions, including the consummation of the Offer. The Company shall waive any of the conditions to the Debt Offer and make any other changes in the terms and conditions of the Debt Offer as may be reasonably requested by the Parent, and the Company shall not, without the Parent's prior consent, waive a condition to the Debt Offer or make any changes to the terms and conditions of the Debt Offer. Notwithstanding anything in the Merger Agreement, including the immediately preceding sentence, to the contrary, the Company shall not be required to accept for payment or pay for any Senior Notes prior to the consummation of the Offer. Pursuant to the Merger Agreement, the Purchaser acknowledges that the Company is making the Debt Offer at the request and as an accommodation to the Purchaser, and that the Debt Offer, and its terms, conditions, failure or success, or any claims or actions relating thereto, will not be grounds for failure of a 19 22 condition, termination or delay of the Offer or the Merger, including the conditions thereof, nor otherwise affect them. The Purchaser will pay and reimburse the Company upon request for all fees and expenses relating to the Debt Offer, and will indemnify the Company and its directors and officers from and against all claims, lawsuits, losses, expenses and liabilities incurred by any of them in connection with the Debt Offer. Representations and Warranties. The Merger Agreement contains various customary representations and warranties of the parties thereto including, but not limited to, representations and warranties by the Company concerning the Company's capitalization, required filings and consents, the Board of Directors' approval of the Merger Agreement and the transactions contemplated thereby (including approvals so as to render inapplicable thereto the limitation on business combinations contained in Section 203 of the DGCL), SEC filings and financial statements, absence of certain changes or events, business, compliance with law, absence of litigation, employee benefit plans, environmental matters, tax matters, intellectual property matters, insurance matters, labor matters, real estate matters and brokers. Some of the representatives are qualified by a Material Adverse Effect clause. "Material Adverse Effect" includes any change or effect that would be materially adverse to the assets, liabilities, business, operations or financial condition of the Company and its subsidiaries, taken as a whole, except for any such change or effect resulting from general economic, financial or market conditions in the United States. Conditions of the Merger. Under the Merger Agreement, the respective obligations of the Parent, the Purchaser and the Company to consummate the Merger are subject to the satisfaction, at or before the Effective Time, of each of the following conditions: (i) if required by the DGCL, the stockholders of the Company shall have duly adopted the Merger Agreement and approved the transactions contemplated by the Merger Agreement pursuant to the requirements of the Company's certificate of incorporation and applicable law (which the Company has represented shall be solely the affirmative vote of a majority of the outstanding Shares), (ii) the Purchaser shall have accepted for payment and paid for Shares pursuant to the Offer in accordance with the terms thereof; provided, that this condition shall be deemed to have been satisfied with respect to the Parent and the Purchaser if the Purchaser fails to accept for payment or pay for Shares pursuant to the Offer in violation of the terms of the Offer, (iii) the consummation of the Merger shall not be restrained, enjoined or prohibited by any order, judgment, decree, injunction or ruling of a court of competent jurisdiction or any governmental entity and there shall not have been any statute, rule or regulation enacted, promulgated or deemed applicable to the Merger by any governmental entity which prevents the consummation of the Merger; provided that the party invoking this condition shall have used its reasonable best efforts to prevent the entry of such order, judgment, decree, injunction or ruling and to appeal as promptly as practicable any such order, judgment, decree, injunction or ruling, and (iv) any waiting period applicable to the Merger under the HSR Act shall have terminated or expired. Termination Events. The Merger Agreement can be terminated and the Offer and the Merger contemplated thereby may be abandoned at any time prior to the Effective Time, notwithstanding approval thereof by the stockholders of the Company: (a) by mutual written consent of the Parent and the Company; (b) by the Parent or the Company, if there shall be any statute, law, rule or regulation that makes consummation of the Offer or the Merger illegal or prohibited or if any court or other governmental entity of competent jurisdiction or located or having jurisdiction within the United States or any country or economic region in which either the Company or the Parent, directly or indirectly, has material assets or operations shall have issued, enacted, entered, promulgated or enforced any final order, judgment, decree, injunction, or ruling or taken any other action restraining, enjoining or otherwise prohibiting the Offer or the Merger and such order, judgment, decree, injunction or ruling shall have become nonappealable; (c) by the Parent or the Company if (i) the Offer is terminated or withdrawn pursuant to its terms without any Shares being purchased thereunder or (ii) if the Purchaser shall have failed to pay for Shares pursuant to the Offer within 55 days following the date of the Merger Agreement; provided, however, that neither the Parent nor the Company, as the case may be, may terminate the Merger Agreement as described in this paragraph, if the Purchaser's termination or withdrawal of the Offer 20 23 or failure to pay for Shares pursuant to the Offer has been caused by or results from the failure of such terminating party to perform in any material respects any of its covenants or agreements contained in the Merger Agreement or a material breach of such party's representations and warranties contained in the Merger Agreement; (d) by the Company if (i) the Offer shall not be commenced within five business days following the date of execution of the Merger Agreement, provided, that the failure to so commence has not been caused by and does not result from the failure of the Company to perform in any material respect any of its representations, warranties, covenants or agreements contained in the Merger Agreement, (ii) there shall have been a breach of any representation, warranty, covenant or agreement (without regard to any materiality or Material Adverse Effect qualifier) on the part of the Parent or the Purchaser contained in the Merger Agreement which materially adversely affects the Parent's or the Purchaser's ability to consummate (or materially delays commencement or consummation of) the Offer, and, with respect to any such breach that is reasonably capable of being cured, which shall not have been cured prior to the earlier of (A) 10 business days following notice of such breach and (B) two business days prior to the Expiration Date, (iii) the Purchaser shall have terminated the Offer, (iv) any of the commitment letters for the financing of the Offer and the Merger shall have been withdrawn, terminated or modified in an adverse manner to the Company or (v) prior to the purchase of Shares pursuant to the Offer, any person shall have made a bona fide Takeover Proposal (A) that the Board of Directors of the Company determines in its good faith judgment in consultation with its financial advisor, is more favorable to the Company's stockholders than the Offer and the Merger (taking into account all legal, financial, regulatory and other aspects of the proposal and the person making the proposal) and (B) as a result of which a majority of the Board of Directors concludes in good faith on the advice of independent outside legal counsel to the Company that termination of the Merger Agreement is necessary in order for the Board of Directors to comply with its fiduciary obligations under applicable law; provided, that such termination under this clause (v) shall not be effective until the Company has made payment of the Fee and Expenses (as defined below) reimbursement required by the Merger Agreement; or (e) by the Parent prior to the purchase of Shares pursuant to the Offer, if (i) there shall have been a breach of any representation or warranty on the part of the Company contained in the Merger Agreement (without regard to any materiality or Material Adverse Effect qualifier) which would reasonably be expected to have a Material Adverse Effect on the Company or which would materially adversely affect (or materially delay) the commencement or consummation of the Offer, (ii) there shall have been a breach of any covenant or agreement on the part of the Company contained in the Merger Agreement (without regard to any materiality or Material Adverse Effect qualifier) which would reasonably be expected to have a Material Adverse Effect on the Company or which would materially adversely affect (or materially delay) the consummation of the Offer, which, in the case of clause (i) or (ii), if such breach is reasonably capable of being cured, such breach shall not have been cured prior to the earlier of (A) 10 days following notice of such breach and (B) two business days prior to the Expiration Date, (iii) the Company shall effect, or enter into any agreement with respect to, an Acquisition Transaction with any person (other than the Parent or the Purchaser) or the Board of Directors has resolved to do so, (iv) the Board of Directors shall have withdrawn or modified in a manner adverse to the Purchaser its approval or recommendation of the Offer or the Merger or shall have recommended another offer or transaction, or shall have resolved to effect any of the foregoing or (v) the Minimum Condition shall not have been satisfied by the Expiration Date and, in addition, on or prior to such date (A) any person (other than the Parent or the Purchaser) shall have made a public proposal, filing, announcement or communication to the Company with respect to a Significant Acquisition Transaction (as defined below) or (B) any person (including the Company or any of its affiliates or subsidiaries) other than the Parent or any of its affiliates shall have become the beneficial owner of 25% or more of the Shares. "Significant Acquisition Transaction" has the same meaning as "Acquisition Transaction" except that the references to 15% contained therein shall be deemed to be (i) 35% with respect to any Significant 21 24 Acquisition Transaction effected through a primary sale of Shares (or a security convertible into Shares) by the Company or a merger involving the Company or a tender or exchange offer or any other transaction that the Board of Directors has recommended acceptance of, and (ii) 50% with respect to any Significant Acquisition Transaction effected through a tender or exchange offer that the Board of Directors has recommended rejection of or other market or secondary acquisition of Shares (or a security convertible into Shares). Termination Fees and Expenses. The Merger Agreement provides that (i) if the Merger Agreement is terminated by the Company as described under paragraph (d)(v) under "Termination Events", or by the Parent as described under paragraph (e)(iii) or (iv) under "Termination Events"; or (ii) (A) if the Merger Agreement is terminated by the Parent as described under paragraph (e)(i), (e)(ii) or (e)(v) under "Termination Events," (B) following the date of the Merger Agreement and at or prior to the time of the event giving rise to such termination there shall have existed a Takeover Proposal for a Significant Acquisition Transaction with respect to the Company and (C) within twelve months thereafter, either (1) the Company enters into an agreement with respect to any Significant Acquisition Transaction or (2) any Significant Acquisition Transaction occurs, then the Company shall pay to Parent a cash fee of $5.5 million (the "Fee"); If the Merger Agreement is terminated as described under paragraph 8.01(d)(v) or 8.01(e) under "Termination Events", then the Company shall pay to the Purchaser an amount equal to the reasonable and documented Expenses of the Parent and the Purchaser of up to $1 million (the "Expenses Cap"); provided, however, that the Expenses Cap shall not apply to the Collection Expenses. Such Expenses shall be in addition to, and not in substitution for, the Fee paid by the Company, if any. "Expenses" means all out-of-pocket fees and expenses actually incurred by the Parent or the Purchaser or on their behalf, whether before or after the execution and delivery of the Merger Agreement, in connection with the transactions contemplated by the Merger Agreement, including the Merger and the Shareholders Agreement, including without limitation, fees and reasonable expenses payable to all banks, investment banking firms and other financial institutions, and their respective agents and counsel, all fees and reasonable expenses of counsel, accountants, experts and consultants to the Parent or the Purchaser, and, further, including without limitation fees and reasonable expenses of, or incurred in connection with, any litigation or other proceedings to collect the Fee or the Expenses (the "Collection Expenses"). Shareholders Agreement. Concurrently with the execution and delivery of the Merger Agreement, the Parent, the Purchaser and the Principal Holders entered into a Shareholders Agreement (the "Shareholders Agreement"). Pursuant to the Shareholders Agreement, each Stockholder agrees to validly tender (or cause the record owner of such shares to validly tender), pursuant to and in accordance with the terms of the Offer, as soon as practicable after commencement of the Offer but in no event later than 15 business days after the date of commencement of the Offer, all of such Stockholder's Shares by physical delivery of the certificates therefor and to not withdraw such Shares. The Shareholders Agreement also provides that the Stockholders will (i) grant an irrevocable proxy to the Purchaser to vote their Shares during the term of the Shareholders Agreement in favor of the Merger, the execution and delivery by the Company of the Merger Agreement and against any action or agreement that would result in a breach of any covenant, representation or warranty or any other obligation or agreement of the Company under the Merger Agreement or the Shareholders Agreement, (ii) not directly or indirectly solicit, facilitate, participate in or initiate any inquiries or the making of any proposal by any person or entity (other than the Purchaser or any of its affiliates) which constitutes or may reasonably be expected to lead to any sale of the Shares or any Takeover Proposal or Acquisition Transaction, or (iii) not sell, transfer, pledge, encumber, assign or otherwise dispose of their Shares or stock options during the term of the Shareholders Agreement. 12. 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 Offer is being made pursuant to the Merger Agreement. As promptly as practicable following consummation of the Offer and after satisfaction or waiver of 22 25 all conditions to the Merger set forth in the Merger Agreement, the Purchaser intends to acquire the remaining equity interest in the Company not acquired in the Offer by consummating the Merger. Vote Required to Approve the Merger; Stockholder Approval. The Board of Directors of the Company has approved and adopted the Merger and the Merger Agreement in accordance with the DGCL. The Board will be required to submit the Merger Agreement to the Company's stockholders for approval at a stockholders' meeting convened for that purpose in accordance with the DGCL, except as otherwise required as described in the next paragraph. If stockholder approval is required, the Merger Agreement must be approved by the vote of the holders of a majority of the outstanding Shares. As a result, if the Minimum Condition is satisfied, the Purchaser will have the power, which it intends to exercise, to approve the Merger Agreement without the affirmative vote of any other stockholder. The Merger Agreement provides that, notwithstanding the foregoing, in the event that the Parent, the Purchaser or any other subsidiary of the Parent shall acquire at least 90% of the outstanding Shares pursuant to the Offer, the parties thereto agree to take all necessary and appropriate action to cause the Merger to become effective as soon as practicable after the consummation of the Offer, without a meeting of stockholders of the Company, in accordance with Section 253 of the DGCL. 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. THE OFFER IS CONDITIONED UPON THE MINIMUM CONDITION BEING SATISFIED. Appraisal Rights. 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. 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. 23 26 The foregoing description of the DGCL is not necessarily complete and is qualified in its entirely 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 14. If such registration were terminated, Rule 13e-3 would be inapplicable to any such future Merger or such alternative transaction. 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 as described in this Offer to Purchase, none of the Purchaser, the Parent, JWCP or, to the best knowledge of the Purchaser, the Parent, JWCP or 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. 13. DIVIDENDS AND DISTRIBUTIONS. If the Company should, on or after the date of the Merger Agreement, 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 15, 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 the date of the Merger Agreement, 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, then without prejudice to the Purchaser's rights under Section 15, (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. 14. EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES, NASDAQ 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 could reduce the number of holders of Shares, which could adversely affect the liquidity and 24 27 market value of the remaining Shares. Following completion of the Offer, at least a majority of the outstanding Shares will be owned by the Purchaser. Depending upon the number of Shares purchased pursuant to the Offer, the Shares may no longer meet the requirements of the National Association of Securities Dealers, Inc. (the "NASD") for continued inclusion in Nasdaq, which require that an issuer have at least 200,000 publicly held shares, held by at least 400 stockholders or 300 stockholders of round lots, with a market value of at least $1,000,000 and have net tangible assets of at least $1,000,000, $2,000,000 or $4,000,000, depending on profitability levels during the issuer's four most recent fiscal years. If these standards are not met, the Shares might nevertheless continue to be included in the NASD's Nasdaq Stock Market (the "Nasdaq Stock Market") with quotations published in Nasdaq "additional list" or in one of the "local lists," but if the number of holders of the Shares were to fall below 300, or if the number of publicly held Shares were to fall below 100,000 or there were not at least two registered and active market makers for the Shares, the NASD's rules provide that the Shares would no longer be "qualified" for Nasdaq Stock Market reporting and Nasdaq Stock Market would cease to provide any quotations. Shares held directly or indirectly by directors, officers or beneficial owners of more than 10% of the Shares are not considered as being publicly held for this purpose. As of February 19, 1999, there were approximately 83 holders of record and there were 12,110,049 Shares outstanding. If as a result of the purchase of Shares pursuant to the Offer or otherwise, the Shares no longer meet the requirements of the NASD for continued inclusion in Nasdaq or in any other tier of Nasdaq Stock Market and the Shares are no longer included in Nasdaq or in any other tier of Nasdaq Stock Market, as the case may be, the market for the Shares could be adversely affected. If Nasdaq were to delist the Shares, it is possible that the Shares would continue to trade on another securities exchange or in the over-the-counter market and that price or other quotations would be reported by such exchanges or through other sources. The extent of the public market therefor and the availability of such quotations would depend, however, upon such factors as the number of stockholders and/or the aggregate market value of such securities 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 or whether it would cause future market prices to be greater or less than the Offer price. The Shares 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, as amended. If registration of the Shares under the Exchange Act were terminated, the Shares would no longer be eligible for Nasdaq reporting. If the Shares are eligible for deregistration under the Exchange Act following the Offer, the Parent expects to seek to deregister the Shares under the Exchange Act. 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 listing and market quotations, it is possible that, following the Offer, the Shares might no longer constitute "margin securities" for the purposes of the Federal Reserve Board's margin regulations and therefore could no longer be used as collateral for purpose loans made by brokers. 25 28 15. 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 14-e-1(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 tendered pursuant to the Offer, and may postpone the acceptance for payment or, subject to the restriction referred to above, payment for any Shares tendered pursuant to the Offer, and may amend or terminate the Offer (whether or not any shares have theretofore been purchased or paid for) to the extent permitted by the Merger Agreement if, (i) at the expiration of the Offer, a number of Shares which constitutes more than 50% of the voting power (determined on a fully-diluted basis), on the date of purchase, of all the securities of the Company entitled to vote generally in the election of directors or in a merger shall not have been validly tendered and not properly withdrawn prior to the Expiration Date (the "Minimum Condition"), or (ii) at any time on or after the date of the Merger Agreement and prior to the acceptance for payment of Shares, any of the following conditions occurs or has occurred: (a) there shall have been instituted or pending any action or proceeding brought by any governmental authority before any federal or state court, or any order or preliminary or permanent injunction entered and continuing in any action or proceeding before any federal or state court or governmental, administrative or regulatory authority or agency, or any statute, rule, regulation, legislation, interpretation, judgment or order enacted, entered, enforced, promulgated, amended, issued and continuing and applicable to the Parent, the Purchaser, the Company or any subsidiary or affiliate of the Purchaser or the Company or the Offer or the Merger, by any legislative body, court, government or governmental, administrative or regulatory authority or agency which would reasonably be expected to have the effect of: (i) making illegal, or otherwise directly or indirectly restraining or prohibiting or making materially more expensive the making of the Offer, the acceptance for payment of, or payment for, the Shares by the Parent or the Purchaser or the consummation of any of the transactions contemplated by the Merger Agreement; (ii) prohibiting or materially limiting the ownership or operation by the Company or any of its subsidiaries or the Parent, the Purchaser or any of the Parent's affiliates of all or any material portion of the business or assets of the Company or any of its subsidiaries, taken as a whole, or any of its affiliates or compelling the Parent, the Purchaser or any of the Parent's affiliates to dispose of or hold separate all or any material portion of the business or assets of the Company or any of its subsidiaries or the Parent, or any of its affiliates, as a result of the transactions contemplated by the Offer or the Merger Agreement; or (iii) imposing or confirming material limitations on the ability of the Parent, the Purchaser or any of the Parent's affiliates effectively to acquire or hold or to exercise full rights of ownership of Shares, including without limitation the right to vote any 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, including without limitation the adoption and approval of the Merger Agreement and the Merger or the right to vote any shares of capital stock of any subsidiary directly or indirectly owned by the Company; or (iv) requiring material divestiture by the Parent or the Purchaser of any Shares; (b) there shall have occurred and be continuing (i) any general suspension of trading in, or limitation on prices for, securities on any national securities exchange or in the over-the-counter market in the United States, (ii) a material adverse change in or material disruption of conditions in the market for syndicated bank credit facilities or the financial, banking, or capital markets generally, (iii) a commencement and continuation of a war or armed hostilities or other national or international calamity directly or indirectly involving the United States which would have a Material Adverse Effect on the Company or (iv) in the case of any of the foregoing existing at the time of commencement of the Offer, a material acceleration or worsening thereof; (c) (i) it shall have been publicly disclosed or the Purchaser shall have otherwise learned that beneficial ownership (determined for the purposes of this paragraph as set forth in Rule 13d-3 promulgated under the Exchange Act) of more than 25% of the outstanding Shares has been acquired by any corporation (including the Company or any of its subsidiaries or affiliates), partnership, person or other entity or group (as defined in Section 13(d)(3) of the Exchange Act), other than the Parent 26 29 or its affiliates, or the Principal Holders or any of their respective affiliates (but only with respect to the Shares that they beneficially own on the date of the Merger Agreement), or (ii) (A) the Board of Directors of the Company or any committee thereof shall have withdrawn or modified in a manner adverse to the Parent or the Purchaser the approval or recommendation of the Offer, the Merger or the Merger Agreement, or approved or recommended any Takeover Proposal or any other acquisition of Shares other than the Offer and the Merger, (B) any such corporation, partnership, person or other entity or group shall have entered into a definitive agreement or an agreement in principle with the Company with respect to an Acquisition Transaction, or (C) the Board of Directors of the Company or any committee thereof shall have resolved to do any of the foregoing; (d) any of the representations and warranties of the Company set forth in the Merger Agreement that are qualified as to materiality or Material Adverse Effect shall not be true and correct, or any such representations and warranties that are not so qualified shall not be true and correct in any material respect, in each case as if such representations and warranties were made at the time of such determination; (e) the Company shall have failed to perform in any material respect any obligation or to comply in any material respect with any agreement or covenant of the Company to be performed or complied with by it under the Merger Agreement; (f) the Merger Agreement shall have been terminated in accordance with its terms or the Offer shall have been terminated with the consent of the Company; or (g) 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 material approval, permit, authorization or consent of any domestic or foreign governmental, administrative or regulatory agency (federal, state, local, provincial or otherwise) shall not have been obtained on terms satisfactory to the Parent in its reasonable discretion; and, in addition, which, in the case of (a) through (g), in the reasonable, good faith judgment of the Parent or the Purchaser, and regardless of the circumstances (including any action or inaction by the Parent or the Purchaser or any of their affiliates) giving rise to any such conditions, makes it inadvisable to proceed with the Offer and/or with such acceptance for payment of or payment for Shares or to proceed with the Merger. The foregoing conditions are for the sole benefit of the Parent and the Purchaser and may be asserted by the Parent or the Purchaser regardless of the circumstances giving rise to any such conditions and may be waived by the Parent or the Purchaser in whole or in part at any time and from time to time in their reasonable discretion, in each case, subject to the terms of the Merger Agreement. The failure by the Parent or the Purchaser at any time to exercise any of the foregoing rights shall not be deemed a waiver of such right and each such right shall be deemed an ongoing right which may be asserted at any time and from time to time. 16. CERTAIN LEGAL MATTERS AND REGULATORY APPROVALS. 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 15 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 27 30 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. 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. 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 15. 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 by February 26, 1999 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. 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 such fifteenth day, 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 28 31 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 or agreement of the parties. 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. 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. 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 challenge is made, what the outcome will be. See Section 15 for certain conditions to the Offer, including conditions with respect to litigation and certain government actions. 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. 17. FEES AND EXPENSES. Donaldson, Lufkin & Jenrette Securities Corporation ("DLJ") and NationsBanc Montgomery Securities LLC ("NMS") are acting as Dealer Managers in connection with the Offer and will be reimbursed by the Parent and the Purchaser for their reasonable out-of-pocket expenses, including reasonable attorneys' fees. The Parent, the Purchaser and JWCP have also agreed to indemnify DLJ and NMS against certain liabilities and expenses in connection with the Offer, including certain liabilities under the federal securities laws. DLJ has provided in the past other investment banking and financial advisory services to the Company. DLJ and NMS (or their respective affiliates) are acting as dealer managers for the Debt Offer, as co-arrangers under the New Credit Facility and as joint-book running managers for the possible offering of the New Notes. The Purchaser has retained MacKenzie Partners, Inc. to act as the Information Agent and Continental Stock Transfer & Trust Company 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 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 Managers, the Information Agent and the Depositary). Brokers, dealers, commercial banks and trust companies will, upon request, be 29 32 reimbursed by the Purchaser for customary mailing and handling expenses incurred by them in forwarding offering materials to their customers. 18. 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. RSA ACQUISITION CORP. February 22, 1999 30 33 SCHEDULE I DIRECTORS AND EXECUTIVE OFFICERS OF THE PURCHASER, THE PARENT AND J.W. CHILDS 1. Directors and Executive Officers of the Purchaser and Parent. The name, present principal occupation or employment and five-year employment history of each director and executive officer of the Parent and the Purchaser are set forth below. All persons listed below are citizens of the United States. The business address of each of the Parent and the Purchaser is c/o J.W. Childs Equity Partners II, L.P., One Federal Street, 21st Floor, Boston, MA 02110.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND MATERIAL OCCUPATIONS, POSITIONS, OFFICES NAME OR EMPLOYMENT HELD DURING THE LAST FIVE YEARS - ---- --------------------------------------------- Adam L. Suttin......................... Sole Director and President of both the Parent and the Purchaser. Managing Director of J.W. Childs Associates, L.P. since December 1997. Vice President of J.W. Childs Associates, L.P. from July 1995 to December 1997. Mr. Suttin was an executive at the Thomas H. Lee Company from August 1989 to 1995, most recently holding the position of Associate. B. Lane MacDonald...................... Vice President and Secretary of both the Parent and the Purchaser. Associate at J.W. Childs Associates, L.P. since 1998. Assistant Vice President at BancBoston Capital from 1995 to 1998. Financial Analyst at Robertson, Stephens and Co. from 1992 to 1993. Allan A. Dowds......................... Vice President and Treasurer of both the Parent and the Purchaser. Chief Financial Officer of J.W. Childs Associates, L.P. since 1995. Manager of Accounting and Reporting at Snapple Beverage Corporation from 1993 to 1995.
2. Directors and Executive Officers of J.W. Childs. The name, present principal occupation or employment and five-year employment history of directors and officers of J.W. Childs are set forth below. All persons listed below are citizens of the United States. The business address of all persons set forth below is c/o J.W. Childs Equity Partners II, L.P., One Federal Street, 21st Floor, Boston, MA 02110.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND MATERIAL OCCUPATIONS, POSITIONS, OFFICES NAME OR EMPLOYMENT HELD DURING THE LAST FIVE YEARS ---- --------------------------------------------- John W. Childs......................... Sole Director, President and Treasurer of JWC Inc. since July 1995. Prior to that time, he was an executive at the Thomas H. Lee Company from May 1987, most recently holding the position of Senior Managing Director. Steven G. Segal........................ Senior Managing Director of J.W. Childs Associates, L.P. since December 1997. Managing Director of J.W. Childs Associates, L.P., from July 1995 to December 1997. Managing Director at the Thomas H. Lee Company, 1994-1995. Associate at the Thomas H. Lee Company from 1987 to 1994. Adam L. Suttin......................... Sole Director and President of both the Parent and the Purchaser. Managing Director of J.W. Childs Associates, L.P. since December 1997. Vice President of J.W. Childs Associates, L.P. from July 1995 to December 1997. Mr. Suttin was an executive at the Thomas H. Lee Company from August 1989 to 1995, most recently holding the position of Associate.
I-1 34
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND MATERIAL OCCUPATIONS, POSITIONS, OFFICES NAME OR EMPLOYMENT HELD DURING THE LAST FIVE YEARS ---- --------------------------------------------- Glenn A. Hopkins....................... Managing Director, J.W. Childs Associates, L.P., since December 1997. Vice President, J.W. Childs Associates, L.P., from September 1995 to December 1997. Financial Analyst and Associate at the Thomas H. Lee Company from 1989 to 1995. Edward Yun............................. Vice President, J.W. Childs Associates, L.P., since December 1997. Associate, J.W. Childs Associates, L.P. from August 1996 to December 1997. Associate at DLJ Merchant Banking Partners from 1994 to 1996. Dana L. Schmaltz....................... Vice President, J.W. Childs Associates, L.P. since December 1997. Associate, J.W. Childs Associates, L.P., from February 1997 through December 1997. Associate at DLJ Merchant Banking Partners, 1995 to 1997. Associate, NTC Group, 1991 to 1993.
