-----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, RDJWapkOO1clCI986UbiPqgphp8hs97eex8QALIcu/fq4TcCcE4lN7V/oGXgZbY7 Grmz2NWeW5Q0OqJtn9X2PA== 0000950116-97-001436.txt : 19970811 0000950116-97-001436.hdr.sgml : 19970811 ACCESSION NUMBER: 0000950116-97-001436 CONFORMED SUBMISSION TYPE: SC 14D1 PUBLIC DOCUMENT COUNT: 11 FILED AS OF DATE: 19970808 SROS: NONE SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: OUTBOARD MARINE CORP CENTRAL INDEX KEY: 0000075149 STANDARD INDUSTRIAL CLASSIFICATION: ENGINES & TURBINES [3510] IRS NUMBER: 361589715 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: SC 14D1 SEC ACT: 1934 Act SEC FILE NUMBER: 005-12268 FILM NUMBER: 97654166 BUSINESS ADDRESS: STREET 1: 100 SEA HORSE DR CITY: WAUKEGAN STATE: IL ZIP: 60085 BUSINESS PHONE: 7086896200 MAIL ADDRESS: STREET 1: 100 SEA HORSE DRIVE CITY: WAUKEGAN STATE: IL ZIP: 60085 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: GREENMARINE ACQUISITION CORP CENTRAL INDEX KEY: 0001043456 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: SC 14D1 BUSINESS ADDRESS: STREET 1: 277 PARK AVE STREET 2: 27TH FL CITY: NEW YORK STATE: NY ZIP: 10172 BUSINESS PHONE: 2123505100 MAIL ADDRESS: STREET 1: 277 PARK AVE STREET 2: 27TH FL CITY: NEW YORK STATE: NY ZIP: 10172 SC 14D1 1 ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 --------------------- SCHEDULE 14D-1 Tender Offer Statement Pursuant to Section 14(d)(1) of the Securities Exchange Act of 1934 OUTBOARD MARINE CORPORATION (Name of Subject Company) GREENMARINE ACQUISITION CORP. A Wholly-Owned Subsidiary of GREENMARINE HOLDINGS LLC (Bidders) SCHEDULE 13D Under the Securities Exchange Act of 1934 (Amendment No. 3)
Greenlake Holdings LLC Greenhouse Partners, L.P. Greenhut Overseas, L.L.C. Greenway Partners, L.P. Greenhut, LLC Alfred D. Kingsley Greentree Partners, L.P. Greenbelt Corp. Gary K. Duberstein Greensea Offshore, L.P. and
SCHEDULE 13D Under the Securities Exchange Act of 1934 (Initial Filing)
Greenmarine Holdings LLC QIH Management Investor, L.P. Stanley F. Drunkenmiller Greenmarine Acquisition Corp. QIH Management Inc. Quasar International Fund N.V. Quantum Industrial Holdings Ltd. Soros Fund Management LLC Quasar International Partners C.V. Quantum Industrial Partners LDC George Soros Quaser Strategic Partners LDC
Common Stock, $.15 Par Value ---------------------------- (Title of Class of Securities) 690020102 ------------------------------------- (CUSIP Number of Class of Securities) Gary K. Duberstein, Esq. GREENMARINE ACQUISITION CORP. 277 Park Avenue, 27th Floor New York, New York 10172 (212) 350-5100 --------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications on Behalf of Bidder) Copies to: David E. Zeltner, Esq. Patrick J. Dooley, Esq. WEIL, GOTSHAL & MANGES LLP AKIN, GUMP, STRAUSS, HAUER & FELD LLP 767 Fifth Avenue 590 Madison Avenue New York, New York 10153 New York, New York 10022 (212) 310-8000 (212) 872-1000 CALCULATION OF FILING FEE - -------------------------------------------------------------------------------- Transaction Valuation 327,995,352* Amount of Filing Fee 65,600** - -------------------------------------------------------------------------------- / / 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: None Filing Party: N/A -------------- ---------------- Form or registration no.: N/A Date filed: N/A ------------ ---------------- - ------------ * Pursuant to, and as provided by, Rule 0-11(d), and for the purpose of calculating filing fees only, this amount assumes the purchase at $18.00 cash per share of 18,221,964 shares of the common stock of the Subject Company, par value $0.15 per share ("Shares"), which is equal to the total number of Shares outstanding as reported in the Quarterly Report on Form 10-Q of Outboard Marine Corporation for the quarter ended June 30, 1997, less 2,000,000 Shares owned beneficially by Bidders and their affiliates. ** 1/50 of 1% of Transaction Valuation. ================================================================================ - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS GREENLAKE HOLDINGS LLC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 2,000,000 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 2,000,000 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,000,000 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 9.9% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON OO - -------------------------------------------------------------------------------- 2 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS GREENWAY PARTNERS, L.P. S.S. OR I.R.S. IDENTIFICATION 13-3714238 NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS N/A - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON PN - -------------------------------------------------------------------------------- 3 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS GREENTREE PARTNERS, L.P. S.S. OR I.R.S. IDENTIFICATION 13-3752875 NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS N/A - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON PN - -------------------------------------------------------------------------------- 4 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS GREENHOUSE PARTNERS, L.P. S.S. OR I.R.S. IDENTIFICATION 13-3793447 NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS N/A - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON PN - -------------------------------------------------------------------------------- 5 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS GREENHUT, L.L.C. S.S. OR I.R.S. IDENTIFICATION 13-3793450 NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS N/A - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON OO - -------------------------------------------------------------------------------- 6 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS GREENBELT CORP. S.S. OR I.R.S. IDENTIFICATION 13-3791931 NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS N/A - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- 7 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS GREENSEA OFFSHORE, L.P. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS N/A - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON PN - -------------------------------------------------------------------------------- 8 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS GREENHUT OVERSEAS, L.L.C. S.S. OR I.R.S. IDENTIFICATION 13-3868906 NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS N/A - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES /X/ - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON OO - -------------------------------------------------------------------------------- 9 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS ALFRED D. KINGSLEY S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 2,000,000 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 2,000,000 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,000,000 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 9.9% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- 10 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS GARY K. DUBERSTEIN S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 2,000,000 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 2,000,000 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,000,000 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 9.9% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- 11 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS GREENMARINE HOLDING LLC S.S. OR I.R.S. IDENTIFICATION 13-3960749 NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS AF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON OO - -------------------------------------------------------------------------------- 12 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS GREENMARINE ACQUISITION CORP. S.S. OR I.R.S. IDENTIFICATION 13-3960743 NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO,BF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- 13 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS QUANTUM INDUSTRIAL HOLDINGS LTD. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION British Virgin Islands - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- 14 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS QUANTUM INDUSTRIAL PARTNERS LDC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS WC - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON OO; IV - -------------------------------------------------------------------------------- 15 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS QIH MANAGEMENT INVESTOR, L.P. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON PN; IA - -------------------------------------------------------------------------------- 16 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS QIH MANAGEMENT, INC. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- 17 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS SOROS FUND MANAGEMENT, LLC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON OO; IA - -------------------------------------------------------------------------------- 18 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS MR. GEORGE SOROS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IA - -------------------------------------------------------------------------------- 19 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS MR. STANLEY F. DRUCKENMILLER S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IA - -------------------------------------------------------------------------------- 20 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS QUASAR INTERNATIONAL FUND N.V. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- 21 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS QUASAR INTERNATIONAL PARTNERS, C.V. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Netherlands Antilles - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON PN - -------------------------------------------------------------------------------- 22 - ------------------------ ------------------------ CUSIP No. 690020102 14D-1 Page_____ of _____ Pages - ------------------------ ------------------------ - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS QUASAR STRATEGIC PARTNERS LDC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS AF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(E) OR 2(F) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER 0 NUMBER OF SHARES -------------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER 0 OWNED BY EACH -------------------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER 0 PERSON WITH -------------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 0 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0 - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON OO; IV - -------------------------------------------------------------------------------- 23 This Tender Offer Statement on Schedule 14D-1 (the "Schedule 14D-1") relates to the offer by Greenmarine Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of Greenmarine Holdings LLC, a Delaware limited liability company ("Parent"), the members of which are Quasar Strategic Partners LDC, a Cayman Islands limited duration company ("QSP"), Quantum Industrial Partners LDC, a Cayman Islands limited duration company ("QIP"), and Greenlake Holdings LLC, a Delaware limited liability company ("Greenlake"), to purchase all outstanding shares of common stock, $0.15 par value per share (the "Shares") of Outboard Marine Corporation, a Delaware corporation (the "Company"), including the associated preferred stock purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated as of April 24, 1996 (as amended, the "Rights Agreement"), by and between the Company and First Chicago Trust Company of New York, as Rights Agent, at $18 per Share, net to the seller in cash, upon the terms and subject to the conditions set forth in the Offer to Purchase dated August 8, 1997 (the "Offer to Purchase") and in the related Letter of Transmittal (which together constitute the "Offer"). The Purchaser, the Parent, QSP, QIP, and Greenlake are referred to collectively herein as the "Reporting Persons". This Schedule 14D-1 also constitutes Amendment No. 3 to the Statement on Schedule 13D previously filed by Greenway Partners, L.P., a Delaware limited partnership, Greentree Partners, L.P., a Delaware limited partnership, Greenhouse Partners, L.P., a Delaware limited partnership, Greenhut, LLC, a Delaware limited liability company, Greenbelt Corp., a Delaware corporation, Greensea Offshore, L.P., a Cayman Islands limited partnership, Greenhut Overseas, L.L.C., a Delaware limited liability company (collectively, the "Transferors"), Alfred D. Kingsley and Gary K. Duberstein. The Transferors, as indicated in Item 6(b) below, transferred beneficial ownership of all of their Shares, which in the aggregate constitutes 2,000,000 Shares (and, as described in Item 6(a) below, represents 9.9% of the issued and outstanding Shares), to Greenlake, which may be deemed to be beneficially owned by Messrs. Kingsley and Duberstein and may be deemed to be part of a group with Messrs. Kingsley and Duberstein (the "Greenlake Group"). In addition, this Schedule 14D-1 constitutes the initial filing of a statement on Schedule 13D by Parent, Purchaser, QSP, QIP, Quantum Industrial Holdings Ltd., a British Virgin Islands corporation, QIH Management Investor, L.P., a Delaware limited partnership, QIH Management Inc., a Delaware corporation, Soros Fund Management LLC, a Delaware limited liability company, Quasar International Fund N.V., a Netherlands Antilles limited liability company, Quasar International Partners C.V., a Netherlands Antilles limited partnership, George Soros and Stanley F. Druckenmiller, who may be deemed to be part of a group, for purposes of Schedule 13D, with the Greenlake Group by virtue of the contractual arrangements relating to the formation of Parent and Purchaser and the Offer, as more fully described or incorporated by reference into this Schedule 14D-1; however, none of such persons affirms the existence of any such group. The item numbers and responses thereto below are in accordance with the requirements of Schedule 14D-1. Information relating to members of the Greenlake Group in this Schedule 14D-1 and the related Offer to Purchase has been provided by Greenlake Holdings LLC. Information relating to persons other than the Greenlake Group in this Schedule 14D-1 and the related Offer to Purchase has been provided individually by such person. ITEM 1. SECURITY AND SUBJECT COMPANY. (a) The name of the subject company is Outboard Marine Corporation. The address of the principal executive offices of the Company is set forth in Section 8 ("Certain Information Concerning the Company") of the Offer to Purchase and is incorporated herein by reference. (b) The exact title of the class of equity securities being sought in the Offer is the Common Stock, par value $0.15 per share, of the Company. The information set forth in the Introduction to 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) through (d), and (g): The information set forth in the Introduction and Section 9 ("Certain Information Concerning the Purchaser and the Parent") of the Offer to Purchase, and in Schedule I thereto, is incorporated herein by reference. 24 (e) and (f): None of the Purchaser or Parent, nor, to the best of their knowledge, any of the persons listed in Schedule I of the Offer to Purchase, has during the last five years (i) been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) been 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) None. (b) The information set forth in Section 9 ("Certain Information Concerning the Purchaser and the Parent") Section 10 ("Background of the Offer; Contacts with the Company") of the Offer to Purchase is incorporated herein by reference. ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. (a) and (b): The information set forth in Section 12 ("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) through (e): The information set forth in the Introduction, Section 10 ("Background of the Offer; Contacts with the Company") and Section 11 ("Purpose of the Offer and the Merger; Plans for the Company") of the Offer to Purchase is incorporated herein by reference. Except as set forth in the Introduction, Section 10, and Section 11 of the Offer to Purchase, neither the Purchaser nor the Parent has any present plans or proposals that would result in an extraordinary corporate transaction, such as a merger, reorganization, liquidation or sale or transfer of a material amount of assets involving the Company, or any other material changes in the Company's capitalization, dividend policy, corporate structure or business or composition of its management or personnel. (f) and (g): The information set forth in Section 7 ("Effect of the Offer on the Market for the Shares; Stock Exchange Listing, Exchange Act Registration; Margin Regulations") of the Offer to Purchase is incorporated herein by reference. ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY. (a) As of the date of this Schedule 14D-1, the Reporting Persons beneficially owned in the aggregate 2,000,000 Shares constituting 9.9% of outstanding Shares (the percentage of Shares owned being based upon 20,221,964 Shares outstanding as of July 31, 1997 as set forth in the Quarterly Report on Form 10-Q of the Company for the quarter ended June 30, 1997. The information set forth in Section 9 ("Certain Information Concerning the Purchaser and the Parent") of the Offer to Purchase is incorporated herein by reference. (b) The information set forth in Schedule II ("Transaction in Shares within 60 days prior to the Offer") 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 and Section 9 ("Certain Information Concerning the Purchaser and the Parent") 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 in Section 16 ("Certain Fees and Expenses") of the Offer to Purchase is incorporated herein by reference. 25 ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS. The information set forth in Section 9 ("Certain Information Concerning the Purchaser and the Parent") of the Offer to Purchase is incorporated herein by reference. The incorporation by reference herein of the above-mentioned financial information does not constitute an admission that such information is material to a decision by a security holder of the Company as whether to sell, tender or hold securities being sought in the Offer. ITEM 10. ADDITIONAL INFORMATION. (a) None. (b) and (c): The information set forth in Section 15 ("Certain Regulatory and Legal Matters") of the Offer to Purchase is incorporated herein by reference. (d) The information set forth in Section 7 ("Effect of the Offer on the Market for the Shares; Stock Exchange Listing; Exchange Act Registration; Margin Regulations") and Section 15 ("Certain Regulatory and Legal Matters") of the Offer to Purchase is incorporated herein by reference. (e) The information set forth in the Introduction and Section 11 ("Purpose of the Offer and the Merger; Plans for the Company") of the Offer to Purchase is incorporated herein by reference. (f) The information set forth in the Offer to Purchase and the Letter of Transmittal is incorporated herein by reference in their entirety. ITEM 11. MATERIAL TO BE FILED AS EXHIBITS. (a)(1) Offer to Purchase, dated August 8, 1997. (a)(2) Letter of Transmittal. (a)(3) Letter from Greenmarine Acquisition Corp., to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (a)(4) Letter from Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees to Clients. (a)(5) Notice of Guaranteed Delivery. (a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9. (a)(7) Summary Announcement, dated August 8, 1997. (a)(8) Press Release issued by the Purchaser on August 7, 1997. (b)(1) Financing Commitment Letter, dated August 7, 1997, among Purchaser and American Financial Group, Inc. (c)(1) Operating Agreement of Greenmarine Holdings LLC dated August 7, 1997 by and among the members signatory thereto. (d) None. (e) Not applicable. (f) Not applicable. 26 SIGNATURE After due inquiry and to the best of its knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: August 8, 1997 GREENLAKE HOLDINGS LLC By: /s/ Gary K. Duberstein ------------------------------- Gary K. Duberstein Member GREENWAY PARTNERS, L.P. By: Greenhouse Partners, L.P., its general partner By: /s/ Gary K. Duberstein ------------------------------- Gary K. Duberstein General Partner GREENTREE PARTNERS, L.P. By: Greenhut, L.L.C., its general partner By: /s/ Gary K. Duberstein ------------------------------- Gary K. Duberstein Member GREENHOUSE PARTNERS, L.P. By: /s/ Gary K. Duberstein ------------------------------- Gary K. Duberstein General Partner GREENHUT, L.L.C. By: /s/ Gary K. Duberstein ------------------------------- Gary K. Duberstein Member GREENBELT CORP. By: /s/ Alfred D. Kingsley ------------------------------- Alfred D. Kingsley President 27 GREENSEA OFFSHORE, L.P. By: Greenhut Overseas, L.L.C., its investment general partner By: /s/ Gary K. Duberstein ------------------------------- Gary K. Duberstein Member GREENHUT OVERSEAS, L.L.C. By: /s/ Gary K. Duberstein ------------------------------- Gary K. Duberstein Member By: /s/ Alfred D. Kingsley ------------------------------- Alfred D. Kingsley By: /s/ Gary K. Duberstein ------------------------------- Gary K. Duberstein GREENMARINE HOLDINGS LLC By: /s/ Gary K. Duberstein ------------------------------- Gary K. Duberstein Title: Member GREENMARINE ACQUISITION CORP. By: /s/ Gary K. Duberstein ------------------------------- Gary K. Duberstein Title: Vice-President QUANTUM INDUSTRIAL HOLDINGS LTD. By: /s/ Michael C. Neus ------------------------------- Michael C. Neus Attorney-in-Fact QUANTUM INDUSTRIAL PARTNERS LDC By: /s/ Michael C. Neus ------------------------------- Michael C. Neus Attorney-in-Fact 28 QIH MANAGEMENT INVESTOR, L.P. By: QIH Management, Inc., its General Partner By: /s/ Michael C. Neus ------------------------------- Michael C. Neus Vice President QIH MANAGEMENT, INC. By: /s/ Michael C. Neus ------------------------------- Michael C. Neus Vice President SOROS FUND MANAGEMENT LLC By: /s/ Michael C. Neus ------------------------------- Michael C. Neus Assistant General Counsel GEORGE SOROS By: /s/ Michael C. Neus ------------------------------- Michael C. Neus Attorney-in-Fact STANLEY F. DRUCKENMILLER By: /s/ Michael C. Neus ------------------------------- Michael C. Neus Attorney-in-Fact QUASAR INTERNATIONAL FUND N.V. By: /s/ Michael C. Neus ------------------------------- Michael C. Neus Attorney-in-Fact QUASAR INTERNATIONAL PARTNERS C.V. By: /s/ Michael C. Neus ------------------------------- Michael C. Neus Attorney-in-Fact 29 QUASAR STRATEGIC PARTNERS LDC By: /s/ Michael C. Neus ------------------------------- Michael C. Neus Attorney-in-Fact 30 EXHIBIT INDEX