I-2 35 Facsimile copies of the Letter of Transmittal, properly completed and duly executed, will be accepted. The Letter of Transmittal, certificates for Shares and any other required documents should be sent or delivered by each stockholder of the Company or his broker, dealer, commercial bank, trust company or other nominee to the Depositary as follows: The Depositary for the Offer is: CONTINENTAL STOCK TRANSFER & TRUST COMPANY By Mail: By Facsimile Transmission: By Hand or Overnight Delivery: Reorganization Department (for Eligible Institutions Reorganization Department Two Broadway only) Two Broadway 19th Floor (212) 509-5150 19th Floor New York, NY 10004 New York, NY 10004 For Information by Telephone: (212)509-4000 Ext. 535
Any questions and requests for assistance may be directed to the Information Agent or the Dealer Managers 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: [MACKENZIE LOGO] 156 Fifth Avenue New York, New York 10010 (212) 929-5500 (Call Collect) (800) 322-2885 (Call Toll-Free) The Dealer Managers for the Offer are:
NATIONSBANC MONTGOMERY DONALDSON, LUFKIN & JENRETTE SECURITIES LLC 277 Park Avenue Equity Capital Markets New York, New York 10172 600 Montgomery Street (877) 893-0567 (Toll-Free) San Francisco, California 94111 (212) 892-8117 (800) 227-4786 Ext. 2044 (Toll-Free)
EX-99.11.A.2 3 LETTER OF TRANSMITTAL 1 EXHIBIT 11(A)(2) LETTER OF TRANSMITTAL TO TENDER SHARES OF COMMON STOCK OF AMERICAN SAFETY RAZOR COMPANY PURSUANT TO THE OFFER TO PURCHASE DATED FEBRUARY 22, 1999 BY RSA ACQUISITION CORP. A WHOLLY OWNED SUBSIDIARY OF RSA HOLDINGS CORP. OF DELAWARE THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, MARCH 19, 1999, UNLESS THE OFFER IS EXTENDED. THE DEPOSITARY FOR THE OFFER IS: CONTINENTAL STOCK TRANSFER & TRUST CO. By Mail: By Facsimile Transmission: By Hand or Overnight Delivery: Reorganization Department (for Eligible Institutions Reorganization Department Two Broadway only) Two Broadway 19th Floor (212) 509-5150 19th Floor New York, NY 10004 Confirm by Telephone: New York, NY 10004 (212) 509-4000 x535
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE, OR TRANSMISSIONS OF INSTRUCTIONS VIA 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 (as defined below) are to be forwarded herewith or, unless an Agent's Message (as defined in the Offer to Purchase) is utilized, if tenders of Shares are to be made by book-entry transfer into the account of Continental Stock Transfer & Trust Co., as Depositary (the "Depositary"), at The Depository Trust Company ("DTC" or the "Book-Entry Transfer Facility") pursuant to the procedures set forth in Section 3 of the Offer to Purchase (as defined below). Stockholders who tender Shares by book-entry transfer are referred to herein as "Book-Entry Stockholders". Holders of Shares whose certificates for such Shares (the "Share Certificates") are not immediately available or who cannot deliver their Share Certificates and all other required documents to the Depositary 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 according to the guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase. See Instruction 2. DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY. 2 - ------------------------------------------------------------------------------------------------------------------------------ DESCRIPTION OF SHARES TENDERED - ------------------------------------------------------------------------------------------------------------------------------ NAME(S) & ADDRESS(ES) OF REGISTERED HOLDER(S) PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) SHARE CERTIFICATE(S) AND SHARE(S) TENDERED APPEAR(S) ON CERTIFICATE(S) (ATTACH ADDITIONAL SIGNED LIST IF NECESSARY) - ------------------------------------------------------------------------------------------------------------------------------ TOTAL NUMBER OF SHARES NUMBER OF SHARE 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. - ------------------------------------------------------------------------------------------------------------------------------
3 3 [ ] CHECK HERE IF SHARES ARE BEING TENDERED BY BOOK-ENTRY TRANSFER MADE TO AN ACCOUNT MAINTAINED BY THE DEPOSITARY WITH THE BOOK-ENTRY TRANSFER FACILITY AND COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN THE BOOK-ENTRY TRANSFER FACILITY MAY DELIVER SHARES BY BOOK-ENTRY TRANSFER): Name of Tendering Institution - -------------------------------------------------------------------------------- Check box of Book-Entry Transfer Facility: [ ] The 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: [ ] The Depository Trust Company Account Number - ------------------------------- Transaction Code Number - -------------------------------- 4 4 NOTE: SIGNATURES MUST BE PROVIDED BELOW PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY Ladies and Gentlemen: The undersigned hereby tenders to RSA Acquisition Corp., a Delaware corporation (the "Purchaser"), a wholly owned subsidiary of RSA Holdings Corp. of Delaware, a Delaware corporation ("Parent"), the above-described shares of Common Stock, $0.01 par value per share (the "Shares"), of American Safety Razor Company, a Delaware corporation (the "Company"), at a purchase price of $14.125 per Share, net to the seller in cash without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase dated February 22, 1999 (the "Offer to Purchase") and in this Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). The undersigned understands that the Purchaser reserves the right to transfer or assign, in whole or from time to time in part, to one or more of its affiliates, the right to purchase all or any portion of the Shares tendered pursuant to the Offer, receipt of which is hereby acknowledged. Subject to, and effective upon, acceptance for payment for the Shares tendered herewith in accordance with the terms of the Offer, the undersigned hereby sells, assigns and transfers to, or upon the order of, the Purchaser all right, title and interest in and to all of the Shares that are being tendered hereby and any and all non-cash dividends, distributions (including additional Shares) or rights declared, paid or issued with respect to the tendered Shares on or after February 12, 1999, 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 (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 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 any Distribution) or transfer ownership of such Shares (and any Distribution) on the account books maintained by the 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 any Distribution) 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 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 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 February 12, 1999. 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 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 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. The undersigned hereby represents and warrants that (a) the undersigned has full power and authority to tender, sell, assign and transfer the Shares (and any Distribution) tendered hereby and (b) when the Shares are accepted for payment by the Purchaser, the Purchaser will acquire good, marketable and unencumbered title to the Shares (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 tendered hereby (and any Distribution). In addition, the 5 5 undersigned shall promptly remit and transfer to the Depositary for the account of the Purchaser any and all Distributions in respect of the Shares 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 made pursuant to the Offer are irrevocable, except that Shares tendered pursuant to the Offer may be withdrawn at any time prior to the Expiration Date (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 April 22, 1999. See Section 4 of the Offer to Purchase. The undersigned understands that tenders of Shares pursuant to any of the procedures described in Section 3 of the Offer to Purchase and in the instructions hereto will constitute a binding agreement between the undersigned and the Purchaser upon the terms and subject to the conditions set forth in the Offer, including the undersigned's representation that the undersigned owns the Shares 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 not tendered or not accepted for payment in the name(s) of the registered holder(s) appearing under "Description of Shares Tendered". Similarly, unless otherwise indicated herein under "Special Delivery Instructions", please mail the check for the purchase price and/or any certificate(s) for Shares 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". 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 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. The undersigned recognizes that the Purchaser has no obligation, pursuant to the Special Payment Instructions, to transfer any Shares from the name(s) of the registered holder(s) thereof if the Purchaser does not accept for payment any of the Shares so tendered. 6 6 ------------------------------------------------------------ SPECIAL PAYMENT INSTRUCTIONS (SEE INSTRUCTIONS 1, 5, 6 AND 7) To be completed ONLY if certificate(s) for Shares not tendered or not accepted for payment and/or the check for the purchase price of Shares accepted for payment are to be issued in the name of someone other than the undersigned. 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) ------------------------------------------------------------ ------------------------------------------------------------ SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 1, 5, 6 AND 7) To be completed ONLY if certificate(s) for Shares not tendered or not accepted for payment and/or the check for the purchase price of Shares accepted for payment are to be sent to someone other than the undersigned at an address other than that shown above. Mail [ ] check [ ] certificates to: Name ---------------------------------------------------- (PLEASE PRINT) Address -------------------------------------------------- ------------------------------------------------------------ (INCLUDE ZIP CODE) ------------------------------------------------------------ ------------------------------------------------------------ 7 7 SIGN SIGN HERE SIGN HERE AND COMPLETE SUBSTITUTE FORM W-9 HERE X - -------------------------------------------------------------------------------- & : X (Signature(s) of Holder(s)) Dated: , 1999 (Must be signed by the registered holder(s) exactly as name(s) appear(s) on Share Certificate(s) or a security position listing or by person(s) authorized to become registered holder(s) by certificates and documents transmitted herewith. If signature is by trustee, 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: , 1999 8 8 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 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 are tendered for the account of 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 the 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). Stockholders whose Share Certificates are not immediately available or who cannot deliver their Share 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 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; and (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 three Nasdaq National Market trading days after the date of execution of such Notice of Guaranteed Delivery. THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL, SHARE CERTIFICATES AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE 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 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 for payment. 3. Inadequate Space. If the space provided herein is inadequate, the certificate numbers and/or the number of Shares 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". In such cases, new Share Certificates for the Shares that were evidenced by your old Share 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 delivered to the Depositary will be deemed to have been tendered unless otherwise indicated. 9 9 5. Signatures on Letter of Transmittal, Stock Powers and Endorsements. If this Letter of Transmittal is signed by the registered holder(s) of the Shares tendered hereby, the signature(s) must correspond with the name(s) as written on the face of the certificate(s) without alteration, enlargement or any change whatsoever. If any of the Shares tendered hereby are owned of record by two or more joint owners, all such owners must sign this Letter of Transmittal. If any of the tendered Shares are registered in different names on several certificates, it will be necessary to complete, and submit as many separate Letters of Transmittal as there are different registrations of certificates. If this Letter of Transmittal or any certificates or stock powers are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, and proper evidence satisfactory to the Purchaser of their authority so to act must be submitted. If this Letter of Transmittal is signed by the registered holder(s) of the Shares listed and transmitted hereby, no endorsements of certificates or separate stock powers are required unless payment is to be made to, or certificates for Shares 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(s) on the certificate(s). Signatures on such certificates or stock powers must be guaranteed by an Eligible Institution. 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 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 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 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. 8. Waiver of Conditions. Subject to the terms and conditions of the Merger Agreement, the conditions of the Offer (other than the Minimum Condition (as defined in the Offer to Purchase)) 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 are accepted for payment is required to provide the Depositary with such stockholder's correct taxpayer identification number ("TIN") on Substitute Form W-9 below. If the Depositary is not provided with the correct TIN, the Internal Revenue Service may subject the stockholder or other payee to a $50 penalty. In addition, payments that are made to such stockholder or other payee with respect to Shares purchased pursuant to the Offer may be subject to 31% backup withholding. Certain stockholders (including, among others, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements. In order for a foreign individual to qualify as 10 10 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 Payer Identification Number on Substitute Form W-9" for more instructions. If backup withholding applies, the Depositary is required to withhold 31% of any 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 by filing a United States federal income return with the Internal Revenue Service. The box in Part 3 of the Substitute Form W-9 may be checked if the tendering stockholder has applied for a TIN but has not yet been issued 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 or of the last transferee appearing on the transfers attached to, or endorsed on, the Shares. If the Shares are in more than one name or are not in the name of the actual owner, consult the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for additional guidance on which number to report. 10. Requests for Assistance or Additional Copies. Questions or requests for assistance may be directed to the Dealer Managers 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 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. 11 11 - ---------------------------------------------------------------------------------------------------------- PAYER'S NAME: CONTINENTAL STOCK TRANSFER & TRUST CO. - ---------------------------------------------------------------------------------------------------------- SUBSTITUTE PART 1 -- PLEASE PROVIDE YOUR TIN FORM W-9 IN THE BOX AT RIGHT AND CERTIFY BY Social Security Number DEPARTMENT OF THE TREASURY SIGNING AND DATING BELOW. OR INTERNAL REVENUE SERVICE Employer Identification Number -------------------------------------------------------------------- PART 2 -- Certification -- Under Part 3 -- the penalties of perjury, I certify Awaiting TIN 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. -------------------------------------------------------------------- PAYER'S REQUEST FOR CERTIFICATE INSTRUCTIONS -- You must cross out item (2) above if TAXPAYER you have been notified by the IRS that you are currently subject to IDENTIFICATION NUMBER (TIN) backup withholding because of under-reporting interest or dividends on your tax return. However, if after being notified by the IRS that you were subject to backup withholding you received another notification from the IRS that you are no longer subject to backup withholding, do not cross out such item (2). -------------------------------------------------------------------- SIGN HERE SIGNATURE DATE _____________________________ - ----------------------------------------------------------------------------------------------------------
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 THE 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 ________________________, 1999 12 12 The Information Agent for the Offer is: [MACKENZIE LOGO] 156 Fifth Avenue New York, New York 10010 (212) 929-5500 (Call Collect) (800) 322-2885 (Call Toll-Free) BANKS AND BROKERS CALL COLLECT: (212) 929-5500 ALL OTHERS CALL TOLL FREE: (800) 322-2885 The Dealer Managers for the Offer are: DONALDSON, LUFKIN & JENRETTE NATIONSBANC MONTGOMERY SECURITIES LLC 277 Park Avenue 600 Montgomery Street New York, New York 10172 San Francisco, California 94111 (877) 893-0567 (Call (800) 227-4786 Ext. 2044 (Toll-Free) Toll-Free) (212) 892-8117
Date: February 22, 1999 13 EX-99.11.A.3 4 NOTICE OF GUARANTEED DELIVERY 1 EXHIBIT 11(A)(3) NOTICE OF GUARANTEED DELIVERY TO TENDER SHARES OF COMMON STOCK OF AMERICAN SAFETY RAZOR 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) ARE NOT IMMEDIATELY AVAILABLE OR THE CERTIFICATES FOR SHARES 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: CONTINENTAL STOCK TRANSFER & TRUST CO. By Mail: By Facsimile Transmission: By Hand or Overnight Delivery: Reorganization Department (for Eligible Institutions only) Reorganization Department Two Broadway (212) 509-5150 Two Broadway 19th Floor 19th Floor New York, NY 10004 New York, NY 10004 Confirm by Telephone: (212) 509-4000 x535
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 RSA Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of RSA Holdings Corp. of Delaware, a Delaware corporation, upon the terms and subject to the conditions set forth in the Offer to Purchase dated February 22, 1999 (the "Offer to Purchase"), and in the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"), receipt of which is hereby acknowledged, the number of shares of Common Stock, $0.01 par value per share (the "Shares"), of American Safety Razor Company, a Delaware corporation, pursuant to the guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase. 2 Signature(s) --------------------------------------- Name(s) of Record Holders ----------------------------------------------------- Please Type or Print Number of Shares --------------------------------- Certificate Nos. (If Available) ----------------------------------------------------- ----------------------------------------------------- Dated ----------------------------------------, 1999 Address(es) --------------------------------------- ----------------------------------------------------- Zip Code Area Code and Tel. No.(s) (Check the box below if Shares will be tendered by book-entry transfer) [ ] The Depositary Trust Company Account Number --------------------------------- GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE) The undersigned, 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 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, and (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 "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 three Nasdaq National Market trading days after the date hereof. ----------------------------------------------------- Name of Firm ----------------------------------------------------- Address ----------------------------------------------------- Zip Code Area Code and Tel. No. ----------------------------------------------------- Authorized Signature ----------------------------------------------------- Please Type or Print Title ----------------------------------------------- Dated ---------------------------------------, 1999 NOTE: DO NOT SEND CERTIFICATES FOR SHARES WITH THIS NOTICE. CERTIFICATES MUST BE SENT WITH YOUR LETTER OF TRANSMITTAL. 2 EX-99.11.A.4 5 LETTER TO BROKERS 1 EXHIBIT 11(A)(4) OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK OF AMERICAN SAFETY RAZOR COMPANY at $14.125 Net Per Share by RSA ACQUISITION CORP. a wholly owned subsidiary of RSA HOLDINGS CORP. OF DELAWARE THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, MARCH 19, 1999, UNLESS THE OFFER IS EXTENDED. February 22, 1999 To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees: We have been appointed by RSA Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of RSA Holdings Corp. of Delaware, a Delaware corporation (the "Parent"), to act as Dealer Managers in connection with the Purchaser's offer to purchase for cash all the outstanding shares of Common Stock, par value $0.01 per share (the "Shares"), of American Safety Razor Company, a Delaware corporation (the "Company"), at a purchase price of $14.125 per Share, net to the Seller in cash without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated February 22, 1999 (the "Offer to Purchase"), and in the related Letter of Transmittal (which together constitute the "Offer") enclosed herewith. Holders of Shares whose certificates for such Shares (the "Share Certificates") are not immediately available or who cannot deliver their Share Certificates and all other required documents to the Depositary (as defined below) prior to the 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 according to the guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase. Please furnish copies of the enclosed materials to those of your clients for whose accounts you hold Shares registered in your name or in the name of your nominee. Enclosed herewith for your information and forwarding to your clients are copies of the following documents: 1. The Offer to Purchase, dated February 22, 1999. 2. The Letter of Transmittal to tender Shares for your use and for the information of your clients. Facsimile copies of the Letter of Transmittal may be used to tender Shares. 3. The Notice of Guaranteed Delivery for Shares to be used to accept the Offer if certificates for the Shares (the "Share Certificates") are not immediately available or if such certificates and all other required documents cannot be delivered to Continental Stock Transfer & Trust Co. (the "Depositary") by the Expiration Date or if the procedure for book-entry transfer cannot be completed by the Expiration Date. 4. The Letter to Stockholders of the Company from the Chairman of the Board, President and Chief Executive Officer of the Company, accompanied by the Company's Solicitation/Recommendation Statement on Schedule 14D-9. 2 5. A printed form of letter which may be sent to your clients for whose accounts you hold Shares registered in your name or in the name of your nominee, with space provided for obtaining such clients' instructions with regard to the Offer. 6. Guidelines of the Internal Revenue Service for Certification of Taxpayer Identification Number on Substitute Form W-9. 7. A return envelope addressed to Continental Stock Transfer & Trust Co., Reorganization Department, Two Broadway, 19th Floor, New York, NY 10004, 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, MARCH 19, 1999, UNLESS THE OFFER IS EXTENDED. 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, and any other required documents should be sent to the Depositary and (ii) either Share Certificates representing the tendered Shares should be delivered to the Depositary or such Shares should be tendered by book-entry transfer into the Depositary's account maintained at the Book-Entry Transfer Facility (as described in the Offer to Purchase), all in accordance with the instructions set forth in the Letter of Transmittal and the Offer to Purchase. If holders of Shares wish to tender, but it is impracticable for them to forward their Share Certificates or other required documents on or prior to the Expiration Date or to comply with the book-entry transfer procedures on a timely basis, a tender 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 Managers, the Depositary and MacKenzie Partners (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 the undersigned, 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, DONALDSON, LUFKIN & JENRETTE NATIONSBANC MONTGOMERY SECURITIES LLC NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY OTHER PERSON THE AGENT OF THE PURCHASER, THE PARENT, THE DEALER MANAGERS, THE COMPANY, THE DEPOSITARY OR THE INFORMATION AGENT, OR ANY AFFILIATE OF ANY OF THEM, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENT OR USE ANY DOCUMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE ENCLOSED DOCUMENTS AND THE STATEMENTS CONTAINED THEREIN. 2 EX-99.11.A.5 6 LETTER TO CLIENTS 1 EXHIBIT 11(A)(5) OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK OF AMERICAN SAFETY RAZOR COMPANY at $14.125 Net Per Share by RSA ACQUISITION CORP. a wholly owned subsidiary of RSA HOLDINGS CORP. OF DELAWARE THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, MARCH 19, 1999, UNLESS THE OFFER IS EXTENDED. FEBRUARY 22, 1999 To Our Clients: Enclosed for your consideration is an Offer to Purchase, dated February 22, 1999 (the "Offer to Purchase"), and the related Letter of Transmittal relating to an offer by RSA Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of RSA Holdings Corp. of Delaware, a Delaware corporation (the "Parent"), to purchase all of the outstanding shares of Common Stock, $0.01, par value per share (the "Shares"), of American Safety Razor Company, a Delaware corporation (the "Company"), at a purchase price of $14.125 per Share, net to the seller in cash without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase and in the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). We are the holder of record of Shares held by us for your account. A tender of such Shares can be made only by us as the holder of record and pursuant to your instructions. The Letter of Transmittal is furnished to you for your information only and cannot be used by you to tender Shares held by us for your account. We request instructions as to whether you wish to 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 attention is directed to the following: 1. The tender price is $14.125 per share, net to the seller in cash without interest thereon. 2. The Offer is made for all of the outstanding Shares. 3. The Board of Directors of the Company has unanimously determined that the Merger Agreement (as defined below) and the transactions contemplated thereby, including each of the Offer and the Merger (as defined below), are fair to and in the best interests of the stockholders of the Company and recommends that holders of the Shares accept the Offer and tender their Shares to the Purchaser. 4. The Offer is being made pursuant to an Agreement and Plan of Merger, dated as of February 12, 1999 (the "Merger Agreement"), which provides that subsequent to the consummation of the Offer, the Purchaser will merge with and into the Company (the "Merger"). At the effective time of the Merger 2 (the "Effective Time"), each Share issued and outstanding immediately prior to the Effective Time (other than Shares held in the treasury of the Company and Shares, if any, owned by the Purchaser, the Parent or any direct or indirect subsidiary of the Parent or of the Company and other than Shares, if any, held by stockholders who have not voted in favor of the Merger Agreement or consented thereto in writing and have timely delivered to the Company demand for appraisal of such Shares in accordance with the Delaware General Corporation Law) shall be cancelled, extinguished and converted automatically into the right to receive $14.125 in cash, without interest. 5. The Offer and withdrawal rights will expire at 12:00 Midnight, New York City time, on Friday, March 19, 1999, unless the Offer is extended. 6. Tendering stockholders 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. 7. The Offer is conditioned upon, among other things, (i) there being validly tendered and not properly withdrawn prior to the expiration of the Offer, at least that number of Shares which, when combined with the Shares owned, directly or indirectly, by the Parent and its direct and indirect subsidiaries, constitute more than 50% of the voting power (determined on a fully-diluted basis) of all securities of the Company entitled to vote generally in the election of directors or in a merger and (ii) the expiration or termination of all applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. 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 Managers 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. 2 3 INSTRUCTIONS WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK OF AMERICAN SAFETY RAZOR COMPANY The undersigned acknowledge(s) receipt of your letter enclosing the Offer to Purchase dated February 22, 1999 (the "Offer to Purchase"), and the related Letter of Transmittal pursuant to an offer by RSA Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of RSA Holdings Corp. of Delaware, a Delaware corporation, to purchase all outstanding shares of Common Stock, $0.01 par value per share (the "Shares"), of American Safety Razor Company, a Delaware corporation. This will instruct you to tender the number of Shares indicated below (or, if no number is indicated below, all Shares) which are held by you for the account of the undersigned, upon the terms and subject to the conditions set forth in the Offer to Purchase and in the related Letter of Transmittal furnished to the undersigned. Number of Shares to be Tendered* Shares Dated , 1999 SIGN HERE - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Signature(s) - -------------------------------------------------------------------------------- Please print name(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 held by us for your account are to be tendered. EX-99.11.A.6 7 TAX GUIDELINES 1 EXHIBIT 11(A)(6 ) GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER FOR THE PAYEE (YOU) TO GIVE THE PAYER. -- Social security numbers have nine digits separated by two hyphens: i.e., 000-00-0000. Employee 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. All "Section" references are to the Internal Revenue Code of 1986, as amended. "IRS" is the Internal Revenue Service. ------------------------------------------------------------------ GIVE THE SOCIAL SECURITY FOR THIS TYPE OF ACCOUNT: NUMBER OF -- - --------------------------------------------------------------------- 1. Individual The individual 2. Two or more individuals (joint The actual owner of the ac- account) count or, if combined funds, the first individual on the account(1) 3. Custodian account of a minor The minor(2) (Uniform Gift to Minors Act) 4. a. The usual revocable savings The grantor-trustee(1) trust account (grantor is also trustee) The actual owner.(1) b. So-called trust account that is not a legal or valid trust under state law 5. Sole proprietorship The owner(3) - --------------------------------------------------------------------- GIVE THE EMPLOYER FOR THIS TYPE OF ACCOUNT: IDENTIFICATION NUMBER OF -- - --------------------------------------------------------------------- 6. Sole proprietorship The owner(3) 7. A valid trust, estate, or The legal entity(4) pension trust 8. Corporate The corporation 9. Association, club, religious, The organization charitable, educational, or other tax-exempt organization account 10. Partnership The partnership 11. A broker or registered nominee The broker or nominee 12. Account with the Department of The public entity Agriculture in the name of a public entity (such as a state or local government, school district, or prison) that receives agricultural program payments