Exhibit Description Page No. - ------- ----------- -------- (a)(1) Offer to Purchase, dated August 8, 1997. -- (a)(2) Letter of Transmittal -- (a)(3) Letter from Greenmarine Acquisition Corp. to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees -- (a)(4) Letter from Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees to Clients -- (a)(5) Notice of Guaranteed Delivery -- (a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9. -- (a)(7) Summary Announcement, dated August 8, 1997 -- (a)(8) Press Release issued by Purchaser on August 7, 1997. -- (b)(1) Financing Commitment Letter, dated August 7, 1997, among Purchaser and American Financial Group, Inc. -- (c)(1) Operating Agreement of Greenmarine Holdings LLC dated August 7, 1997 by and among the Members signatory thereto. -- (d) None. -- (e) Not applicable. -- (f) Not applicable. --
EX-99.(A)(1) 2 EXHIBIT 99.(A)(1) Offer to Purchase for Cash All Outstanding Shares of Common Stock (Including the Associated Preferred Stock Purchase Rights) of OUTBOARD MARINE CORPORATION at $18.00 Net Per Share by GREENMARINE ACQUISITION CORP. a wholly-owned subsidiary of GREENMARINE HOLDINGS LLC THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON MONDAY, SEPTEMBER 8, 1997, UNLESS THE OFFER IS EXTENDED. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY TENDERED AND NOT PROPERLY WITHDRAWN PRIOR TO THE EXPIRATION DATE THAT NUMBER OF SHARES THAT, WHEN ADDED TO THE NUMBER OF SHARES BENEFICIALLY OWNED BY THE PURCHASER AND THE PARENT, WOULD REPRESENT 90% OF ALL OUTSTANDING SHARES ON THE DATE OF PURCHASE AND, AS A RESULT THEREOF, THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT ON THE DATE OF PURCHASE IT WILL BE ABLE TO CONSUMMATE THE PROPOSED SECOND-STEP MERGER AS A "SHORT-FORM MERGER" PURSUANT TO THE PROVISIONS OF SECTION 253 OF THE DELAWARE GENERAL CORPORATION LAW IMMEDIATELY AFTER CONSUMMATION OF THE OFFER, (2) THE COMPANY'S PREFERRED STOCK PURCHASE RIGHTS BEING REDEEMED BY THE BOARD OF DIRECTORS OF THE COMPANY OR THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT SUCH RIGHTS HAVE BEEN INVALIDATED OR ARE OTHERWISE INAPPLICABLE TO THIS OFFER AND THE PROPOSED MERGER DESCRIBED HEREIN, (3) THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE PROPOSED MERGER CAN BE CONSUMMATED WITHOUT THE NEED FOR A SUPERMAJORITY VOTE OF THE COMPANY'S STOCKHOLDERS PURSUANT TO ARTICLE EIGHTEENTH OF THE COMPANY'S RESTATED CERTIFICATE OF INCORPORATION, (4) THE PURCHASER SHALL HAVE RECEIVED THE LOAN PROCEEDS COMMITTED TO BE PROVIDED BY AMERICAN FINANCIAL GROUP, INC. ("AFG") IN ACCORDANCE WITH THE COMMITMENT LETTER ISSUED BY AFG TO THE PURCHASER, DATED AUGUST 7, 1997, (5) THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT, UPON CONSUMMATION OF THE OFFER AND THE MERGER, THE COMPANY WILL NOT BE IN DEFAULT UNDER ANY INSTRUMENT EVIDENCING THE COMPANY'S THEN OUTSTANDING INDEBTEDNESS, OR, IF IN DEFAULT, THE PURCHASER AND THE PARENT HAVING OBTAINED, PRIOR TO THE EXPIRATION DATE, ON TERMS REASONABLY ACCEPTABLE TO THE PARENT, SUFFICIENT FINANCING TO ENABLE THE COMPANY TO REFINANCE OR REDEEM ANY SUCH INDEBTEDNESS UPON CONSUMMATION OF THE OFFER AND THE MERGER, AND (6) THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE PREVIOUSLY ANNOUNCED AGREEMENT AND PLAN OF MERGER BETWEEN THE COMPANY AND DETROIT DIESEL CORPORATION HAS BEEN TERMINATED IN ACCORDANCE WITH ITS TERMS. THE OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS CONTAINED IN THIS OFFER TO PURCHASE. SEE THE INTRODUCTION AND SECTIONS 1, 12, 14 AND 15. --------------------- IMPORTANT THE PARENT INTENDS TO SEEK TO NEGOTIATE WITH THE COMPANY WITH RESPECT TO THE ACQUISITION OF THE COMPANY BY THE PARENT OR THE PURCHASER. THERE CAN BE NO ASSURANCE, HOWEVER, THAT THE PARENT'S EFFORTS WILL RESULT IN AN AGREEMENT WITH THE COMPANY. THE PURCHASER AND THE PARENT RESERVE THE RIGHT TO AMEND THE OFFER, INCLUDING, BUT NOT LIMITED TO, UPON ENTERING INTO A MERGER AGREEMENT WITH THE COMPANY. ACCORDINGLY, SUCH NEGOTIATIONS COULD RESULT IN, AMONG OTHER THINGS, TERMINATION OF THE OFFER AND SUBMISSION OF A DIFFERENT ACQUISITION PROPOSAL TO THE COMPANY'S STOCKHOLDERS FOR THEIR APPROVAL. Any stockholder desiring to tender all or any portion of such stockholder's Shares (and the associated Rights) should either (a) complete and sign the Letter of Transmittal (or a facsimile thereof) in accordance with the instructions in the Letter of Transmittal, have such stockholder's signature thereon guaranteed if required by Instruction 1 to the Letter of Transmittal, mail or deliver the Letter of Transmittal (or such facsimile), or, in the case of a book-entry transfer effected pursuant to the procedure set forth in Section 3, an Agent's Message (as defined herein), and any other required documents to the Depositary and either deliver the certificates for such Shares and, if separate, the certificate(s) representing the associated Rights to the Depositary along with the Letter of Transmittal (or facsimile thereof) or deliver such Shares (and Rights, if applicable) pursuant to the procedure for book-entry transfer set forth in Section 3, or (b) request such stockholder's broker, dealer, commercial bank, trust company or other nominee to effect the transaction for such stockholder. A stockholder whose Shares and, if applicable, Rights are registered in the name of a broker, dealer, commercial bank, trust company or other nominee must contact such broker, dealer, commercial bank, trust company or other nominee if such stockholder desires to tender such Shares and, if applicable, Rights. If a Distribution Date (as defined in Section 11) occurs, stockholders will be required to tender one Right for each Share tendered in order to effect a valid tender of such Share. A stockholder who desires to tender such stockholder's Shares (and Rights, if applicable) and whose certificates representing such Shares (and Rights, if applicable) are not immediately available or who cannot comply with the procedures for book-entry transfer on a timely basis may tender such Shares (and Rights, if applicable) by following the procedures for guaranteed delivery set forth in Section 3. Questions and requests for assistance may be directed to the Information Agent at its address and telephone number set forth on the back cover of this Offer to Purchase. Additional copies of this Offer to Purchase, the Letter of Transmittal, the Notice of Guaranteed Delivery and other related materials may be obtained from the Information Agent. --------------------- August 8, 1997 TABLE OF CONTENTS INTRODUCTION ............................................................................ 1 THE TENDER OFFER ......................................................................... 6 1. Terms of the Offer; Expiration Date ................................................ 6 2. Acceptance for Payment and Payment ................................................ 8 3. Procedures for Accepting the Offer and Tendering Shares and Rights .................. 9 4. Withdrawal Rights .................................................................. 12 5. Certain Federal Income Tax Consequences ............................................. 12 6. Price Range of the Shares; Dividends ................................................ 13 7. Effect of the Offer on the Market for the Shares; Stock Exchange Listing; Exchange Act Registration; Margin Regulations ................................................... 14 8. Certain Information Concerning the Company .......................................... 15 9. Certain Information Concerning the Purchaser and the Parent ........................ 16 10. Background of the Offer; Contacts with the Company .................................. 21 11. Purpose of the Offer and the Merger ................................................. 22 12. Source and Amount of Funds .......................................................... 29 13. Dividends and Distributions ....................................................... 31 14. Certain Conditions of the Offer .................................................... 32 15. Certain Regulatory and Legal Matters .............................................. 33 16. Certain Fees and Expenses .......................................................... 34 17. Miscellaneous ...................................................................... 35 Schedule I -- DIRECTORS, EXECUTIVE OFFICERS OR CONTROLLING PERSONS OF THE ACQUIRORS ................................................................... 36 Schedule II -- TRANSACTIONS IN SHARES WITHIN 60 DAYS PRIOR TO THE OFFER ................... 41
To: All Holders of Shares of Common Stock (Including the Associated Preferred Stock Purchase Rights) of Outboard Marine Corporation INTRODUCTION Greenmarine Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly-owned subsidiary of Greenmarine Holdings LLC, a Delaware limited liability company (the "Parent"), hereby offers to purchase all outstanding shares of common stock, par value $0.15 per share (the "Shares"), of Outboard Marine Corporation, a Delaware corporation (the "Company"), together with (unless and until the Purchaser declares that the Rights Condition (as defined below) is satisfied) the associated preferred stock purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated as of April 24, 1996 (as amended, the "Rights Agreement"), by and between the Company and First Chicago Trust Company of New York, as Rights Agent, at a price of $18.00 per Share (and associated Right), net to the seller in cash, without interest thereon (the "Offer Price"), upon the terms and subject to the conditions set forth in this Offer to Purchase and in the related Letter of Transmittal (which, together with any amendments or supplements hereto or thereto, collectively constitute the "Offer"). Unless the context otherwise requires, all references to Shares shall include the Rights and all references to the Rights shall include all benefits that may inure to holders of the Rights pursuant to the Rights Agreement. The members of the Parent are Greenlake Holdings LLC, a Delaware limited liability company ("Greenlake"), Quasar Strategic Partners LDC, a Cayman Islands limited duration company ("QSP"), and Quantum Industrial Partners LDC, a Cayman Islands limited duration company ("QIP"). Each of Greenlake, QSP and QIP has approximately a 30.5%, 34.75% and 34.75% interest in the Parent, respectively. Greenlake is controlled by Mr. Alfred D. Kingsley and Mr. Gary K. Duberstein, each of whom are principals of Greenway Partners, L.P. The principal business of Greenway Partners, L.P. is investing in securities. See Section 9. QSP is an indirect subsidiary of Quasar International Fund N.V., a Netherlands Antilles limited liability company ("Quasar"). QIP is the principal operating subsidiary of Quantum Industrial Holdings Ltd., a British Virgin Islands corporation ("QIH"). Quasar and QIH are investment funds which have as their principal investment advisors Soros Fund Management LLC ("SFM LLC"), of which Mr. George Soros serves as Chairman. The Purchaser, the Parent, QSP, QIP and Greenlake are sometimes collectively referred to herein as, the "Acquirors." 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, transfer taxes on the purchase of Shares pursuant to the Offer. The Purchaser will pay all fees and expenses of Marine Midland Bank, which is acting as the Depositary (the "Depositary"), and Georgeson & Company Inc., which is acting as Information Agent (the "Information Agent"), incurred in connection with the Offer. See Section 16. On July 9, 1997, the Company and Detroit Diesel Corporation, a Delaware corporation ("DDC"), announced that they and OMC Acquisition Corp., a Delaware corporation and a wholly-owned subsidiary of DDC ("OMC Acquisition"), had entered into an Agreement and Plan of Merger dated as of July 8, 1997 (the "DDC Merger Agreement"). In accordance with the DDC Merger Agreement and pursuant to OMC Acquisition's Offer to Purchase, dated July 15, 1997 (the "DDC Offer to Purchase"), a copy of which is filed as Exhibit (a)(1) to the Tender Offer Statement on Schedule 14D-1, dated July 15, 1997, with respect to the DDC Offer (as defined below) (as amended, the "DDC Schedule 14D-1"), filed by DDC and OMC Acquisition with the Securities and Exchange Commission (the "Commission"), OMC Acquisition is currently offering (the "DDC Offer") to purchase 13,842,619 Shares at a purchase price of $16.00 per Share (if validly tendered and not withdrawn prior to August 11, 1997, the "DDC Minimum Condition"), net to the seller in cash, without interest, upon the terms and subject to the conditions set forth in full therein. According to the DDC Offer to Purchase, in the event the DDC Offer is consummated, the DDC Merger Agreement provides that, subject to the satisfaction or waiver of certain conditions set forth therein, OMC Acquisition will merge with and into the Company (the "DDC Merger"), with the Company as the surviving corporation of the DDC Merger. According to the DDC Offer to Purchase, pursuant to the DDC Merger Agreement, at the effective time of the DDC Merger (the "DDC Effective Time"), each then issued and outstanding Share (other than Shares held by the Company as treasury stock, Shares owned by OMC Acquisition or DDC or Shares held by shareholders who perfect their appraisal rights under the Delaware General Corporation Law, as amended (the "DGCL") (the "Exchanged Shares"), will be converted into and represent the right to receive (a) a fractional share of the common stock of DDC equal to 4,000,000 divided by the number of Exchanged Shares (the "Exchange Ratio"), plus (b) a cash payment equal to (i) $16.00 minus (ii) the product of the Exchange Ratio times $25.00, plus (c) in the event the average closing price of common stock of DDC on the New York Stock Exchange ("NYSE") prior to the closing date of the DDC Merger (the "DDC Closing Date Market Price") is less than $25.00, then an additional cash payment equal to the product of the Exchange Ratio multiplied by the lesser of (i) $25.00 minus the DDC Closing Date Market Price or (ii) $6.00. According to the DDC Offer to Purchase, the DDC Merger Agreement may be terminated and the DDC Merger abandoned under certain circumstances described in the DDC Merger Agreement, including, but not limited to, (i) by the Company, at any time prior to the acceptance for payment of Shares by OMC Acquisition pursuant to the DDC Offer, if there is an Alternative Proposal (as defined in the DDC Merger Agreement) which the Company's Board of Directors in good faith determines represents a superior transaction for the shareholders of the Company as compared to the DDC Offer and the DDC Merger, and the Company's Board of Directors determines, after consultation with outside counsel and its financial advisor, that it is required by its fiduciary duties to the Company's shareholders imposed by law to terminate the DDC Merger Agreement and the Company pays to DDC the DDC Termination Fee (as defined below); provided, however, that the right to terminate the DDC Merger Agreement under this circumstance shall not be available (a) if such Alternative Proposal results from a breach in any material respect of the Company's "non-solicitation" covenant under the DDC Merger Agreement or (b) if the Company has not provided DDC and OMC Acquisition with at least two business days' prior written notice of its intent to so terminate the DDC Merger Agreement together with a summary of the material terms and conditions of the Alternative Proposal, or (ii) by DDC, if the Company's Board of Directors shall have failed to recommend, or shall have withdrawn, modified or amended in any manner adverse to DDC or OMC Acquisition its approval or recommendation of the DDC Offer or the DDC Merger, or shall have recommended acceptance of any Alternative Proposal. According to the DDC Offer to Purchase, the Company has agreed in the DDC Merger Agreement that, in the event that (i) the Company's Board of Directors shall publicly modify or amend its recommendation of the DDC Offer or the DDC Merger in a manner adverse to DDC or shall withdraw its recommendation of the DDC Offer or shall recommend any Alternative Proposal, or shall resolve to do any of the foregoing, or (ii) at any time prior to the termination of the DDC Merger Agreement any person (other than DDC or any of its affiliates) shall publicly announce any Alternative Proposal and, at any time on or prior to one year after the date of the DDC Merger Agreement, shall become the beneficial owner of 33% or more of the outstanding Shares or shall consummate an Alternative Proposal, then in any such event the Company shall promptly, but in no event later than two business days after the first of such events to occur, pay DDC an amount equal to $15,750,000 (the "DDC Termination Fee"), which shall be in lieu of any and all damages, costs, and expenses, for breach of the DDC Merger Agreement by the Company. The foregoing description of the DDC Merger Agreement is qualified in its entirety by reference to the full text thereof, a copy of which has been filed by OMC Acquisition and DDC as an exhibit to the DDC Schedule 14D-1 and may be obtained in the manner described in Section 8 (except that copies may not be available at regional offices of the Commission). By tendering Shares to the Purchaser in the Offer, the Company's stockholders effectively will be given the opportunity to express to the Company's Board of Directors that they wish to be able to accept the Purchaser's Offer and to approve the proposed Merger (as defined below). Merger And Plans The purpose of the Offer is to acquire control of, and the entire equity interest in, the Company. The Offer, as the first step in the acquisition of the Company, is intended to facilitate the acquisition of all outstanding Shares. The Parent currently intends, immediately following consummation of the Offer, to seek to have the Company consummate a merger or similar business combination with the Purchaser or another direct or indirect wholly-owned subsidiary of the Purchaser (the "Merger"), pursuant to which each then outstanding Share (other 2 than Shares held by the Purchaser, the Parent or any of their respective wholly-owned subsidiaries, treasury shares and Shares held by shareholders who properly exercise appraisal rights available to them under Section 262 of the DGCL) would be converted into the right to receive in cash the price per Share paid by the Purchaser pursuant to the Offer. Although the Purchaser will seek to have the Company consummate the Merger immediately after consummation of the Offer, if the Board of Directors of the Company opposes the Offer and the Merger, certain terms of the Rights, and certain provisions of the DGCL and the Company's Restated Certificate of Incorporation (as amended, the "Charter") and By-Laws (as amended, the "By-Laws"), may affect the ability of the Purchaser to obtain control of the Company and to effect the Merger. Accordingly, the timing and details of the Merger will depend on a variety of factors and legal requirements, the actions of the Board of Directors of the Company, the number of Shares (if any) acquired by the Purchaser pursuant to the Offer, and whether the Minimum Condition, the Rights Condition, the Funding Condition, the Supermajority Condition, the OMC Indebtedness Condition and the DDC Termination Condition (each as defined below), and the other conditions set forth in Section 14 are satisfied or waived. If the Purchaser and the Parent collectively own at least 90% of the outstanding Shares following the consummation of the Offer or otherwise, the Purchaser intends to attempt to effect the Merger pursuant to the "short-form merger" provisions of Section 253 of the DGCL immediately following the purchase of Shares in the Offer. There can be no assurance that the Purchaser will be able to consummate the Offer or, if the Offer is consummated, will in fact effectuate the Merger. See below and see Sections 10 and 11. The Parent intends to seek to negotiate with the Company with respect to the acquisition of the Company by the Parent or the Purchaser. There can be no assurance, however, that the Parent's efforts will result in an agreement with the Company. The Purchaser and the Parent reserve the right to amend the Offer, including, but not limited to, upon entering into a merger agreement with the Company. Accordingly, such negotiations could result in, among other things, termination of the Offer and submission of a different acquisition proposal to the Company's stockholders for their approval. See Section 1 and Section 14. In addition, the Purchaser reserves the right to acquire additional Shares after consummation of the Offer in open market purchases, through a tender offer, in privately negotiated transactions or otherwise, in order to obtain a sufficient number of Shares to approve the transactions contemplated hereby. Certain Conditions to the Offer The Offer is subject to the fulfillment of certain conditions, including the following: Minimum Condition. Consummation of the Offer is conditioned upon there being validly tendered and not withdrawn prior to the Expiration Date (as defined in Section 1) that number of Shares (the "Minimum Number of Shares") that, when added to the 2,000,000 Shares beneficially owned by the Purchaser and the Parent, would represent 90% of all outstanding Shares on the date of purchase and, as a result thereof, the Purchaser being satisfied, in its sole discretion, that on the date of purchase it will be able to consummate the Merger as a "short-form merger" pursuant to the provisions of Section 253 of the DGCL immediately after consummation of the Offer (the "Minimum Condition"). SUBJECT TO THE APPLICABLE RULES AND REGULATIONS OF THE COMMISSION, THE PURCHASER RESERVES THE RIGHT, WHICH IT PRESENTLY HAS NO INTENTION OF EXERCISING, TO WAIVE OR REDUCE THE MINIMUM CONDITION AND TO ELECT TO PURCHASE, PURSUANT TO THE OFFER, FEWER THAN THE MINIMUM NUMBER OF SHARES. SEE SECTION 1. Upon the terms and subject to the conditions of the Offer, if more than the Minimum Number of Shares are validly tendered on or prior to the Expiration Date and not withdrawn in accordance with Section 4 of this Offer to Purchase, the Purchaser will accept for payment and pay for such Shares. According to the Company's Form 10-Q for the quarterly period ended June 30, 1997 (the "June 1997 Form 10-Q"), there were 20,221,964 Shares issued and outstanding as of July 31, 1997. According to the DDC Offer to Purchase, the Company advised DDC that there were, as of June 30, 1997, options outstanding to purchase 1,430,000 Shares. Further, according to the DDC Offer to Purchase, there are outstanding convertible debt instruments of the Company convertible into approximately 3,360,000 Shares, at a conversion price of $22.25 per Share (the "Company Debentures"). Based on the foregoing and assuming that there would be 20,221,964 Shares outstanding on the date of purchase, the Minimum Number of Shares would be 16,199,768, which number excludes the 2,000,000 Shares to be beneficially owned by the Parent upon consummation of the Offer. 3 However, the actual Minimum Number of Shares will depend on the facts as they exist on the date of purchase. Greenlake beneficially owns 2,000,000 Shares (approximately 9.9% of the outstanding Shares). Greenlake acquired beneficial ownership of such Shares from Greenway Partners, L.P., Greentree Partners, L.P., Greenbelt Corp. and Greensea Offshore, L.P. Prior to the consummation of the Offer, Greenlake has agreed, among other things, to transfer such Shares to the Parent as a capital contribution. See Section 9. The Company's Charter and By-laws contain numerous provisions which may delay or ultimately preclude a change in control of the Company following the purchase of Shares by the Purchaser upon consummation of the Offer. These provisions include, but are not limited to, the following: (i) a classified board of directors consisting of three classes of directors; (ii) the inability to remove a director except for cause and with approval of the holders of 80% of the voting stock of the Company; (iii) a prohibition against the taking of stockholder action by written consent; (iv) the ability of only the Chairman of the Board, the Chief Executive Officer or three-quarters of the entire Board of Directors to call special meetings of the Company's stockholders; (v) the requirement that the holders of two-thirds of the voting stock of the Company approve amendments to certain by-laws, including those relating to special meetings of stockholders and the number and nomination of directors; and (vi) the supermajority vote and "fair price" requirements (as discussed and defined in Section 11) applicable to certain business combinations such as the Merger. As a result of these provisions, the Purchaser may be unable to consummate the Merger or the consummation of the Merger may be substantially delayed. In general, pursuant to the DGCL, the approval of both the stockholders and the board of directors of a corporation is required to effect the merger of that corporation with or into another corporation. In addition, the Purchaser's ability to consummate the Merger may be further impeded by the provisions of Section 203 of the DGCL. Section 203 of the DGCL, in general, prevents an "Interested Stockholder" (defined generally as a person owning 15% or more of a corporation's outstanding voting stock) from engaging in a "Business Combination" (defined to include a variety of transactions including a merger) with a Delaware corporation for three years following the date on which such person became an Interested Stockholder. The prohibition contained in Section 203 of the DGCL would not apply to the Merger if the Board of Directors of the Company approved the Offer and the Merger prior to consummation of the Offer, or if, after consummation of the Offer, the Purchaser owned at least 85% of the total voting stock of the Company outstanding at the time the Offer commenced (excluding Shares owned by persons who are directors and also officers of the Company and possibly excluding Shares held in certain employee stock plans). See Section 11 for a more detailed discussion of Section 203 of the DGCL. As a result of the aforementioned impediments to a change in control of the Company, assuming the Minimum Condition and the other conditions to the Offer set forth below and in Section 14 are satisfied, the Purchaser and the Parent intend to attempt to effect the Merger immediately after the Offer is consummated pursuant to the "short-form merger" provisions of Section 253 of the DGCL. Section 253 of the DGCL, in general, provides that if a parent corporation owns at least 90% of each class of the outstanding shares of capital stock of a subsidiary corporation, the parent corporation may merge with or into the subsidiary corporation without any action or vote on the part of the board of directors or the other stockholders of the subsidiary corporation. No assurance, however, can be given that the Merger will be consummated pursuant to the "short-form merger" provisions of Section 253 of the DGCL or otherwise. See Section 11 for a more complete description of the foregoing potential restrictions on the ability of the Parent to obtain control of the Company and consummate transactions subsequent to the Offer. Rights Condition. Consummation of the Offer is conditioned upon the Rights having been redeemed by the Board of Directors of the Company, or the Purchaser being satisfied, in its sole discretion, that the Rights have been invalidated or are otherwise inapplicable to the Offer and to the Merger (the "Rights Condition"). The Rights are described in the Company's Report on Form 8-A dated June 14, 1996. The Rights Agreement is appended as an exhibit thereto, and amended by Amendment No. 1 to the Rights Agreement, dated July 8, 1997. This amendment is appended to the Company's Form 8-A12B/A, dated July 10, 1997 (together with the Form 8-A, dated June 14, 1996, referenced above, the "Company 8-A"). See Section 11 for a more detailed discussion of the Rights Agreement. 4 According to the Company 8-A, at any time prior to the earlier of (i) 10 days following the initial public announcement that a person or group of affiliated persons has become an "Acquiring Person" (as defined in Section 11), or (ii) the expiration of the Rights, the Company may redeem the then outstanding Rights in whole, but not in part, at a price of $.01 per Right. The Board of Directors of the Company may not redeem any Rights after it has determined any person to be an "Adverse Person" (as defined in Section 11). According to the Company 8-A, until the earliest to occur of (i) 10 days following the first date of public announcement that a person or group of affiliated persons has become an Acquiring Person, (ii) 10 business days (or such later date as may be determined by action of the Board of Directors) following the commencement of, or announcement of an intention to make, a tender offer or exchange offer the consummation of which would result in any person becoming, or after the consummation of which any person would be, the beneficial owner of 15% or more of the outstanding Shares, or (iii) 10 days following the date on which the Company's Board of Directors has determined that an entity has become an Adverse Person (the earliest of such dates being called the "Distribution Date"), the Rights will be evidenced, with respect to any of the certificates representing Shares (the "Share Certificates") outstanding as of the Record Date (as defined in Section 11), by such Share Certificate. From and after the Distribution Date, the Rights will separate from the Shares and the Shares Certificates. Based on publicly available information, the Purchaser believes that certificates representing the Rights (the "Rights Certificates") have not been issued and the Rights are evidenced by the Share Certificates. The Purchaser believes that as a result of the commencement of the Offer, the Distribution Date will be 10 days following such commencement, or announcement of the Offer, unless prior to the Distribution Date the Company's Board of Directors redeems the Rights within such 10-day period or takes action to delay the Distribution Date. See Section 11. According to the Company's Form 8-A12B/A, dated July 10, 1997, the Company has amended the Rights Agreement so that the execution, delivery and performance of the DDC Merger Agreement will not (1) cause any Rights to become exercisable, (2) cause DDC, OMC Acquisition or any of their affiliates to become an Acquiring Person or (3) give rise to a Distribution Date or a "Triggering Date" (as defined in Section 11). IF A DISTRIBUTION DATE OCCURS, STOCKHOLDERS WILL BE REQUIRED TO TENDER ONE RIGHT FOR EACH SHARE TENDERED IN ORDER TO EFFECT A VALID TENDER OF SHARES IN ACCORDANCE WITH THE PROCEDURES SET FORTH IN SECTION 3. UNLESS THE DISTRIBUTION DATE OCCURS, A TENDER OF SHARES WILL ALSO CONSTITUTE A TENDER OF RIGHTS. The Purchaser and the Parent believe that under the circumstances of the Offer, and under applicable law, the Board of Directors of the Company has a fiduciary obligation to redeem the Rights (or amend the Rights Agreement to make the Rights inapplicable to the Offer and the proposed Merger), and the Purchaser and the Parent have and are hereby again requesting that the Company's Board of Directors do so. However, there can be no assurance that the Board will redeem the Rights (or amend the Rights Agreement). The Purchaser has commenced litigation in the Court of Chancery for the State of Delaware seeking, among other things, an order compelling the Company's Board of Directors to redeem the Rights or to amend the Rights Agreement to make the Rights inapplicable to the Offer and the proposed Merger on the grounds that failure to do so would constitute a breach of fiduciary duty to the Company's stockholders. There can be no assurance that such an order will be obtained. Funding Condition. Consummation of the Offer is conditioned upon the Purchaser receiving the loan proceeds committed to be provided by AFG in accordance with the Commitment Letter (the "Commitment Letter") issued by AFG to the Purchaser, dated August 7, 1997 (the "Funding Condition"). The total amount of funds required by the Purchaser to consummate the Offer and the Merger (assuming the outstanding Company options are not exercised and the Company Debentures are not converted) is expected to be approximately $328 million, which excludes related fees and expenses. QSP, QIP and Greenlake have committed to contribute at least $241 million and 2,000,000 Shares to the Parent for the purpose of effecting the Offer and the Merger. The Purchaser has received the Committment Letter from AFG pursuant to which, upon the terms and subject to the conditions therein, AFG has agreed to lend to the Purchaser up to $150 million to be used to effect the Offer and the Merger. See Section 12. Supermajority Condition. Consummation of the Offer is conditioned upon the Purchaser being satisfied, in its sole discretion, that the proposed Merger can be consummated without the need for a supermajority vote of the Company's stockholders pursuant to Article Eighteenth of the Company's Charter (the "Supermajority Condition"). 5 Article Eighteenth of the Charter provides that the affirmative vote of the holders of at least 75% of the voting shares of the Company held by stockholders other than a "Related Person" (as defined in Section 11 below) is required for the approval or authorization of a "Business Combination," which includes a merger involving the Company, between the Company and any Related Person (the "75% Voting Requirement"). However, the 75% Voting Requirement does not apply under the following circumstances: (i) approval of the proposed business combination by at least a majority of the directors whose tenure began prior to the Related Person's attaining Related Person status (the "Continuing Directors"), or (ii) the determination by a majority of the Continuing Directors that the cash or the fair market value of any other consideration to be received by holders of the Company's stock pursuant to the business combination is not less in amount than the "Highest Per Share Price" (as defined in Section 11) or the "Highest Equivalent Price" (as defined in Section 11 below) paid by the Related Person in acquiring any of its holdings of the Company's stock. The Purchaser believes that it and the Parent collectively will be deemed to be a Related Person for purposes of Article Eighteenth of the Charter upon consummation of the Offer. The foregoing summary of Article Eighteenth of the Charter is qualified by reference to the text thereof as filed by the Company with the Commission and which can be examined or copies thereof obtained as set forth in Section 8 (except that copies thereof may not be available at the regional offices of the Commission). OMC Indebtedness Condition. Consummation of the Offer is conditioned upon the Purchaser being satisfied, in its sole discretion, that, upon consummation of the Offer and the Merger, the Company will not be in default under any instrument evidencing the Company's then outstanding indebtedness, or, if in default, the Purchaser and the Parent having obtained, prior to the Expiration Date, on terms reasonably acceptable to the Parent, sufficient financing to enable the Company to refinance or redeem any such indebtedness upon consummation of the Offer and the Merger. According to publicly available information regarding the Company, it is possible that consummation of the Offer may result in a default under instruments pursuant to which approximately $300 million of the Company's indebtedness was issued. While the Parent will seek to obtain the requisite consents under such instruments prior to the Expiration Date, in the event that such consents are not obtained, the Parent will seek to arrange for additional financing so that upon obtaining control of the Company, the Parent will be able to cause the Company to refinance or redeem such indebtedness. DDC Termination Condition. Consummation of the Offer is conditioned upon the Purchaser being satisfied, in its sole discretion, that the DDC Merger Agreement has been terminated in accordance with its terms (the "DDC Termination Condition"). The Purchaser does not intend to consummate the Offer if at the time of such consummation the Company would be obligated to consummate the proposed DDC Merger. Certain other conditions to the consummation of the Offer are described in Section 14. Subject to the rules and regulations of the Commission, the Purchaser expressly reserves the right to waive any one or more of the conditions to the Offer. See Sections 1, 14 and 15. This Offer to Purchase and the Letter of Transmittal contain important information which should be read carefully before any decision is made with respect to the Offer. 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 any such extension or amendment), the Purchaser will accept for payment and thereby purchase all Shares validly tendered and not withdrawn in accordance with the procedures set forth in Section 4 on or prior to the Expiration Date (as hereinafter defined). The term "Expiration Date" means 5:00 p.m., New York City time, on Monday, September 8, 1997, unless and until the Purchaser, in its sole discretion, shall have extended the period of time for which the Offer is open, in which event the term "Expiration Date" shall mean the time and date at which the Offer, as so extended by the Purchaser, shall expire. THE OFFER IS CONDITIONED UPON SATISFACTION OF THE MINIMUM CONDITION, THE RIGHTS CONDITION, THE FUNDING CONDITION, THE SUPERMAJORITY CONDITION, THE OMC INDEBTEDNESS CONDITION AND THE DDC TERMINATION CONDITION, AND THE SATISFACTION OF THE OTHER CONDITIONS SET FORTH IN SECTION 14. 6 Subject to the applicable rules and regulations of the Commission, the Purchaser expressly reserves the right, in its sole discretion, at any time and from time to time, to extend the period during which the Offer is open for any reason, including the occurrence of any of the conditions specified in Section 14, by giving oral or written notice of such extension to the Depositary. During any such extension, all Shares and Rights previously tendered and not withdrawn will remain subject to the Offer and subject to the right of a tendering stockholder to withdraw such stockholder's Shares and Rights. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE FOR TENDERED SHARES, WHETHER OR NOT THE PURCHASER EXERCISES ITS RIGHTS TO EXTEND THE OFFER. See Section 4. Subject to the applicable rules and regulations of the Commission, the Purchaser also expressly reserves the right, in its sole discretion, at any time and from time to time, to (i) delay acceptance for payment of or, regardless of whether such Shares or Rights were theretofore accepted for payment, payment for any Shares or Rights pending receipt of any regulatory or governmental approvals specified in Section 15, (ii) terminate the Offer (whether or not any Shares or Rights have theretofore been accepted for payment) if any of the conditions referred to in Section 14 has not been satisfied or upon the occurrence of any of the events specified in Section 14 and (iii) waive any condition or otherwise amend the Offer in any respect, in each case, by giving oral or written notice of such delay, termination, waiver or amendment to the Depositary and by making a public announcement thereof. The Purchaser acknowledges that (i) Rule 14e-1(c) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), requires the Purchaser to pay the consideration offered or return the Shares and Rights tendered promptly after the termination or withdrawal of the Offer and (ii) the Purchaser may not delay acceptance for payment of, or payment for (except as provided in clause (i) of the preceding sentence), any Shares or Rights upon the occurrence of any of the conditions specified in Section 14 without extending the period of time during which the Offer is open. Any such extension, delay, termination, waiver or amendment will be followed as promptly as practicable by public announcement thereof, and such announcement in the case of an extension will be made no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled Expiration Date. Without limiting the manner in which the Purchaser may choose to make any public announcement, subject to applicable law (including Rules 14d-4(c) and 14d-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 to the Offer, the Purchaser will extend the Offer and disseminate additional tender offer materials to the extent required by Rules 14d-4(c) and 14d-6(d) under the Exchange Act. The minimum period during which an offer must remain open following material changes in the terms of the offer, other than a change in price or a change in percentage of securities sought or a change in any dealer's soliciting fee, 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 or a change in any dealer's soliciting fee, a minimum ten business day period from the date of such change is generally required to allow for adequate dissemination to stockholders. Accordingly, if on or prior to the Expiration Date, the Purchaser increases (other than increases of not more than two percent of the outstanding Shares) or decreases the number of Shares being sought, or increases or decreases the consideration offered pursuant to the Offer, and if the Offer is scheduled to expire at any time earlier than the period ending on the tenth business day from the date that notice of such increase or decrease is first published, sent or given to holders of Shares, the Offer will be extended at least until the expiration of such ten business day period. For purposes of the Offer, a "business day" means any day other than a Saturday, Sunday or a federal holiday and consists of the time period from 12:01 a.m. through 12:00 midnight, New York City time. If a Distribution Date occurs, stockholders will be required to tender one Right for each Share tendered to effect a valid tender of such Share. See Sections 3 and 11. A request is being made to the Company pursuant to Rule 14d-5 under the Exchange Act and Section 220 of the DGCL for the use of the Company's stockholder list, its list of holders of Rights, if any, and security 7 position listings for the purpose of disseminating the Offer to holders of Shares. Upon compliance by the Company with such request, this Offer to Purchase and the related Letter of Transmittal and, if required, other relevant materials will be mailed to record holders of Shares and Rights, if any, and will be furnished to brokers, dealers, commercial banks, trust companies and similar persons whose names, or the names of whose nominees, appear on the stockholder list and list of holders of Rights, if applicable, or who are listed as participants in a clearing agency's security position listing for subsequent transmittal to beneficial owners of Shares and Rights. 