------------------------------------------------------------------ (1) List first and circle the name of the person whose number you furnish. If only one person on a joint account has a social security number, that person's number must be furnished. (2) Circle the minor's name and furnish the minor's social security number. (3) You must show your individual name, but you may also enter your business or "doing business as" name. You may use either your social security number or your employer identification number (if you have one). (4) List first and circle the name of the legal trust, estate, or pension trust. (Do not furnish the taxpayer identification number of the personal representative or trustee unless the legal entity itself is not designated in the account title.) NOTE: If no name is circled when there is more than one name, the number will be considered to be that of the first name listed. OBTAINING A NUMBER If you don't have a taxpayer identification number or you don't know your number, obtain Form SS-5. Application for a Social Security Card, at the local Social Administration office, or Form SS-4, Application for Employer Identification Number, by calling 1 (800) TAX-FORM, and apply for a number. PAYEES EXEMPT FROM BACKUP WITHHOLDING Payees specifically exempted from withholding include: - - An organization exempt from tax under Section 501(a), an individual retirement account (IRA), or a custodial account under Section 403(b)(7), if the account satisfies the requirements of Section 401(f)(2). - - The United States or a state thereof, the District of Columbia, a possession of the United States, or a political subdivision or wholly-owned agency or instrumentality of any one or more of the foregoing. - - An international organization or any agency or instrumentality thereof. - - A foreign government and any political subdivision, agency or instrumentality thereof. Payees that may be exempt from backup withholding include: - - A corporation. - - A financial institution. - - A dealer in securities or commodities required to register in the United States, the District of Columbia, or a possession of the United States. - - A real estate investment trust. - - A common trust fund operated by a bank under Section 584(a). - - An entity registered at all times during the tax year under the Investment Company Act of 1940. - - A middleman known in the investment community as a nominee or who is listed in the most recent publication of the American Society of Corporate Secretaries, Inc., Nominee List. - - A futures commission merchant registered with the Commodity Futures Trading Commission. - - A foreign central bank of issue. Payments of dividends and patronage dividends generally exempt from backup withholding include: - - Payments to nonresident aliens subject to withholding under Section 1441. - - Payments to partnerships not engaged in a trade or business in the United States and that have at least one nonresident alien partner. - - Payments of patronage dividends not paid in money. - - Payments made by certain foreign organizations. - - Section 404(k) payments made by an ESOP. Payments of interest generally exempt from backup withholding include: - - Payments of interest on obligations issued by individuals. Note: You may be subject to backup withholding if this interest is $600 or more and you have not provided your correct taxpayer identification number to the payer. - - Payments of tax-exempt interest (including exempt-interest dividends under Section 852). - - Payments described in Section 6049(b)(5) to nonresident aliens. - - Payments on tax-free covenant bonds under Section 1451. - - Payments made by certain foreign organizations. - - Mortgage interest paid to you. Certain payments, other than payments of interest, dividends, and patronage dividends, that are exempt from information reporting are also exempt from backup withholding. For details, see the regulations under sections 6041, 6041A, 6042, 6044, 6045, 6049, 6050A and 6050N. EXEMPT PAYEES DESCRIBED ABOVE MUST FILE FORM W-9 OR A SUBSTITUTE FORM W-9 TO AVOID POSSIBLE ERRONEOUS BACKUP WITHHOLDING. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" IN PART II OF THE FORM, AND RETURN IT TO THE PAYER. IF THE PAYMENTS ARE OF INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO SIGN AND DATE THE FORM. PRIVACY ACT NOTICE. -- Section 6109 requires you to provide your correct taxpayer identification number to payers, who must report the payments to the IRS. The IRS uses the number for identification purposes and may also provide this information to various government agencies for tax enforcement or litigation purposes. Payers must be given the numbers whether or not recipients are required to file tax returns. Payers must generally withhold 31% of taxable interest, dividend, and certain other payments to a payee who does not furnish a taxpayer identification number to payer. Certain penalties may also apply. PENALTIES (1) FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER. -- If you fail to furnish your taxpayer identification number to a payer, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect. (2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING. -- If you make a false statement with no reasonable basis that results in no backup withholding, you are subject to a $500 penalty. (3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION. -- Willfully 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-99.11.A.7 8 SUMMARY ADVERTISEMENT 1 EXHIBIT 11(A)(7) This announcement is neither an offer to purchase nor a solicitation of an offer to sell Shares (as defined below). The Offer (as defined below) is made solely by the Offer to Purchase dated February 22, 1999 and the related Letter of Transmittal (and any amendments thereto) and is being made to all holders of Shares. The Purchaser (as defined below) 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 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 Managers 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 of AMERICAN SAFETY RAZOR COMPANY at $14.125 NET PER SHARE by RSA ACQUISITION CORP. a wholly owned subsidiary of RSA HOLDINGS CORP. OF DELAWARE RSA Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of RSA Holdings Corp. of Delaware, a Delaware corporation (the "Parent"), is offering to purchase all of the outstanding shares of Common Stock, par value $0.01 per share (the "Shares"), of American Safety Razor Company, a Delaware corporation (the "Company"), at a purchase price of $14.125 per Share, net to the seller in cash without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase dated February 22, 1999 (the "Offer to Purchase") and in the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). RSA Holdings Corp. of Delaware is a wholly owned subsidiary of J.W. Childs Equity Partners II, L.P. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, MARCH 19, 1999, UNLESS THE OFFER IS EXTENDED. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY TENDERED AND NOT PROPERLY WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF SHARES WHICH CONSTITUTES MORE THAN 50% 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. The purpose of the Offer is to acquire control of, and the entire equity interest in, the Company. Following the consummation of the Offer, the Purchaser intends to effect the Merger described below. The Offer is being made pursuant to an Agreement and Plan of Merger, dated as of February 12, 1999 (the "Merger Agreement"), among the Parent, the Purchaser and the Company. The Merger Agreement provides, among other things, for the making of the Offer by the Purchaser, and further provides that, following the completion of the Offer, upon the terms and subject to the conditions of the Merger Agreement and the Delaware General Corporation Law ("DGCL"), the Purchaser will be merged with and into the Company (the "Merger"), and each Share issued and outstanding immediately prior to the effective time of the Merger (other than any Shares held by the Parent, the Purchaser, any wholly owned subsidiary of the Parent or the Purchaser, in the treasury of the Company or by any wholly owned subsidiary of the Company, which Shares, by virtue of the Merger, shall be canceled and shall cease to exist with no payment being made with respect thereto, and other than Shares held by holders who perfect dissenters' rights under the DGCL) will be converted into the right to receive $14.125 in cash payable to the holder thereof, without interest, upon surrender of the certificate formerly representing such Share. The Merger Agreement is more fully described in Section 11 of the Offer to Purchase. THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY DETERMINED THAT THE MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING EACH OF THE OFFER AND THE MERGER, ARE FAIR TO AND IN THE BEST INTERESTS OF THE STOCKHOLDERS AND RECOMMENDS THAT ALL STOCKHOLDERS ACCEPT THE OFFER AND TENDER ALL OF THEIR SHARES TO THE PURCHASER. 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 Continental Stock Transfer & Trust Company (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. 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 such Shares (the "Share Certificates") or timely confirmation of a book-entry transfer of such Shares into the Depositary's account at The Depository Trust Company ("DTC") 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. Subject to the applicable rules and regulations of the Securities and Exchange Commission and the terms of the Merger Agreement, the Purchaser expressly reserves the right, in its sole discretion, at any time and from time to time, and regardless of whether or not any of the events set forth in Section 15 of the Offer to Purchase shall have occurred or shall have been determined by the Purchaser to have occurred, to (i) extend the period of time during which the Offer is open and thereby delay acceptance for payment of, and the payment for, any Shares, by giving oral or written notice of such extension to the Depositary and (ii) amend the Offer in any respect by giving oral or written notice of such amendment to the Depositary. Any extension, delay, termination, waiver or amendment 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. 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. The term "Expiration Date" means 12:00 Midnight, New York City time, on Friday, March 19, 1999, unless and until the Purchaser, in its discretion (but subject to the terms and conditions of the Merger Agreement), 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 made pursuant to the Offer are irrevocable, except that Shares 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 April 22, 1999. 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 notice of withdrawal must specify the name of the person who tendered the Shares to be withdrawn, the number of Shares to be withdrawn and the name of the registered holder, if different from that of the person who tendered such Shares. If Share 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 signature(s) 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 have been tendered for the account of an Eligible Institution. If Shares 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 DTC to be credited with the withdrawn Shares, 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. 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. The information required to be disclosed by Rule 14d-6(e)(1)(vii) of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended, is contained in the Offer to Purchase and is incorporated herein by reference. The Company has provided the Purchaser with the Company's stockholder list and security position listings for the purpose of disseminating the Offer to holders of Shares. The Offer to Purchase and the related Letter of Transmittal and other relevant materials will be mailed by the Purchaser to record holders of Shares and furnished to brokers, dealers, commercial banks, trust companies and similar persons whose names, or the names of whose nominees, appear on the stockholder list or, if applicable, who are listed as participants in a clearing agency's security position listing for subsequent transmittal to beneficial owners of Shares. THE OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE WITH RESPECT TO THE OFFER. Questions and requests for assistance may be directed to the Dealer Managers 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 Managers) for soliciting tenders of Shares pursuant to the Offer. The Information Agent for the Offer is: [MACKENZIE PARTNERS, INC. LOGO] 156 Fifth Avenue New York, New York 10010 (212) 929-5500 (Call Collect) or Call Toll-Free (800) 322-2885 The Dealer Managers for the Offer are: Donaldson, Lufkin & Jenrette NationsBanc Montgomery Securities LLC 277 Park Avenue 600 Montgomery Street New York, New York 10172 San Francisco, CA 94111 (877) 893-0576 (Toll-Free) (800) 227-4786 Ext. 2044 (Toll-Free) (212) 892-8117 (Call Collect) February 22, 1999 EX-99.11.A.8 9 PRESS RELEASE 1 EXHIBIT 11(A)(8) Copyright 1999 Business Wire, Inc. Business Wire February 15, 1999, Monday DISTRIBUTION: Business Editors LENGTH: 544 words HEADLINE: J. W. Childs to Acquire American Safety Razor Company DATELINE: STAUNTON, VA BODY: Feb. 15, 1999--J. W. Childs Equity Partners II, L.P. and American Safety Razor Company (Nasdaq:RAZR) today announced that they have entered into a definitive merger agreement under which J. W. Childs will acquire American Safety Razor for $ 14 1/8 per share or approximately $ 173 million in cash. Pursuant to the Merger Agreement, a cash tender offer will be commenced by a wholly-owned subsidiary of J. W. Childs no later than February 22, 1999 to acquire all of the outstanding shares of common stock of American Safety Razor. On Friday, February 12, 1999, the last reported sales price of common stock of American Safety Razor was $ 9 7/8. The Board of Directors of American Safety Razor has unanimously approved the merger agreement. PaineWebber Incorporated has rendered a fairness opinion to the Board of Directors in connection with the transaction. The tender offer will be subject to the valid tender of shares representing a majority of the voting power (determined on a fully diluted basis) of American Safety Razor, the expiration of the waiting period under applicable antitrust and competition laws, and other customary conditions. The Jordan Company, certain of its affiliates, partners and officers, and members of American Safety Razor's senior management, collectively the holders of approximately 19% of the stock of American Safety Razor, have contractually agreed to support the transaction and tender the shares of American Safety Razor held by them in response to the tender offer. Funding for the tender offer and merger and the transactions contemplated thereby will be provided with approximately $ 245 million of debt commitments made by J. W. Childs, NationsBank, N.A. and Donaldson, Lufkin & Jenrette. J. W. Childs has also made an equity investment commitment of $ 90 million. American Safety Razor Company is the leading manufacturer of private-brand and value-priced shaving blades and razors in the United States. The Company's shaving blade and razor products are sold under retailers' private-brand names as well as American Safety Razor's own brands: Personna(R), Gem(R), Flicker(R), LegMate(R), Bump Fighter(R), Treet(R), GEM Blue Star(R), Pal(R), MBC(TM) and Burma Shave(TM). The Company also manufactures cotton swabs, cotton balls and puffs, and foot care items which are sold under retailers' private-brand names as well as its own value-priced brands, Megas(R), ACCO(R), and Crystal(R). The Company is also a leading manufacturer of premium and value-priced blades and bladed hand tools, sold primarily under the Personna(R), American Line(TM), and Ardell(TM) brand names, as well as bar soaps for the cosmetic/skin care, 2 PAGE 3 Business Wire, February 15, 1999 pharmaceutical, and department store markets. In addition to its consumer products, American Safety Razor manufactures and markets industrial and specialty and medical blades. J. W. Childs is a private investment firm based in Boston. CONTACT: American Safety Razor Company, Staunton Thomas G. Kasvin, 540/248-9725 EX-99.11.B.1 10 COMMITMENT LETTER TO THE PURCHASER 1 EXHIBIT 11(B)(1) February 12, 1999 RSA Acquisition Corp. c/o J.W. Childs Equity Partners II, L.P. One Federal Street 21st Floor Boston, MA 02110 Attention: Mr. Adam Suttin AMERICAN SAFETY RAZOR COMPANY Ladies and Gentlemen: You have advised NationsBank, N.A. ("NATIONSBANK"), NationsBanc Montgomery Securities LLC ("NMS") and DLJ Capital Funding, Inc. ("DLJ") that J.W. Childs Equity Partners II, L.P. or one of its affiliates ("JWC") will organize a single-purpose, wholly-owned subsidiary ("HOLDINGS"). Holdings in turn will organize a single-purpose, wholly-owned subsidiary (the "PURCHASER") that, pursuant to a merger agreement (the "MERGER AGREEMENT"), dated as of the date hereof, entered into with American Safety Razor Company, a Delaware corporation (the "COMPANY"), will offer to acquire through a tender offer (the "STOCK TENDER OFFER") for $14.125 in cash per share all of the shares of the Company's outstanding common stock (the "COMPANY STOCK"), subject to the minimum condition provided for in the Stock Tender Offer. As promptly as practicable after the closing of the Stock Tender Offer, the Purchaser (or a subsidiary of the Purchaser) will consummate a merger (the "MERGER") with the Company in which the Company will be the surviving corporation and a wholly-owned subsidiary of Holdings. You have further advised us that concurrently with the commencement of the Stock Tender Offer, the Purchaser will commence a tender offer/consent solicitation at an offer price and on the other terms set forth in the schedules to the Merger Agreement (the "BOND TENDER OFFER"; and together with the Stock Tender Offer, the "TENDER OFFERS") for all of the Company's 9-7/8% Senior Notes due 2005 (the "SENIOR NOTES"), but in any event not less than a majority in principal amount of the Senior Notes then outstanding (the "MINIMUM BOND TENDER CONDITION"). The Bond Tender Offer shall be scheduled to close (including any extensions) at least two business days following the closing of the Stock Tender Offer. The Tender Offers, the Merger and the related equity and debt financings described below in this letter are hereinafter collectively referred to as the "TRANSACTION". We understand that you intend to finance the Transaction, the costs and expenses related to the Transaction and the ongoing working capital needs and other general corporate purposes of the Company and its subsidiaries after consummation of the Transaction from the following sources (and that no financing other than the financings described herein will be required in connection with the Transaction): (a) at least $90 million of common equity will be contributed in cash to Holdings by JWC and certain members of management of the Company (provided, that management "rollover" stock shall be included as part of such amount in amounts that are acceptable to NationsBank, DLJ and NMS), (b) Holdings shall 2 issue to JWC for cash not less than $55 million in unsecured, pay-in-kind debt (the "HOLDINGS DEBT"), (c) up to $190 million in senior secured credit facilities of the Purchaser and the Company (the "SENIOR CREDIT FACILITIES"), comprised of (i) term loan facilities aggregating up to $165 million and (ii) a revolving credit facility of up to $25 million and (d) if the Minimum Bond Tender Condition is met, at least $100 million in gross proceeds from the issuance and sale by the Company of senior subordinated unsecured notes (the "SUBORDINATED DEBT"). If the Subordinated Debt is issued on the Closing Date, the proceeds thereof will automatically reduce the Senior Credit Facilities by $40 million. In connection with the foregoing, each of NationsBank and DLJ is pleased to advise you of its several (and not joint) commitment to provide 50% of the full principal amount of the Senior Credit Facilities and NationsBank is pleased to advise you of its commitment to act as the sole and exclusive administrative agent (in such capacity, the "ADMINISTRATIVE AGENT") for the Senior Credit Facilities, in each case upon and subject to the terms and conditions set forth in this letter and in the summary of terms attached as Annex I hereto (the "SUMMARY OF TERMS" and, together with this letter agreement, the "COMMITMENT LETTER"). Each of NMS and DLJ is pleased to advise you of its willingness, as a co-arranger (each a "CO-ARRANGER" and, collectively, the "CO-ARRANGERS") and, in the case of DLJ, as syndication agent (the "SYNDICATION AGENT"), for the Senior Credit Facilities, to form a syndicate of financial institutions and institutional lenders (collectively, the "LENDERS") reasonably acceptable to you for the Senior Credit Facilities. All capitalized terms used and not otherwise defined herein shall have the same meanings as specified therefor in the Summary of Terms. The commitment of each of NationsBank and DLJ hereunder and the undertaking of NMS and DLJ to provide the services described herein are subject to the satisfaction of each of the following conditions precedent in a manner acceptable to NationsBank, DLJ and NMS: (a) prior to and during the syndication of the Senior Credit Facilities there shall be no competing offering, placement or arrangement of any debt securities or bank financing by or on behalf of Holdings, the Company or any of its subsidiaries (other than either the Subordinated Debt or the Holdings Debt); (b) no material adverse change in or material disruption of conditions in the market for syndicated bank credit facilities or the financial, banking or capital markets generally shall have occurred and be continuing that, in the reasonable judgment of NationsBank, DLJ or NMS, would materially impair the syndication of the Senior Credit Facilities; and (c) no change, occurrence or development shall have occurred since September 30, 1998, and no information shall have become known to NationsBank, DLJ or NMS since the date of this Commitment Letter, that could reasonably be expected to (1) have a material adverse effect on the business, assets, liabilities (actual or contingent), operations, condition (financial or otherwise) or prospects of Holdings, the Company or the Company's subsidiaries, taken as a whole, (2) materially adversely affect the ability of the Borrower or any Guarantor (as defined in the Summary of Terms), taken as a whole, to perform their obligations under the loan documentation or (3) materially adversely affect the rights and remedies of the Administrative Agent or the Lenders under the loan documentation (collectively, a "MATERIAL ADVERSE EFFECT"). NMS and DLJ intend to commence syndication of the Senior Credit Facilities promptly after your acceptance of this Commitment Letter and the Fee Letter (as hereinafter defined). You agree to actively assist, and to cause the Company to actively assist, NMS in achieving a syndication of the Senior Credit Facilities that is satisfactory to NMS, DLJ and you. Such assistance shall include (a) your providing and causing your advisors to provide NationsBank, NMS and DLJ and the other Lenders upon request with all information reasonably deemed necessary by NationsBank, DLJ and NMS to complete syndication, including, but not limited to, information and evaluations prepared by you, the Company, the proposed new management of the Company and your and their advisors, or on your or their behalf, relating to the 3 Transaction, (b) your assistance in the preparation of an Information Memorandum to be used in connection with the syndication of the Senior Credit Facilities, (c) using your commercially reasonable efforts to ensure that the syndication efforts of NMS and DLJ benefit materially from your existing lending relationships and the existing lending relationships of the Company and (d) otherwise assisting NationsBank, DLJ and NMS in their syndication efforts, including by making your officers and advisors and the officers and advisors of the Company and its subsidiaries available from time to time to attend and make presentations regarding the business and prospects of the Company and its subsidiaries, as appropriate, at one or more meetings of prospective Lenders. If the syndication of the Senior Credit Facilities cannot be successfully completed in a manner satisfactory to NationsBank, DLJ and NMS under the structure outlined in this Commitment Letter, you hereby agree that NationsBank and NMS or DLJ shall be entitled, in consultation with you, to change the pricing, structure, tenor or other terms of the Senior Credit Facilities if we determine that such changes are advisable in order to ensure a successful syndication therefor; provided that the aggregate amount of the commitment in respect of the Senior Credit Facilities shall remain unchanged. The agreement in this paragraph shall survive the closing of the Senior Credit Facilities until each of NationsBank and DLJ shall have reduced its commitments under the Senior Credit Facilities to its desired hold position. It is understood and agreed that NMS and DLJ will manage and control all aspects of the syndication in consultation with you, including decisions as to the selection of prospective Lenders and any titles offered to proposed Lenders, when commitments will be accepted and the final allocations of the commitments among the Lenders. It is understood that no Lender participating in the Senior Credit Facilities will receive compensation from you in order to obtain its commitment, except on the terms contained herein and in the Summary of Terms. It is also understood and agreed that the amount and distribution of the fees among the Lenders will be at the sole discretion of NationsBank, DLJ and NMS. You hereby represent, warrant and covenant that (a) all information, other than Projections (as defined below), which has been or is hereafter made available to NationsBank, DLJ, NMS or the Lenders by you or any of your affiliates or representatives (or on your or their behalf) or by the Company or any of its subsidiaries or representatives (or on their behalf) in connection with any aspect of the Transaction (the "INFORMATION"), taken as a whole, is and will be complete and correct in all material respects and does not and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein not misleading and (b) all financial projections concerning the Company and its subsidiaries that have been or are hereafter made available to NationsBank, DLJ, NMS or the Lenders by you or any of your affiliates or representatives (or on your or their behalf) or by the Company or any of its subsidiaries or representatives (or on their behalf) (the "PROJECTIONS") have been or will be prepared in good faith based upon reasonable assumptions. You agree to furnish us with such Information and Projections as we may reasonably request and to supplement the Information and the Projections from time to time until the date of the initial borrowing under the Senior Credit Facilities (the "CLOSING DATE") so that the representation, warranty and covenant in the immediately preceding sentence is correct on the Closing Date. In issuing this commitment and in arranging and syndicating the Senior Credit Facilities, NationsBank, DLJ and NMS are and will be using and relying on the Information and the Projections (collectively, the "PRE-COMMITMENT INFORMATION") without independent verification thereof. By executing this Commitment Letter, you agree to reimburse NationsBank, DLJ and NMS from time to time on demand for all reasonable out-of-pocket fees and expenses (including, but not limited to, the reasonable fees, disbursements and other charges of Shearman & Sterling, as counsel to the 4 Co-Arrangers, and of special and local counsel to the Co-Arrangers) incurred in connection with the Senior Credit Facilities, the syndication thereof, the preparation of the definitive documentation therefor and the other transactions contemplated hereby. You agree to indemnify and hold harmless NationsBank, NMS, DLJ, each Lender and each of their affiliates and their officers, directors, employees, agents, advisors and other representatives (each an "INDEMNIFIED PARTY") from and against (and will reimburse each Indemnified Party as the same are incurred for) any and all claims, damages, losses, liabilities and expenses (including, without limitation, the reasonable fees, disbursements and other charges of counsel) that may be incurred by or asserted or awarded against any Indemnified Party, in each case arising out of or in connection with or by reason of (including, without limitation, in connection with any investigation, litigation or proceeding or preparation of a defense in connection therewith) (a) any aspect of the Transaction or any similar transaction and any of the other transactions contemplated thereby or (b) the Senior Credit Facilities and any other financings, or any use made or proposed to be made with the proceeds thereof, except to the extent such claim, damage, loss, liability or expense results from such Indemnified Party's gross negligence or willful misconduct. In the case of an investigation, litigation or proceeding to which the indemnity in this paragraph applies, such indemnity shall be effective whether or not such investigation, litigation or proceeding is brought by you, your equityholders or creditors or an Indemnified Party or an Indemnified Party is otherwise a party thereto and whether or not any aspect of the Transaction is consummated. You also agree that no Indemnified Party shall have any liability (whether direct or indirect, in contract or tort or otherwise) to you or your subsidiaries or affiliates or to your or their respective security holders or creditors arising out of, related to or in connection with any aspect of the Transaction, except for direct, as opposed to consequential, damages that resulted from such Indemnified Party's gross negligence or willful misconduct. This Commitment Letter and the fee letter among you, NationsBank, DLJ and NMS of even date herewith (the "FEE LETTER") and the contents hereof and thereof are confidential and, except for the disclosure hereof or thereof on a confidential basis to your accountants and attorneys retained in connection with the Transaction, to the Company and its directors, officers, advisors and representatives and to the proposed new management of the Company or as otherwise required by law, may not be disclosed in whole or in part to any person or entity without our prior written consent; provided, however, it is understood and agreed that your may disclose this Commitment Letter (including the Summary of Terms) but not the Fee Letter (a) on a confidential basis to the board of directors and advisors of each of Holdings and the Company in connection with their consideration of the Transaction, and (b) after your acceptance of this Commitment Letter and the Fee Letter, in filings with the Securities and Exchange Commission and other applicable regulatory authorities and stock exchanges. The provisions of the immediately preceding three paragraphs shall remain in full force and effect regardless of whether any definitive documentation for the Senior Credit Facilities shall be executed and delivered and notwithstanding the termination of this Commitment Letter or any commitment or undertaking of NationsBank, DLJ or NMS hereunder. In connection with the services and transactions contemplated hereby, you agree that NationsBank, DLJ and NMS are permitted to access, use and share with any of their bank or non-bank affiliates, agents, advisors (legal or otherwise) or representatives, any information concerning you, the Company or any of your or its respective affiliates that is or may come into the possession of NationsBank, DLJ, NMS or any of such affiliates. NationsBank, DLJ, NMS and their affiliates will treat confidential information relating to you, the Company and your and its respective affiliates with the same degree of care as they treat their 5 own confidential information. This Commitment Letter may be executed in counterparts which, taken together, shall constitute an original. Delivery of an executed counterpart of this Commitment Letter or the Fee Letter by telecopier shall be effective as delivery of a manually executed counterpart thereof. This Commitment Letter and the Fee Letter shall be governed by, and construed in accordance with, the laws of the State of New York. Each of you, NationsBank, DLJ and NMS hereby irrevocably waives all right to trial by jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this Commitment Letter (including, without limitation, the Summary of Terms), the Fee Letter, the Transaction and the other transactions contemplated hereby and thereby or the actions of NationsBank, DLJ and NMS in the negotiation, performance or enforcement hereof. The commitments and undertakings of NationsBank, DLJ and NMS may be terminated by us if you fail to perform your obligations under this Commitment Letter or the Fee Letter on a timely basis. This Commitment Letter, together with the Summary of Terms and the Fee Letter, embodies the entire agreement and understanding among NationsBank, DLJ, NMS, you, Holdings and your and its affiliates with respect to the Senior Credit Facilities and supersedes all prior agreements and understandings relating to the specific matters hereof. However, please note that the terms and conditions of the commitment of each of NationsBank and of DLJ and undertaking of NMS hereunder are not limited to those set forth herein or in the Summary of Terms. Those matters that are not covered or made clear herein or in the Summary of Terms or the Fee Letter are subject to mutual agreement of the parties. No party has been authorized by NationsBank or NMS or DLJ to make any oral or written statements that are inconsistent with this Commitment Letter. This letter is not assignable by you without our prior written consent and is intended to be solely for the benefit of the parties hereto and the Indemnified Parties. This Commitment Letter and all commitments and undertakings of NationsBank, DLJ and NMS hereunder will expire at 5:00 p.m. (New York City time) on February 15, 1999 unless you execute this Commitment Letter and the Fee Letter and return them to us prior to that time. Thereafter, all commitments and undertakings of NationsBank, DLJ and NMS hereunder will expire on the earliest of (a) April 16, 1999, unless the Closing Date occurs on or prior thereto, (b) the closing of the Stock Tender Offer without the use of the Senior Credit Facilities and (c) the acceptance by Holdings or any of its affiliates of an offer for all or any substantial part of the capital stock or property and assets of Holdings and its subsidiaries other than as part of the Transaction. 