2. Acceptance for Payment and Payment. Upon the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of the Offer as so extended or amended), the Purchaser will purchase, by accepting for payment, and will pay for, all Shares validly tendered and not withdrawn (as permitted by Section 4) on or prior to the Expiration Date, promptly after the later to occur of (i) the Expiration Date and (ii) the satisfaction or waiver of the conditions to the Offer set forth in Section 14. In addition, subject to the applicable rules and regulations of the Commission, the Purchaser expressly reserves the right to delay acceptance for payment of, or payment for, Shares pending receipt of any regulatory or governmental approvals specified in Section 15. In all cases, payment for Shares purchased pursuant to the Offer will be made only after timely receipt by the Depositary of (i) Share Certificates for such Shares and, if applicable, Rights Certificates for the associated Rights, or timely confirmation (a "Book-Entry Confirmation") of the book-entry transfer of such Shares and, if applicable, Rights into the Depositary's account at The Depository Trust Company, Midwest Securities Trust Company or Philadelphia Depository Trust Company (each, a "Book-Entry Transfer Facility" and collectively, the "Book-Entry Transfer Facilities"), pursuant to the procedures set forth in Section 3, (ii) the Letter of Transmittal (or a facsimile thereof), properly completed and duly executed, with any required signature guarantees, or an Agent's Message (as defined below) in connection with a book-entry transfer, and (iii) any other documents required by the Letter of Transmittal. The term "Agent's Message" means a message, transmitted by a Book-Entry Transfer Facility to, and received by, the Depositary and forming a part of a Book-Entry Confirmation, which states that such Book-Entry Transfer Facility has received an express acknowledgment from the participant in such Book-Entry Transfer Facility tendering the Shares and, if applicable, Rights which are the subject of such Book-Entry Confirmation, that such participant has received and agrees to be bound by the terms of the Letter of Transmittal and that the Purchaser may enforce such agreement against such participant. For purposes of the Offer, the Purchaser will be deemed to have accepted for payment, and thereby purchased, Shares validly tendered and not withdrawn as, if and when the Purchaser gives oral or written notice to the Depositary of the Purchaser's acceptance of such Shares for payment pursuant to the Offer. In all cases, upon the terms and subject to the conditions of the Offer, payment for Shares purchased pursuant to the Offer will be made by deposit of the purchase price therefor with the Depositary, which will act as agent for tendering stockholders for the purposes of receiving payment from the Purchaser and transmitting payment to validly tendering stockholders. Under no circumstances will interest on the purchase price for Shares or Rights be paid by the Purchaser by reason of any delay in making such payment. If any tendered Shares are not purchased pursuant to the Offer for any reason, or if Share Certificates are submitted representing more Shares than are tendered, Share Certificates representing unpurchased or untendered Shares will be returned, without expense to the tendering stockholder (or, in the case of Shares delivered by book-entry transfer into the Depositary's account at a Book-Entry Transfer Facility pursuant to the procedures set forth in Section 3, such Shares will be credited to an account maintained within such Book-Entry Transfer Facility), as promptly as practicable following the expiration, termination or withdrawal of the Offer. In the event separate Rights Certificates are issued, similar action will be taken with respect to unpurchased and untendered Rights. If, on or prior to the Expiration Date, the Purchaser shall increase the consideration offered to holders of Shares pursuant to the Offer, such increased consideration shall be paid to all holders of Shares that are purchased pursuant to the Offer, whether or not such Shares were tendered prior to such increase in consideration. 8 The Purchaser reserves the right to transfer or assign, in whole or from time to time in part, to one or more of the Purchaser's subsidiaries or affiliates the right to purchase all or any portion of the Shares and Rights tendered pursuant to the Offer, but any such transfer or assignment will not relieve the Purchaser of its obligations under the Offer or prejudice the rights of tendering stockholders to receive payment for Shares validly tendered and accepted for payment pursuant to the Offer. 3. Procedures for Accepting the Offer and Tendering Shares and Rights. Valid Tender of Shares and Rights Except as set forth below, in order for Shares and (prior to the Distribution Date) Rights to be validly tendered pursuant to the Offer, the Letter of Transmittal (or a facsimile thereof), properly completed and duly executed, together with any required signature guarantees, or an Agent's Message in connection with a book- entry delivery of Shares and (prior to the Distribution Date) Rights, and any other documents required by the Letter of Transmittal must be received by the Depositary at its address set forth on the back cover of this Offer to Purchase on or prior to the Expiration Date and either (i) Share Certificates and Rights Certificates, if applicable, representing tendered Shares and Rights must be received by the Depositary, or such Shares and Rights must be tendered pursuant to the procedure for book-entry transfer set forth 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 set forth below must be complied with. If the Purchaser declares that the Rights Condition is satisfied, the Purchaser will not require delivery of Rights. If a Distribution Date occurs, holders of Shares will be required to tender one Right for each Share tendered in order to effect a valid tender of such Share. The method of delivery of Share Certificates, Rights Certificates (if applicable), the Letter of Transmittal and all other required documents is at the option and sole risk of the tendering stockholder, and the delivery will be deemed made only when actually received by the Depositary. If delivery is by mail, registered mail with return receipt requested, properly insured, is recommended. In all cases, sufficient time should be allowed to ensure timely delivery. Separate Delivery of Rights Certificates If the Distribution Date does not occur prior to the Expiration Date, a tender of Shares will also constitute a tender of the associated Rights. If the Distribution Date occurs and Rights Certificates are distributed by the Company to holders of Shares prior to the time a holder's Shares are tendered pursuant to the Offer, in order for Rights (and the corresponding Shares) to be validly tendered, Rights Certificates representing a number of Rights equal to the number of Shares tendered must be delivered to the Depositary or, if available, a Book-Entry Confirmation received by the Depositary with respect thereto. If the Distribution Date occurs and Rights Certificates are not distributed prior to the time Shares are tendered pursuant to the Offer, Rights may be tendered prior to a stockholder receiving Rights Certificates by use of the guaranteed delivery procedure described below. In any case, a tender of Shares constitutes an agreement by the tendering stockholder to deliver Rights Certificates representing a number of Rights equal to the number of Shares tendered pursuant to the Offer to the Depositary within five business days after the date Rights Certificates are distributed. The Purchaser reserves the right to require that the Depositary receive Rights Certificates, or a Book-Entry Confirmation, if available, with respect to such Rights, prior to accepting the related Shares for payment pursuant to the Offer, if the Distribution Date occurs prior to the Expiration Date. Book-Entry Transfer The Depositary will make a request to establish accounts with respect to the Shares at each of the Book- Entry Transfer Facilities 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 any Book-Entry Transfer Facility may make book-entry delivery of Shares by causing such Book-Entry Transfer Facility to transfer such Shares into the Depositary's account at such Book-Entry Transfer Facility in accordance with such Book-Entry Transfer Facility's procedures for such transfer. However, although delivery of Shares may be effected through book-entry transfer into the Depositary's account at a Book-Entry Transfer Facility, the Letter of Transmittal (or facsimile thereof), properly completed and duly executed, with any required signature guarantees, or an Agent's Message in connection with a book-entry transfer, and any other required documents must, in any case, be transmitted to and received by the Depositary at its address set forth on the back cover of this Offer to Purchase on or prior to the Expiration Date, or the guaranteed delivery procedures set forth below must be complied with. 9 If the Distribution Date occurs, the Depositary will also make a request to establish an account with respect to the Rights at each of the Book-Entry Transfer Facilities, but no assurance can be given that book-entry delivery of Rights will be available. If book-entry delivery of Rights is available, the foregoing book-entry transfer procedures will also apply to Rights. Otherwise, if Rights Certificates have been issued, a tendering stockholder will be required to tender Rights by means of physical delivery to the Depositary of Rights Certificates (in which event references in this Offer to Purchase to Book-Entry Confirmations with respect to Rights will be inapplicable) or pursuant to the guaranteed delivery procedures set forth below. Delivery of documents to a Book-Entry Transfer Facility in accordance with such Book-Entry Transfer Facility's procedures does not constitute delivery to the Depositary. Signature Guarantees Signatures on all Letters of Transmittal must be guaranteed by a firm that is a bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of the Securities Transfer Agent's Medallion Program (an "Eligible Institution"), unless the Shares and Rights tendered thereby are tendered (i) by a registered holder of Shares and Rights who has not completed either the box labeled "Special Payment Instructions" or the box labeled "Special Delivery Instructions" on the Letter of Transmittal or (ii) for the account of an Eligible Institution. See Instruction 1 of the Letter of Transmittal. If the Share Certificates or Rights Certificates are registered in the name of a person other than the signer of the Letter of Transmittal, or if payment is to be made to, or Share Certificates or Rights Certificates for unpurchased Shares or Rights are to be issued or returned to, a person other than the registered holder, then the tendered certificates must be endorsed or accompanied by appropriate stock powers, signed exactly as the name or names of the registered holder or holders appear on the certificates, with the signatures on the certificates or stock powers guaranteed by an Eligible Institution as provided in the Letter of Transmittal. See Instructions 1 and 5 of the Letter of Transmittal. If the Share Certificates and Rights Certificates are forwarded separately to the Depositary, a properly completed and duly executed Letter of Transmittal (or facsimile thereof) must accompany each such delivery. Guaranteed Delivery If a stockholder desires to tender Shares and Rights pursuant to the Offer and such stockholder's Share Certificates or, if applicable, Rights Certificates are not immediately available (including, if the Distribution Date has occurred and Rights Certificates have not yet been distributed by the Company) or time will not permit all required documents to reach the Depositary on or prior to the Expiration Date, or the procedures for book-entry transfer cannot be completed on a timely basis, such Shares or Rights may nevertheless be tendered if all of the following guaranteed delivery procedures are duly complied with: (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 Rights Certificates (or a Book-Entry Confirmation) representing all tendered Shares or Rights, in proper form for transfer together with a properly completed and duly executed Letter of Transmittal (or facsimile thereof), with any required signature guarantees (or, in the case of a book-entry transfer, an Agent's Message) and any other documents required by the Letter of Transmittal are received by the Depositary, within (x) in the case of Shares, five NYSE trading days after the date of execution of such Notice of Guaranteed Delivery or (y) in the case of Rights, a period ending on the later of (1) five NYSE trading days after the date of execution of such Notice of Guaranteed Delivery and (2) five business days after the date Rights Certificates are distributed to stockholders. The Notice of Guaranteed Delivery may be delivered by hand or transmitted by facsimile transmission or mail to the Depositary and must include a guarantee by an Eligible Institution in the form set forth in such Notice of Guaranteed Delivery. 10 Notwithstanding any other provision hereof, payment for Shares and Rights accepted for payment pursuant to the Offer will in all cases be made only after timely receipt by the Depositary of Share Certificates for, or of Book-Entry Confirmation with respect to, such Shares, and if the Distribution Date has occurred, Rights Certificates for, or a Book-Entry Confirmation, if available, with respect to, the associated Rights (unless the Purchaser elects, in its sole discretion, to make payment for such Shares pending receipt of the Rights Certificates for, or a Book-Entry Confirmation with respect to, such Rights), a properly completed and duly executed Letter of Transmittal (or facsimile thereof), together with any required signature guarantees (or, in the case of a book-entry transfer, an Agent's Message) and any other documents required by the Letter of Transmittal. Accordingly, payment might not be made to all tendering stockholders at the same time, and will depend upon when Share Certificates (or Rights Certificates) or Book-Entry Confirmations of such Shares (or Rights, if available) are received into the Depositary's account at a Book-Entry Transfer Facility. If the Rights Condition is satisfied, the guaranteed delivery procedures with respect to Rights Certificates and the requirement for the tender of Rights will no longer apply. Backup Federal Tax Withholding Under the federal income tax laws, the Depositary will be required to withhold 31% of the amount of any payments made to certain stockholders pursuant to the Offer. To prevent backup federal income tax withholding on payments made to certain stockholders with respect to the purchase price of Shares purchased pursuant to the Offer, each such stockholder must provide the Depositary with his correct taxpayer identification number and certify that he is not subject to backup federal income tax withholding by completing the Substitute Form W-9 included in the Letter of Transmittal. See Instruction 8 of the Letter of Transmittal. Appointment as Proxy By executing the Letter of Transmittal, a tendering stockholder irrevocably appoints Gary K. Duberstein and Alfred D. Kingsley or any other designees of the Purchaser, and each of them, as such stockholder's attorneys-in-fact and proxies, with full power of substitution, in the manner set forth in the Letter of Transmittal, to the full extent of such stockholder's rights with respect to the Shares and, if applicable, Rights tendered by such stockholder and accepted for payment and paid for by the Purchaser and with respect to any and all other Shares or Rights and other securities or rights issued or issuable in respect of such Shares and Rights on or after the date of this Offer to Purchase. All such powers of attorney and proxies shall be considered irrevocable and coupled with an interest in the tendered Shares and Rights. Such appointment will be effective when, and only to the extent that, the Purchaser pays for such Shares and Rights by depositing the purchase price therefor with the Depositary. Upon such payment, all powers of attorney and proxies given by such stockholder with respect to such Shares, Rights and such other securities or rights prior to such payment will be revoked, without further action, and no subsequent powers of attorney and proxies may be given by such stockholder (and, if given, will not be deemed effective). The designees of the Purchaser will, with respect to the Shares and Rights 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. The Purchaser reserves the right to require that, in order for Shares and Rights to be deemed validly tendered, immediately upon the payment for such Shares and Rights, the Purchaser or its designee must be able to exercise full voting rights with respect to such Shares, Rights and other securities, including voting at any meeting of stockholders. Determination of Validity All questions as to the form of documents and validity, eligibility (including time of receipt) and acceptance for payment of any tender of Shares or Rights will be determined by the Purchaser, in its sole discretion, which determination shall be final and binding on all parties. The Purchaser reserves the absolute right to reject any or all tenders determined by it not to be in proper form or the acceptance of or payment for which may, in the opinion of the Purchaser's 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 or Rights of any particular stockholder whether or not similar defects or irregularities are waived in the case of other stockholders. 11 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. No tender of Shares will be deemed to have been validly made until all defects and irregularities with respect to such tender have been cured or waived. None of the Purchaser, Parent or any of their affiliates or assigns, if any, the Depositary, the Information Agent or any other person will be under any duty to give any notification of any defects or irregularities in tenders or incur any liability for failure to give any such notification. The Purchaser's acceptance for payment of Shares and, if applicable, Rights tendered pursuant to any of the procedures described above will constitute a binding agreement between the tendering stockholder and the Purchaser upon the terms and subject to the conditions of the Offer. 4. Withdrawal Rights. Except as otherwise provided in this Section 4, tenders of Shares and Rights made pursuant to the Offer are irrevocable. Shares and Rights tendered pursuant to the Offer may be withdrawn at any time on or prior to the Expiration Date and, unless theretofore accepted for payment as provided herein, may also be withdrawn at any time after October 8, 1997 (or such later date as may apply in case the Offer is extended). A withdrawal of Shares will also constitute a withdrawal of the associated Rights. Rights may not be withdrawn unless the associated Shares are also withdrawn. If, for any reason whatsoever, acceptance for payment of any Shares and Rights tendered pursuant to the Offer is delayed, or the Purchaser is unable to accept for payment or pay for Shares and Rights 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, retain tendered Shares and Rights and such Shares and Rights may not be withdrawn except to the extent that the tendering stockholder is entitled to and duly exercises withdrawal rights as described in this Section 4. Any such delay will be by an extension of the Offer to the extent required by law. In order for a withdrawal to be effective, a written or facsimile transmission notice of withdrawal must be timely received by the Depositary at its address set forth on the back cover of this Offer to Purchase. Any such notice of withdrawal must specify the name of the person who tendered the Shares and Rights to be withdrawn, the number of Shares and Rights to be withdrawn, and (if Share Certificates and Rights Certificates have been tendered) the name of the registered holder of the Shares and Rights as set forth in the Share Certificate and Rights Certificate, if different from that of the person who tendered such Shares and Rights. If Share Certificates and Rights Certificates have been delivered or otherwise identified to the Depositary, then prior to the physical release of such certificates, the tendering stockholder must submit the serial numbers shown on the particular certificates evidencing the Shares and Rights to be withdrawn and the signature on the notice of withdrawal must be guaranteed by an Eligible Institution, except in the case of Shares and Rights tendered for the account of the Eligible Institution. If Shares and Rights have been tendered pursuant to the procedures for book-entry transfer set forth in Section 3, the notice of withdrawal must specify the name and number of the account at the appropriate Book-Entry Transfer Facility to be credited with the withdrawn Shares and Rights, in which case a notice of withdrawal will be effective if delivered to the Depositary by any method of delivery described in the first sentence of this paragraph. Withdrawals of tenders of Shares and Rights may not be rescinded. Any Shares and Rights properly withdrawn will be deemed not validly tendered for purposes of the Offer, but may be retendered at any subsequent time on or prior to the Expiration Date by following any of the procedures described in Section 3. All questions as to the form and validity (including time of receipt) of notices of withdrawal will be determined by the Purchaser, in its sole discretion, which determination shall be final and binding. None of the Purchaser, the Parent or any of their affiliates or assigns, if any, the Depositary, the Information Agent or any other person will be under any duty to give any notification of any defects or irregularities in any notice of withdrawal or incur any liability for failure to give any such notification. 5. Certain Federal Income Tax Consequences. Sales or conversions of Shares pursuant to the Offer or the Merger, as the case may be, will be taxable transactions for federal income tax purposes and may also be taxable transactions under applicable state, local and other tax laws. Generally, for federal income tax purposes, a stockholder will recognize gain or loss equal to the difference, if any, between the amount of cash received by the stockholder pursuant to the Offer or the 12 Merger and such stockholder's tax basis in the Shares tendered by the stockholder and purchased pursuant to the Offer or converted in the Merger, as the case may be. Such gain or loss will be capital gain or loss (assuming the Shares are held as a capital asset) and any such capital gain or loss will be long term if, as of the date of sale, the Shares were held for more than one year or will be short term if, as of such date, the Shares were held for one year or less. In addition, any gain on the sale of Shares by an individual may be taxed at the maximum rate of 20%, if, as of the date of sale, the Shares were held for more than 18 months. The foregoing discussion may not be applicable to certain types of stockholders, including stockholders who acquired Shares pursuant to the exercise of employee stock options or otherwise as compensation, individuals who are not citizens or residents of the United States and foreign corporations, or entities that are otherwise subject to special tax treatment under the Internal Revenue Code of 1986, as amended (such as insurance companies, other financial institutions, regulated investment companies), and tax-exempt entities. THE FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION ONLY. STOCKHOLDERS ARE URGED TO CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE OFFER AND MERGER, INCLUDING THE EFFECTS OF FEDERAL, STATE AND LOCAL TAX CONSEQUENCES THEREOF. 6. Price Range of the Shares; Dividends. According to the DDC Offer to Purchase, the Shares are listed and traded principally on the NYSE. The Shares are traded on the NYSE under the symbol "OM." The following table sets forth, for the periods indicated, the reported high and low sale prices for the Shares on the NYSE Composite Tape and the amount of cash dividends paid per Share.