6 We are pleased to have the opportunity to work with you on this important financing. Very truly yours, NATIONSBANK, N.A. By____________________________________ Title: NATIONSBANC MONTGOMERY SECURITIES LLC By___________________________________ Title: DLJ CAPITAL FUNDING, INC. By___________________________________ Title: ACCEPTED AND AGREED TO AS OF FEBRUARY __, 1999 RSA ACQUISITION CORP. By_______________________________ Title: EX-99.11.B.2 11 COMMITMENT LETTER FROM J.W. CHILDS EQUITY PTNR. II 1 EXHIBIT 11(B)(2) J.W. CHILDS EQUITY PARTNERS II, L.P. ONE FEDERAL STREET, FLOOR 21 BOSTON, MA 02110 February 12, 1999 RSA Holdings Corp. of Delaware One Federal Street Boston, MA 02110 Ladies and Gentlemen: RSA Acquisition Corp. ("Purchaser") has been organized by J.W. Childs Equity Partners II, L.P. ("J.W. Childs") and RSA Holdings Corp. of Delaware ("Holding") to purchase all of the outstanding shares of common stock, par value $0.01 per share, of American Safety Razor Company, a Delaware corporation (the "Company"), pursuant to the terms of the Agreement and Plan of Merger dated as of February 12, 1999 by and among Holding, Purchaser and the Company (the "Merger Agreement"). Capitalized terms used and not otherwise defined herein have the meanings ascribed to them in the Merger Agreement. Subject to the satisfaction of all conditions precedent to Purchaser's obligation to consummate the Offer and the Merger, we confirm that J.W. Childs is pleased to commit to provide Holding with (i) a common stock investment in cash of up to $90.0 million and (ii) an unsecured, pay-in-kind debt investment in cash of up to $55.0 million, such investment to be made upon the closing of the Tender Offer. J.W. Childs will not be under any obligation pursuant to the preceding paragraph unless and until all conditions precedent to Purchaser's obligation to consummate the Tender Offer have been satisfied in accordance with the terms of the Merger Agreement. J.W. Childs will use its reasonable best efforts to cause Purchaser and Holding to satisfy the conditions to the senior debt funding contemplated by the NationsBank commitment letter in connection with the financing of the Offer and the Merger. J.W. Childs will guarantee the due performance of any and all obligations and liabilities of Purchaser and Holding pursuant to Sections 6.16(d)(iii) and 8.03(a) of the Merger Agreement. This letter may be disclosed to the Company and its directors, officers, representatives and advisors, to NationsBank and as required by applicable law. 2 2 Notwithstanding anything that may be expressed or implied in this letter agreement, Holding, by its acceptance of the benefits hereof, covenants, agrees and acknowledges that, no person other than J.W. Childs shall have any obligation hereunder and that, notwithstanding that J.W. Childs is a partnership, no recourse hereunder or any documents or instruments delivered in connection herewith shall be had against any current or future officer, agent or employee of J.W. Childs, against any current or future general or limited partner of J.W. Childs or against any current or future director, officer, employee, general or limited partner, member, affiliate or assignee of any of the foregoing, whether by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any statute, regulation or other applicable law, it being expressly agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any current or future officer, agent or employee of J.W. Childs or any current or future general or limited partner of J.W. Childs or any current or future director, officer, employee, general or limited partner, member, affiliate or assignee of any of the foregoing, as such for any obligations of J.W. Childs under this letter agreement or any documents or instruments delivered in connection herewith or for any claim based on, in respect of or by reason of such obligations or their creation. Very truly yours, J.W. CHILDS EQUITY PARTNERS II, L.P. By: J.W. Childs Advisors II, L.P. its general partner By: J.W. Childs Associates, L.P. its general partner By: J.W. Childs Associates, Inc. its general partner By: /s/ Adam Suttin -------------------------------- Name: Adam Suttin Title: Vice President Agreed and Accepted this 12th day of February, 1999 RSA Holdings Corp. of Delaware By: /s/ Adam Suttin ------------------------------------ Name: Adam Suttin Title: President EX-99.11.C.1 12 AGREEMENT AND PLAN OF MERGER 1 EXHIBIT 11(C)(1) AGREEMENT AND PLAN OF MERGER AGREEMENT AND PLAN OF MERGER dated as of February 12, 1999, by and among RSA Holdings Corp. of Delaware, a Delaware corporation ("Parent"), RSA Acquisition Corp., a Delaware corporation and a subsidiary of Parent (the "Purchaser") and American Safety Razor Company, a Delaware corporation (the "Company"). WHEREAS, the respective Boards of Directors of Parent, the Purchaser and the Company have approved the acquisition of the Company by Parent on the terms and subject to the conditions set forth in this Agreement; WHEREAS, in furtherance of such acquisition, Parent proposes to cause the Purchaser to make a tender offer (as it may be amended from time to time as permitted under this Agreement, the "Offer") to purchase all of the shares of Common Stock, par value $0.01 per share, of the Company (the "Shares") at a price per share of $14.125 net to the selling stockholders in cash (such price as it may hereafter be increased, the "Share Offer Price") upon the terms and subject to the conditions set forth in this Agreement; WHEREAS, pursuant to the Merger (as defined) Purchaser shall pay and cash out all options outstanding on the date hereof issued and exercisable under the Option Plan (as hereinafter defined) at a price per option net to the selling stockholder in cash equal to the difference between the Share Offer Price and the exercise price of such options under the Option Plan (the "Option Offer Price"); WHEREAS, the Board of Directors of the Company (the "Board") has approved the Offer and the Merger as fair and advisable to the Company's stockholders and is recommending that the Company's stockholders accept the Offer; WHEREAS, the respective Boards of Directors of Parent, the Purchaser and the Company have approved the merger of the Purchaser with and into the Company, as set forth be low (the "Merger"), in accordance with the General Corporation Law of the State of Delaware (the "GCL") and upon the terms and subject to the conditions set forth in this Agreement, whereby each issued and outstanding Share not owned directly or indirectly by Parent or the Company will be converted into the right to receive the Share Offer Price applicable thereto in cash; WHEREAS, concurrently with the execution and delivery of the Merger Agreement, Parent, certain shareholders of the Company and certain executive officers of the Company, including but not limited to the partners, principals, officers, employees and affiliates of The Jordan Company ("TJC") (the "Principal Holders"), have entered into a Shareholders Agreement dated as of the date hereof in the form of Exhibit A hereto (the "Shareholders Agreement", and, together with the Confidentiality Agreement (as hereinafter defined), the "Related Agreements"); 2 WHEREAS, Parent, the Purchaser and the Company desire to make certain representations, warranties, covenants and agreements in connection with the Offer and the Merger and also to prescribe various conditions to the Offer and the Merger. NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth herein, Parent, the Purchaser and the Company agree as follows: ARTICLE I THE OFFER SECTION 1.01 The Offer. (a) So long as this agreement shall not have been terminated in accordance with Section 8.01 and none of the events set forth in Annex I hereto (as hereinafter provided) shall have occurred or exist, the Purchaser shall, and Parent shall cause the Purchaser to, commence (within the meaning of Rule 14d-2(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as promptly as practicable after the date hereof, but in any event not later than the fifth business day following the date hereof, the Offer for all outstanding Shares at the Share Offer Price applicable to such Shares, net to the seller in cash in accordance with this Agreement. The initial expiration date for the Offer shall be the twentieth business day from and after the date the Offer is commenced, including the date of commencement as the first business day in accordance with Rule 14d-2 under the Exchange Act (the "Initial Expiration Date"). As promptly as reasonably practicable, on the commencement date of the Offer, the Parent and the Purchaser shall file with the Securities and Exchange Commission (the "SEC"), with respect to the Offer, the Purchaser's Tender Offer Statement on Schedule 14D-1 (the "Schedule 14D-1") (together with any supplements or amendments thereto, the "Offer Documents"), which shall contain (as an exhibit thereto) the Purchaser's Offer to Purchase (the "Offer to Purchase") which shall be mailed to the holders of Shares with respect to the Offer. The Company and its counsel shall be given an opportunity to review and comment upon the Offer Documents and any amendment or supplement thereto prior to the filing thereof with the SEC, and Parent and Purchaser shall consider such comments in good faith. Parent and Purchaser agree to provide to the Company and its counsel any comments which Parent, Purchaser or their counsel may receive from the Staff of the SEC with respect to the Offer Documents promptly after receipt thereof. The obligation of Parent to accept for payment or pay for any Shares tendered pursuant to the Offer will be subject to the satisfaction or waiver (to the extent permitted by this Agreement) of the conditions set forth in Annex I hereto (the "Offer Conditions"). Without the prior written consent of the Company, the Purchaser shall not decrease the price per Share or change the form of consideration payable in the Offer, decrease the number of Shares sought to be purchased in the Offer, change the conditions set forth in Annex I, waive the Minimum Condition (as defined in Annex I), impose additional conditions to the Offer, except as otherwise provided herein, extend the Initial Expiration Date or amend any other term of the Offer in any 2 3 manner adverse to the holders of any Shares. Subject to the terms of the Offer and this Agreement and the satisfaction or waiver (to the extent permitted by this Agreement) of all the conditions of the Offer set forth in Annex I hereto as of the Initial Expiration Date or any expiration date permitted by the Agreement, Parent will accept for payment and pay for all Shares validly tendered and not withdrawn pursuant to the Offer as soon as practicable after such expiration date of the Offer. Subject to Section 8.01, if the conditions set forth in Annex I hereto are not satisfied or, to the extent permitted by this Agreement, waived by the Parent, as of the Initial Expiration Date (or any subsequently scheduled expiration date), Parent will extend the Offer from time to time for the shortest time periods permitted by law and which it reasonably believes are necessary until the consummation of the Offer; provided that notwithstanding the satisfaction of the Offer Conditions the Parent and the Purchaser shall have the right, after consultation with the Company, to extend the Offer for up to 10 business days after the Initial Expiration Date, notwithstanding the prior satisfaction of the Offer Conditions. Each of Parent and the Purchaser shall use its reasonable best efforts to avoid the occurrence of any event specified in Annex I or to cure any such event that shall have occurred. (b) The Offer Documents will comply in all material respects with the provisions of applicable federal securities laws and, on the date filed with the SEC and on the date first published, sent or given to the Company's stockholders, shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading, except that no representation is made by Parent or the Purchaser with respect to information supplied by the Company in writing for inclusion in the Offer Documents. Each of Parent and the Purchaser, on the one hand, and the Company, on the other hand, agrees promptly to correct any information provided by it for use in the Offer Documents if and to the extent that it shall have become false or misleading in any material respect and the Purchaser further agrees to take all steps necessary to cause the Offer Documents as so corrected to be filed with the SEC and to be disseminated to stockholders of the Company, in each case as and to the extent required by applicable federal securities laws. SECTION 1.02 Company Actions. (a) The Company shall promptly file with the SEC and mail to the holders of Shares a Solicitation/Recommendation Statement on Schedule 14D-9 with respect to the Offer (together with any amendments or supplements thereto, the "Schedule 14D-9"). The Schedule 14D-9 will set forth, and the Company hereby represents and warrants, that the Board, at a meeting duly called and held, has (i) determined that the Offer and the Merger are fair and advisable to and in the best interests of the Company and its stockholders, (ii) approved the Offer, the Merger and the Shareholders Agreement in accordance with Section 203 of the GCL, and (iii) resolved to recommend acceptance of the Offer and approval and adoption of the Merger and this Agreement by the Company's stockholders (in accordance with the requirements of the Company's certificate of incorporation and of applicable law); provided, however, that prior to consummation of the Offer such recommendation and approval may be withdrawn, modified or amended if the Board by majority vote shall have determined in good faith, based upon the 3 4 advice of outside legal counsel to the Company, that such determination to withdraw, modify or amend would be necessary in order to comply with the Board's fiduciary duty under applicable law. The Company hereby further represents and warrants that PaineWebber, Incorporated (the "Financial Advisor") has delivered to the Board its written opinion that the consideration to be received by the holders of the Shares pursuant to each of the Offer and the Merger is fair to such holders from a financial point of view. The Company has been authorized by the Financial Advisor to permit, subject to prior review and consent by such Financial Advisor (such consent not to be unreasonably withheld), the inclusion of such fairness opinion (or a reference thereto) in the Offer Documents and in the Schedule 14D-9 referred to below and the Proxy Statement. The Company hereby consents to the inclusion in the Offer Documents of the recommendations of the Board described in this Section 1.02(a). (b) The Schedule 14D-9 and all amendments thereto will comply in all material respects with the Exchange Act and the rules and regulations promulgated thereunder and, on the date filed with the SEC and on the date first published, sent or given to the Company's stockholders, shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading, except that no representation is made by the Company with respect to information supplied by the Parent or Purchaser for inclusion in the Schedule 14D-9. Each of the Company, on the one hand, and Parent and the Purchaser, on the other hand, agree promptly to correct any information provided by either of them for use in the Schedule 14D-9 if and to the extent that it shall have become false or misleading, and the Company further agrees to take all steps necessary to cause the Schedule 14D-9 as so corrected to be filed with the SEC and to be disseminated to the stockholders of the Company, in each case as and to the extent required by applicable federal securities law. (c) Parent and its counsel shall be given an opportunity to review and comment upon the Schedule 14D-9 and any amendment or supplement thereto prior to the filing thereof with the SEC, and the Company shall consider any such comments in good faith. The Company agrees to provide to Parent and their counsel any comments which the Company or its counsel may receive from the Staff of the SEC with respect to the Schedule 14D-9 promptly after receipt thereof. In connection with the Offer, the Company will, if reasonably requested by Purchaser, promptly furnish Purchaser with mailing labels, security position listings, any non-objecting beneficial owner lists and any available listings or computer files containing the names and addresses of the record holders of Shares, each as of a recent date, and shall promptly furnish the Purchaser with such additional information (including but not limited to updated lists of stockholders, mailing labels, security position listing and non-objective beneficial owner lists) and assistance as the Purchaser or its agents or representatives may reasonably request in connection with communicating the Offer to the record and beneficial holders of the Shares. 4 5 SECTION 1.03 Directors. (a) Subject to compliance with applicable law, promptly upon the payment by the Purchaser for Shares pursuant to the Offer, and from time to time thereafter, Parent shall be entitled to designate such number of directors, rounded up to the next whole number, on the Board as is equal to the product of the total number of directors on the Board (determined after giving effect to the directors elected pursuant to this sentence) multiplied by the percentage that the aggregate number of Common Shares beneficially owned by Parent or its affiliates bears to the total number of fully diluted Common Shares then outstanding, and the Company shall, promptly take all actions necessary to cause Parent's designees to be so elected, including, if necessary, seeking the resignations of one or more existing directors or increasing the size of the Board; provided, however, that prior to the Effective Time (as defined in Section 2.02), the Board shall always have at least three members who are neither officers, directors, stockholders or designees of the Purchaser or any of its affiliates ("Purchaser Insiders"). At such times, the Company will use its reasonable best efforts to cause persons designated by Purchaser to constitute the same percentage as is on the Board of (i) each committee of the Board, (ii) each board of directors of each subsidiary of the Company and (iii) each committee of each such board, in each case only to the extent permitted by law. If the number of directors who are not Purchaser Insiders is reduced below three for any reason prior to the Effective Time, the remaining directors who are not Purchaser Insiders (or if there is only one director who is not a Purchaser Insider, the remaining director who is not a Purchaser Insider) shall be entitled to designate a person (or persons) to fill such vacancy (or vacancies) who is not an officer, director, stockholder or designee of the Purchaser or any of its affiliates and who shall be a director not deemed to be a Purchaser Insider for all purposes of this Agreement. (b) The Company's obligations to appoint Parent's designees to the Board shall be subject to Section 14(f) of the Exchange Act and Rule 14f-1 thereunder. The Company shall promptly take all actions required pursuant to such Section and Rule in order to fulfill its obligations under this Section 1.03 and shall include in the Schedule 14D-9 such information with respect to the Company and its officers and directors as is required under such Section and Rule in order to fulfill its obligations under this Section 1.03. Parent will supply any information with respect to itself and its officers, directors and affiliates required by such Section and Rule to the Company. (c) From and after the election or appointment of Parent's designees pursuant to this Section 1.03 and prior to the Effective Time, any amendment or termination of this Agreement by the Company, any extension by the Company of the time for the performance of any of the obligations or other acts of Parent or the Purchaser or waiver of any of the Company's rights hereunder, or any other action taken by the Board in connection with this Agreement, will require the concurrence of a majority of the directors of the Company then in office who are not Purchaser Insiders. 5 6 ARTICLE II THE MERGER SECTION 2.01 The Merger. Upon the terms and subject to the satisfaction or waiver of the conditions hereof, and in accordance with the applicable provisions of this Agreement and the GCL, at the Effective Time (as defined in Section 2.02) the Purchaser shall be merged with and into the Company. Following the Merger, the separate corporate existence of the Purchaser shall cease and the Company shall continue as the surviving corporation (the "Surviving Corporation"). At Parent's election, any direct or indirect subsidiary of Parent other than Purchaser may he merged with and into the Company instead of the Purchaser. In the event of such an election, the parties agree to execute an appropriate amendment to this Agreement in order to reflect such an election. SECTION 2.02 Effective Time; Closing. As soon as practicable after the satisfaction or waiver of the conditions set forth in Sections 7.01(a) and (b), but subject to Section 7.01(c), the Company shall execute in the manner required by the GCL and deliver to the Secretary of State of the State of Delaware a duly executed and verified certificate of merger, or, if permitted, a certificate of ownership and merger, and the parties shall take such other and further actions as may be required by law to make the Merger effective. The time the Merger becomes effective in accordance with applicable law is referred to as the "Effective Time." SECTION 2.03 Effects of the Merger. The Merger shall have the effects set forth in the GCL. SECTION 2.04 Certificate of Incorporation and By-Laws of the Surviving Corporation. (a) The certificate of incorporation of the Company, as in effect immediately prior to the Effective Time, shall be the certificate of incorporation of the Surviving Corporation, until thereafter amended in accordance with the provisions thereof and hereof and applicable law. (b) Subject to the provisions of Section 6.01 of this Agreement, the by-laws of the Purchaser in effect at the Effective Time shall be the by-laws of the Surviving Corporation, until thereafter amended in accordance with the provisions thereof and hereof and applicable law. SECTION 2.05 Directors. Subject to applicable law, the directors of the Purchaser immediately prior to the Effective Time shall be the initial directors of the Surviving Corporation and shall hold office until their respective successors are duly elected and qualified, or their earlier death, resignation or removal. SECTION 2.06 Officers. The officers of the Company immediately prior to the Effective Time shall be the initial officers of the Surviving Corporation and shall hold office until their respective successors are duly elected and qualified, or their earlier death, resignation or removal; provided that, promptly upon the payment by the Purchaser for Shares pursuant to 6 7 the Offer, any partners, officers or affiliates of TJC who are also officers of the Company immediately prior to the Effective Time shall resign as officers of the Company. SECTION 2.07 Conversion of Shares. At the Effective Time, by virtue of the Merger and without any action on the part of the holders thereof, each Share issued and outstanding immediately prior to the Effective Time (other than any Shares held by Parent, the Purchaser, any wholly-owned subsidiary of Parent or the Purchaser, in the treasury of the Company or by any wholly-owned subsidiary of the Company, which Shares, by virtue of the Merger and without any action on the part of the holder thereof, shall be cancelled and retired and shall cease to exist with no payment being made with respect thereto, and other than Dissenting Shares (as defined in Section 3.01)) shall be converted into the right to receive in cash the Share Offer Price applicable thereto (the "Merger Price") payable to the holder thereof, and in the case of the Options, net of taxes required by law to be withheld with respect thereto and without interest thereon, upon surrender of the certificate formerly representing such Share. SECTION 2.08 Conversion of Purchaser Common Stock. At the Effective Time, each share of common stock, par value $0.01 per share, of the Purchaser issued and outstanding immediately prior to the Effective Time shall, by virtue of the Merger and without any action on the part of the holder thereof, be converted into and become one validly issued, fully paid and nonassessable share of common stock, par value $0.01 per share, of the Surviving Corporation. SECTION 2.09 Company Option Plan. Parent and the Company shall take all actions necessary so that, immediately prior to the Effective Time, (A) each outstanding option to purchase Common Shares (an "Option") granted under the American Safety Razor Company Stock Option Plan (the "Option Plan"), whether or not then exercisable or vested, shall become fully exercisable and vested, (B) each Option which is then outstanding shall be cancelled and (C) in consideration of such cancellation, and except to the extent that Parent or the Purchaser and the holder of any such Option otherwise agree, immediately following the Effective Time, the Company shall pay to such holders of Options an amount in respect thereof equal to the product of (1) the excess of the Merger Price over the exercise price thereof and (2) the number of Common Shares subject thereto (such payment to be net of taxes required by law to be withheld with respect thereto). The Company shall use its reasonable best efforts to take all such action as is necessary prior to the Effective Time to terminate the Option Plan so that on and after the Effective Time no current or former employee or director shall have any Option to purchase shares of common stock or any other equity interest in the Company under the Option Plan. The Company shall use its reasonable best efforts to obtain any consents as may be necessary to release the Company from any liability in respect of any Options. SECTION 2.10 Stockholders' Meeting. (a) If required by the Company's certificate of incorporation and/or applicable law in order to consummate the Merger, the Company, acting through the Board, shall, in accordance with applicable law: 7 8 (i) duly call, give notice of, convene and hold a special meeting of its stockholders (the "Special Meeting") as soon as practicable following the acceptance for payment of and payment for Shares by the Purchaser pursuant to the Offer for the purpose of considering and taking action upon this Agreement; (ii) prepare and file with and to use its reasonable best efforts to have cleared by the SEC a preliminary proxy statement relating to the Merger and this Agreement and use its reasonable best efforts (x) to obtain and furnish the information required to be included by the SEC in the Proxy Statement (as hereinafter defined) and, after consultation with Parent, to respond promptly to any comments made by the SEC with respect to the preliminary proxy statement and cause a definitive proxy statement (the "Proxy Statement") to be mailed to its stockholders and (y) to obtain the necessary approvals of the Merger and this Agreement by its stockholders; and (iii) subject to the fiduciary obligations of the Board under applicable law as determined in good faith by a majority of the Board based on the advice of independent outside legal counsel, (A) include in the Proxy Statement the recommendation of the Board that stockholders of the Company vote in favor of the approval of the Merger and the adoption of this Agreement and the written opinion of the Financial Advisor that the consideration to be received by the stockholders of the Company pursuant to the Offer and the Merger is fair to such stockholders and (B) use its reasonable best efforts to obtain the necessary adoption of this Agreement. (b) Parent agrees that it will vote, or cause to be voted, all of the Shares then owned by it, the Purchaser or any of its other subsidiaries in favor of the approval of the Merger and the adoption of this Agreement. SECTION 2.11 Merger Without Meeting of Stockholders. Notwithstanding Section 2.10, in the event that Parent, the Purchaser or any other subsidiary of Parent shall acquire at least 90% of the outstanding shares of each outstanding class of capital stock of the Company pursuant to the Offer, the parties hereto agree to take all necessary and appropriate action to cause the Merger to become effective as soon as practicable after the acceptance for payment of and payment for Shares by the Purchaser pursuant to the Offer without a meeting of stockholders of the Company, in accordance with Section 253 of the GCL. SECTION 2.12 Fractional Shares and Payments. In the event that the aggregate consideration to be received by a holder of Shares pursuant to the Offer or the Merger for such holders Shares equals, when aggregated, an amount that includes one-half of one cent, then such amount will be rounded up to the nearest whole cent. 8 9 ARTICLE III DISSENTING SHARES; PAYMENT FOR SHARES AND WARRANTS SECTION 3.01 Dissenting Shares. Notwithstanding anything in this Agreement to the contrary, Shares outstanding immediately prior to the Effective Time and held by a holder who has not voted in favor of the Merger or consented thereto in writing and who demands in writing appraisal for such Shares in accordance with Section 262 of the GCL, if such Section 262 provides for appraisal rights for such Shares in the Merger ("Dissenting Shares"), shall not be converted into the right to receive the Merger Price as provided in Section 2.07 but shall be entitled to receive the consideration as shall be determined pursuant to Section 262 of GCL, unless and until such holder fails to perfect or withdraws or otherwise loses his right to appraisal and payment under the GCL. If, after the Effective Time, any such holder fails to perfect or withdraws or loses his right to appraisal, such Dissenting Shares shall thereupon be treated as if they had been converted as of the Effective Time into the right to receive the Merger Price, if any, to which such holder is entitled, without interest or dividends thereon. The Company shall give Parent prompt notice of any demands received by the Company for appraisal of Shares, withdrawals of such demands and any other instruments served pursuant to the GCL and received by the Company and, prior to the Effective Time, Parent shall have the right to direct all negotiations and proceedings with respect to such demands. Prior to the Effective Time, the Company shall not, except with the prior written consent of Parent, make any payment with respect to, or settle or offer to settle, any such demands. SECTION 3.02 Payment for Shares. (a) From and after the Effective Time, a bank or trust company designated by Parent and reasonably acceptable to the Company shall act as paying agent (the "Paying Agent") in effecting the payment of the Merger Price in respect of certificates (the "Share Certificates") that, prior to the Effective Time, represented Shares entitled to payment of the Merger Price pursuant to Section 2.07. When and as needed, Parent or the Purchaser shall deposit, or cause to be deposited, in trust with the Paying Agent the aggregate Merger Price to which holder of Shares shall be entitled at the Effective Time pursuant to Section 2.07. (b) Promptly after the Effective Time, the Paying Agent shall mail to each record holder of Certificates that immediately prior to the Effective Time represented Shares (other than Share Certificates representing Dissenting Shares and Certificates representing Shares held by Parent or the Purchaser, any wholly-owned subsidiary of Parent or the Purchaser, in the treasury of the Company or by any wholly-owned subsidiary of the Company) (i) a form of letter of transmittal which shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon proper delivery of the Certificates to the Paying Agent and which shall be in such form and have such other provisions as Parent and Purchaser may reasonably specify and (ii) instructions for use in surrendering such Certificates and receiving the aggregate Merger Price in respect thereof. Upon surrender of each such Certificate together with such letter of transmittal duly completed and validly executed in accordance with the instructions thereto, the 9 10 Paying Agent shall pay the holder of such Certificate the Merger Price multiplied by the number of Shares formerly represented by such Certificate in consideration therefor, and such Certificate shall forthwith be cancelled. Until so surrendered, each such Certificate (other than Share Certificates representing Dissenting Shares and Certificates representing Shares held by Parent or the Purchaser, any wholly-owned subsidiary of Parent or the Purchaser, in the treasury of the Company or by any wholly-owned subsidiary of the Company) shall represent solely the right to receive the aggregate Merger Price relating thereto. No interest or dividends shall be paid or accrued on the Merger Price. If the Merger Price (or any portion thereof) is to be delivered to any person other than the person in whose name the Certificate formerly representing Shares surrendered therefor is registered, it shall be a condition to such right to receive such Merger Price, that the Certificate so surrendered shall be properly endorsed, with signature guaranteed, or otherwise be in proper form for transfer and that the person surrendering such Certificates shall pay to the Paying Agent any transfer or other taxes required by reason of the payment of the Merger Price, to a person other than the registered holder of the Certificate surrendered, or shall establish to the satisfaction of the Paying Agent that such tax has been paid or is not applicable. (c) Promptly following the date which is 270 days after the Effective Time, the Paying Agent shall deliver to the Surviving Corporation all cash, Certificates and other documents in its possession relating to the transactions described in this Agreement, and the Paying Agent's duties shall terminate. Thereafter, each holder of a Certificate formerly representing a Share shall thereafter look only to the Surviving Corporation (as a general creditor thereof) for payment of its claim for the Merger Price (without any interest or dividends thereon). (d) No Liability. None of Parent, Purchaser, the Company or the Paying Agent shall be liable to any person in respect of any cash delivered to a public official pursuant to any applicable abandoned property, escheat or similar law. If any Certificates representing Shares shall not have been surrendered prior to one year after the Effective Time (or immediately prior to such earlier date on which any Merger Price would otherwise escheat to or become the property of any Governmental Entity (as defined in Section 4.05(b)), any such Merger Price shall, to the extent permitted by applicable law, become the property of the Surviving Corporation, free and clear of all claims or interest of any person previously entitled thereto. (e) Investment in Exchange Fund. The Paying Agent shall invest the Merger Price as directed by the Surviving Corporation (within guidelines approved by the Company prior to the Closing Date, which approval shall not be unreasonably withheld). Any interest resulting from such investment shall be paid to the Surviving Corporation. (f) After the Effective Time, there shall be no registrations of transfers on the stock transfer books of the Surviving Corporation of any Shares which were outstanding immediately prior to the Effective Time. If, after the Effective Time, Certificates formerly representing Shares are presented to the Surviving Corporation or the Paying Agent, they shall be surrendered and cancelled in return for the payment of the aggregate Merger Price, relating thereto, as provided in this Article III. 10 11 (g) No Further Ownership Rights in Shares Exchanged For Cash. All cash paid upon the surrender for exchange of Certificates representing Shares in accordance with the terms of this Article III shall be deemed to have been issued (and paid) in full satisfaction of all rights pertaining to the Shares exchanged for cash theretofore represented by such Certificates in accordance with the GCL. (h) Lost Certificates. If any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming such Certificate to be lost, stolen or destroyed and, if reasonably required by the Surviving Corporation, the posting by such person of a bond in such reasonable and customary amount as the Surviving Corporation may direct as indemnity against any claim that may be made against it with respect to the Certificate, the Paying Agent shall deliver in exchange for such lost, stolen or destroyed Certificate the applicable Merger Price with respect thereto. (i) Withholding Rights. In the case of the Options, the Surviving Corporation shall be entitled to deduct and withhold from the consideration otherwise payable to any holder of Shares pursuant to this Agreement such amounts as may be required to be deducted and withheld with respect to the making of such payment under the Internal Revenue Code of 1986, as amended (the "Code"), or under any provision of state, local or foreign Tax law. ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY The Company represents and warrants to Parent and the Purchaser that except as set forth in the Company's Form 10-K for the year ended December 31, 1997 and the Company's Form 10-Qs for each of the quarters ended March 31, 1998, June 30, 1998 and September 30, 1998 (collectively, the "Recent SEC Reports") filed with the SEC and except as set forth in the Company Disclosure Statement delivered to Parent and Purchaser prior to the execution of this Agreement (the "Company Disclosure Statement"): SECTION 4.01 Organization and Qualification; Subsidiaries. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Each of the Company's subsidiaries is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation. The Company and each of the subsidiaries has the requisite corporate power and authority to own, operate or lease its properties and to carry on its business as it is now being conducted, and is duly qualified or licensed to do business, and is in good standing, in each jurisdiction in which the nature of its business or the properties owned, operated or leased by it makes such qualification, licensing or good standing necessary; except where the failure to have such power or authority, or the failure to be so qualified, licensed or in good standing, would not reasonably be expected to have a Material Adverse Effect on the Company. The term "Material Adverse Effect on the Company" as used in this Agreement, means any change or effect that would be materially adverse to the 11 12 assets, liabilities, business, operations or financial condition of the Company and its subsidiaries, taken as a whole, except for any such change or effect resulting from general economic, financial or market conditions in the United States. SECTION 4.02 Certificate of Incorporation and By-Laws. The Company has heretofore made available to Parent and the Purchaser a complete and correct copy of the certificate of incorporation and the by-laws, each as amended to the date hereof, of the Company and its subsidiaries. Such articles of incorporation and by-laws are in full force and effect and no other organizational documents are applicable to or binding upon the Company or any of its subsidiaries. Neither the Company nor any of its subsidiaries is in violation in any material respect of any of the provisions of its certificate of incorporation or by-laws. SECTION 4.03 Capitalization. The authorized capital stock of the Company consists of 25,000,000 Common Shares, 2,900,000 shares of Class B Common Stock, par value $0.01 per share (the "Class B Common Stock") of the Company, and 1,000,000 shares of Preferred Stock, par value $0.01 per share (the "Preferred Stock"), of the Company. As of the date of this Agreement, the Company had 12,110,049 Common Shares outstanding and no shares of Class B Common Stock and no shares of Preferred Stock issued or outstanding. The Company has no shares of capital stock reserved for issuance, except that, as of the date of this Agreement, there were 750,000 Common Shares reserved for issuance pursuant to the Option Plan (of which Options to purchase 464,400 Common Shares are outstanding). The Company Disclosure Statement sets forth the identity of each holder of Options, and the number of shares of Common Stock and the exercise price with respect thereto. All the outstanding Common Shares are, and all Common Shares which may be issued pursuant to the exercise of outstanding Options will be, when issued in accordance with the respective terms thereof, duly authorized, validly issued, fully paid and nonassessable and free of preemptive (or similar) rights. There are no bonds, debentures, notes or other indebtedness having general voting rights (or convertible into securities having such rights) ("Voting Debt") of the Company or any of its subsidiaries issued and outstanding. Except as set forth above and except pursuant to the Option Plan and except for the transactions contemplated by this Agreement, there are no existing options, warrants, calls, subscriptions or other rights, agreements, arrangements or commitments of any character, relating to the issued or unissued capital stock of the Company or any of its subsidiaries, obligating the Company or any of its subsidiaries to issue, transfer, or sell or cause to be issued, transferred or sold any shares of capital stock or Voting Debt of, or other equity interest in, the Company or any of its subsidiaries or securities convertible into or exchangeable for such shares or equity interests or obligations of the Company or any of its subsidiaries to grant, extend or enter into any such option, warrant, call, subscription or other right, agreement, arrangement or commitment. Except (i) as contemplated by this Agreement and (ii) the Company's obligations under the Option Plan, there are no outstanding contractual obligations of the Company or any of its subsidiaries to repurchase, redeem, or otherwise acquire any Common Shares or the capital stock of the Company or any of its subsidiaries or to provide funds to or make any investment (in the form of a loan, capital contribution or otherwise) in any such subsidiary or any other entity. Each of the outstanding shares of capital stock of each of the Company's subsidiaries is duly authorized, validly issued, fully paid and nonassessable, and all such shares of the Company's 12 13 subsidiaries are owned by the Company or by another wholly owned subsidiary of the Company and owned in each case free and clear of any lien, claim, option, charge, security interest, limitation, encumbrance and restriction of any kind (any of the foregoing being a "Lien"), except such as would not reasonably be expected to have a Material Adverse Effect on the Company. The Company has delivered to Parent prior to the date hereof a list of all subsidiaries and associated entities of the Company which evidences, among other things, the amount of capital stock or other equity interests owned by the Company, directly or indirectly, in such subsidiaries or associated entities. No entity in which the Company owns, directly or indirectly, less than a 50% equity interest is, individually or when taken together with all such other entities, material to the business of the Company and its subsidiaries taken as a whole. SECTION 4.04 Authority Relative to this Agreement; Minimum Condition. (a) The Company has all necessary corporate power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement by the Company and the consummation by the Company of the transactions contemplated hereby have been duly and validly authorized and approved by the Board and no other corporate proceedings on the part of the Company are necessary to authorize or approve this Agreement or to consummate the transactions contemplated hereby (other than, with respect to the Merger, the approval and adoption of the Merger and this Agreement by holders of the Shares to the extent required by the Company's certificate of incorporation and by applicable law and the filing of appropriate merger documents as required by the GCL). This Agreement has been duly and validly executed and delivered by the Company and, assuming the due and valid authorization, execution and delivery of this Agreement by Parent and the Purchaser, constitutes a valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except that such enforceability (i) may be limited by bankruptcy, insolvency, moratorium or other similar laws affecting or relating to the enforcement of creditors' rights generally and (ii) is subject to general principles of equity. (b) Pursuant to GCL and the Company's Certificate of Incorporation and By-Laws, the Shares purchased in satisfaction of the Minimum Condition are sufficient to provide the stockholder vote required to consummate the Merger in accordance with the Company's Certificate of Incorporation and By-Laws and Section 251 of the GCL. SECTION 4.05 No Conflict; Required Filings and Consents. (a) None of the execution, delivery of and performance of this Agreement by the Company, the consummation by the Company of the transactions contemplated hereby or compliance by the Company with any of the provisions hereof will (i) conflict with or violate the certificate of incorporation or by-laws of the Company or the comparable organizational documents of any of its subsidiaries, (ii) conflict with or violate any law, regulation or order of any governmental authority applicable to the Company or any of its subsidiaries, or by which any of them or any of their respective properties or assets may be bound or affected, or (iii) result in a violation or breach of or constitute a default (or an event which with notice or lapse of time or both would become a default) under, (any of the foregoing referred to in clause (ii) or this 13 14 clause (iii) being a "Violation") pursuant to, any loan and credit agreement, note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries or any of their respective properties may be bound or affected, except (x) in the case of clause (iii), with regard to the Company's Credit Agreement (as hereinafter defined) and other indebtedness of the Company set forth in the Company Disclosure Statement, and (y) in the case of the foregoing clause (ii) or (iii) for any such Violations which would not reasonably be expected to have a Material Adverse Effect on the Company or materially adversely affect the ability of the Company to perform its obligations and consummate the transactions contemplated hereby. (b) None of the execution, delivery and performance of this Agreement by the Company, the consummation by the Company of the transactions contemplated hereby or compliance by the Company with any of the provisions hereof will require any consent, waiver, approval, authorization or permit of, or registration or filing with or notification to (any of the foregoing being a "Consent"), any government or subdivision thereof, or any administrative, governmental or regulatory authority, agency, court, commission, tribunal or body, domestic, foreign or supranational (a "Governmental Entity"), except for (i) compliance with any applicable requirements of the Exchange Act, (ii) the filing of a certificate of merger, or, if permitted, a certificate of ownership and merger, pursuant to the GCL, (iii) applicable state takeover and environmental statutes listed on the Company Disclosure Statement, (iv) compliance with the Hart-Scott-Rodino Anti-Trust Improvements Act of 1976, as amended (the "HSR Act") and any requirements of any foreign or supranational Anti-Trust Laws (as hereinafter defined) and (v) Consents the failure of which to obtain or make would not reasonably be expected to have a Material Adverse Effect on the Company or materially adversely effect the ability of the Company to consummate the transactions contemplated hereby. SECTION 4.06 SEC Reports and Financial Statements. (a) The Company has filed with the SEC all forms, reports, schedules, registration statements and definitive proxy statements (the "SEC Reports") required to be filed with the SEC since June 9, 1993. As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Exchange Act or the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder applicable, as the case may be, to such SEC Reports, and none of the SEC Reports (including but not limited to any financial statements or schedules included or incorporated by reference therein) contained when filed, or (except to the extent revised or superseded by a subsequent filing with the SEC) contains any untrue statement of a material fact or omitted or omits to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading. (b) The consolidated balance sheets as of December 31, 1997 and 1996 and the related consolidated statements of income, common shareholders' equity and cash flows for each of the three years in the period ended December 31, 1997 (including the related notes and schedules 14 15 thereto) of the Company contained in the Company's Form 10-K for the year ended December 31, 1997 included in the SEC Reports present fairly, in all material respects, the consolidated financial position and the consolidated results of operations and cash flows of the Company and its consolidated subsidiaries as of the dates or for the periods presented therein in conformity with United States generally accepted accounting principles ("GAAP") applied on a consistent basis during the periods involved except as otherwise noted therein, including the related notes. (c) The consolidated balance sheets and the related statements of income and cash flows (including in each case the related notes thereto) of the Company contained in the Forms 10-Q for the periods ended September 30, 1998, June 30, 1998 and March 31, 1998 included in the SEC Reports (collectively, the "Quarterly Financial Statements") have been prepared in accordance with the requirements for interim financial statements contained in Regulation S-X. The Quarterly Financial Statements present fairly, in all material respects, the consolidated financial position and consolidated results of operations and cash flows of the Company and its consolidated subsidiaries as of the dates and for the periods presented therein in conformity with GAAP applied on a consistent basis during the periods involved, except as otherwise noted therein, including the related notes, provided, that the Quarterly Financial Statements do not reflect full year end adjustments, accruals, reserves and footnotes. (d) There are no liabilities of the Company or any of its subsidiaries of any kind whatsoever, whether or not accrued and whether or not contingent or absolute, that are material to the Company and its subsidiaries, taken as a whole, other than (i) liabilities disclosed or provided for in the consolidated balance sheet of the Company and its subsidiaries at December 31, 1997, including the notes thereto, (ii) liabilities disclosed in the Recent SEC Reports, (iii) liabilities incurred on behalf of the Company in connection with this Agreement and the contemplated Merger, (iv) liabilities incurred in the ordinary course of business consistent with past practice since September 30, 1998, and (v) other liabilities, none of which (without giving effect to the materiality qualifier contained in this Section 4.06(d)) would reasonably be expected to have a Material Adverse Effect. (e) The Company has heretofore furnished or made available to Parent a complete and correct copy of any amendments or modifications which have not yet been filed with the SEC to agreements, documents or other instruments which previously had been filed by the Company with the SEC pursuant to the Securities Act and the rules and regulations promulgated thereunder or the Exchange Act and the rules and regulations promulgated thereunder. SECTION 4.07 Information. Neither the Schedule 14D-9, the Proxy Statement, nor any of the information supplied by the Company in writing specifically for inclusion or incorporation by reference in (i) the Offer Documents, or (ii) any other document to be filed with the SEC or any other Governmental Entity in connection with the transactions contemplated by this agreement and any amendment or supplement to any of the above (the "Other Filings") will, at the respective times filed with the SEC or other Governmental Entity and, in addition, in the case of the Proxy Statement, at the date it or any amendment or supplement is mailed to stockholders, 15 16 at the time of the Special Meeting (as herein defined) and at the Effective Time, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. Notwithstanding the foregoing, the Company makes no representation or warranty with respect to any information supplied by Parent or Purchaser or any of their respective representatives which is contained in the Schedule 14D-9 or the Proxy Statement. The Proxy Statement will comply as to form in all material respects with the provisions of the Exchange Act and the rules and regulations thereunder, except that no representation is made by the Company with respect to statements made therein based on information supplied by Parent or the Purchaser in writing specifically for inclusion in the Proxy Statement. SECTION 4.08 Litigation. The Company Disclosure Statement sets forth each instance in which any of the Company and its subsidiaries or any of their respective properties (a) is subject to any judgment, order, decree, stipulation, injunction, or charge or (b) is a party to or the subject of any material charge, complaint, action, suit, proceeding, hearing, or investigation of or in any court or quasi-judicial or administrative agency of any federal, state, local, or foreign jurisdiction, or to the Knowledge of the Company, is threatened to be a party to or the subject of any such action, except, in each case, where the judgment, order, decree, stipulation, injunction, charge, complaint, action, suit, proceeding, hearing, or investigation would not reasonably be expected to have a Material Adverse Effect on the Company or unreasonably delay or prevent the consummation of the transactions contemplated hereby. SECTION 4.09 Compliance with Applicable Laws. Neither the Company nor any of its subsidiaries is in conflict with or in default or violation of (i) any laws, regulations, rules, orders, judgment or decree of any Governmental Entity applicable to it, such subsidiaries or any of their respective properties or (ii) any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries or its or any of their respective properties are bound or affected, except for any such conflicts, defaults or violations which would not reasonably be expected to have a Material Adverse Effect on the Company. The Company and its subsidiaries have all permits, licenses, authorizations, consents, approvals and franchises from governmental agencies required to conduct their businesses as now being conducted, except for such permits, licenses, authorizations, consents, approvals, and franchises the absence of which would not reasonably be expected to have a Material Adverse Effect on the Company. The business operations of the Company and its subsidiaries are not being conducted in violation of any law, ordinance or regulation of any Governmental Entity, except for possible violations which, would not reasonably be expected to have a Material Adverse Effect on the Company. SECTION 4.10 Employee Benefit Plans. (a) The Company Disclosure Statement includes a complete list of all employee benefit plans (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 16 17 1974, as amended ("ERISA"), including, without limitation, multiemployer plans within the meaning of ERISA Section 3(37)), stock purchase, stock option, severance, employment, change-in-control, fringe benefit, collective bargaining, bonus, incentive, deferred compensation and all other employee benefit plans, agreements, programs, policies or other arrangements, whether or not subject to ERISA (including any funding mechanism therefor now in effect or required in the future as a result of the transaction contemplated by this Agreement or otherwise), providing benefits to any employee or former employee of the Company and its subsidiaries sponsored or maintained by the Company or any of its subsidiaries or to which the Company or any of its subsidiaries contributes or is obligated to contribute (collectively, the "Plans"). (b) With respect to each Plan, the Company has made available to Parent a true, correct and complete copy of: (i) all material plan documents, benefit schedules, trust agreements, and insurance contracts and other funding vehicles; (ii) the three most recent Annual Reports (Form 5500 Series) and accompanying schedules, if any; (iii) the current summary plan description, if any; (iv) the three most recent annual financial reports, if any; (v) the three most recent actuarial reports, if any; and (vi) the most recent determination letter from the Internal Revenue Service (the "IRS"), if any. (c) As to each single employer Plan, the Company and each of its subsidiaries has complied, and is now in compliance, with all provisions of ERISA, the Code and all laws and regulations applicable to each Plan, except where the failure to comply would not reasonably be expected to have a Material Adverse Effect. With respect to each Plan that is intended to be a "qualified plan" within the meaning of Section 401(a) of the Code ("Qualified Plans"), the Company has obtained (or has timely applied for), and the IRS has issued, a favorable determination letter and each such Plan is qualified except where the failure to be so qualified would not reasonably be expected to have a Material Adverse Effect on the Company. (d) All contributions required to be made to any Plan by applicable law or regulation or by any Plan document or other contractual undertaking, and all premiums due or payable with respect to insurance policies funding any Plan, for any period through the date hereof have been timely made or paid in full or, to the extent not required to be made or paid on or before the date hereof, have been fully reflected in the financial statements of the Company included in the SEC Reports to the extent required under generally accepted accounting principles, except such as would not reasonably be expected to have a Material Adverse Effect on the Company. (e) No Plan is subject to Title IV or Section 302 of ERISA or Section 412 or 4971 of the Code. No event has occurred, nor do any circumstances exist that could result in, any liability under (i) Title IV of ERISA, (ii) Section 302 of ERISA, (iii) Sections 412 and 4971 of the Code, or (iv) the continuation coverage requirements of section 601 et seq. of ERISA and Section 4980B of the Code except, in each case, as would not reasonably be expected to have a Material Adverse Effect on the Company. (f) With respect to any multiemployer plan (within the meaning of ERISA Section 4001(a)(3)) to which the Company, its subsidiaries or any member of their Controlled Group 17 18 (defined as any organization which is a member of a controlled group of organizations within the meaning of Code Section 414(b), (c), (m) or (o)) has any liability or contributes (or has at any time within the six year period prior to the date hereof, contributed or had an obligation to contribute): (i) none of the Company, its subsidiaries or any member of their Controlled Group has incurred any withdrawal liability under Title IV of ERISA; and, (ii) no such multiemployer plan is in reorganization or insolvent (as those terms are defined in ERISA Sections 4241 and 4245, respectively) except in each case as would not reasonably be expected to have a Material Adverse Effect on the Company. (g) With respect to any Plan, no actions, suits or claims (other than routine claims for benefits in the ordinary course) are pending or, to the Knowledge of the Company, threatened against the Company or any of its subsidiaries, which, if adversely determined, would reasonably be expected to have a Material Adverse Effect on the Company. (h) No Plan (other than the Option Plan) exists that could result in the payment to any present or former employee of the Company or its subsidiaries of any money or other property or accelerate or provide any other rights or benefits to any present or former employee of the Company or its subsidiaries as a result of the transaction contemplated by this Agreement, whether or not such payment would constitute a parachute payment within the meaning of Code Section 280G. SECTION 4.11 Taxes. (a) The Company has timely filed (or caused to be timely filed) all Federal, state, local and foreign income and other tax returns regarding the Company or its subsidiaries required by law to be filed prior to the date of this Agreement, (b) such tax returns are correct and complete in all respects, (c) the Company and its subsidiaries have paid all Federal, state, local or foreign income and other taxes that are due and payable (including any interest, penalties or additions to tax that are due with respect thereto) other than taxes that are being contested in good faith and which have been reserved for in accordance with GAAP, (d) no tax return of the Company or its subsidiaries is currently under audit by any taxing authority and no deficiency in the payment of any taxes by the Company or any subsidiary has been assessed, asserted or, to the Knowledge of the Company, threatened against the Company or any subsidiary that remains unsettled as of the date of this Agreement, (e) there are currently no outstanding waivers of statutes of limitations with any taxing authority by the Company or the subsidiaries, and (f) the Company has not at any time filed a consolidated or combined Tax Return as a member of an affiliated group (within the meaning of Section 1504 of the Code) other than as a group of which the Company was the parent, except, in the case of clauses (a) through (f), where any such failure or breach would not reasonably be expected to have a Material Adverse Effect. SECTION 4.12 Intellectual Property. (a) The Company, directly or indirectly, owns, or is licensed or otherwise possesses legally enforceable rights to use, all patents, trademarks, trade names, service marks, copyrights, 18 19 and any applications therefor, technology, know-how and tangible or intangible proprietary information or material that are material to the business of the Company and its subsidiaries as currently conducted by the Company or its subsidiaries (the "Company Intellectual Property Rights"). (b) Either the Company or one of its subsidiaries is the sole and exclusive owner of, or the exclusive or non-exclusive licensee of, with all right, title and interest in and to (free and clear of any liens or encumbrances), the Company Intellectual Property Rights, and, in the case of Company Intellectual Property Rights owned by the Company or any of its subsidiaries, has sole and exclusive rights (and is not contractually obligated to pay any compensation to any third party in respect thereof) to the use thereof or the material covered thereby in connection with the services or products in respect of which the Company Intellectual Property Rights are being used. No claims with respect to the Company Intellectual Property Rights have been asserted or, to the Knowledge of the Company, are threatened by any person that if adversely determined would reasonably be expected to have a Material Adverse Effect on the Company (i) to the effect that the manufacture, sale, licensing, or use of any of the products of the Company or any of its subsidiaries as now manufactured, sold or licensed or used or proposed for manufacture, use, sale or licensing by the Company or any of its subsidiaries infringes on any copyright, patent, trade mark, service mark or trade secret, (ii) against the use by the Company or any of its subsidiaries of any trademarks, service marks, trade names, trade secrets, copyrights, patents, technology or know-how and applications used in the business of the Company and its subsidiaries are currently conducted, or (iii) challenging the ownership by the Company or any of its subsidiaries or the validity of any of the Company Intellectual Property Rights. All registered trademarks, service marks and copyrights held by the Company are valid and subsisting, except to the extent any failure does not constitute a Material Adverse Effect on the Company. To the Knowledge of the Company, there is no unauthorized use, infringement or misappropriation of any of the Company Intellectual Property Rights by any third party, including any employee or former employee of the Company or any of its subsidiaries, which would have Material Adverse Effect on the Company. No Company Intellectual Property Rights or product of the Company or any of its subsidiaries is subject to any outstanding decree, order, judgment, or stipulation restricting in any manner the licensing thereof by the Company or any of its subsidiaries, except to the extent any such restriction would not reasonably be expected to have a Material Adverse Effect on the Company. Neither the Company nor any of its subsidiaries has entered into any agreement (other than exclusive distribution agreements) under which the Company or its subsidiaries is restricted from selling, licensing or otherwise distributing any of its products to any class of customers, in any geographic area, during any period of time or in any segment of the market, except to the extent any such restriction would not reasonably be expected to have a Material Adverse Effect on the Company. SECTION 4.13 Environmental Matters. Except as would not reasonably be expected to have a Material Adverse Effect on the Company, (i) the Company and its subsidiaries are, and have been, in compliance with Environmental Law, (ii) to the Knowledge of the Company, there has been no release of Hazardous Substances at, about or under any real property currently or formerly owned or operated by the Company or any current or former subsidiary thereof, (iii) no 19 20 judicial or administrative proceeding is pending or to the Knowledge of the Company threatened relating to violation of or liability under or relating to any Environmental Law, including without limitation violations or liabilities relating to any off-site disposal or contamination, (iv) the Company and its subsidiaries have not received in writing any claims or notices alleging any violation of or liability under or relating to any Environmental Law, and (v) none of the Company and its subsidiaries has entered into, has agreed to, or is subject to any settlement judgment, decree, order or other similar obligation under or relating to any Environmental Law. "Environmental Law" means any and all applicable foreign, Federal, state or local law (including, without limitation, common law), statute, regulation, order, decree or judicial opinion or other governmental requirement having the force and effect of law and relating to the use, storage, handling or disposal of Hazardous Substances or the protection of the environment. "Hazardous Substance" means any toxic or hazardous material or substance that is regulated by or under authority of any Environmental Law or that could result in liability under Environmental Law, including without limitation, any petroleum products, asbestos and polychlorinated biphenyls. SECTION 4.14 Material Adverse Change. Since September 30, 1998, except as contemplated by this Agreement, the Company and its subsidiaries, taken as a whole, have conducted their businesses only in the ordinary course and in a manner consistent with past practice and, since such date, there has not been: (i) any change in the assets, liabilities, results of operation, financial condition or business of the Company or any of its subsidiaries that would reasonably be expected to have a Material Adverse Effect on the Company; (ii) any condition, event or occurrence which would reasonably be expected to have a Material Adverse Effect on the Company; or (iii) any other action which, if it had been taken after the date hereof, would have required the consent of Parent under Section 6.01. SECTION 4.15 Certain Approvals; Take-Over Laws. The Board has taken appropriate action such that, assuming the accuracy of Parent's representation in Section 5.06 of this Agreement, the provisions of Section 203 of the GCL will not apply to any of the transactions contemplated by this Agreement or the Shareholders Agreement. Other than Section 203 of the GCL, no foreign or state takeover law is applicable to the transactions contemplated by this Agreement, including the Offer and the Merger. SECTION 4.16 Opinion of Financial Advisor. The Company has received the written opinion of PaineWebber, Incorporated ("PaineWebber") to the effect that the Share Offer Price to be received by holders pursuant to each of the Offer and the Merger is fair to the holders of the applicable Shares from a financial point of view. SECTION 4.17 Brokers. Except for the engagement of PaineWebber and TJC Management Corp., none of the Company, any of its subsidiaries, or any of their respective officers, directors or employees has employed any broker or finder or incurred any liability for any brokerage fees, commissions or finder's fees in connection with the transactions contemplated by this Agreement. True and correct copies of the Company's agreements with 20 21 PaineWebber and TJC Management Corp. have been provided to Parent prior to the date of this Agreement. SECTION 4.18 Insurance. The Company Disclosure Statement contains an accurate and complete list as of the date of this Agreement of all material policies of fire, liability, workmen's compensation and other forms of insurance owned by the Company or its subsidiaries. SECTION 4.19 Real Estate Matters. (a) The Company or its subsidiaries has good, valid, and, in the case of Owned Properties (as defined below), marketable fee title to: (i) all of the material real property and interests in real property owned by the Company or its subsidiaries, except for properties sold or otherwise disposed of in the ordinary course of business (the "Owned Properties"), and (ii) all of the material leasehold estates in all real properties leased by the Company or its subsidiaries, except leasehold interests terminated in the ordinary course of business (the "Leased Properties"; the Owned Properties and Leased Properties being sometimes referred to herein as the "Real Properties"), in each case free and clear of all mortgages, liens, security interests, easements, covenants, rights-of-way, subleases and other similar restrictions and encumbrances ("Encumbrances"); except for (i) liens for current property taxes and assessments or other governmental charges or levies not yet due and payable or the validity of which is being contested in good faith in appropriate proceedings; (ii) liens for mechanics, materialmen, laborer, warehousemen, carriers and other similar common law or statutory liens arising in the ordinary course of business which are not yet due and payable; (iii) zoning, entitlement and other land use and environmental regulations by governmental agencies provided that such regulations have not been violated; (iv) Encumbrances which would not reasonably be expected to have a Material Adverse Effect on the Company; and (v) Encumbrances under the Credit Agreement (collectively the "Permitted Encumbrances"). (b) Except to the extent that the inaccuracy of any of the following would not reasonably be expected to have a Material Adverse Effect: (i) each of the agreements by which the Company has obtained a leasehold interest in each Leased Property (individually, a "Lease" and collectively, the "Leases") is in full force and effect in accordance with its respective terms and the Company or its subsidiary is the holder of the lessee's or tenant's interest thereunder; (ii) there exists no default by the Company or any of its subsidiaries and, to the Knowledge of the Company, there exists no default by a landlord or third party under any Lease and no circumstance exists which, with the giving of notice, the passage of time or both, is reasonably likely to result in such a default; (iii) there are no leases, subleases, licenses, concessions or any other contracts or agreements granting to any person or entity other than the Company or any of its subsidiaries any right to the possession, use, occupancy or enjoyment of any Real Property or any portion thereof; and (iv) the current operations and use of the Real Properties do not violate any statute, law, regulation, rule, ordinance, permit, requirement, order or decree now in effect. (c) Except as set forth in the Company Disclosure Statement, neither the Company nor any of its subsidiaries is obligated under or bound by any option, right of first refusal, purchase contract, or other contractual right to sell or dispose of any Owned Property or any portions 21 22 thereof or interests therein which property, portions and interests, individually or in the aggregate, are material to the Company and its subsidiaries. SECTION 4.20 Labor Matters; Compliance. Neither the Company nor any of its subsidiaries is a party to any agreement pursuant to which a labor organization is certified under applicable labor law as a bargaining agent for any of the Company's or any of its subsidiaries' employees, and no such agreement is being negotiated. There are no representation or certification proceedings, petitions seeking a representation proceeding, strikes or organizing activities pending or, to the Knowledge of the Company, threatened to be brought or filed with the National Labor Relations Board or any other labor relations tribunal or authority (domestic or foreign); except for such proceedings, petitions, activities or strikes that would not have a Material Adverse Effect on the Company. SECTION 4.21 Disclaimer of Other Representations and Warranties; Disclosure. (a) The Company does not make, and has not made, any representations or warranties relating to the Company or any subsidiaries in connection with the transactions contemplated hereby other than those expressly set forth in this Article IV. It is understood that Purchaser has fully reviewed the SEC Reports, Company Disclosure Statement, the materials referenced therein and in the "data room" relating to the transactions contemplated by this Agreement. It is also understood that any cost estimates, projections or other productions, any data, any financial information or any memoranda or presentations are not and shall not be deemed to be or to include representations or warranties of the Company, except to the extent otherwise expressly covered by the representations and warranties the Company hereunder. No person has been authorized by the Company to make any representation or warranty relating to the Company or any subsidiary, the businesses of the Company or any subsidiary or otherwise in connection with the transactions contemplated hereby except as set forth in this Article IV and, if made, such representation or warranty must not be relied upon as having been authorized by the Company or any subsidiary of the Company. (b) Notwithstanding anything to the contrary contained in this Agreement or in any of the Exhibits or the Company Disclosure Statement, any information disclosed in one Exhibit or Company Disclosure Statement shall be deemed to be disclosed for purposes of this Agreement. Certain information set forth in the Company Disclosure Statement is included solely for informational purposes and may not be required to be disclosed pursuant to this Agreement. The disclosure of any information shall not be deemed to constitute an acknowledgment that such information is required to be disclosed in connection with the representations and warranties made by the Company in this Agreement or that it is material, nor shall such information be deemed to establish a standard of materiality or Material Adverse Effect (and the actual standard of materiality may be higher or lower than the matters disclosed by such information). 