Dividends High Low Paid -------- -------- ---------- FISCAL 1995: First Quarter ................................. $24.88 $17.50 $.10 Second Quarter .............................. 22.00 19.50 .10 Third Quarter ................................. 22.88 18.88 .10 Fourth Quarter .............................. 22.63 18.00 .10 FISCAL 1996: First Quarter ................................. $22.38 $19.75 $.10 Second Quarter .............................. 21.88 18.88 .10 Third Quarter ................................. 20.25 18.13 .10 Fourth Quarter .............................. 18.50 14.38 .10 FISCAL 1997: First Quarter ................................. $16.88 $15.25 $.10 Second Quarter .............................. 17.50 12.13 .10 Third Quarter ................................. 17.75 10.88 -- Fourth Quarter (through August 7, 1997) ...... 19.50 15.75 --
According to the DDC Offer to Purchase, on July 8, 1997, the last full day of trading prior to the public announcement of the execution of the DDC Merger Agreement, the closing price per Share as reported on the NYSE was $19.50, and on July 14, 1997, the last full day of trading prior to the commencement of the DDC Offer, the closing price per Share as reported on the NYSE was $15.94. On August 7, 1997, the last full day of trading prior to the commencement of this Offer, the closing price per Share as reported on the NYSE was $16.3125. STOCKHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS FOR THE SHARES. The Purchaser believes, based upon publicly available information, that as of the date of this Offer to Purchase, the Rights are listed on the NYSE, are attached to the Shares and are not traded separately. As a result, the sale prices per Share set forth above are also the high and low sale prices per Share and associated Right 13 during such periods. Upon the occurrence of the Distribution Date, the Rights are to detach, and may trade separately, from the Shares. See Section 11. As a result of the commencement of the Offer by the Purchaser, the Distribution Date will be August 22, 1997, unless, prior to such date the Company's Board of Directors redeems the Rights or takes action to delay the Distribution Date. If the Distribution Date occurs and the Rights begin to trade separately from the Shares, stockholders are also urged to obtain a current market quotation for the Rights. 7. Effect of the Offer on the Market for the Shares; Stock Exchange Listing; Exchange Act Registration; Margin Regulations. Effect of the Offer on the Market for the Shares The purchase of Shares pursuant to the Offer will reduce the number of Shares that might otherwise trade publicly and could adversely affect the liquidity and market value of the remaining Shares held by the public. The purchase of Shares pursuant to the Offer can also be expected to reduce the number of holders of Shares. Stock Exchange Listing According to the NYSE's published guidelines, the NYSE would consider delisting the Shares if, among other things, the number of record holders of at least 100 Shares should fall below 1,200, the number of publicly held Shares (exclusive of holdings of officers, directors, their immediate families and other concentrated holdings of 10% or more ("NYSE Excluded Holdings")) should fall below 600,000 or the aggregate market value of publicly held Shares (exclusive of NYSE Excluded Holdings) should fall below $5,000,000. Depending upon the number of Shares acquired pursuant to the Offer, the Shares may no longer meet the requirements for continued listing on the NYSE or any other exchanges upon which the Shares are listed. According to the DDC Offer to Purchase, as of July 8, 1997, there were approximately 3,950 holders of record of Shares and approximately 15,400 beneficial owners of the Shares. If, however, as a result of the purchase of Shares pursuant to the Offer or otherwise, the Shares no longer meet the requirements of the NYSE for continued listing and/or trading and such trading of the Shares were discontinued, the market for the Shares could be adversely affected. In the event that the Shares were no longer listed or traded on the NYSE, it is possible that the Shares would trade on another securities exchange or in the over-the-counter market and that price quotations would be reported by such exchange or over-the-counter market or other sources. Such trading and the availability of such quotations would, however, depend upon the number of stockholders and/or the aggregate market value of the Shares remaining at such time, the interest in maintaining a market in the Shares on the part of securities firms, the possible termination of registration of the Shares under the Exchange Act as described below and other factors. Exchange Act Registration The Shares and Company Debentures are currently registered under the Exchange Act. The purchase of the Shares pursuant to the Offer may result in the Shares becoming eligible for deregistration under the Exchange Act. Registration of the Shares may be terminated upon application by the Company to the Commission if the Shares are not listed on a "national securities exchange" and there are fewer than 300 record holders of Shares. Termination of registration of the Shares under the Exchange Act would substantially reduce the information required to be furnished by the Company to its stockholders and the Commission and would make certain provisions of the Exchange Act, such as the short-swing profit recovery provisions of Section 16(b) of the Exchange Act and the requirements of furnishing a proxy statement in connection with stockholders' meetings pursuant to Section 14(a) of the Exchange Act, no longer applicable to the Company. If the Shares are no longer registered under the Exchange Act, the requirements of Rule 13e-3 under the Exchange Act with respect to "going private" transactions would no longer be applicable to the Company. Furthermore, the ability of "affiliates" of the Company and persons holding "restricted securities" of the Company to dispose of such securities pursuant to Rule 144 promulgated under the Securities Act of 1933, as amended, may be impaired or eliminated. However, so long as any the Company Debentures remain registered under the Exchange Act, the Company may remain subject to the requirements of the Exchange Act with respect to the filing with the Commission of publicly available annual, periodic and certain other reports. If, as a result of the purchase of Shares pursuant to the Offer or the Merger, the Company is no longer required to maintain registration of the Shares under the Exchange Act, the Purchaser intends to cause the Company to apply for termination of such registration. 14 Based upon publicly available information, the Purchaser believes that, as of the date of this Offer to Purchase, the Rights are registered under the Exchange Act and are listed on the NYSE, but are attached to the Shares and are not separately transferable. As a result of the commencement of the Offer by the Purchaser, the Distribution Date will be August 22, 1997 unless, prior to such date, the Company's Board of Directors redeems the Rights or delays such Distribution Date. See Section 11. According to the Company 8-A, as soon as practicable after the occurrence of the Distribution Date, Rights Certificates will be sent to all holders of Rights and the Rights will become transferable apart from the Shares. See Section 11. If the Distribution Date occurs and the Rights separate from the Shares, the foregoing discussion with respect to the effect of the Offer on the market for the Shares, stock exchange listings and Exchange Act registration would apply to the Rights in a similar manner. If registration of the Shares is not terminated prior to the Merger, then the Shares will be delisted from all stock exchanges and the registration of the Shares under the Exchange Act will be terminated following the consummation of the Merger. Margin Regulations The Shares are currently "margin securities" under the regulations of the Board of Governors of the Federal Reserve System (the "Federal Reserve Board"), which have 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 such as the number of record holders of the Shares and the number and market value of publicly held Shares, following the purchase of Shares pursuant to the Offer, the Shares may no longer constitute "margin securities" for purposes of the Federal Reserve Board's margin regulations and, therefore, could no longer be used as collateral for Purpose Loans made by brokers. In addition, if registration of the Shares under the Exchange Act were terminated, the Shares would no longer constitute "margin securities." 8. Certain Information Concerning the Company. The Company is a Delaware corporation with its principal executive offices located at 100 Sea Horse Drive, Waukegan, Illinois 60085. According to the Company's Annual Report on Form 10-K for the year ended September 30, 1996 (the "Company 10-K"), the Company is engaged principally in the manufacturing and marketing of marine engines, boats and marine parts and accessories principally for recreational use. Most of the Company's principal products are sold throughout the world. The following selected consolidated financial data of the Company and its subsidiaries for the three fiscal years ended September 30, 1996 have been taken or derived from the audited financial statements contained in the Company 10-K, and the consolidated financial data for the nine months ended June 30, 1997 and the nine months ended June 30, 1996 have been taken or derived from the unaudited financial statements contained in the June 1997 Form 10-Q. More comprehensive financial information for such period is included in the Company 10-K and the June 1997 Form 10-Q, and the financial data set forth below is qualified in its entirety by reference to such reports, including the financial statements contained therein. Such reports may be examined and copies may be obtained from the offices of the Commission in the manner set forth below. 15 Outboard Marine Corporation Selected Consolidated Financial Data (in millions except per Share amounts)
Nine Months Ended Fiscal Year Ended June 30, September 30, --------------------------- ------------------------------------------- 1997 1996 1996 1995 1994 ------------ ------------ -------------- ------------ ----------- (unaudited) Income Statement Data: Net sales .................................... $ 709.9 $ 808.6 $ 1,121.5 $ 1,229.2 $ 1,078.4 Net earnings (Loss) ........................... (26.7 ) (14.9 ) (7.3) 51.4 48.5 Primary net earnings (loss) per Share ......... (1.32) (0.74) (.36) 2.56 2.42 Fully diluted earnings (loss) per Share ...... (1.32) (0.74) (.36) 2.33 2.22 Dividends declared per Share .................. .20 .30 .40 .40 .40
At At June 30, September 30, 1997 1996 1995 ------------ --------- -------- (Unaudited) Balance Sheet Data: Total assets ................................. $ 825.1 $ 873.7 $ 907.0 Total current assets ........................ 439.8 467.5 502.2 Total current liabilities ..................... 241.0 253.3 248.8 Long-term debt .............................. 172.6 177.6 177.4 Total shareholders' investment ............... 203.2 237.6 255.8
The information concerning the Company contained herein has been taken from or is based upon reports and other documents on file with the Commission or otherwise publicly available. Although the Purchaser does not have any knowledge that would indicate that any statements contained herein based upon such reports and documents are untrue, the Purchaser does not take any responsibility for the accuracy or completeness of the information contained in such reports and other documents or for any failure by the Company to disclose events that may have occurred and may affect the significance or accuracy of any such information but that are unknown to the Acquirors. The Company is subject to the informational requirements of the Exchange Act and in accordance therewith files 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, stock options granted to them, the principal holders of the Company's securities and any material interests of such persons in transactions with the Company. Such reports, proxy statements and other information may be inspected at the public reference facilities maintained by the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549 and are also available for inspection and copying at the regional offices of the Commission in New York (Seven World Trade Center, Suite 1300, New York, New York 10048) and Chicago (Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511). Copies of such material can also be obtained from the Public Reference Section of the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Such material may also be accessed electronically by means of the Commission's home page on the World Wide Web (www.sec.gov). In addition, information about the Company can be inspected at the offices of the New York Stock Exchange, 20 Broad Street, New York, New York, 10005. All of the information with respect to the Company, the DDC Offer and the DDC Merger Agreement set forth in this Offer to Purchase has been derived from publicly available information. 9. Certain Information Concerning the Purchaser, the Parent and Others. The Purchaser, a Delaware corporation, was recently incorporated and has not engaged in any business since its incorporation other than that incident to its organization and in connection with the Offer. All of the outstanding capital stock of the Purchaser is owned by the Parent. The Parent, a Delaware limited liability company, was recently organized pursuant to an operating agreement (the "Parent LLC Agreement") and has not engaged in any business since its 16 organization other than that incident to its organization and in connection with the Offer. Neither the Purchaser nor the Parent is expected to engage in any business other than in connection with its respective organization, the Offer and the Merger. The members of the Parent are Greenlake, QSP and QIP. Each of Greenlake, QSP and QIP has approximately a 30.5%, 34.75% and 34.75% interest in the Parent, respectively. Greenlake is controlled by Messrs. Alfred D. Kingsley and Gary K. Duberstein, each of whom are principals of Greenway Partners, L.P. QSP is an indirect subsidiary of Quasar International Fund N.V. QIP is the principal operating subsidiary of Quantum Industrial Holdings Ltd. Quasar and QIH are investment funds which have as their principal investment advisors Soros Fund Management LLC, of which Mr. George Soros serves as Chairman. The principal executive offices of the Purchaser and the Parent are located at c/o Greenway Partners, L.P., 277 Park Avenue, 27th Floor, New York, New York 10172. QIH and QIP. QIH is a British Virgin Islands corporation, organized in 1994, which makes investments under the general supervision of SFM LLC, a Delaware limited liability company, its principal investment advisor. QIH has its principal office at Kaya Flamboyan 9, Willemstad, Curacao, Netherlands Antilles. QIH engages in its investment program principally through its consolidated subsidiary, QIP. QIP's principal address is Kaya Flamboyan 9, Willemstad, Curacao, Netherlands Antilles. Current information concerning the directors and executive officers of QIH and QIP is set forth on Schedule I hereto. QIH Management Investor, L.P. ("QIHMI"), an investment advisory firm organized as a Delaware limited partnership, is a minority shareholder of, and has investment discretion with respect to the portfolio assets held for the account of, QIP. The principal business of QIHMI is to provide management and advisory services to, and to invest in, QIP and related entities, including QSP. QIH Management, Inc. ("QIH Management"), a Delaware corporation of which Mr. Soros is the sole shareholder, is the sole general partner of QIHMI. The principal business of QIH Management is to serve as the sole general partner of QIHMI. The name, business address, citizenship, present principal occupation or employment, five year employment history and citizenship of each director and executive officer of QIH Management is set forth on Schedule I hereto. QIHMI and QIH Management have their principal offices at 888 Seventh Avenue, 33rd Floor, New York, New York 10106. Mr. Soros has agreed with SFM LLC that he will, among other things, use his best efforts to cause QIH Management, as the general partner of QIHMI, to act at the direction of SFM LLC, which agreement to so act shall terminate upon the earlier of (a) the assignment to SFM LLC of the legal and beneficial ownership interest in QIH Management and (b) the assignment to SFM LLC of the general partnership interest in QIHMI. The business of SFM LLC is managed through a Management Committee (the "SFM Management Committee") comprised of Mr. Soros, Mr. Stanley F. Druckenmiller and Mr. Gary Gladstein. SFM LLC has its principal office at 888 Seventh Avenue, 33rd Floor, New York, New York 10106. Its principal business is to serve, pursuant to contract, as the principal investment manager to several foreign investment companies, including QIH (the "SFM Clients"). Mr. Soros, as Chairman of SFM LLC, has the ability to direct the investment decisions of SFM LLC and as such may be deemed to have investment discretion over the securities held for the accounts of the SFM Clients. Mr. Druckenmiller, as Lead Portfolio Manager of SFM LLC, has the ability to direct the investment decisions of SFM LLC and as such may be deemed to have investment discretion over the securities held for the accounts of the SFM Clients. The name, business address, present principal occupation or employment, five year employment history and citizenship of each managing director of SFM LLC are set forth in Schedule I hereto. The principal occupation of Mr. Soros, a United States citizen, is his direction of the activities of SFM LLC, which is carried out in his capacity as Chairman of SFM LLC at SFM LLC's principal office, a position he has held since January 1997. From 1987 through January of 1997 Mr. Soros was the sole proprietor of Soros Fund Management, the predecessor of SFM LLC. The principal occupation of Mr. Druckenmiller, a United States citizen, is his position as Lead Portfolio Manager and a Member of the SFM Management Committee, which is carried out at SFM LLC's principal office. QIH is not subject to the informational reporting requirements of the Exchange Act, and, accordingly, does not file reports or other information with the Commission relating to its business, financial condition and other matters. Set forth below is certain selected historical consolidated financial data of QIH (which includes QIP). Balance sheet and income statement components of portfolio companies are not consolidated. 17 QUANTUM INDUSTRIAL HOLDINGS LTD. SELECTED CONSOLIDATED FINANCIAL INFORMATION (IN U.S. DOLLARS)
YEAR ENDED DECEMBER 31, ------------------------------------------------------- 1996 1995 1994 ---------------- ----------------- ---------------- Earnings Data Total investment income .................................... $ 276,689,174 $ 49,091,649 $ 9,614,222 Total expenses ............................................. 183,027,218 189,926,682 48,971,622 Net investment income .................................... 93,661,956 (140,835,033) (39,357,400) Net increase in net assets resulting from operations ...... 357,057,390 653,441,119 81,309,699 Balance Sheet Data Total assets ............................................. $5,803,224,397 $5,720,376,316 $ 602,218,890 Total liabilities .......................................... 3,312,783,028 3,566,344,418 423,231,700 Net assets applicable to outstanding shares ............... 2,490,441,369 2,154,031,898 1,476,562,644
- ------------ The consolidated financial statements are generally in accordance with accounting principles generally accepted in the United States, except for QIH's valuation policies regarding a portion of its strategic investments. Securities traded on securities exchanges (including The Nasdaq Stock Market) are valued at the last sales price reported on the valuation date, and marketable securities traded in an over-the-counter market for which last sales prices are not reported are valued at the last reported bid price for securities held long or the last reported ask price for securities sold short. Investments in certain other funds advised by SFM LLC or its predecessor are valued at the estimated net asset value issued by the respective funds. Investments in other open-end investment companies are valued at the last reported net asset value provided by such investment companies. A significant portion of QIH's investments are non-marketable equity or equity-related investments which are restricted and/or illiquid ("strategic investments") and are carried at cost, including capitalized expenses such as legal fees and other professional expenses. QIH's general policy is to mark such investments up in value only when: (i) there is a definitive agreement to dispose of the investment; or (ii) the class of securities held by QIH becomes publicly traded (or when a class of securities held by QIH is freely convertible into publicly traded securities); or (iii) an independent corroboration of value with respect to a private equity investment occurs through an "arm's length" purchase or sale of the same type of security as that owned by QIH, whether or not QIH is involved in the transaction. Investments will be written down below cost when QIH, in consultation with SFM LLC, believes developments of a significant nature result in a diminution in value that is other than temporary. Quasar, Quasar Partner and QSP. Quasar is an open-end investment fund organized in 1991 as a limited liability company under the laws of the Netherlands Antilles to enable investors to participate in a diversified investment portfolio under the general supervision of SFM LLC, its principal asset manager. Quasar has its principal office at Kaya Flamboyan 9, Willemstad, Curacao, Netherlands Antilles. Quasar invests all of its assets in Quasar International Partners C.V., a Netherlands Antilles limited partnership ("Quasar Partners"), which is Quasar's operating unit. Quasar Partners is making an investment in the Parent through its consolidated subsidiary, QSP. Each of Quasar Partners and QSP has its principal office at Kaya Flamboyan 9, Willemstad, Curacao, Netherlands Antilles. Current information concerning the directors and executive officers of Quasar, Quasar Partners and QSP is set forth on Schedule I hereto. QIHMI is a minority shareholder, and has investment discretion with respect to the portfolio assets held for the account of, QSP. Mr. Soros has agreed with SFM LLC that he will, among other things, use his best efforts to cause QIH Management, as the general partner of QIHMI, to act at the direction of SFM LLC, which agreement to so act shall terminate upon the earlier of (a) the assignment to SFM LLC of the legal and beneficial ownership interest in QIH Management and (b) the assignment to SFM LLC of the general partnership interest in QIHMI. Current information concerning the directors and executive officers of QIH Management is set forth on Schedule I hereto. Mr. Soros, as Chairman of SFM LLC, has the ability to direct the investment decisions of SFM LLC and as such may be deemed to have investment discretion over the securities held for the account of Quasar Partners. Mr. Druckenmiller, as Lead Portfolio Manager of SFM LLC, has the ability to direct the investment decisions of SFM LLC and as such may be deemed to have investment discretion over the securities held for the account of Quasar Partners. The name, business address, present principal occupation or employment, five year employment history and citizenship of each managing director of SFM LLC are set forth on Schedule I hereto. 18 Quasar Partners is not subject to the informational reporting requirements of the Exchange Act, and, accordingly, does not file reports or other information with the Commission relating to its business, financial condition and other matters. Set forth below is certain selected historical consolidated financial data of Quasar Partners. QUASAR INTERNATIONAL PARTNERS C.V. SELECTED CONSOLIDATED FINANCIAL INFORMATION (IN U.S. DOLLARS)
YEAR ENDED JANUARY 31, ------------------------------------------------------- 1997 1996 1995 ---------------- ----------------- ---------------- Earnings Data Total investment income .............................. $ 308,262,079 $ 220,085,825 $ 296,685,094 Total expenses ....................................... 293,372,427 410,318,825 202,971,972 Net investment income ................................. 14,889,652 (190,233,000) 93,713,122 Net increase/(decrease) in net assets/partner's capital resulting from operations ........................... 124,058,875 934,585,985 (28,067,500) Balance Sheet Data Total assets .......................................... $8,816,290,024 $6,789,994,524 $3,087,125,402 Total liabilities .................................... 6,718,351,586 4,623,266,389 1,564,250,491 Partners' capital .................................... 2,097,938,438 2,166,728,135 1,522,874,911
- ------------ The consolidated financial statements are in accordance with accounting principles generally accepted in the United States. Securities traded on securities exchanges (including The Nasdaq Stock Market) are valued at the last sales price reported on the valuation date, and marketable securities traded in an over-the-counter market for which last sales prices are not reported are valued at the last reported bid price for securities held long or the last reported ask price for securities sold short. Investments in certain other funds advised by SFM LLC are valued at the estimated net asset value issued by the respective funds. In the absence of quoted values or when quoted values are not deemed by SFM LLC to be representative of market values for the Partnership's positions, securities are valued at fair value as determined by the Partnership's Managing Director in consultation with SFM LLC. Greenlake. Greenlake Holdings LLC, a Delaware limited liability company, was recently organized pursuant to an operating agreement (the "Greenlake LLC Agreement"), and has not conducted any business other than incident to its organization and the organization of the Parent for the purpose of commencing the Offer. The principal business of Greenlake is to hold cash and Shares contributed by its members that, prior to the consummation of the Offer, it has agreed to transfer to Parent as a capital contribution. Greenlake is operated and managed under the full and exclusive control of Mr. Kingsley and Mr. Duberstein. The members of Greenlake include Greenway Partners, L.P., Greentree Partners, L.P., Greenbelt Corp. on behalf of certain accounts managed by it, and Greensea Offshore, L.P., all of which are managed by Messrs. Kingsley and Duberstein (collectively, the "Greenway Entities") and certain other investors. The Directors of the Purchaser are Mr. Kingsley, Mr. Duberstein and Mr. Richard Katz. Mr. Kingsley is the Chief Executive Officer and President of the Purchaser, and Mr. Duberstein is the Purchaser's Vice President, Secretary and Treasurer. The principal office of Greenlake is located at 277 Park Avenue, 27th Floor, New York, New York 10172. See Schedule I hereto for additional information concerning Messrs. Kingsley, Duberstein and Katz. The Parent. The members of the Parent are QIP, QSP (collectively, the "Group A Members") and Greenlake. The Parent is controlled by a Management Committee comprised of up to a total of four Managers. Pursuant to the terms of the Parent LLC Agreement, Greenlake has the right to appoint two designees to the Parent's Management Committee and the holders of a majority of the Parent's interests held by the Group A Members have the right to appoint two members to the Parent's Management Committee. The Parent's Management Committee is currently comprised of Messrs. Kingsley, Duberstein and Katz. From and after the date that is twelve months after the Initial Capital Contribution Date (as defined below), the holders of a majority of the Parent's interests held by the Group A Members may elect to increase the size of the Parent's Management 19 Committee to five members, three of whom will be designated by the holders of a majority of the Parent's interest held by the Group A Members and two of whom will be designated by Greenlake. The vote of three of the members of the Parent's Management Committee is required for action by the Management Committee. The Parent LLC Agreement also provides that the board of directors (or similar governing body) of any subsidiary of the Parent, including the Purchaser, will be persons approved by the Parent's Management Committee; provided, however, that Greenlake will have the right to designate one member of any such board of directors (or similar governing body). Under the Parent LLC Agreement, the "Initial Capital Contribution Date" is the earlier to occur of (i) one day prior to the date on which any subsidiary of the Parent is required to accept Shares for payment pursuant to a tender offer commenced by such subsidiary for Shares under the Exchange Act or (ii) such date as may be determined by the Parent's Management Committee upon not less than three business days' notice to the members of the Parent of such date. Pursuant to the Parent LLC Agreement, on the Initial Capital Contribution Date, each of QSP and QIP has agreed to contribute $96,250,000 to the capital to the Parent and Greenlake has agreed to contribute $48,500,000 and 2,000,000 Shares to the capital of the Parent. The members of Greenlake have substantially completed the making of capital contributions to Greenlake that will be sufficient to enable it to fulfill its commitment to make capital contributions to the Parent. Pursuant to the Greenlake LLC Agreement, the Greenway Entities contributed their beneficial ownership of the 2,000,000 Shares to Greenlake. The Greenway Entities acquired the 2,000,000 Shares in open market transactions as described in the Schedule 13D (as amended, the "Greenway Schedule 13D") of Greenway Partners, L.P., Greentree Partners, L.P., Greenhouse Partners, L.P., Greenhut, L.L.C., Greenbelt Corp., Greensea Offshore, L.P., Greenhut Overseas, L.L.C., Alfred D. Kingsley and Gary K. Duberstein, The Greenway Schedule 13D may be examined or copies thereof may be obtained in the same manner as described in Section 8. Pursuant to the Parent LLC Agreement, in the event that the Offer and the Merger are not consummated and the Parent sells Shares contributed to it by Greenlake that exceeds $16.00 per Share or the Parent receives cash or other consideration for such Shares as a result of a merger or other business combination of the Company that exceeds $16.00 per Share, the aggregate amount of such excess price or consideration shall be applied as follows: (i) first, to the payment of certain expenses incurred in connection with the formation of the Parent and the Purchaser, obtaining financing in connection with the Offer and the Merger, preparation of documentation in connection with the Offer and the Merger, printing expenses, any fees and disbursements of attorneys, accountants and other advisors, and any indemnity obligations of the Parent under the Parent LLC Agreement; and (ii) the balance, if any, shall be distributed as follows: (a) 80% to Greenlake and (b) 20% to Greenlake, QSP and QIP on a pro rata basis based upon the respective amounts of cash contributed by them as initial capital contributions to the Parent. The foregoing summary of the Parent LLC Agreement is qualified in its entirety by reference to the text of the Parent LLC Agreement, a copy of which has been filed as Exhibit (a)(1) to the Tender Offer Statement on Schedule 14D-1 relating to the Offer (the "Purchaser Schedule 14D-1"). The Purchaser Schedule 14D-1 may be inspected and copies of which may be obtained at the same places and in the same manner as set forth in Section 8. The name, citizenship, business address and present principal occupation of each of the directors, executive officers or controlling persons of the Acquirors are set forth in Schedule I to this Offer to Purchase. Except as set forth elsewhere in this Offer to Purchase: (i) none of the Acquirors nor, to the knowledge of the Acquirors, any of the persons listed on Schedule I hereto or any affiliate, associate or majority-owned subsidiary of the Parent or any of the persons so listed, beneficially owns or has a right to acquire any Shares or any other equity securities of the Company; (ii) none of the Acquirors nor to the knowledge of the Acquirors, any of the persons or entities referred to in clause (i) above or any of their executive officers, directors or subsidiaries has effected any transaction in the Shares or any other equity securities of the Company during the past 60 days; (iii) none of the Acquirors nor, to the knowledge of the Acquirors, any of the persons listed in Schedule I hereto, has any contract, arrangement, understanding or relationship with any other person with respect to any securities of the Company, including, but not limited to, the transfer or voting thereof, joint ventures, loan 20 or option arrangements, puts or calls, guarantees of loans, guarantees against loss or the giving or withholding of proxies, consents or authorizations; (iv) since October 1, 1993, there have been no transactions which would require reporting under the rules and regulations of the Commission between any of the Acquirors or any of their respective subsidiaries or affiliates or, to the best knowledge of the Acquirors, any of the persons listed in Schedule I hereto, on the one hand, and the Company or any of its executive officers, directors or affiliates, on the other hand; (v) there have been no contracts, negotiations or transactions between any of the Acquirors or any of their respective subsidiaries or affiliates or, to the best knowledge of the Acquirors, any of the persons listed in Schedule I hereto, on the one hand, and the Company or its subsidiaries or affiliates, on the other hand, concerning a merger, consolidation or acquisition, tender offer or other acquisition of securities, an election of directors or a sale or other transfer of a material amount of assets of the Company; (vi) none of the Acquirors nor to the knowledge of the Acquirors, any of the persons listed on Schedule I hereto has, during the last five years, (a) been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors), or (b) been 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. 10. Background of the Offer; Contacts with the Company. On August 21, 1996, the Greenway Entities initially filed with the Commission the Greenway Schedule 13D disclosing, among other things, the Greenway Entities' beneficial ownership of 1,710,000 Shares (approximately 8.5% of the Shares outstanding at such time). On October 1, 1996, the Greenway Entities filed with the Commission Amendment No. 1 to the Greenway Schedule 13D disclosing, among other things, the Greenway Entities' beneficial ownership of 2,000,000 Shares (approximately 9.9% of the Shares outstanding at such time). On August 1, 1997, the Greenway Entities filed with the Commission Amendment No. 2 to the Greenway Schedule 13D disclosing, among other things, that: The [Greenway Entities] are actively exploring the possibility of making an offer to the Company and/or its stockholders that would represent a superior transaction for the shareholders of the Company as compared with the transaction set forth in the Agreement and Plan of Merger, dated as of July 8, 1997, among Detroit Diesel Corporation, OMC Acquisition Corp. and the Company. There can be no assurance that the [Greenway Entities] will determine to proceed with a competing offer. On August 8, 1997, the Acquirors filed with the Commission a Tender Offer Statement on Schedule 14D-1 commencing the Offer. Such Schedule 14D-1 also constituted Amendment No. 3 to the Greenway Schedule 13D. On August 8, 1997, the Purchaser commenced litigation in the Court of Chancery for the State of Delaware seeking, among other things, an order compelling the Company's Board of Directors to redeem the Rights or to amend the Rights Agreement inapplicable to the Offer and the proposed Merger on the grounds that failure to do so would constitute a breach of fiduciary duty to the Company's stockholders. On August 8, 1997, the Purchaser sent the following letter to the Board of Directors of the Company: The Board of Directors Outboard Marine Corporation 100 Sea Horse Drive Waukegan, Illinois 60085 Dear Sirs: Greenmarine Acquisition Corp. ("Purchaser"), a wholly-owned subsidiary of Greenmarine Holdings LLC ("Parent"), has today commenced an all cash tender offer for all outstanding shares of common stock of Outboard Marine Corporation (the "Company" or "Outboard Marine") at a price of $18.00 per share. Shares not purchased in the tender would be acquired in a second-step merger at a price of $18.00 per share cash. The 21 investors in the Parent include an entity affiliated with Messrs. Alfred D. Kingsley and Gary K. Duberstein of Greenway Partners, L.P. and two entities associated with Soros Fund Management LLC. Entities affiliated with the Parent currently hold 9.9% of the Company's outstanding stock. The $18.00 per share consideration exceeds the consideration offered by Detroit Diesel Corporation ("DDC") and its subsidiary, OMC Acquisition Corp., pursuant to the July 8, 1997 merger agreement (the "DDC Merger Agreement"). DDC's economically inferior offer is also inherently coercive because it is a two-tier offer with an all cash payment in the first tier only, i.e., a tender at $16 per share cash for 66 2/3% of the Company's shares to be followed by a second-step merger in which stockholders will receive a combination of DDC stock and cash. In light of the superior value offered in our tender, we request that the Board of Directors of Outboard Marine recommend our proposal to the Company's shareholders and withdraw its prior recommendation of the DDC offer. We are prepared to sit down immediately with you and your advisors to negotiate and sign a merger agreement substantially in the form of the DDC Merger Agreement. If you decline to negotiate a merger agreement with us, we hope you will nevertheless agree that, in the context of the ongoing sale of the Company, the shareholders of the Company have the right to choose between competing offers. Accordingly, we request that the Board (a) immediately exempt our tender from the operation of the Company's Rights Plan, as you have done with respect to the economically inferior (and coercive) DDC offer, and (b) take all other necessary action to render the sale of the Company impediments in your charter inapplicable to our offer. Thank you for your consideration and we look forward to meeting with you and your representatives. Very truly yours, /s/ Alfred D. Kingsley --------------------- Alfred D. Kingsley Chief Executive Officer and President Except as described in this Offer to Purchase, there have been no contacts, negotiations or transactions between any of the Acquirors, any of their respective affiliates or subsidiaries or, to the best of any Acquiror's knowledge, any of the persons listed on Schedule I, on the one hand, and the Company or any of its affiliates, on the other hand, concerning a merger, consolidation or acquisition, a tender offer or other acquisition of securities, an election of directors, or sale or other transfer of a material amount of assets. 11. Purpose of the Offer and the Merger. Purpose of the Offer and the Merger The purpose of the Offer is to acquire control of, and the entire equity interest in, the Company. The purpose of the Merger is to acquire all outstanding Shares not acquired pursuant to the Offer or otherwise. The Parent and the Purchaser reserve the right to acquire additional Shares after consummation of the Offer in open market purchases, through a tender offer, in privately negotiated transactions or otherwise, in order to obtain a sufficient number of Shares to approve the transactions contemplated hereby. The Merger The Parent currently intends, immediately following completion of the Offer, to seek to consummate the Merger. The Parent intends that in the Merger, each then outstanding Share (other than Shares owned by Parent, Purchaser or any of their wholly owned subsidiaries, Shares held in the treasury of the Company, and, if stockholder appraisal rights are available with respect to Shares, Shares held by stockholders who perfect any available appraisal rights under the DGCL) would be converted into the right to receive in cash the price per Share paid by the Purchaser pursuant to the Offer. 22 In general, pursuant to the DGCL the approval of both the stockholders and the board of directors of a corporation is required to effect the merger of that corporation with or into another corporation. Section 253 of the DGCL provides, however, that if a parent corporation owns at least 90% of each class of the outstanding shares of capital stock of a subsidiary corporation, the parent corporation may merge with or into the subsidiary corporation without any action or vote on the part of the board of directors or the other stockholders of the subsidiary corporation. A merger effected under this law is referred to herein as a "short-form merger." Although the Parent intends to seek consummation of the Merger immediately following the consummation of the Offer, subject to its ability to cause the Purchaser to effect a "short-form merger" with the Company pursuant to Section 253 of the DGCL, certain terms of the Charter, the By-laws and Section 203 of the DGCL may affect the ability of the Parent to obtain control of the Company and to cause the Purchaser to consummate the Merger. Accordingly, the Parent can give no assurance that the Merger will be consummated or as to the timing of the Merger if it is consummated. Classified Board. Unless the Merger is consummated pursuant to a "short-form merger", the approval the Company's Board of Directors will be required under the DGCL to effect the Merger. If the Board of Directors of the Company in office at the time of the consummation of the Offer were to refuse to approve the Merger (or any transaction or corporate action proposed by the Purchaser that required the approval of the Board of Directors), the Purchaser, in order to consummate such transaction or cause the Company to take such action, would have to replace at least a majority of the Board of Directors with its own designees. Certain provisions of the Charter and By-laws could prevent the Purchaser from replacing or electing a majority of the Board of Directors for up to two years. Pursuant to Article Fourteenth of the Charter, the Board of Directors is divided into three classes with each class elected for a term of three years and one class elected at the Company's annual meeting of stockholders each year (the "Classified Board Provision"). Pursuant to Article III, Section 3 of the By-laws, the number of directors can be no less than nine and no more than 12 and can only be established by a resolution of the Board of Directors (the "Director Number Provision"). Pursuant to Article III, Section 6 of the By-laws, directors can be removed from the Board of Directors only for cause and only by the affirmative vote of holders representing 80% or more of all the shares of stock of the Company entitled to vote for the election of directors (the "Director Removal Provision"). Article III, Section 9 of the By-laws provides that nominations of persons for election to the Company's Board of Directors may be made by stockholders' notice if such notice is delivered to the Secretary of the Company at its principal executive offices not less than 60 nor more than 90 days prior to the date one year from the date of the immediately preceding annual meeting of stockholders. According to publicly available information, the last annual meeting of the Company's stockholders was held on January 16, 1997. As a result of these provisions, at least two annual meetings of the Company's stockholders, absent the directors' removal in accordance with the Director Removal Provision or their resignations, would be required to elect new directors comprising a majority of the Board of Directors who could approve the Merger (or any similar transaction requiring the approval of the Board of Directors). According to the Charter, amending the Classified Board Provision requires the affirmative vote of the holders of two-thirds ( 2/3) of all shares of the outstanding stock of the Company entitled to vote thereon. According to the By-laws, the Director Number Provision can only be amended by action of two-thirds ( 2/3) of the stockholders or by two-thirds ( 2/3) of the then current Board of Directors. However, the Director Removal Provision can be amended by action of either a majority of the stockholders or a majority of the Board of Directors. Stockholder Meetings. To the extent that a special stockholders meeting is necessary to effect the Merger and gain control of the Company, certain By-law provisions relating thereto could further impede any such change of control. Article II, Section 4 provides that special meetings of stockholders can be called only by the Chairman of the Board, the Chief Executive Officer or three-quarters ( 3/4) of the entire Board of Directors. At such meetings, the election of directors cannot take place. Amending Article II, Section 4 requires action by two-thirds ( 2/3) of either the stockholders or the then current Board of Director. In addition, Article II, Section 9 of the By-laws provides that any action required or permitted to be taken by the stockholders of the Company must be effected at a duly called annual or special meeting of the stockholders and may not be effected by any consent in writing by the stockholders. The Purchaser will seek to have either the Chairman of the Board, the Chief Executive Officer or three-quarters of the Board of Directors call a special meeting if it becomes necessary to effect the Merger. There can be no assurance, however, that such a meeting will be so called. 