22 23 ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT AND THE PURCHASER Parent and the Purchaser represent and warrant to the Company as follows: SECTION 5.01 Organization and Qualification. Parent is a corporation duly organized, validly existing and in good standing under the laws of Delaware. The Purchaser is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Parent and the Purchaser each has the requisite corporate power and authority to own, operate or lease its properties and to carry on its business as it is now being conducted, and is duly qualified or licensed to do business, and is in good standing, in each jurisdiction in which the nature of its business or the properties owned, operated or leased by it makes such qualification, licensing or good standing necessary, except where the failure to have such power or authority, or the failure to be so qualified, licensed or in good standing, would not reasonably be expected to have a Material Adverse Effect on Parent. The term "Material Adverse Effect on Parent", as used in this Agreement, means any change in or effect on the business, operations or financial condition of Parent or any of its subsidiaries that would reasonably be expected to prevent or materially delay consummation of the Offer or Merger. SECTION 5.02 Authority Relative to this Agreement. Each of Parent and the Purchaser has all necessary corporate power and authority to execute and deliver this Agreement and each of the Related Agreements to which it is a party and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement and each of the Related Agreements to which it is a party by Parent and the Purchaser and the consummation by Parent and the Purchaser of the transactions contemplated hereby have been duly and validly authorized and approved by the Boards of Directors of Parent and the Purchaser and by Parent as stockholder of the Purchaser and no other corporate proceedings on the part of Parent or the Purchaser are necessary to authorize or approve this Agreement or each of the Related Agreements to which it is a party or to consummate the transactions contemplated hereby. This Agreement and each of the Related Agreements to which it is a party has been duly executed and delivered by each of Parent and the Purchaser and, assuming the due and valid authorization, execution and delivery by the Company, constitutes a valid and binding obligation of each of Parent and the Purchaser enforceable against each of them in accordance with its terms, except that such enforceability (i) may be limited by bankruptcy, insolvency, moratorium or other similar laws affecting or relating to the enforcement of creditors' rights generally and (ii) is subject to general principles of equity. SECTION 5.03 No Conflict; Required Filings and Consents. (a) None of the execution and delivery of this Agreement and each of the Related Agreements to which it is a party by the Parent or the Purchaser, the consummation by the Parent or the Purchaser of the transactions contemplated hereby or compliance by the Parent or the 23 24 Purchaser with any of the provisions contained in this Agreement and each of the Related Agreements to which it is a party will (i) conflict with or violate the organizational documents of the Parent or the Purchaser, (ii) conflict with or violate any law, regulation or order applicable to Parent or the Purchaser or any of their subsidiaries, or by which any of them or any of their respective properties or assets may be bound or affected, or (iii) result in a Violation pursuant to any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which the Parent or the Purchaser, or any of their respective subsidiaries, is a party or by which any of their respective properties may be bound or affected, except in the case of the foregoing clause (ii) or (iii) for any such Violations which would not have a Material Adverse Effect on the Parent. (b) None of the execution and delivery of this Agreement or each of the Related Agreements to which it is a party by Parent or the Purchaser, the consummation by Parent or the Purchaser of the transactions contemplated hereby or compliance by Parent or the Purchaser with any of the provisions hereof will require any Consent of any Governmental Entity, except for (i) compliance with any applicable requirements of the Exchange Act, (ii) the filing of a certificate of merger, or, if permitted, a certificate of ownership and merger, pursuant to the GCL, (iii) applicable state takeover and environmental statutes, (iv) compliance with the HSR Act and any requirements of any foreign or supranational Antitrust Laws and (v) Consents the failure of which to obtain or make would not reasonably be expected to have a Material Adverse Effect on Parent. SECTION 5.04 Information. None of the information supplied or to be supplied by Parent and the Purchaser in writing specifically for inclusion in (i) the Offer Documents, (ii) the Schedule 14D-9, (iii) the Proxy Statement or (iv) the "Other Filings" will, at the respective times filed with the SEC or other Governmental Entity and, in addition, in the case of the Proxy Statement, at the date it or any amendment or supplement is mailed to stockholders, at the time of the Special Meeting and at the Effective Time, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. SECTION 5.05 Financing. Purchaser has received and obtained firm commitment letters from nationally recognized, financially capable financial institutions addressed to Purchaser providing for equity, mezzanine and debt capital and sufficient funds to consummate the Offer, the Merger and the transactions contemplated hereby and related fees and expenses (the "Commitment Letters"). The Purchaser is not aware of any reason, condition or circumstance that would prevent or interfere with funding under the Commitment Letters as contemplated by this Agreement. True, complete and correct copies of the Commitment Letters, together with a summary of Purchaser's expected sources and uses of cash, have been furnished to the Company. All fees and expenses required, to be paid under the Commitment Letters have been paid by or on behalf of Purchaser. 24 25 SECTION 5.06 Ownership of Common Shares. Except for the transactions contemplated by the Shareholders Agreement, as of the date of this Agreement, neither Parent, Purchaser nor any of their respective subsidiaries or stockholders beneficially owns any Common Shares. SECTION 5.07 Brokers. None of Parent, Purchaser, or any of their respective subsidiaries, officers, directors or employees, has employed any broker or finder or incurred any liability for any brokerage fees, commissions or finder's fees in connection with the transactions contemplated by this Agreement for or with respect to which the Company is or might be liable. SECTION 5.08 Line of Business. Section 5.08 of the Purchaser Disclosure Statement contains a complete and accurate list of (i) all Persons which Parent, Purchaser and each of its shareholders controls (as such term is defined in the HSR Act) and whose principal line of business is in the consumer products industry and (ii) the principal products produced or manufactured by each such Person. ARTICLE VI COVENANTS SECTION 6.01 Conduct of Business of the Company. Except as expressly contemplated by this Agreement, or with the prior written consent of Parent, or as specified in the Company Disclosure Statement, during the period from the date of this Agreement to the Effective Time, the Company will, and will cause each of its subsidiaries to, conduct its operations only in and the Company and its subsidiaries shall not take any action other than in the ordinary course of business consistent with past practice and in compliance with applicable laws (including but not limited to Environmental Laws) and will use commercially reasonable efforts, and will cause each of its subsidiaries to use commercially reasonable efforts, to preserve intact the business organization of the Company and each of its subsidiaries, to keep available the services of its and their present officers and key employees, and to preserve the present relationships of the Company and its subsidiaries with customers, suppliers and other persons with which the Company or any of its subsidiaries has significant business relations. Without limiting the generality of the foregoing and except as otherwise expressly contemplated by this Agreement or the Company Disclosure Statement, the Company will not, and will not permit any of its subsidiaries to, prior to the Effective Time, without the prior written consent of Parent (which will not be unreasonably withheld or delayed): (a) adopt any amendment to its charter or by-laws or comparable organizational documents; (b) except for issuances of capital stock of the Company's subsidiaries to the Company or a wholly-owned subsidiary of the Company, issue, reissue, sell, pledge, dispose of or encumber or authorize the issuance, reissuance, sale, pledge, disposition or 25 26 encumbrance of (i) additional shares of capital stock of any class, or securities convertible into capital stock of any class, or any rights, warrants or options or other rights of any kind to acquire any convertible securities or capital stock or any other ownership interest (including but not limited to stock appreciation rights or phantom stock) of the Company or any of its subsidiaries other than the issuance of Common Shares, in accordance with the terms of the instruments governing such issuance on the date hereof or pursuant to the exercise of Options outstanding on the date hereof or (ii) any other securities in respect of, in lieu of, or in substitution for, Common Shares outstanding on the date hereof; (c) declare, set aside or pay any dividend or other distribution (whether in cash, securities or property or any combination thereof) in respect of any class or series of its capital stock other than between any of the Company and any of its wholly owned subsidiaries; (d) split, combine, subdivide, reclassify or redeem, purchase or otherwise acquire, or propose to redeem or purchase or otherwise acquire, any shares of its capital stock, or any of its other securities; (e) except for (i) increases in salary, wages and benefits of officers or employees of the Company or its subsidiaries in the ordinary course of business and in accordance with past practice, (ii) increases in salary, wages and benefits granted to officers and employees of the Company or its subsidiaries in conjunction with new hires, promotions or other changes in job status in the ordinary course of business for officers and employees whose aggregate cash compensation is equal to or less than $75,000 per annum or (iii) increases in salary, wages and benefits to employees of the Company pursuant to collective bargaining agreements entered into in the ordinary course of business consistent with past practice, increase the compensation or fringe benefits payable or to become payable to its directors, officers or key employees (whether from the Company or any of its subsidiaries), or pay any benefit not required by any existing plan or arrangement (including, without limitation, the granting of stock options, stock appreciation rights, shares of restricted stock or performance units) or grant any severance or termination pay to (except pursuant to existing agreements, plans or policies), or enter into any employment or severance agreement with, any director, officer or other key employee of the Company or any of its subsidiaries or establish, adopt, enter into, or amend any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, savings, welfare, deferred compensation, employment, termination, severance or other employee benefit plan, agreement, trust, fund, policy or arrangement for the benefit or welfare of any directors, officers or current or former employees (any of the foregoing being an "Employee Benefit Arrangement"), except in each case to the extent as required by applicable law or regulation, provided, however, that nothing herein will be deemed to prohibit the payment of benefits as they become payable; 26 27 (f) (i) acquire (by merger, consolidation, or acquisition of stock or assets) any corporation, partnership or other business organization or division thereof or any material assets, (ii) except for borrowings under existing lines of credit in the ordinary course of business, incur any indebtedness for borrowed money or issue any debt securities or assume, guarantee or endorse, or otherwise as an accommodation become responsible for, the obligations of any person, or make any loans, advances or capital contributions to, or investments in, any other person, except for bonuses, advances, capital contributions or investments between any wholly owned subsidiary of the Company and the Company or another wholly owned subsidiary of the Company, (iii) except in the ordinary course of business consistent with past practice, make or start any bid or proposal, or enter into, renew or amend any contract or agreement that could result in a loss or would involve aggregate consideration in excess of $0.5 million, (iv) authorize any single capital expenditure which is in excess of $0.5 million or capital expenditures which are, in the aggregate, in excess of $1.0 million for the Company and its subsidiaries taken as a whole, (v) enter into any transaction, contract or commitment with any affiliate of the Company, except as contemplated by this Agreement, (vi) sell, lease, license to others or dispose of any assets outside the ordinary course of business consistent with past practice which individually or in the aggregate are material to the Company or (vii) enter into or amend any contract, agreement, commitment or arrangement with respect to any of the matters set forth in this Section 6.01(f); (g) except as may be required as a result of a change in law or in generally accepted accounting principles, change in any material respect any of the accounting practices or principles used by it; (h) make or change any Tax election, make or change any method of accounting with respect to Taxes, file any amended Tax Return or settle or compromise any material Tax liability; (i) settle or compromise any pending or threatened suit, action or claim which is material or which relates to the transactions contemplated hereby; (j) make any change in the key management structure of the Company or any of its subsidiaries, including, without limitation, the hiring of additional officers or the termination of existing officers; (k) transfer or grant any rights under, or enter into any settlement regarding, the breach or infringement of, any Company Intellectual Property Rights, or modify any existing rights with respect thereto; (l) take any action, including but not limited to introducing a new product, reasonably likely to expose the Company to any claim that the Company has violated applicable laws, rules or regulations or any rights of any other person in any material respect; 27 28 (m) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its subsidiaries not constituting an inactive subsidiary (other than the Merger); (n) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business and consistent with past practice of liabilities reflected or reserved against in the financial statements of the Company or incurred in the ordinary course of business and consistent with past practice; (o) enter into any collective bargaining agreement or any successor collective bargaining agreement to any collective bargaining agreement; or (p) take, or offer or propose to take, or agree to take in writing or otherwise, any of the actions described in Sections 6.01(a) through 6.01(o) or any action which would make any of the representations or warranties of the Company contained in this Agreement untrue and incorrect as of the date when made in any material respect if such action had then been taken, or would result in any of the conditions set forth in Annex I not being satisfied. SECTION 6.02 Access to Information. From the date hereof until the Effective Time, the Company will, and will cause its subsidiaries, and each of their respective officers, directors, employees, counsel, advisors and representatives (collectively, the "Company Representatives") to, provide Parent and the Purchaser and their respective officers, employees, counsel, advisors and representatives and financing sources (collectively, the "Parent Representatives") reasonable access (subject, however, to existing confidentiality and similar non-disclosure obligations and the preservation of attorney-client and work product privileges), during normal business hours and upon reasonable notice, to the offices and other facilities and to the books and records of the Company and its subsidiaries, and will permit Parent and the Purchaser to make inspections of such as either of them may reasonably require, and will cause the Company Representatives and the Company's subsidiaries to furnish Parent, the Purchaser and the Parent Representatives to the extent available with such other information with respect to the business and operations of the Company and its subsidiaries as Parent and the Purchaser may from time to time reasonably request. Unless otherwise required by law, Parent and the Purchaser will, and will cause the Parent Representatives to, hold any such information in confidence until such time as such information otherwise becomes publicly available through no wrongful act of Parent, the Purchaser or the Parent Representatives. No investigation pursuant to this Section 6.02 shall affect any representations or warranties of the parties herein or the conditions to the obligations of the parties hereto. In the event of termination of this Agreement for any reason, Parent and the Purchaser will, and will cause the Parent Representatives to, return to the Company or destroy all copies of written information furnished by the Company or any of the Company Representatives to Parent or the Purchaser or the Parent Representatives and destroy all memoranda, notes and other writings prepared by Parent, the Purchaser or the Parent Representatives based upon or including the information furnished by the Company or any of the Company Representatives to 28 29 Parent or the Purchaser or the Parent Representatives (and Parent will certify to the Company that such destruction has occurred). In addition, Parent will comply with the terms of the Confidentiality Agreement (as hereinafter defined). SECTION 6.03 Efforts. (a) Subject to the terms and conditions hereof, each party hereto shall use their reasonable best efforts to ensure that the conditions set forth in Article VII and Annex I are satisfied and to consummate and make effective the transactions contemplated by the Offer, the Merger and this Agreement as promptly as practicable in accordance with this Agreement. (b) The Company agrees to provide, and will cause its subsidiaries and its and their respective officers, employees and advisers to provide, all reasonable cooperation in connection with the arrangement of any financing contemplated by the Commitment Letters to be consummated contemporaneous with the Closing in respect of the transactions contemplated by this Agreement, including without limitation, participation in meetings, due diligence sessions, road shows, the preparation of offering memoranda, private placement memoranda, prospectuses and similar documents. The Company will also provide commercially reasonable assistance to the Purchaser in connection with the execution and delivery of any underwriting or placement agreements, pledge and security documents, other definitive financing documents, or other requested certificates or documents, as may be requested by Parent or Purchaser, except (i) as specifically provided in Section 6.16 and (ii) the Company will not be responsible for any indemnities or expense reimbursements in connection therewith until the Offer closes. (c) The Company and the Purchaser will as promptly as practicable file with the Federal Trade Commission and the Department of Justice the notification and report forms required for the transactions contemplated hereby and any supplemental information that may be reasonably requested in connection therewith pursuant to the HSR Act, which notification and report forms and supplemental information will comply in all material respects with the requirements of the HSR Act. Purchaser shall pay all filing fees required with respect to the notification, report and other requirements of the HSR Act. (d) If at any time prior to the Effective Time any event or circumstance relating to either the Company or Parent or the Purchaser or any of their respective subsidiaries, should be discovered by the Company or Parent, as the case may be, and which should be set forth in an amendment to the Offer Documents or Schedule 14D-9, the discovering parties will promptly inform the other party of such event or circumstance. If at any time after the Effective Time any further action is necessary or desirable to carry out the purposes of this Agreement, including the execution of additional instruments, the proper officers and directors of each party to this Agreement shall take all such necessary action. (e) Each of the parties agrees to cooperate with each other in taking, or causing to be taken, all actions necessary to delist the Shares from the NASDAQ National Market; provided, that such delisting shall not be effective until after the Effective Time. The parties also 29 30 acknowledge that it is Purchaser's intent that the Shares following the Merger will not be listed on any national securities exchange or quoted on NASDAQ/NMS. (f) The Purchaser agrees to use reasonable best efforts to promptly satisfy any conditions in the Commitment Letters, and not to waive or amend, or provide any waivers, in respect of the Commitment Letters in a manner which would adversely affect the consummation of the Merger or the Offer in accordance with this Agreement, including its timing thereof (an "Adverse Manner"). The Purchaser agrees to fully enforce the Commitment Letters. (g) Other than pursuant to Section 1.01(a), the Purchaser agrees not to delay, extend or terminate the Offer or the Merger without the prior written approval of the Company, unless Purchaser is entitled to terminate this Agreement pursuant to Section 8.01. SECTION 6.04 Consents. (a) Each of the parties will as promptly as practicable (i) make the required filings with, and take all reasonable steps to obtain the required authorizations, approvals, consents and other actions of, any Governmental Entity, (ii) take all reasonable steps (not including the expenditure of money or the payment or delivery of other consideration) to obtain the required consents of other persons with respect to the transactions contemplated hereby and the Shareholders Agreement and (iii) use its reasonable best efforts to obtain waivers of any Violations that may be caused by, the consummation of the Offer, the Merger and other transactions contemplated by the Offer and this Agreement. (b) Any party hereto shall promptly inform the others of any material communication from the United States Federal Trade Commission, the Department of Justice or any other domestic or foreign government or governmental or multinational authority regarding any of the transactions contemplated by this Agreement. If any party or any affiliate thereof receives a request for additional information or documentary material from any such government or authority with respect to the transactions contemplated by this Agreement, then such party will endeavor in good faith to make, or cause to be made, as soon as reasonably practicable and after consultation with the other party, an appropriate response in compliance with such request. Parent will advise the Company promptly in respect of any understandings, undertakings or agreements (oral or written) which Parent proposes to make or enter into with the Federal Trade Commission, the Department of Justice or any other domestic or foreign government or governmental or multinational authority in connection with the transactions contemplated by this Agreement. The parties will use their respective commercially reasonable best efforts to satisfy the condition in Section 7.01(d). SECTION 6.05 Maintenance of Insurance. Each of the Company and its subsidiaries will continue to carry its existing insurance through the Effective Time, and shall not allow any breach, default or cancellation (other than expiration and replacement of policies in the ordinary cause of business) of such insurance policies or agreements to occur or exist that would reasonably be expected to have a Material Adverse Effect on the Company. 30 31 SECTION 6.06 Public Announcements. So long as this Agreement is in effect, Parent, the Purchaser and the Company agree to consult with each other before issuing any press release or otherwise making any public statement with respect to the transactions contemplated by this Agreement and shall not issue any such press release or make any such public statement prior to such consultation, except as may be required by law or any listing agreement with any securities exchange. SECTION 6.07 Employment Benefit Arrangements. (a) Parent agrees that the Company will honor and, from and after the Effective Time, Parent will cause the Surviving Corporation to honor and continue to maintain in full force and effect, all Employee Benefit Arrangements to which the Company or any of its subsidiaries is presently a party, including but not limited to the agreements existing on the date hereof between the Company and certain executives of the Company (the "Executive Protection Agreements") listed on the Company Disclosure Statement, provided however that nothing herein shall restrict or limit the surviving corporation's ability to amend or terminate any Plan. (b) Parent will cause the Surviving Corporation to take such actions as are necessary so that, for a period of at least one year from the Effective Time, employees of the Company and its subsidiaries (excluding employees covered by collective bargaining agreements) will be provided cash compensation employee benefit and incentive compensation and similar plans and programs as will provide compensation and benefits which in the aggregate are substantially comparable to those provided to such employees by the Plans listed in Section 4.10 of the Company Disclosure Statement; provided, however, that neither the Parent nor the Surviving Corporation shall have any obligation to provide benefits substantially, comparable to any Plan providing equity awards. (c) In any termination or layoff of (i) any employee as of the Effective Time as a result of the transactions contemplated by this Agreement or (ii) any employee of the Surviving Corporation as of the Effective Time (a "Hired Employee") after the Effective Time, Parent will cause the Surviving Corporation to comply fully, if applicable, with the Worker Adjustment and Retraining Notification Act of 1988 ("WARN") and all other applicable foreign, Federal state and local laws, including those prohibiting discrimination and requiring notice to employees. The Surviving Corporation shall not, and shall cause its subsidiaries not to, at any time prior to 60 days after the Effective Time, effectuate a "plant closing" or "mass layoff" as those terms are defined in WARN affecting in whole or in part any facility, site of employment, operating unit or employee of the Company or any subsidiary without complying fully with the requirements of WARN. Parent will bear the cost of compliance with (or failure to comply with) any such laws. SECTION 6.08 Indemnification. (a) The Certificate of Incorporation and By-Laws of the Surviving Corporation shall contain provisions no less favorable with respect to indemnification than are set forth in the Certificate of Incorporation and By-laws of the Company, which provisions shall not be amended, repealed or otherwise modified for a period of six years from the Effective Time in any 31 32 manner that would adversely affect the rights thereunder of individuals who at the Effective Time were directors, officers or employees of the Company. (b) For six years from and after the Effective Time, Parent agrees that it will or will cause the Surviving Corporation to indemnify and hold harmless each present and former director, officer and employee of the Company (collectively, the "Indemnified Parties") against any costs or expenses (including reasonable attorneys' fees), judgments, fines, losses, claims, damages or liabilities (collectively, "Costs") (but only to the extent such Costs are not otherwise covered by insurance and paid) incurred in connection with any claim, action, suit, proceeding or investigation, whether civil, criminal, administrative or investigative (collectively, "Claims"), arising out of or pertaining to matters existing or occurring at or prior to the Effective Time, including, in any event, in connection with the Offer, the Merger and this Agreement, whether asserted or claimed prior to, at or after the Effective Time, to the fullest extent permitted under applicable law (and Parent shall, or shall cause the Surviving Corporation to, also advance expenses as incurred to the fullest extent permitted under applicable law provided the person to whom expenses are advanced provides an undertaking to repay such advances if it is ultimately determined that such person is not entitled to indemnification). (c) Parent agrees that the Company and, from and after the Effective Time, the Surviving Corporation shall use its reasonable best efforts to cause to be maintained in effect for not less than six years from the Effective Time the current policies of the directors' and officers' liability insurance maintained by the Company with respect to matters occurring prior to the Effective Time; provided that the Surviving Corporation may substitute therefor policies of at least the same coverage containing terms and conditions which are no less advantageous and provided that such substitution shall not result in any gaps or lapses in coverage with respect to matters occurring prior to the Effective Time; and provided, further, that the Surviving Corporation shall not be required to pay an annual premium in excess of 200% of the last annual premium paid by the Company prior to the date hereof and if the Surviving Corporation is unable to obtain the insurance required by this Section 6.08(c) it shall obtain as much comparable insurance as possible for an annual premium equal to such maximum amount. (d) Any Indemnified Party wishing to claim indemnification under this Section 6.08, upon learning of any such claim, action, suit, proceeding or investigation, shall promptly notify the Parent thereof, but the failure to so notify shall not relieve Parent of any liability it may have to such Indemnified Party if such failure does not materially prejudice the Parent. In the event of any such claim, action, suit, proceeding or investigation (whether arising before or after the Closing Date), (i) Parent or the Surviving Corporation shall have the right to assume the defense thereof and Parent shall not be liable to such Indemnified Parties for any legal expenses of other counsel or any other expenses subsequently incurred by such Indemnified Parties in connection with the defense thereof, except that if Parent or the Surviving Corporation elects not to assume such defense or counsel for the indemnified parties advises that there are issues which raise conflicts of interest between Parent or the Surviving Corporation and the Indemnified Parties, the Indemnified Parties may retain counsel satisfactory to them, and Parent shall pay all reasonable fees and expenses of such counsel for the Indemnified Parties promptly as statements therefor are 32 33 received; provided, however, that Parent or the Surviving Corporation shall be obligated pursuant to this paragraph (d) to pay for only one firm of counsel for all Indemnified Parties in any jurisdiction unless the use of one counsel for such Indemnified Parties would present such counsel with a conflict of interest, (ii) the Indemnified Parties will cooperate in the defense of any such matter and (iii) Purchaser shall not be liable for any settlement effected without its prior written consent, which will not be unreasonably withheld; and provided, further, that Purchaser shall not have any obligation hereunder to any Indemnified Party if and when a court of competent jurisdiction shall ultimately determine, and such determination shall have become final, that the indemnification of such Indemnified Party in the manner contemplated hereby is prohibited by applicable law. (e) If the Parent or any of its successors or assigns (i) shall consolidate with or merge into any other corporation or entity and shall not be the continuing or surviving corporation or entity of such consolidation or merger or (ii) shall transfer all or substantially all of its properties and assets to any individual, corporation or other entity, then, and in each such case, proper provisions shall be made so that the successors and assigns of the Parent shall assume all of the obligations set forth in this Section 6.08. (f) The provisions of this Section 6.08 are intended to be for the benefit of, and shall be enforceable by, each of the Indemnified Parties, their heirs and their representatives. SECTION 6.09 No Solicitation. The Company agrees that, prior to the Effective Time, it shall not, and shall not authorize or permit any of its or its subsidiaries' directors, officers, employees, agents, advisors or representatives, directly or indirectly, to (a) solicit, initiate or encourage or knowingly facilitate the submission of any inquiries or the making of any proposal (a "Takeover Proposal") with respect to any acquisition or purchase of a substantial amount of the assets of the Company and its subsidiaries, taken as a whole, or of over 15% of any class of equity securities or convertible securities of the Company or any of its subsidiaries, or any tender offer (including a self tender offer) or exchange offer that if consummated would result in any person beneficially owning 15% or more of any class of equity securities or convertible securities of the Company or any of its subsidiaries, or any merger, consolidation or business combination recapitalization, reclassification, liquidation, dissolution or similar transaction involving the Company or any of its subsidiaries other than the transactions contemplated