23 The Offer does not constitute a solicitation of proxies for any meeting of the Company's stockholders. Any such solicitation which the Purchaser might make would be made only pursuant to separate proxy materials complying with the requirements of Section 14(A) of the Exchange Act. Supermajority and "Fair Price" Clauses. Article Seventeenth of the Charter requires the approval of the holders of two-thirds ( 2/3) of the outstanding voting stock of the Company in all cases in which a vote of stockholders is taken with respect to (a) the proposed adoption of any merger of the Company with or into another corporation or the consolidation of the Company with another corporation, (b) the authorization of any sale, lease or exchange of all or substantially all of the assets of the Company or (c) a proposed dissolution of the Company (the "Two-Thirds Voting Requirement"). Amending the two-thirds voting requirement requires the affirmative vote or consent of the holders of two-thirds ( 2/3) of all shares of the outstanding stock of the Company entitled to vote thereon. Article Eighteenth of the Charter requires the affirmative vote of the holders of not less than 75% of the outstanding voting shares of the Company held by stockholders other than a "Related Person" (defined below) to approve a "Business Combination" (defined below), unless: (i) the "Continuing Directors" (defined below) of the Company by at least a majority vote of such Continuing Directors have expressly approved such Business Combination either in advance of or subsequent to such Related Person's having become a Related Person; or (ii) the cash or fair market value (as determined by at least a majority of the Continuing Directors) of the property, securities or other consideration to be received per share by holders of voting shares of the capital stock of the Company in the Business Combination is not less than the "Highest Equivalent Price" paid by the Related Person in acquiring any of its holdings of the Company's voting stock (the "75% Voting Requirement" and together with the Two-Thirds Voting Requirement, the "Supermajority Vote Requirements"). Amending the 75% Voting Requirement requires the affirmative vote of the holders of the 75% of the combined voting power of the outstanding of voting shares held by stockholders other than any Related Person or its "Affiliates" (defined below) or its "Associates" (defined below). The term "Business Combination" means (i) any merger or consolidation of the Company or a subsidiary of the Company with or into a Related Person, (ii) any sale, lease, exchange, transfer or other disposition, of all or any "Substantial Part" of the assets either of the Company or of a subsidiary of the Company to a Related Person, (iii) the adoption of any plan or proposal for the liquidation or dissolution of the Company proposed by or on behalf of any Related Persons, (iv) any sale, lease, exchange, transfer or other disposition, of all or any Substantial Part of the assets of a Related Person to the Company or a subsidiary of the Company, (v) the issuance of any securities of the Company or a subsidiary of the Company to a Related Person other than the issuance on a pro rata basis to all holders of stock of the same class pursuant to a stock split or stock dividend, (vi) any reclassification of securities, recapitalization of the Company, or any merger or consolidation of the Company with any of its subsidiaries or any other transaction that would have the effect directly or indirectly of increasing the voting power of a Related Person, and (vii) any agreement, contract or other arrangement providing for any of the transactions described in this definition of Business Combination. The term "Related Person" means (a) any person which, together with its Affiliates and Associates, becomes the "Beneficial Owner" of an aggregate of 20% or more of the outstanding voting stock of the Company, and (b) any Affiliate or Associate of any such persons. "Related Person" does not include (1) a person whose acquisition of such aggregate percentage of voting shares was approved in advance by at least a majority of the Continuing Directors or (2) any trustee or fiduciary when acting in such capacity with respect to any person and any other person with whom such person or any Affiliate or Associate thereof has any agreement, arrangement or understanding, directly or indirectly, for the purpose of acquiring, holding, voting or disposing of voting shares. The term "Substantial Part" means an amount equal to 10% or more of the fair market value, as determined by at least a majority of the Continuing Directors, of the total consolidated assets of the Company and its subsidiaries as of the end of its most recent fiscal year prior to the time the determination is being made. The term "Beneficial Owner" means any person who beneficially owns any voting stock of the Company within the meaning ascribed in Rule 13d-3 under the Exchange Act or who has the right to acquire any such beneficial ownership (whether or not such right is exercisable immediately) pursuant to any agreement, contract, arrangement or understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise. 24 The term "Continuing Director" means a director of the Company who is not an Affiliate or Associate of the Related Person involved in the relevant Business Combination and (i) who was a member of the Board of Directors of the Company immediately prior to the time that such Related Person became a Related Person or (ii) whose initial election as a director of the Company recommended by the affirmative vote of a majority of the Continuing Directors then in office, provided that, in either such case, such Continuing Director has continued in office after becoming a Continuing Director. A Related Person is deemed to have acquired voting shares at the time when such Related Person became the Beneficial Owner thereof. The price deemed to have been paid by a Related Person for voting shares of which an Affiliate or Associate is the Beneficial Owner is the price, as determined by vote of at least a majority of the Continuing Directors, which is the highest of (i) the price paid upon the acquisition thereof by the relevant Affiliate or Associate (if any, and whether or not such Affiliate or Associate was an Affiliate or Associate at the time of such acquisition), (ii) the highest market price of such voting shares at the time when the Related Person became the Beneficial Owner thereof and (iii) the highest price previously paid by such Related Person or an Affiliate or Associate thereof for such voting shares. The terms "Highest Per Share Price" and "Highest Equivalent Price" means (a) if there is only one class of capital stock of the Company issued and outstanding, the Highest Per Share Price means the higher of (i) the highest price that can be determined, by a majority of the continuing Directors, to have been paid at any time by the Related Person for any share or shares of the class of capital stock and (ii) the fair market value per share of such capital stock, as determined by a majority of the Continuing Directors, immediately prior to the time the relevant Business Combination is first publicly announced, and (b) if there is more than one class of capital stock of the Company issued and outstanding, with respect to each class and series of capital stock of the Company, the amount determined by a majority of the Continuing Directors, on whatever basis they believe is appropriate, to be the higher of (i) the highest per share price equivalent of the highest price that can be determined to have been paid at any time by the Related Person for any share or shares or any class or series of capital stock of the Company and (ii) the equivalent fair market value per share of such capital stock, as determined by a majority of the Continuing Directors, immediately prior to the time the relevant Business Combination is first publicly announced. In determining the Highest Per Share Price and Highest Equivalent Price, (a) all purchases by the Related Person are to be taken into account regardless of whether the shares were purchased before or after the Related Person became a Related Person and (b) the Highest Per Share Price and the Highest Equivalent Price is to include any brokerage commissions, transfer taxes and soliciting dealers' fees or other value paid in connection with such purchases. In the case of any Business Combination with a Related Person, the Continuing Directors will determine the Highest Equivalent Price for each outstanding class and series of the capital stock of the Company. The terms "Affiliate" and "Associate" have the same meaning as in Rule 12b-2 under the Exchange Act. The Purchaser believes that it and the Parent collectively will be deemed to be a Related Person for purposes of Article Eighteenth the Charter upon consummation of the Offer. The foregoing summary of certain provisions of the Charter and the By-laws are qualified by reference to the text thereof as filed by the Company with the Commission and which can be examined or copies obtained as set forth in Section 8. Delaware Business Combination Law. Section 203 of the DGCL provides that a Delaware corporation such as the Company may not engage in any Business Combination (defined to include a variety of transactions, including a merger) with any Interested Stockholder (defined generally as any person that, directly or indirectly, beneficially owns 15% or more of the outstanding voting stock of the corporation), or any affiliate of an Interested Stockholder, for three years after the date on which the Interested Stockholder became an Interested Stockholder. The three-year prohibition on Business Combinations with Interested Stockholders (the "Business Combination Prohibition") does not apply if certain conditions, described below, are satisfied. Section 203 of the DGCL provides that a "beneficial owner" of voting stock includes any person who, individually or together with any of its affiliates or associates, has (i) the right to acquire voting stock (whether such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding or upon 25 the exercise of conversion rights, exchange rights, warrants or options or otherwise, (ii) the right to vote such stock pursuant to any agreement, arrangement or understanding, or (iii) any agreement, arrangement or understanding for the purposes of acquiring, holding, voting or disposing of such stock with any other person that beneficially owns, directly or indirectly, such stock. The Business Combination Prohibition does not apply to a particular Business Combination between a corporation and a particular Interested Stockholder if (i) prior to the date such Interested Stockholder became an Interested Stockholder, the board of directors of such corporation approves either the Business Combination or the transaction which resulted in the stockholder becoming an Interested Stockholder, or (ii) upon consummation of the transaction which resulted in the stockholder becoming an Interested Stockholder, the Interested Stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding those shares owned by (x) persons who are directors and also officers and (y) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer, or (iii) on or subsequent to the date the stockholder becomes an Interested Stockholder, the Business Combination is approved by the board of directors of such corporation and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the Interested Stockholder. The foregoing summary of Section 203 of the DGCL does not purport to be complete and is qualified in its entirety by reference to the provisions of Section 203 of the DGCL If the Minimum Condition is satisfied, the Business Combination Prohibition would not apply to the Merger by virtue of the Purchaser owning at least 85% of the voting stock of the Company at the time the Merger would be commenced. Alternatively, the prohibition contained in Section 203 would not apply to the Merger if the Company's Board of Directors adopt a resolution approving the Offer and the Merger prior to consummation of the Offer the for purposes of Section 203. There can be no assurance that the Company's Board will adopt such a resolution. The Rights. According to the Company 8-A, on April 24, 1996, the Board of Directors of the Company declared a dividend distribution of one Right for each outstanding Share. The dividend is payable to the stockholders of record on June 23, 1996 (the "Record Date"), and with respect to Shares issued thereafter until the Distribution Date and, in certain circumstances, with respect to Shares issued after the Distribution Date. Except as set forth below, each Right, when it becomes exercisable, entitles the registered holder to purchase from the Company one one-thousandth (1/1000th) of a share of Series A Junior Participating Preferred Stock, $10.00 par value per share (the "Preferred Shares"), of the Company at a price of $115.00 per one one-thousandth (1/1000th) of a Preferred Share (the "Purchase Price"), subject to adjustment. According to the Company 8-A, initially, the Rights will be attached to all Share Certificates then outstanding, and no separate Right Certificates will be distributed. The Rights will separate from the Shares upon the earliest to occur of (i) a person or group of affiliated or associated persons having acquired beneficial ownership of 15% or more of the outstanding Shares, (ii) 10 days (or such later date as the Board may determine) following the commencement of, or announcement of an intention to make, a tender offer or exchange offer, the consummation of which would result in a person or group of affiliated or associated persons becoming an Acquiring Person (as hereinafter defined), or (iii) 10 days after the Board of Directors determines that a person or group of affiliated or associated persons has become an Adverse Person (as hereinafter defined) (the "Distribution Date"). A person or group whose acquisitions of Shares cause a Distribution Date pursuant to clause (i) above is an "Acquiring Person," (it being deemed, however, that DDC and OMC Acquisition are not Acquiring Persons under the Rights Agreement) with certain exceptions as set forth in the Rights Agreement. The date that a person or group is first publicly announced to have become such by the Company or such Acquiring Person is the "Stock Acquisition Date." A person or group is an "Adverse Person" when the Board of Directors of the Company determines that (x) such person or group has acquired beneficial ownership of a substantial number of Shares (which in no event will represent less than 10% of all outstanding Shares), and (y) such ownership is intended to cause the Company to repurchase the Shares held by such person or group, or such ownership is causing or is reasonably likely to cause a material adverse impact on the business or prospects of the Company. 26 According to the Company 8-A, until the Distribution Date, the Rights will be transferred with and only with the Shares. Until the Distribution Date (or earlier redemption or expiration of the Rights), new Share Certificates issued after the Record Date upon transfer or new issuance of Shares will contain a notation incorporating the Rights Agreement by reference. Until the Distribution Date (or earlier redemption or expiration of the Rights), the surrender for transfer of any Share Certificates outstanding as of the Record Date, even without such notation or a copy of the Summary of Rights contained in the Company Form 8-A being attached thereto, will also constitute the transfer of the Rights associated with the Shares represented by such certificate. As soon as practicable following the Distribution Date, separate Rights Certificates will be mailed to the holders of record of the Shares as of the close of business on the Distribution Date (and to each initial record holder of certain Shares issued after the Distribution Date), and such separate Right Certificates alone will evidence the Rights. According to the Company 8-A, the Rights are not exercisable until the Distribution Date and will expire at the close of business on June 23, 2006 unless, earlier, there is (i) a redemption by the Company, (ii) an exchange by the Company of one Share for each Right, or (iii) the consummation of transactions contemplated by the DDC Merger Agreement. According to the Company 8-A, in the event that any person becomes an Acquiring Person (except (i) pursuant to an offer which is for all outstanding Shares at a price and on terms which the independent directors determine to be fair and otherwise in the best interests of the Company and its stockholders and (ii) for certain persons who report their ownership on Schedule 13G under the Exchange Act or on Schedule 13D under the Exchange Act, provided that they do not state any intention to, or reserve the right to, control or influence the Company and such persons certify that they became an Acquiring Person inadvertently and they agree that they will not acquire any additional Shares or an Adverse Person (each, a "Triggering Event"), then the Rights will "flip-in" and entitle each holder of a Right (the "Flip-In Right") to receive upon its exercise the number of Shares having a value (immediately prior to such Triggering Event) equal to two times the exercise price of the Right. Notwithstanding the foregoing, following the occurrence of the event described above, all Rights that are, or (under certain circumstances specified in the Rights Agreement) were, beneficially owned by any Acquiring Person, Adverse Person, or any affiliate or associate thereof will be null and void. According to the Company 8-A, in the event that, at any time following a Triggering Event, (i) the Company is acquired in a merger or other business combination transaction in which its common stock does not remain outstanding or is changed, or (ii) more than 50% of the Company's assets or earning power is sold or transferred, then each holder of a Right (except Rights which previously have been voided as set forth above) shall thereafter have the right (the "Flip-Over Right") to receive, upon exercise common shares of the acquiring company having a value equal to two times the exercise price of the Right. According to the Company 8-A, Preferred Shares purchasable upon exercise of the Rights will not be redeemable. Each Preferred Share will be entitled to a preferential quarterly dividend payment of the greater of (i) $0.01 per share and (ii) an aggregate dividend per share of 1,000 times the dividend declared per Share. In the event of liquidation, the holders of the Preferred Shares will be entitled to a minimum preferential liquidation payment per share in an amount equal to the greater of 1,000 times $115.00 or 1,000 times the payment made per Share plus an amount equal to accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment (the "Series A Liquidation Preference"); thereafter, and after the holders of the Shares receive a liquidation payment of an amount equal to the quotient obtained by dividing the Series A Liquidation Preference by 1,000 (subject to certain adjustments for stock splits, stock dividends and recapitalizations with respect to the Shares), the holders of the Preferred Shares and the holders of the Shares will share the remaining assets in the ratio of 1,000 to 1 (as adjusted) for each Preferred Share and Share so held, respectively. Finally, in the event of any merger, consolidation or other transaction in which Shares are exchanged, each Preferred Share will be entitled to receive 1,000 times the amount received per Share. These rights are protected by customary antidilution provisions. Each Preferred Share entitles its holder to 1,000 votes (subject to certain adjustments) on all matters submitted to a vote of the Company's stockholders. In the event that the amount of accrued and unpaid dividends on the Preferred Shares is equivalent to six full quarterly dividends or more, the