by this Agreement and the Shareholders Agreement or any other transaction the consummation of which would reasonably be expected to impede, interfere with, prevent or materially delay the Offer or Merger or which would reasonably be expected to materially dilute the benefits to Parent and Purchaser of the transactions contemplated hereby (each, an "Acquisition Transaction"), (b) negotiate, explore or otherwise participate in discussions with any person (other than Parent, Purchaser or their respective directors, officers, employees, agents and representatives), and including any parties with which the Company has previously engaged in discussions or negotiations with respect to any Acquisition Transaction, or furnish to any person (other than Parent, Purchaser or their respective directors, officers, employees, agents and representatives) any information with respect to its business, properties or assets or any of the foregoing, or otherwise cooperate in any way with, or assist or participate in, facilitate or encourage, any effort or attempt by any other 33 34 person (other than Parent, Purchaser or their respective directors, officers, employees, agents and representatives) to do or seek any of the foregoing or (c) enter into any agreement, arrangement or understanding with respect to, or endorse, any Takeover Proposal; provided, however, that the foregoing shall not prohibit the Company from (i) prior to the consummation of the Offer (A) furnishing information pursuant to a confidentiality letter (provided for informational purposes to Parent), with terms no less favorable than the Confidentiality Agreement, concerning the Company and its businesses, properties or assets to a third party who has made an unsolicited bona fide written Takeover Proposal, or (B) engaging in discussions or negotiations with such a third party who has made an unsolicited bona fide written Takeover Proposal or (ii) following receipt of an unsolicited bona fide written Takeover Proposal but prior to consummation of the Offer, failing to make or withdrawing or modifying its recommendation referred to in Section 1.02(a), but in each case referred to in the foregoing clauses (i) and (ii) only to the extent that the Board of Directors of the Company shall have concluded in good faith, on the basis of advice from outside legal counsel and the Company's financial advisors, that (A) such Takeover Proposal is more favorable to the stockholders of the Company than the transactions contemplated by this Agreement (taking into account all legal, financial, regulatory and other aspects of the proposal and the person making the proposal) and (B) such action is necessary in order for the Board of Directors to comply with its fiduciary duties to the shareholders of the Company under applicable law; provided, further, that the Board of Directors of the Company shall not take any of the foregoing actions referred to in clauses (i) and (ii) until after notice to Parent and Purchaser with respect to such action and the Board of Directors shall continue to advise Parent and Purchaser after taking such action. Nothing herein shall prevent the Board from taking, and disclosing to the Company's stockholders, a position contemplated by Rules 14d-9 and 14e-2 promulgated under the Exchange Act with regard to any tender offer. In addition, if the Board of Directors of the Company receives an unsolicited Takeover Proposal or any inquiry with respect to or which could lead to any Takeover Proposal, then the Company shall promptly inform Parent and Purchaser orally and in writing of the terms and conditions of such proposal and the identity of the person making it. SECTION 6.10 Notification of Certain Matters. Parent and the Company shall promptly notify each other of (a) the occurrence or non-occurrence of any fact or event which would be reasonably likely (i) to cause any representation or warranty contained in this Agreement to be untrue or inaccurate in any material respect at any time from the date hereof to the Effective Time or (ii) to cause any covenant, condition or agreement hereunder not to be complied with or satisfied in all material respects and (b) any failure of the Company or Parent, as the case may be, to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it hereunder in any material respect; provided, however, that no such notification shall affect the representations or warranties of any party or the conditions to the obligations of any party hereunder nor shall it limit or otherwise affect the remedies available hereunder to the party receiving such notice. SECTION 6.11 Special Meeting. The Company shall take no action unless compelled by legal process to call a special meeting of stockholders of the Company except in accordance 34 35 with this Agreement unless and until this Agreement has been terminated in accordance with its terms. SECTION 6.12 Disposition of Litigation. (a) The Company agrees that it will not settle any litigation currently pending, or commenced after the date hereof, against the Company or any of its directors by any stockholder of the Company relating to the Offer or this Agreement, without the prior written consent of Parent. (b) The Company will not voluntarily cooperate with any third party which has sought or may hereafter seek to restrain or prohibit or otherwise oppose the Offer or the Merger and will cooperate with Parent and Purchaser to resist any such effort to restrain or prohibit or otherwise oppose the Offer or the Merger. SECTION 6.13 Restatement of Financial Advisory Agreement. The Company has amended and restated the Financial Advisory Agreement, dated July 12, 1995, between the Company and TJC Management Corp. (the "Financial Advisory Agreement") in consideration of the payment of fees of not more than $2.5 million to TJC Management (the "TJC Amount") in accordance with a payment letter acceptable to Parent (the "TJC Letter"). The parties acknowledge that the TJC Amount is paid in consideration of services in connection with this Agreement, as well as the transactions contemplated hereby, and such amendment and restatement, which constitute conditions of Purchaser's willingness to enter into this Agreement. SECTION 6.14 Release. Except to the extent that the Released Parties are shown in a final, unappealable determination by courts of competent jurisdiction to have engaged in criminal, fraudulent or intentionally improper conduct, Parent hereby irrevocably and unconditionally releases, acquits and forever discharges on behalf of itself and any person acting by, through, or under or in concert with Parent (including the Company) and all persons acting by, through, under or in concert with any of them (collectively the "Releasees"), or any of them, each of the directors and officers of the Company (collectively, the "Released Parties") from any and all charges, complaints, claims, suits, judgments, demands, actions, obligations or liabilities, damages, causes of action, rights, costs, loans, debts and expenses (including attorneys' fees and costs actually incurred) of any nature whatsoever known or unknown, emanating from, arising out of, or in any way whatsoever arising prior to the Effective Time or resulting from any action which the Company may have taken or failed to take in connection with this Agreement and the transactions contemplated hereby, including the Merger and the Offer, and Parent agrees that neither it, nor any person acting by, through, or under, Parent shall institute or pursue any action or actions, cause or causes of action (in law or in equity), suits, or claims in state or federal court against or adverse to the Released Parties arising from or attributable to the Releasees in connection with the foregoing. SECTION 6.15 State Takeover Laws. The Company shall, upon the request of the Purchaser, take all reasonable steps to assist in any challenge by the Purchaser to the validity or applicability to the transactions contemplated by this Agreement, including the Offer and the Merger and the Shareholder's Agreement, of any state or foreign takeover law. 35 36 SECTION 6.16 The Debt Offer. (a) Provided that this Agreement shall not have been terminated in accordance with Section 8.01, and subject to Section 6.16(d), the Company shall, as soon as practicable after the date hereof, commence an offer to purchase all of the Company's outstanding 9-7/8% Series B Senior Notes due 2005 (the "Senior Notes") on the terms set forth in Section 6.16 of the Company Disclosure Statement and such other customary terms and conditions as are reasonably acceptable to Parent (the "Debt Offer"); provided, that closing of the Debt Offer will be subject to closing the Offer or Merger. The Company shall waive any of the conditions to the Debt Offer and make any other changes in the terms and conditions of the Debt Offer as may be reasonably requested by Parent, and the Company shall not, without Parent's prior consent, waive any condition to the Debt Offer, make any changes to the terms and conditions of the Debt Offer set forth in Section 6.16 of the Disclosure Statement or make any other changes to the terms and conditions of the Debt Offer. Notwithstanding anything in this Agreement, including the immediately preceding sentence, to the contrary, the Company shall not be required to accept for payment or pay for any Senior Notes prior to the closing of the Offer. (b) Promptly following the date of this Agreement, the Company shall prepare, subject to reasonable advice and comments of Parent, an offer to purchase the Senior Notes (or portions thereof) and forms of the related letter of transmittal (the "Letter of Transmittal") (collectively, the "Debt Offer to Purchase"), as well as all other information and exhibits required in connection therewith (collectively, the "Debt Offer Documents"). All mailings to the holders of Senior Notes in connection with the Debt Offer shall be subject to the prior review, comment and approval (which will not be unreasonably withheld) of Parent. The Company will use its reasonable best efforts to cause the Debt Offer Documents to be mailed to the holders of the Senior Notes as promptly as practicable following commencement of the Debt Offer in accordance with Section 6.16(a). (c) The Company covenants and agrees that, subject to the terms and conditions of this Agreement, including but not limited to the conditions to the Debt Offer, on the closing of the Debt Offer, the Company will accept for payment the Senior Notes. (d)(i) Notwithstanding the foregoing, the Company will not be obligated to take or refrain from taking any action which it reasonably believes is inconsistent with applicable law or the terms and conditions of the Senior Notes or which would impede, delay or interfere with the consummation of the Offer or the Merger in accordance with this Agreement. (ii) The Purchaser acknowledges that the Company is making the Debt Offer at the request and as an accommodation to the Purchaser, and that the Debt Offer, and its terms, conditions, failure or success, or any claims or actions relating thereto, will not be grounds for failure of a condition, termination or delay of the Offer or the Merger, including the conditions thereof, nor otherwise affect them. (iii) The Purchaser will pay and reimburse the Company upon request for all fees and expenses relating to the Debt Offer, including but not limited to legal fees and expenses, 36 37 accounting fees and expenses, and printing, mailing and filing fees and expenses, and fees and expenses of banks, financial institutions, representatives and advisors, and will indemnify the Company and its directors and officers from and against all claims, lawsuits, losses, expenses and liabilities, including legal fees and expenses incurred by any of them in connection with the Debt Offer and this Section 6.16. (iv) The Purchaser agrees to comply with applicable law and the terms and conditions of the Senior Notes in connection with the Debt Offer and this Section 6.16. ARTICLE VII CONDITIONS TO CONSUMMATION OF THE MERGER SECTION 7.01 Conditions. The respective obligations of Parent, the Purchaser and the Company to consummate the Merger are subject to the satisfaction, at or before the Effective Time, of each of the following conditions: (a) Stockholder Approval. If required by the GCL, the stockholders of the Company shall have duly adopted this Agreement and approved the transactions contemplated by this Agreement, pursuant to the requirements of the Company's certificate of incorporation and applicable law (which the Company has represented shall be solely the affirmative vote of a majority of the outstanding Shares). (b) Purchase of Shares. The Purchaser shall have accepted for payment and paid for Shares pursuant to the Offer in accordance with the terms hereof; provided, that this condition shall be deemed to have been satisfied with respect to Parent and the Purchaser if the Purchaser fails to accept for payment or pay for Shares pursuant to the Offer in violation of the terms of the Offer. (c) Injunctions; Illegality. The consummation of the Merger shall not be restrained, enjoined or prohibited by any order, judgment, decree, injunction or ruling of a court of competent jurisdiction or any Governmental Entity and there shall not have been any statute, rule or regulation enacted, promulgated or deemed applicable to the Merger by any Governmental Entity which prevents the consummation of the Merger; provided that the party invoking this condition shall have used their reasonable best efforts to prevent the entry of such order, judgment, decree, injunction or ruling and to appeal as promptly as practicable any such order, judgment, decree, injunction or ruling. (d) Expiration of HSR Waiting Period. Any waiting period applicable to the Merger under the HSR Act shall have terminated or expired. 37 38 ARTICLE VIII TERMINATION; AMENDMENTS; WAIVER SECTION 8.01 Termination. This Agreement may be terminated and the Offer and Merger contemplated hereby may be abandoned at any time prior to the Effective Time, notwithstanding approval thereof by the stockholders of the Company: (a) by the mutual written consent of Parent and the Company; (b) by Parent or the Company if there shall be any statute, law, rule or regulation that makes consummation of the Offer or the Merger illegal or prohibited or if any court or other Governmental Entity of competent jurisdiction or located or having jurisdiction within the United States or any country or economic region in which either the Company or the Parent, directly or indirectly, has material assets or operations shall have issued, enacted, entered, promulgated or enforced any final order, judgment, decree, injunction, or ruling or taken any other action restraining, enjoining or otherwise prohibiting the Offer or the Merger and such order, judgment, decree, injunction or ruling shall have become nonappealable; (c) by Parent or the Company if (i) the Offer is terminated or withdrawn pursuant to its terms without any Shares being purchased thereunder; or (ii) if Purchaser shall have failed to pay for Common Shares pursuant to the Offer within 55 days following the date hereof; provided, however, that neither Parent nor the Company, as the case may be, may terminate the Agreement pursuant to this Section 8.01(c) if Purchaser's termination or withdrawal of the Offer or failure to pay for Common Shares pursuant to the Offer has been caused by or results from the failure of such party seeking to terminate the Agreement to perform in any material respects any of its covenants or agreements contained in this Agreement or a material breach of such party's representations and warranties contained in this Agreement; (d) by the Company if (i) the Offer shall not be commenced upon the day specified in Section 1.01, provided, that the failure to so commence has not been caused by and does not result from the failure of the Company to perform in any material respect any of its representations, warranties, covenants or agreements contained in this Agreement, (ii) there shall have been a breach of any representation, warranty, covenant or agreement (without regard to any materiality or Material Adverse Effect qualifier) on the part of Parent or the Purchaser contained in this Agreement which materially adversely affects Parent's or Purchaser's ability to consummate (or materially delays commencement or consummation of) the Offer, and, with respect to any such breach that is reasonably capable of being cured, which shall not have been cured prior to the earlier of (A) 10 business days following notice of such breach and (B) two business days prior to the date on which the Offer expires, (iii) Purchaser shall have terminated the Offer, (iv) any of the Commitment Letters shall have been withdrawn, terminated or modified in an 38 39 Adverse Manner (unless such withdrawn, terminated or modified Commitment Letters (which shall not include the Commitment Letter of J.W. Childs Equity Partners II, L.P.) are promptly replaced, with commitment letters from nationally recognized, capable financial institutions, having substantially similar commitment, terms and conditions, including but not limited to the funding and closing conditions set forth therein, all of which shall be in form and substance reasonably acceptable to the Company), or (unless with the Company's prior written approval in accordance with this Agreement) or (v) prior to the purchase of Shares pursuant to the Offer, any person shall have made a bona fide Takeover Proposal (A) that the Board of Directors of the Company determines in its good faith judgment in consultation with its financial advisor, is more favorable to the Company's stockholders than the Offer and the Merger (taking into account all legal, financial, regulatory and other aspects of the proposal and the person making the proposal) and (B) as a result of which a majority of the Board of Directors concludes in good faith on the advice of independent outside legal counsel to the Company that termination of this Agreement is necessary in order for the Board to comply with its fiduciary obligations under applicable law; provided, that such termination under this clause (v) shall not be effective until the Company has made payment of the full fee and expense reimbursement required by Section 8.03(b) hereof; or (e) By Parent prior to the purchase of Shares pursuant to the Offer, if (i) there shall have been a breach of any representation or warranty on the part of the Company contained in this Agreement (without regard to any materiality or Material Adverse Effect qualifier) which would reasonably be expected to have a Material Adverse Effect on the Company or which would materially adversely affect (or materially delay) the commencement or consummation of the Offer, (ii) there shall have been a breach of any covenant or agreement on the part of the Company contained in this Agreement (without regard to any materiality or material Adverse Effect qualifier) which would reasonably be expected to have a Material Adverse Effect on the Company or which would materially adversely affect (or materially delay) the consummation of the Offer, which, in the clause (i) or (ii), if such breach is reasonably capable of being cured, such breach shall not have been cured prior to the earlier of (A) 10 days following notice of such breach and (B) two business days prior to the date on which the Offer expires, (iii) the Company shall effect, or enter into any agreement with respect to, an Acquisition Transaction with any person (other than Parent or Purchaser) or the Board has resolved to do so, (iv) the Board shall have withdrawn or modified (including by amendment of the Schedule 14D- 9) in a manner adverse to Purchaser its approval or recommendation of the Offer, this Agreement or the Merger or shall have recommended another offer or transaction, or shall have resolved to effect any of the foregoing or (v) the Minimum Condition (as defined in Annex I hereto) shall not have been satisfied by the expiration date of the Offer and, in addition, on or prior to such date, either (A) any person (other than Parent or Purchaser) shall have made a public proposal, filing, announcement or communication to the Company with respect to a Significant Acquisition Transaction (as defined in Section 9.15 hereof) or (B) any person (including the Company or any of its affiliates or 39 40 subsidiaries), other than Parent or any of its affiliates shall have become the beneficial owners of 25% or more of the Common Shares. SECTION 8.02 Effect of Termination. In the event of the termination of this Agreement pursuant to Section 8.01, this Agreement shall forthwith become void and have no effect, without any liability on the part of any party or its directors, officers or stockholders, other than the provisions of this Section 8.02, Section 8.03 and the last two sentences of Section 6.02, which shall survive any such termination. Nothing contained in this Section 8.02 shall relieve any party from liability for any breach of this Agreement or the Confidentiality Agreement. SECTION 8.03 Fees and Expenses. (a) Subject to Sections 8.03(b) and (c) below, all Expenses (as hereinafter defined) incurred by the parties hereto shall be borne solely and entirely by the party which has incurred such Expenses; provided, that all Expenses related to the printing, filing and mailing of the Offer Documents, the Debt Offer Documents and all Commission and other regulatory filing fees incurred in connection with the Offer Documents and Debt Offer Documents allocable to the Company and to Parent or Purchaser, including legal fees and expenses, as the case may be, shall be paid by Purchaser. (b) (i) If this Agreement is terminated by the Company pursuant to Section 8.01(d)(v) or by the Purchaser pursuant to Section 8.01(e) (iii) or (iv); or (ii) (A) If this Agreement is terminated by Parent pursuant to Section 8.01(e)(i), (ii) or (v), and, in addition, (B) following the date of this Agreement and at or prior to the time of the event giving rise to such termination there shall have existed a Significant Takeover Proposal with respect to the Company and (C) within 12 months thereafter, either (1) the Company enters into an agreement with respect to any Significant Acquisition Transaction or (2) any Significant Acquisition Transaction occurs; the Company shall pay to Parent, within one business day following the execution and delivery of such agreement or such occurrence, as the case may be, or no later than concurrently with any termination contemplated by Section 8.01(e)(iii) or (iv) or Section 8.01(d)(v), a fee, in cash and in immediately available funds, of $5.5 million (the "Fee"). (c) If this Agreement is terminated pursuant to Section 8.01(d)(v) or Section 8.01(e), then the Company shall pay to Purchaser, within one business day after its receipt of written statements therefor, an amount equal to the reasonable and documented Expenses set forth in such statement; provided, that in no event will the amount of the Expenses reimbursed exceed $1 million (the "Expenses Cap"); provided, however, that the Expenses Cap shall not apply to the Collection Expenses. Such Expenses shall be in addition to, and not in substitution for, the Fee paid by the Company, if any, pursuant to Section 8.03(b). "Expenses" means all out-of-pocket fees and expenses actually incurred by Parent or Purchaser or on their behalf, whether before or after the execution and delivery of this Agreement, in connection with the transactions contemplated by this Agreement, including the 40 41 Merger and the Shareholders Agreement, including without limitation, fees and reasonable expenses payable to all banks, investment banking firms and other financial institutions, and their respective agents and counsel, all fees and reasonable expenses of counsel, accountants, experts and consultants to Parent or Purchaser, and, further, including without limitation fees and reasonable expenses of, or incurred in connection with, any litigation or other proceedings to collect the Fee or the Expenses (the "Collection Expenses"). SECTION 8.04 Amendment. Subject to Section 1.03(c), this Agreement may be amended by the Company, Parent and the Purchaser at any time before or after any approval of this Agreement by the stockholders of the Company but, after any such approval, no amendment shall be made which decreases the Merger Price or which adversely affects the rights of the Company's stockholders hereunder without the approval of such stockholders. This Agreement may not be amended except by an instrument in writing signed on behalf of all the parties. SECTION 8.05 Extension; Waiver. Subject to Section 1.03(c), at any time prior to the Effective Time, the parties hereto may (i) extend the time for the performance of any of the obligations or other acts of any other party hereto, (ii) waive any inaccuracies in the representations and warranties contained herein by any other party or in any document, certificate or writing delivered pursuant hereto by any other party or (iii) waive compliance with any of the agreements of any other party or with any conditions to its own obligations. Any agreement on the part of any party to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party. ARTICLE IX MISCELLANEOUS SECTION 9.01 Non-Survival of Representations and Warranties. The representations and warranties made in this Agreement shall not survive beyond the Effective Time. Notwithstanding the foregoing, the agreements set forth in Section 3.02, Section 6.07, Section 6.08, Section 6.13, Section 6.14 and 6.16(d) shall survive the Effective Time indefinitely (except to the extent a shorter period of time is explicitly specified therein) and those agreements set forth in the last two sentences of Section 6.02, Section 8.03 and Article IX shall survive termination of this Agreement. SECTION 9.02 Limitation on Warranties. The Company makes no representations or warranties with respect to any projections, forecasts or forward-looking information provided to Parent or Purchaser. There is no assurance that any projected or forecasted results will be achieved. EXCEPT AS TO THOSE MATTERS COVERED BY THE REPRESENTATIONS AND WARRANTIES IN ARTICLE IV, THE COMPANY DISCLAIMS ALL REPRESENTATIONS AND WARRANTIES, WHETHER EXPRESS OR IMPLIED, AS TO ANY OTHER INFORMATION OR MATTERS. Each of Parent and Purchaser acknowledges that neither the Company, any subsidiary nor any other Person has made any representation or 41 42 warranty, express or implied, as to the accuracy or completeness of any information which is not included in this Agreement or the Company Disclosure Statement, and neither the Company, any subsidiary, nor any other Person will have or be subject to any liability to Parent or Purchaser, any affiliate thereof or any other Person resulting from the distribution of any such information to, or use of any such information by, Parent or Purchaser, any affiliate thereof or any of their agents, consultants, accountants, counsel or other representatives. Without limitation of the foregoing, to the extent that any memoranda or summaries prepared by the Company, any subsidiary or by any of their respective advisors or representatives regarding the Company, the subsidiaries, or their respective businesses are or have been provided to Parent or Purchaser, Parent and Purchaser acknowledge and agree that no representation or warranty is made to Purchaser or any affiliate thereof or any other Person as to the completeness or accuracy of such memoranda or summaries. SECTION 9.03 Company Disclosure Statement. Any fact or item in any portion of the Company Disclosure Statement shall be deemed to be disclosed with respect to any other relevant portion, whether or not an explicit cross-reference appears. No representation or warranty hereunder shall be deemed to be inaccurate if the actual situation is explicitly disclosed in the specifically referenced section or cross-section of the Company Disclosure Statement. Neither the specification of any dollar amount in any representation, warranty or covenant contained in this Agreement nor the inclusion of any specific item in the Company Disclosure Statement hereto is intended to imply that such amount, or higher or lower amounts, or the item so included or other items, are or are not material, and no party shall use the fact of the setting forth of any such amount or the inclusion of any such item in any dispute or controversy between the parties as to whether any obligation, item or matter not described herein or included in the Company Disclosure Statement is or is not material for purposes of this Agreement. SECTION 9.04 Entire Agreement; Assignment. (a) The Exhibits and Schedules identified in this Agreement are incorporated herein by reference and made a part hereof. This Agreement, the Related Agreements (including the documents and the instruments referred to herein and the letter agreements, by and between Purchaser and the Company, dated December 4, 1997 and January 12, 1999 (collectively, the "Confidentiality Agreement")), constitute the entire agreement and supersede all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof and thereof. (b) Neither this Agreement and the Related Agreements nor any of the rights, interests or obligations hereunder or thereunder will be assigned by any of the parties hereto (whether by operation of law or otherwise) without the prior written consent of the other party except that Parent and Purchaser may assign all or any of their rights to affiliates with the permission of the Company, which will not be unreasonably withheld; provided, that no such assignment shall relieve the assigning party of its obligations hereunder. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and their respective successors and assigns. 42 43 SECTION 9.05 Binding Agreement. This Agreement and the Related Agreements shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, provided, that, except as provided in Section 9.04(b), no party may assign its rights and obligations under this Agreement without the prior written consent of the other parties. SECTION 9.06 Further Assurances. Upon the reasonable request of Parent, Purchaser or the Company, each party will on and after the Effective Time execute and deliver to the other parties such other documents, assignments and other instruments as may be required to effectuate completely the transfer and assignment to Purchaser of, and to vest fully in Purchaser title to, the Shares, and to effect and evidence the provisions of this Agreement and the Related Agreements and the transactions contemplated hereby. SECTION 9.07 Severability. Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity of enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other situation or in any other jurisdiction. If the final judgement of a court of competent jurisdiction declares that any term or provision hereof is invalid or unenforceable, the Parties agree that the court making the determination of invalidity or unenforceability shall have the power to reduce the scope, duration, or area of the term or provision, to delete specific words or phrases, or to replace any invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision, and this Agreement shall be enforceable as so modified after the expiration of the time within which the judgment may be appealed. SECTION 9.08 Notices. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered in person, by overnight courier or facsimile to the respective parties as follows: If to Parent or the Purchaser: c/o J.W. Childs Associates, L.P. One Federal Street - 21st Floor Boston, MA 02110 Attention: Adam Suttin with a copy to: Simpson Thacher & Bartlett 425 Lexington Avenue New York, NY 10017 Attention: Mario A. Ponce, Esq. 43 44 If to the Company: American Safety Razor Company One Razor Blade Lane Verona, Virginia 24482 Attention: Tom Kasvin with a copy to: Mayer, Brown & Platt 1675 Broadway New York, New York 10019-5820 Attention: James B. Carlson, Esq. with a copy to: The Jordan Company 767 Fifth Avenue New York, New York 10153 Attention: Jonathan F. Boucher or to such other address as the person to whom notice is given may have previously furnished to the other in writing in the manner set forth above (provided that notice of any change of address shall be effective only upon receipt thereof). SECTION 9.09 Governing Law; Jurisdiction. (a) This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof. (b) In addition, each of the parties hereto (i) consents to submit itself to the personal jurisdiction of any federal court located in the State of New York or any New York state court in the event any dispute arises out of this Agreement or any of the transactions contemplated by this Agreement, (ii) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court and (iii) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated hereby in court other than a federal or state sitting in the State of New York. (c) In the event of any dispute in respect of this Agreement or the Related Agreements, then the enforcement costs (including legal fees and expenses) of the prevailing party will be paid and reimbursed by the losing party. 44 45 SECTION 9.10 Waiver of Jury Trial. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY OR DISPUTE THAT MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (iii) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (iv) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.10. SECTION 9.11 Descriptive Headings. The descriptive headings herein are inserted for convenience of reference only and are not intended to be part of or to affect the meaning or interpretation of this Agreement. SECTION 9.12 Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction shall be applied against any party. Any reference to any federal, state or local law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context requires otherwise. SECTION 9.13 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same agreement. SECTION 9.14 Parties in Interest. This Agreement shall be binding upon and inure solely to the benefit of each party hereto, and, except with respect to Sections 1.03(c), 6.08, 6.13 and 6.14, nothing in this Agreement, express or implied, is intended to confer upon any other person any rights or remedies of any nature whatsoever under or by reason of this Agreement. SECTION 9.15 Certain Definitions. As used in this Agreement: (a) the term "affiliate", as applied to any person, shall mean any other person directly or indirectly controlling, controlled by, or under common control with, that person. For the purposes of this definition, "control" (including, with correlative meanings, the terms "controlling," "controlled by" and "under common control with"), as applied to any person, means the possession, directly or indirectly, of the power to direct 45 46 or cause the direction of the management and policies of that person, whether through the ownership of voting securities, by contract or otherwise; (b) the term "Knowledge" means the actual knowledge, after reasonable inquiry, of the executive officers of the Company; (c) the term "Significant Acquisition Transaction" shall have the same meaning as "Acquisition Transaction" except that the references to 15% contained therein shall be deemed to be (i) 35% with respect to any Significant Acquisition Transaction effected through a primary sale of Common Stock (or a security convertible into Common Stock) by the Company or a merger involving the Company or a tender or exchange offer or any other transaction that the Board has recommended acceptance of, and (ii) 50% with respect to any Significant Acquisition Transaction effected through a tender or exchange offer that the Board has recommended rejection of or other market or secondary acquisition of the Common Stock (or a security convertible into Common Stock); (d) the term "Significant Takeover Proposal" means a Takeover Proposal relating to a Significant Acquisition Transaction; (e) the term "person" shall include individuals, corporations, partnerships, trusts, other entities and groups (which term shall include a "group" as such term is defined in Section 13(d)(3) of the Exchange Act); and (f) the term "subsidiary" or "subsidiaries" means, with respect to Parent, the Company or any other person, any corporation, partnership, joint venture or other legal entity of which Parent, the Company or such other person, as the case may be (either alone or through or together with any other subsidiary), owns, directly or indirectly, stock or other equity interests the holders of which are generally entitled to more than 50% of the vote for the election of the board of directors or other governing body of such corporation or other legal entity. SECTION 9.16 Specific Performance. The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any court of the United States or any state having jurisdiction, this being in addition to any other remedy to which they are entitled at law or in equity. SECTION 9.17 Parent Guarantee. Parent hereby guarantees the due performance of any and all obligations and liabilities of the Purchaser under or arising out of this Agreement and the transactions contemplated hereby. 46 47 IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed on its behalf by its respective officer thereunto duly authorized, all as of the day and year first above written. RSA HOLDINGS CORP. OF DELAWARE By: /s/ Adam L. Suttin ------------------------------------ Name: Adam L. Suttin Title: RSA ACQUISITION CORP. By: /s/ Adam L. Suttin ------------------------------------ Name: Adam L. Suttin Title: AMERICAN SAFETY RAZOR COMPANY By: /s/ Jonathan F. Boucher ------------------------------------ Name: Jonathan F. Boucher Title: 47 48 ANNEX I Offer Conditions Notwithstanding any other provision of the Offer, 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 Purchaser's obligation to pay for or return tendered Shares promptly after termination or withdrawal of the Offer), pay for any Shares tendered pursuant to the Offer, and may postpone the acceptance for payment or, subject to the restriction referred to above, payment for any Shares tendered pursuant to the Offer, and may amend or terminate the Offer (whether or not any Shares have theretofore been purchased or paid for) to the extent permitted by the Merger Agreement if, (i) at the expiration of the Offer, a number of shares of Company Common Stock which constitutes more than 50% of the voting power (determined on a fully-diluted basis), on the date of purchase, of all the securities of the Company entitled to vote generally in the election of directors or in a merger shall not have been validly tendered and not properly withdrawn prior to the expiration of the Offer (the "Minimum Condition"), or (ii) at any time on or after the date of this Agreement and prior to the acceptance for payment of Shares, any of the following conditions occurs or has occurred: (a) there shall have been instituted or pending any action or proceeding brought by any governmental authority before any federal or state court, or any order or preliminary or permanent injunction entered and continuing in any action or proceeding before any federal or state court or governmental, administrative or regulatory authority or agency, or any statute, rule, regulation, legislation, interpretation, judgment or order enacted, entered, enforced, promulgated, amended, issued and continuing and applicable to Parent, Purchaser, the Company or any subsidiary or affiliate of Purchaser or the Company or the Offer or the Merger, by any legislative body, court, government or governmental, administrative or regulatory authority or agency which would reasonably be expected to have the effect of: (i) making illegal, or otherwise directly or indirectly restraining or prohibiting or making materially more expensive the making of the Offer, the acceptance for payment of, or payment for the Shares by Parent or the Purchaser or the consummation of any of the transactions contemplated by the Merger Agreement; (ii) prohibiting or materially limiting the ownership or operation by the Company or any of its subsidiaries or Parent, Purchaser or any of Parent's affiliates of all or any material portion of the business or assets of the Company or any of its subsidiaries, taken as a whole, or any of its affiliates or compelling Parent, Purchaser or any of Parent's affiliates to dispose of or hold separate all or any material portion of the business or assets of the Company or any of its subsidiaries or Parent, or any of its affiliates, as a result of the transactions contemplated by the Offer or the Merger Agreement; (iii) imposing or confirming limitations on the ability of Parent, Purchaser or any of Parent's affiliates effectively to acquire or hold or to exercise full rights of ownership of Shares, including without limitation the right to vote any Shares acquired or owned by Parent or Purchaser or any of its affiliates on all matters properly presented to the stockholders of the Company, including without limitation the adoption and approval of the Agreement and 1 49 the Merger or the right to vote any shares of capital stock of any subsidiary directly or indirectly owned by the Company; or (iv) requiring divestiture by Parent or Purchaser of any Shares; (b) there shall have occurred and be continuing (i) any general suspension of trading in, or limitation on prices for, securities on any national securities exchange or in the over-the-counter market in the United States, (ii) a material adverse change in or material disruption of conditions in the market for syndicated bank credit facilities or the financial, banking or capital markets generally, (iii) a commencement and continuation of a war or armed hostilities or other national or international calamity directly or indirectly involving the United States which would have a Material Adverse Effect on the Company or (iv) in the case of any of the foregoing existing at the time of commencement of the Offer, a material acceleration or worsening thereof; (c) (i) it shall have been publicly disclosed or Purchaser shall have otherwise learned that beneficial ownership (determined for the purposes of this paragraph as set forth in Rule 13d-3 promulgated under the Exchange Act) of more than 25% of the outstanding Shares has been acquired by any corporation (including the Company or any of its subsidiaries or affiliates), partnership, person or other entity or group (as defined in Section 13(d)(3) of the Exchange Act), other than Parent or its affiliates, or the Principal Holders or any of their respective affiliates (but only with respect to the Common Shares that they beneficially own on the date hereof), or (ii) (A) the Board of Directors of the Company or any committee thereof shall have withdrawn or modified in a manner adverse to Parent or Purchaser the approval or recommendation of the Offer, the Merger or the Merger Agreement, or approved or recommended any Takeover Proposal or any other acquisition of Shares other than the Offer and the Merger, (B) any such corporation, partnership, person or other entity or group shall have entered into a definitive agreement or an agreement in principle with the Company with respect to an Acquisition Transaction, or (C) the Board of Directors of the Company or any committee thereof shall have resolved to do any of the foregoing; (d) any of the representations and warranties of the Company set forth in the Merger Agreement that are qualified as to materiality or Material Adverse Effect shall not be true and correct, or any such representations and warranties that are not so qualified shall not be true and correct in any material respect, in each case as if such representations and warranties were made at the time of such determination; (e) the Company shall have failed to perform in any material respect any obligation or to comply in any material respect with any agreement or covenant of the Company to be performed or complied with by it under the Merger Agreement; (f) the Merger Agreement shall have been terminated in accordance with its terms or the Offer shall have been terminated with the consent of the Company; or 2 50 (g) 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 material approval, permit, authorization or consent of any domestic or foreign governmental, administrative or regulatory agency (federal, state, local, provincial or otherwise) shall not have been obtained on terms satisfactory to the Parent in its reasonable discretion; and, in addition, which, in the case of (a) through (g), in the reasonable, good faith judgement of Parent or the Purchaser, and regardless of the circumstances (including any action or inaction by Parent or Purchaser or any of its affiliates) giving rise to any such conditions, makes it inadvisable to proceed with the Offer and/or with such acceptance for payment of or payment for Shares or to proceed with the Merger. The foregoing conditions are for the sole benefit of Parent and the Purchaser and may be asserted by Parent or the Purchaser regardless of the circumstances giving rise to any such conditions and may be waived by Parent or the Purchaser in whole or in part at any time and from time to time in their reasonable discretion, in each case, subject to the terms of the Merger Agreement. The failure by Parent or the Purchaser at any time to exercise any of the foregoing rights shall not be deemed a waiver of such right and each such right shall be deemed an ongoing right which may be asserted at any time and from time to time. The capitalized terms used in this Annex I shall have the meanings set forth in the Agreement to which it is annexed, except that the term "Merger Agreement" shall be deemed to refer to the Agreement to which this Annex I is appended. 3 EX-99.11.C.2 13 SHAREHOLDERS AGREEMENT 1 EXHIBIT 11(C)(2) SHAREHOLDERS AGREEMENT SHAREHOLDERS AGREEMENT (this "Agreement"), dated as of February 12, 1999, by and among RSA Holdings Corp. of Delaware, a Delaware corporation ("Parent"), RSA Acquisition Corp., a Delware corporation ("Purchaser"), and the other parties signatory hereto (each, a "Stockholder"). RECITALS Concurrently herewith, Parent, Purchaser and American Safety Razor Company, a Delaware corporation (the "Company"), are entering into an Agreement and Plan of Merger, dated as of the date hereof (the "Merger Agreement"; capitalized terms used but not defined herein shall have the meanings set forth in the Merger Agreement), pursuant to which Purchaser agrees to make an offer (the "Offer") for all outstanding shares of Common Stock, par value $0.01 per share (the "Common Stock"), of the Company, at a price of $14.125 per share, net to the Stockholder in cash, to be followed by a merger (the "Merger") of Purchaser with and into the Company. As a condition to its willingness to enter into the Merger Agreement and make the Offer, Parent and Purchaser have required that each Stockholder agree, and each Stockholder has agreed, among other things, to tender into the Offer and to grant an irrevocable proxy with respect to the number of shares of Common Stock of such Stockholder set forth on Annex A hereto, together with any additional shares when and if they are acquired, including, without limitation, pursuant to Section 5.5 hereof (such shares, and any additional shares when and if they are acquired, being referred to herein as the "Shares"), on the terms and conditions provided for herein. In consideration of this Agreement, Purchaser has entered into the Merger Agreement and agreed to have the Company pay the TJC Amount, as a condition to the Merger Agreement. The Board of Directors of the Company has approved this Agreement, the Merger Agreement and the transactions contemplated hereby and thereby so as to render inapplicable Section 203 of the Delaware General Corporation Law ("DGCL") to the transactions contemplated hereby and thereby. AGREEMENT To implement the foregoing and in consideration of the mutual agreements contained herein, the parties agree as follows: 1. Agreement to Tender. Each Stockholder hereby agrees to validly tender (or cause the record owner of such shares to validly tender), pursuant to and in accordance with the terms of the Offer, as soon as practicable after commencement of the Offer but in no event later than 15 business days after the date of commencement of the Offer, all of such Stockholder's Shares by physical delivery of the certificates therefor (or by book entry or appropriate instructions to brokers or custodians thereof, as the case may be) and to not withdraw such Shares, except following termination of this Agreement pursuant to Section 7 hereof. Each Stockholder hereby 2 acknowledges and agrees that Parent's and the Purchaser's obligation to accept for payment and pay for the Shares is subject to the terms and conditions of the Offer. Stockholder hereby permits Parent and the Purchaser to publish and disclose in the Offer Documents and, if approval of the Company's stockholders is required under applicable law, the Proxy Statement (including all documents and schedules filed with the Securities and Exchange Commission) his identity and ownership of the Shares and the nature of his commitments, arrangements and understandings under this Agreement. 2. Irrevocable Proxy. Each Stockholder hereby irrevocably appoints Purchaser or any designee of Purchaser the lawful agent, attorney and proxy of such Stockholder, during the term of this Agreement at any meeting of the Stockholders of the Company, however called, or in connection with any written consent of the Stockholders of the Company, to vote (or cause to be voted) the Shares held of record or beneficially by such Stockholder (i) in favor of the Merger, the execution and delivery by the Company of the Merger Agreement and the approval of the terms thereof and each of the other actions contemplated by the Merger Agreement, this Agreement and any actions required in furtherance hereof and thereof; (ii) against any action or agreement that would result in a breach of any covenant, representation or warranty or any other obligation or agreement of the Company under the Merger Agreement or this Agreement; and (iii) except as specifically requested in writing by Purchaser in advance, against the following actions (other than the Offer, Merger and the transactions contemplated by the Merger Agreement): (1) any extraordinary corporate transaction, such as a merger, consolidation or other business combination involving the Company or its subsidiaries; (2) a sale, lease or transfer of a material amount of assets of the Company or its subsidiaries or a reorganization, recapitalization, dissolution or liquidation of the Company or its subsidiaries; (3) (a) any change in the majority of the Board of Directors of the Company; (b) any material change in the present capitalization of the Company or any amendment of the Company's certificate of incorporation; (c) any other material change in the Company's corporate structure or business; or (d) any other action which, is intended, or could reasonably be expected, to impede, interfere with, delay, postpone, discourage or materially adversely affect the Offer, Merger or the transactions contemplated by the Merger Agreement or this Agreement or the contemplated economic benefits of any of the foregoing. Each Stockholder intends this proxy to be irrevocable and coupled with an interest and will take such further action or execute such other instruments as may be necessary to effectuate the intent of this proxy and hereby revokes any proxy previously granted by it with respect to the Shares. Each Stockholder shall not hereafter, unless and until this Agreement terminates pursuant to Section 7.6 hereof, purport to vote (or execute a consent with respect to) such Shares (other than through this irrevocable proxy) or grant any other proxy or power of attorney with respect to any Shares, deposit any Shares into a voting trust or enter into any agreement (other than this Agreement), arrangement or understanding with any person, directly or indirectly, to vote, grant any proxy or give instructions with respect to the voting of such Shares. -2- 3 3. Representations and Warranties. 3.1. Representations and Warranties of Purchaser. Each of Parent and Purchaser hereby represents and warrants to each Stockholder as follows: (a) Due Authorization. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly and validly authorized by the Board of Directors of Purchaser and Parent, as the case may be, and no other corporate proceedings on the part of Parent or Purchaser, as the case may be, are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by Parent and Purchaser, as the case may be, and constitutes a valid and binding agreement of Parent and Purchaser, as the case may be, enforceable against each in accordance with its terms, except that such enforceability (i) may be limited by bankruptcy, insolvency, moratorium or other similar laws affecting or relating to enforcement of creditors' rights generally and (ii) is subject to general principles of equity. (b) No Conflicts. Except for (i) filings under the HSR Act, if applicable, (ii) the applicable requirements of the Exchange Act, and the Securities Act of 1933, as amended (the "Securities Act"), (iii) the applicable requirements of state securities, takeover or Blue Sky laws and (iv) such notifications, filings, authorizing actions, orders and approvals as may be required under other laws, (A) no filing with, and no permit, authorization, consent or approval of, any state, federal or foreign public body or authority is necessary for the execution of this Agreement by Purchaser or Parent, as the case may be, and the consummation by each of the transactions contemplated hereby and (B) neither the execution and delivery of this Agreement by Purchaser or Parent, as the case may be, nor the consummation by it of the transactions contemplated hereby nor compliance by it with any of the provisions hereof shall (1) conflict with or result in any breach of any provision of its certificate of incorporation or by-laws (or similar documents), (2) result in a violation or breach of, or constitute (with or without notice or lapse of time or both) a default (or give rise to any third party right of termination, cancellation, material modification or acceleration) under any of the terms, conditions or provisions of any note, bond, mortgage, indenture, license, contract, agreement or other instrument or obligation to which it is a party or by which it or any of its properties or assets may be bound or (3) violate any order, writ, injunction, decree, statute, rule or regulation applicable to it or any of its properties or assets, except in the case of (2) or (3) for violations, breaches or defaults which would not in the aggregate materially impair the ability of Purchaser or Parent, as the case may be, to perform its obligations hereunder. (c) Good Standing. Each of Parent and Purchaser is a corporation duly organized, validly existing and in good standing under the laws of Delaware and has all requisite corporate power and authority to execute and deliver this Agreement. -3- 4 3.2. Representations and Warranties of Stockholder. Each Stockholder hereby severally represents and warrants to Parent and Purchaser as follows: (a) Ownership of Shares and Options. Subject to Section 4.3, Stockholder (or accounts or trusts controlled or beneficially owned by Stockholder) is the owner of the Shares and options to acquire Shares ("Stock Options") set forth on Annex A hereto and has the power to vote and dispose of such Shares. To Stockholder's knowledge, such Shares are, or upon issuance will be, validly issued, fully paid and nonassessable, with no personal liability attaching to the ownership thereof. Stockholder has, or upon issuance will have, good title to the Shares, free and clear of any agreements, liens, adverse claims or encumbrances whatsoever with respect to the ownership of or the right to vote such Shares. (b) Power; Binding Agreement. Stockholder has the legal capacity, power and authority to enter into and perform all of its obligations under this Agreement. The execution, delivery and performance of this Agreement by Stockholder will not violate any other agreement to which Stockholder is a party including, without limitation, any voting agreement, stockholders agreement or voting trust. This Agreement has been duly and validly authorized, executed and delivered by Stockholder and constitutes a valid and binding agreement of Stockholder, enforceable against Stockholder in accordance with its terms, except that such enforceability (i) may be limited by bankruptcy, insolvency, moratorium or other similar laws affecting or relating to enforcement of creditors' rights generally and (ii) is subject to general principles of equity. (c) No Conflicts. Except for (i) filings under the HSR Act, if applicable, (ii) the applicable requirements of the Exchange Act and the Securities Act, (iii) the applicable requirements of state securities, takeover or Blue Sky laws, (iv) such notifications, filings, authorizing actions, orders and approvals as may be required under other laws, (A) no filing with, and no permit, authorization, consent or approval of, any state, federal or foreign public body or authority is necessary for the execution of this Agreement by Stockholder and the consummation by Stockholder of the transactions contemplated hereby and (B) neither the execution and delivery of this Agreement by Stockholder nor the consummation by Stockholder of the transactions contemplated hereby nor compliance by Stockholder with any of the provisions hereof shall (1) conflict with or result in any breach of any provision of the certificate of incorporation, by-laws, trust or charitable instruments (or similar documents) of Stockholder, (2) result in a violation or breach of, or constitute (with or without notice or lapse of time or both) a default (or give rise to any third party right of termination, cancellation, material modification or acceleration) under any of the terms, conditions or provisions of any note, bond, mortgage, indenture, license, contract, agreement or other instrument or obligation to which Stockholder is a party or by which he or it or any of his or its properties or assets may be bound or (3) violate any order, writ, injunction, decree, statute, rule or regulation applicable to Stockholder or any of his or its properties or assets, except in the case of (2) -4- 5 or (3) for violations, breaches or defaults which would not in the aggregate materially impair the ability of Stockholder to perform his or its obligations hereunder. 4. Certain Covenants of Stockholder. Each Stockholder hereby severally covenants and agrees as follows: 4.1. No Solicitation. Neither Stockholder nor any officer, director, employee, representative or agent of Stockholder shall, directly or indirectly, solicit, facilitate, participate in or initiate any inquiries or the making of any proposal by any person or entity (other than Purchaser or any affiliate of Purchaser) which constitutes, or may reasonably be expected to lead to, (a) any sale of the Shares or (b) any Takeover Proposal or Acquisition Transaction. If Stockholder, or any officer, director, employee, representative or agent of Stockholder, receives an inquiry or proposal with respect to the sale of Shares, then Stockholder shall promptly inform Purchaser of the terms and conditions, if any, of such inquiry or proposal and the identity of the person making it. Stockholder shall, and shall cause its officers, directors, employees, representatives and agents to, immediately cease and cause to be terminated any existing activities, discussions or negotiations with any parties conducted heretofore with respect to any of the foregoing. This Section 4.1 will not bind or apply to any person in their capacity as director of the Company. 4.2. Restriction on Transfer, Proxies and NonInterference. Stockholder hereby agrees, while this Agreement is in effect, and except as contemplated hereby, not to (a) sell, transfer, pledge, encumber, assign or otherwise dispose of, or enter into any contract, option or other arrangement or understanding with respect to the sale, transfer, pledge, encumbrance, assignment or other disposition of, any of the Shares or Stock Options or (b) grant any proxies, deposit any Shares into a voting trust or enter into a voting agreement with respect to any Shares or (c) take any action that would make any representation or warranty of such Stockholder contained herein untrue or incorrect or have the effect of preventing or disabling such Stockholder from performing his obligations under this Agreement. 4.3. Legending of Certificates; Nominees Shares. If requested by Purchaser, Stockholder agrees to submit to Purchaser contemporaneously with or promptly following execution of this Agreement all certificates representing the Shares so that Purchaser may note thereon a legend referring to the proxy and other rights granted to it by this Agreement. If any of the Shares beneficially owned by Stockholder are held of record by a brokerage firm in "street name"or in the name of any other nominee (a "Nominee", and, as to such Shares, "Nominee Shares"), Stockholder agrees that, upon written notice by Purchaser requesting it, Stockholder will within five days of the giving of such notice execute and deliver to Purchaser a limited power of attorney in such form as shall be reasonably satisfactory to Purchaser enabling Purchaser to require the Nominee to (i) grant to Purchaser an irrevocable proxy to the same effect as Section 1 and 2 hereof with respect to the Nominee Shares held by such Nominee, (ii) tender such Nominee Shares in the Offer pursuant to Section 1 hereof, and (iii) submit to Purchaser the certificates representing such Nominee Shares for notation of the above-referenced legend thereon. -5- 6 4.4. Stop Transfer Order. In furtherance of this Agreement, concurrently herewith, Stockholder shall and hereby does authorize the Company's counsel to notify the Company's transfer agent that there is a stop transfer order with respect to all of the Shares (and that this Agreement places limits on the voting and transfer of such shares). 4.5. Stock Options. Each Stockholder that owns any Stock Options hereby agrees not to take any action that would affect the full vesting or free exercisability of such Stock Options. Each Stockholder that owns any Stock Options hereby agrees with Purchaser that, if requested by Purchaser at any time during the period from and including the Exercise Date to the Expiration Date when Purchaser desires to exercise the Option with respect to any Shares underlying any Stock Options, the Stockholder will exercise such number of fully vested and freely exercisable Stock Options (including any such Stock Options that may become fully vested and freely exercisable at any subsequent time between the Exercise Date and the Expiration Date) as may be necessary to enable Purchaser to acquire such Shares. 5. Further Assurances. From time to time, at the other party's request and without further consideration, each party hereto shall execute and deliver such additional documents and take all such further action as may be necessary or desirable to consummate the transactions contemplated by this Agreement, including, without limitation, to vest in Purchaser good title to any Shares purchased hereunder. 6. Adjustments to Prevent Dilution, Etc. In the event of a stock dividend or distribution, or any change in the Company's Common Stock by reason of any stock dividend, split-up, reclassification, recapitalization, combination or the exchange of shares, the term "Shares" shall be deemed to refer to and include the Shares as well as all such stock dividends and distributions and any shares into which or for which any or all of the Shares may be changed or exchanged. In such event, the amount to be paid per share by Purchaser shall be proportionately adjusted. 7. Miscellaneous. 7.1. Entire Agreement; Assignment. This Agreement (i) constitutes the entire agreement among the parties with respect to the subject matter hereof and supersedes all other prior agreements and understandings, both written and oral, between the parties with respect to the subject matter hereof and (ii) shall not be assigned by operation of law or otherwise, provided that Purchaser may assign its rights and obligations hereunder to any direct or indirect wholly owned parent company or subsidiary of Purchaser, but no such assignment shall relieve Purchaser of its obligations hereunder if such assignee does not perform such obligations. 7.2. Amendments. This Agreement may not be modified, amended, altered or supplemented, except upon the execution and delivery of a written agreement executed by the parties hereto. 7.3. Notices. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given (and shall be deemed to have been duly received -6- 7 if so given) by hand delivery, telegram, telex or telecopy, or by mail (registered or certified mail, postage prepaid, return receipt requested) or by any courier service, such as Federal Express, providing proof of delivery. All communications hereunder shall be delivered to the respective parties at the following addresses: If to Stockholder: At such Stockholder's address set forth on Annex A hereto If to Parent or Purchaser: RSA Holdings Corp. of Delaware c/o J.W. Childs Associates, L.P. One Federal Street, 21st Floor Boston, MA 02110 Facsimile No.: (617) 753-1101 Attention: Adam Suttin copy to: Simpson Thacher & Bartlett 425 Lexington Avenue New York, New York 10017 Facsimile No.: (212) 455-2502 Attention: Mario Ponce, Esq. or to such other address as the person to whom notice is given may have previously furnished to the others in writing in the manner set forth above. 7.4. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof. 7.5. Cooperation as to Regulatory Matters. If so requested by Purchaser, promptly after the date hereof, Stockholder will use its reasonable best efforts to cause it and the Company (if required) to make all filings which are required under the HSR Act and applicable requirements and to seek all regulatory approvals required in connection with the transactions contemplated hereby. The parties shall furnish to each other such necessary information and reasonable assistance as may be requested in connection with the preparation of filings and submissions to any governmental agency, including, without limitation, filings under the provisions of the HSR Act. Stockholder shall also use its reasonable best efforts to cause the Company to supply Purchaser with copies of all correspondence, filings or communications (or memoranda setting forth the substance thereof) between the Company and its representatives and the Federal Trade Commission, the Department of Justice and any other governmental agency or authority and members of their respective staffs with respect to this Agreement and the transactions contemplated hereby. 7.6. Termination. This Agreement shall terminate on the earlier of (i) the Effective Time or (ii) the termination of the Merger Agreement in accordance with its terms, provided, that such termination will not terminate or affect Section 3 thereof. -7- 8 7.7. Specific Performance. Each of the parties hereto recognizes and acknowledges that a breach by it of any covenants or agreements contained in this Agreement will cause the other party to sustain damages for which it would not have an adequate remedy at law for money damages, and therefore, each of the parties hereto agrees that in the event of any such breach the aggrieved party shall be entitled to the remedy of specific performance of such covenants and agreements and injunctive and other equitable relief in addition to any other remedy to which it may be entitled, at law or in equity. 7.8. Counterparts. This Agreement may be executed in two counterparts, each of which shall be deemed to be an original, but both of which shall constitute one and the same Agreement. 7.9. Descriptive Headings. The descriptive headings used herein are inserted for convenience of reference only and are not intended to be part of or to affect the meaning or interpretation of this Agreement. 7.10. Severability. Whenever possible, each provision or portion of any provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law but if any provision or portion of any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or portion of any provision in such jurisdiction, and this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision or portion of any provision had never been contained herein. -8- 9 IN WITNESS WHEREOF, this Agreement has been executed by or on behalf of each of the parties hereto, all as of the date first above written. RSA HOLDINGS CORP. OF DELAWARE By: /s/ Adam L. Suttin -------------------------------------- Name: Adam L. Suttin Title: RSA ACQUISITION CORP. By: /s/ Adam L. Suttin -------------------------------------- Name: Adam L. Suttin Title: 10 JOHN W. JORDAN By: /s/ John W. Jordan -------------------------------------- DAVID W. ZALAZNICK By: /s/ David W. Zalaznick -------------------------------------- JONATHAN F. BOUCHER By: /s/ Jonathan F. Boucher -------------------------------------- JOHN R. LOWDEN By: /s/ John R. Lowden -------------------------------------- THOMAS H. QUINN By: /s/ Thomas H. Quinn -------------------------------------- ADAM MAX By: /s/ Adam Max -------------------------------------- 11 LEUCADIA NATIONAL CORP. By: /s/ Joseph A. Orlando ------------------------------------- Name: Joseph A. Orlando Title: Vice President and CEO JZ Equity Partners PLC By: /s/ James E. Jordon ------------------------------------- Name: Title: WILLIAM C. WEATHERSBY By: /s/ William C. Weathersby ------------------------------------- THOMAS G. KASVIN By: /s/ Thomas G. Kasvin ------------------------------------- 12 ANNEX A
Number of Shares of Number of Shares Common Stock Underlying Stockholder Name of Common Stock Stock Options - ---------------- --------------- ------------- John W. Jordan II 332,140 0 c/o The Jordan Company 767 Fifth Avenue New York, NY 10153 David W. Zalaznick 303,140 0 c/o The Jordan Company 767 Fifth Avenue New York, NY 10153 Jonathan F. Boucher 360,639 0 c/o The Jordan Company 767 Fifth Avenue New York, NY 10153 John R. Lowden 184,860 0 c/o The Jordan Company 767 Fifth Avenue New York, NY 10153 Thomas H. Quinn 175,200 0 c/o The Jordan Company 767 Fifth Avenue New York, NY 10153 Adam Max 94,346 0 c/o The Jordan Company 767 Fifth Avenue New York, NY 10153 Leucadia National Corp. 419,233 0 c/o The Jordan Company 767 Fifth Avenue New York, NY 10153
13
Number of Shares of Number of Shares Common Stock Underlying Stockholder Name of Common Stock Stock Options - ---------------- --------------- ------------- MCIT PLC 245,496 0 c/o The Jordan Company 767 Fifth Avenue New York, NY 10153 William C. Weathersby 169,000 60,000 c/o American Safety Razor Company One Razor Blade Lane Verona, VA 24482 Thomas G. Kasvin 27,600 65,000 c/o American Safety Razor Company One Razor Blade Lane Verona, VA 244820
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