holders of the Preferred Shares shall have the right, voting as a class, to elect two directors in addition to the directors elected by the holders of the Shares until all cumulative dividends on the Preferred Shares have been paid through the last quarterly dividend payment date. 27 According to the Company 8-A, with certain exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments require an adjustment of at least 1% in such Purchase Price. No fractional Preferred Shares will be issued (other than fractions which are one one-thousandth (1/1000th) or integral multiples of one one-thousandth (1/1000th) of a Preferred Share) and in lieu thereof, an adjustment in cash will be made based on the market price of the Preferred Shares on the last trading day prior to the date of exercise. According to the Company 8-A, at any time prior to the earlier of (i) 10 days following the Stock Acquisition Date, or (ii) the expiration of the Rights, the Company may redeem the then outstanding Rights in whole, but not in part, at a price of $.01 per Right (the "Redemption Price") (payable in cash or, at the Company's election, in Shares), which redemption shall be effective upon the action of the Board. The Board of Directors of the Company may not redeem any Rights after it has determined any person to be an Adverse Person. According to the Company 8-A, until a Right is exercised, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends. The foregoing summary of the Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the Company 8-A and the text of the Rights Agreement as set forth as an exhibit thereto, filed by the Company with the Commission, copies of which may be obtained in the manner set forth in Section 8 (except that copies thereof may not be available at the regional offices of the Commission). The Purchaser and the Parent believe that under the circumstances of the Offer, and under applicable law, the Board of Directors of the Company has a fiduciary obligation to redeem the Rights (or amend the Rights Agreement to make the Rights inapplicable to the Offer and the proposed Merger), and the Purchaser and the Parent are hereby requesting that the Company's Board of Directors do so. However, there can be no assurance that the Board will redeem the Rights (or amend the Rights Agreement). The Purchaser and the Parent have commenced litigation in the Court of Chancery for the State of Delaware seeking, among other things, an order compelling the Company's Board of Directors to redeem the Rights or to amend the Rights Agreement to make the Rights inapplicable to the Offer and the proposed Merger on the grounds that failure to do so would constitute a breach of fiduciary duty to the Company's stockholders. There can be no assurance that such an order will be obtained. If the Rights Condition is not satisfied and Purchaser elects, in its sole discretion, to waive the Rights Condition and consummate the Offer, if there are outstanding Rights which have not been acquired by Purchaser, Purchaser will evaluate its alternatives. Such alternatives could include purchasing additional Rights in the open market, in privately negotiated transactions, in another tender or exchange offer or otherwise. Any such additional purchase of Rights could be for cash or other consideration. Under such circumstances, the Merger might be delayed or abandoned as impracticable. The form and amount of consideration to be received by the holders of Shares in the Merger, if consummated, might be subject to adjustment to compensate Purchaser for, among other things, the costs of acquiring Rights and a portion of the potential dilution cost to Purchaser of Rights not owned by Purchaser and its wholly owned subsidiaries at the time of the Merger. In such event, the value of the consideration to be exchanged for Shares in the Merger could be substantially less than the consideration paid in the Offer. In addition, Purchaser may elect under such circumstances not to consummate the Merger. Unless the Rights are redeemed, stockholders will be required to tender one Right for each Share tendered in order to effect a valid tender of such Share in accordance with the procedures set forth in Section 3. If separate certificates for the Rights are not issued, a tender of Shares will also constitute a tender of the associated Rights. If a Distribution Date occurs, stockholders will be required to tender one Right for each Share tendered in order to effect a valid tender of Shares. See Sections 1 and 3. Plans for the Company The Parent has made a preliminary review of, and will continue to review, on the basis of available information, various possible business strategies that it might consider if it acquires control of the Company. If Parent acquires control of the Company, Parent intends to conduct a detailed review of the Company and its assets, pension plans, corporate structure, dividend policy, capitalization, operations, properties, policies, management 28 and personnel and consider what, if any, changes or sale of assets would be desirable in light of the circumstances which then exist. Such changes could include, among other things, changes in the Charter and By-laws or in the Company's business, corporate structure, capitalization or management. As described above, however, the Parent's ability to effect any changes or transactions, and the timing thereof, will depend in part on the Parent's ability to gain control of the Company's Board of Directors, as well as the provisions of the Charter, the By-laws and Section 203. The Parent, however, has no present plans or proposals that would result in an extraordinary corporate transaction, such as merger, reorganization, liquidation, relocation of operations, or sale or transfer of assets, involving the Company or any of its subsidiaries, or any material changes in the Company's corporate structure, business or composition of its management. Appraisal Rights No appraisal rights are available in connection with the Offer. Holders of Shares will be entitled to appraisal rights under Section 262 of the DGCL in connection with the Merger (including if the Merger is effected pursuant to the "short-form merger" provisions of Section 253 of the DGCL) and, accordingly, will be entitled to demand appraisal of, and payment in cash of the fair value of, their Shares. Such rights, if the statutory procedures were complied with, could lead to a judicial determination of the fair value (excluding any element of value arising from the accomplishment or expectation of the Merger) required to be paid in cash to such dissenting holders for their Shares. Any such judicial determination of the fair value of Shares could be based upon considerations other than, or in addition to, the price paid in the Offer and the market value of the Shares, including asset values and the investment value of the Shares. The value so determined could be more or less than the purchase price per Share pursuant to the Offer or the consideration per Share to be paid in the Merger. The foregoing summary of Section 262 of the DGCL does not purport to be complete and is qualified in its entirety by reference to Section 262 of the DGCL. The preservation and exercise of appraisal rights requires strict adherence to the applicable provisions of Section 262 of the DGCL. "Going Private" Transactions 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 or another business combination following the purchase of Shares pursuant to the Offer in which Purchaser seeks to acquire the remaining Shares not held by it. However, Rule 13e-3 would be inapplicable if (i) the Shares are deregistered under the Exchange Act prior to the Merger or other business combination or (ii) the Merger or other business combination is consummated within one year after the purchase of the Shares pursuant to the Offer and the amount paid per Share in the Merger or other business combination is at least equal to the amount paid per Share in the Offer. If applicable, Rule 13e-3 requires, among other things, that certain financial information concerning the fairness of the proposed transaction and the consideration offered to minority stockholders in such transaction be filed with the Commission and disclosed to stockholders prior to the consummation of the transaction. 12. Source and Amount of Funds. The total amount of funds required by the Purchaser to consummate the Offer and the Merger (assuming that outstanding Company options are not exercised and the Company Debentures are not converted) is expected to be approximately $328 million, which amount excludes related fees and expenses. The necessary funds are expected to come from the following sources: (i) approximately $241 million of cash equity financing from the Acquirors; and (ii) approximately $87 million under the Credit Facility (as defined below). Equity Financing. On the Initial Capital Contribution Date under the Parent LCC Agreement, each of QSP and QIP will contribute $96,250,000 to the Parent and Greenlake will contribute $48,500,000 and 2,000,000 Shares (the "Contributed Shares") to the Parent. For a more complete description of these contributions (collectively, the "Equity Financing"), see Section 9 hereof. QSP will fund its commitment from working capital provided by Quasar Partners. QIP will fund its commitment through working capital. Credit Facility. The Purchaser has received a written financing commitment, dated August 7, 1997 (the "Commitment Letter"), from AFG to provide two term loans, each up to the amount of $150 million (the "Credit Facility"). The second loan will be made only after the first loan has been repaid. 29 The terms of the definitive agreement (the "Credit Agreement") between the Company and certain affiliates of AFG (collectively, the "Lenders") providing for the Credit Facility have not been finalized. The following is a summary of the anticipated principal terms of the Credit Facility based upon the Commitment Letter. This summary is subject to finalizing the Credit Agreement and is qualified in its entirety by reference to the Commitment Letter which is filed as an exhibit to the Schedule 14D-1 to which this Offer to Purchase is also an exhibit. Under the Credit Facility and subject to the terms and conditions thereof, the Lenders will provide (1) a term loan to the Purchaser in an amount up to $150 million (the "Phase I Loan") and (2) a term loan to the Company in an amount up to $150 million (the "Phase II Loan"). The Phase II Loan will be made only after the consummation of the proposed Merger. The proceeds of the Phase I Loan must be used by the Purchaser solely towards the purchase of Shares in the Offer and for any conversion of the Company Debentures, which repurchase (as described below) may be required as a result of the consummation of the Offer. The proceeds of the Phase II Loan must be used by the Company, as the surviving corporation of the Merger, for (i) the repayment of all amounts outstanding under the Phase I Loan, (ii) the purchase, pursuant to the Merger, of any Shares not acquired in the Offer, and (iii) any required repurchase of Company Debentures. All amounts outstanding under the Phase I Loan must be fully repaid prior to or with the proceeds of the Phase II Loan. The term of the Phase I Loan will commence upon the first disbursement of the Phase I Loan proceeds and terminate upon the earlier of the Merger or nine months after the first disbursement under the Phase I Loan, at which time all principal and accrued interest will be due and payable on the Phase I Loan. The term of the Phase II Loan will commence upon the Merger and terminate nine months after the first disbursement under the Phase I Loan, at which time all principal and accrued interest will be due and payable on the Phase II Loan. The Lenders' obligations to first disburse funds shall remain open for a period of 90 days following the execution of a satisfactory Credit Agreement. Interest will accrue on the outstanding principal balances of the Phase I Loan and the Phase II Loan at a rate of 10% per annum. Interest will be payable monthly in arrears on the first day of each month during the terms of the loans. Upon the execution of the Commitment Letter, the Purchaser paid AFG a non-refundable commitment fee of $1,500,000. Upon each disbursement of loan proceeds other than proceeds of the Phase II Loan used to repay the Phase I Loan, the Purchaser shall pay American Financial a funding fee equal to 1% of the amount of proceeds so disbursed. The maximum funding fee payable to AFG under the Credit Agreement will be $1,500,000. The Purchaser will also reimburse certain expenses of the Lenders and provide certain indemnities to the Lenders, all of which the Purchaser believes to be customary for commitments of this type. The Phase I Loan will be secured by (i) a pledge by the Parent to the Lenders of the Contributed Shares and (ii) a pledge by the Purchaser to the Lenders of all Shares tendered pursuant to the Offer (such Shares, together with the Contributed Shares, the "Security"). The aggregate value of the Security must at all times be equal to or greater than twice the principal balance of the aggregate amount outstanding under the Phase I Loan and the Phase II Loan. The Phase II Loan will be secured by a pledge of all of the capital stock of the surviving corporation in the Merger. In addition, in the event that the Purchaser makes a loan to the Company to fund the Company's repurchase of the Company Debentures, the Purchaser will assign its right to receive repayment of such loan to the Lenders as additional collateral securing repayment of the Phase I Loan. The Credit Agreement will contain representations and warranties, covenants (including financial covenants), indemnities, events of default and other provisions customary for such financings. The Phase I Loan is conditioned upon, among other things, (i) immediately prior to the funding of the Phase I Loan, the Purchaser and Parent, on a consolidated basis, having a minimum shareholders' equity of $275 million consisting of (a) $241 million of cash equity (the "Cash Equity") and (b) $34 million allocable to the Contributed Shares, plus additional equity contributions to the Purchaser (the "Additional Equity"), if necessary, calculated on the basis of the difference, if any, between the final Offer Price and $18.00 as set forth in the Commitment Letter; and (ii) the full amount of the Cash Equity and the Additional Equity being used to finance the Offer prior to the disbursement of any funds under the Phase I Loan. 30 It is anticipated that the indebtedness incurred under the Credit Facility will be repaid from funds generated internally by the Company and its subsidiaries and from other sources that may include the proceeds of the private or public sale of debt or equity securities. No final decisions have been made concerning the method the Company will employ to repay such indebtedness. Such decisions, when made, will be based upon Parent's review from time to time of the advisability of particular actions, as well as upon prevailing interest rates and financial and other economic conditions. The proceeds from the Equity Financing and the Credit Facility may be used to finance the repurchase of the Company Debentures, if necessary. According to publicly available information regarding the Company, following a "Change in Control" (as defined in the Company Debentures), which would occur upon the Purchaser acquiring more than 50% of the outstanding Shares in the Offer, any holder of the Company Debentures would have the right to require the Company to purchase for cash all or any part of such holder's Company Debentures at 100% of the principal thereof. According to the Company's Annual Report on Form 10-K for its fiscal year ended September 30, 1996, as of September 30, 1996, there were outstanding Company Debentures in the aggregate principal amount of $74.8 million. To the extent, if any, that the Equity Financing and the Credit Facility do not provide sufficient funds to consummate the Offer and the Merger and to pay any other amounts due as a result of a "Change in Control," including any amounts due if holders of the Company Debentures require such debentures to be repurchased, the Purchaser will use the available working capital of the Company or will arrange for additional financing sources to satisfy such obligations. The Purchaser has not made any arrangements for such additional financing and there can be no assurance that such financing will be available or, if available, on terms favorable to the Purchaser or the Company. In addition, according to publicly available information regarding the Purchaser, it is possible that consummation of the Offer may result in a default under certain instruments pursuant to which approximately $300 million of the Company's indebtedness (including the $74.8 million represented by the Company Debentures) was issued. While the Parent will seek to obtain the requisite consents under such instruments prior to the Expiration Date, in the event that such consents are not obtained, the Parent will seek to arrange for additional financing so that upon obtaining control of the Company, the Parent will be able to cause the Company to refinance or redeem such indebtedness. There can be no assurance, however, that such financing will be available or, if available, on terms that are not less favorable to the Company than those that currently apply. 13. Dividends and Distributions. If, on or after August 8, 1997, the Company (i) splits, combines or otherwise changes the Shares or its capitalization, (ii) acquires Shares or otherwise causes a reduction in the number of Shares, (iii) issues or sells additional Shares, or any shares of any other class of capital stock, other voting securities or any securities convertible into or exchangeable for, or rights, warrants or options, conditional or otherwise, to acquire, any of the foregoing, or (iv) discloses that it has taken such action, then, without prejudice to the Purchaser's rights under Section 14, the Purchaser, in its sole discretion, may make such adjustments in the purchase price and other terms of the Offer and the Merger as it deems appropriate to reflect such split, combination or other change including, without limitation, the number or type of securities offered to be purchased. If, on or after August 8, 1997, the Company should declare or pay any cash dividend on the Shares or other distribution on the Shares, or issue with respect to the Shares any additional Shares, shares of any other class of capital stock, other than voting securities or any securities convertible into, or rights, warrants or options, conditional or otherwise, to acquire, any of the foregoing, payable or distributable to stockholders of record on a date prior to the transfer of the Shares purchased pursuant to the Offer to the Purchaser or its nominee or transferee on the Company's stock transfer records, then, subject to the provisions of Section 14, (a) the Offer Price may, in the sole discretion of the Purchaser, be reduced by the amount of any such cash dividends or cash distributions and (b) the whole of any such noncash dividend, distribution or issuance to be received by the tendering stockholders will (i) be received and held by the tendering stockholders for the account of the Purchaser and will be required to be promptly remitted and transferred by each tendering stockholder to the Depositary for the account of the Purchaser, accompanied by appropriate documentation of transfer, or (ii) at the direction of the Purchaser, be exercised for the benefit of the Purchaser, in which case the proceeds of such exercise will 31 promptly be remitted to the Purchaser. Pending such remittance and subject to applicable law, the Purchaser will be entitled to all rights and privileges as owner of any such noncash dividend, distribution, issuance or proceeds and may withhold the entire Offer Price or deduct from the Offer Price the amount or value thereof, as determined by the Purchaser in its sole discretion. 14. Certain Conditions of the Offer. Notwithstanding any other term of the Offer, the Purchaser shall not be required to accept for payment or pay for, subject to any applicable rules and regulations of the Commission, any Shares not theretofore accepted for payment or paid for and may terminate or amend the Offer as to such Shares unless (1) the Minimum Condition, the Rights Condition, the Funding Condition, the Supermajority Condition, the OMC Indebtedness Condition and the DDC Termination Condition are satisfied, and (2) approvals required by law to be obtained prior to the consummation of the Offer under any antitrust or competition laws to the purchase of Shares pursuant to the Offer shall have been obtained. Furthermore, notwithstanding any other term of the Offer, the Purchaser shall not be required to accept for payment or to pay for any Shares not theretofore accepted for payment or paid for, and may terminate or amend the Offer if at any time prior to the expiration of the Offer, any of the following conditions exist or shall occur and remain in effect: (i) (a) A court of competent jurisdiction or other governmental entity shall have issued an order, judgment, decree or ruling on the merits in connection with an action, suit or proceeding brought by any governmental entity or person which (1) restrains or prohibits the acquisition by the Purchaser or the Parent of Shares pursuant to the Offer, or the making or consummation of the Offer or the Merger, (2) makes the purchase of or payment for some or all of the Shares pursuant to the Offer or the Merger illegal, (3) imposes material limitations on the ability of the Parent (or any of its affiliates) to acquire or hold, or to require the Parent or any of its affiliates or subsidiaries to dispose of or hold separate, any material portion of the assets or the business of the Parent and its affiliates taken as a whole or the Company and its subsidiaries taken as a whole, or (4) imposes material limitations on the ability of the Purchaser or the Parent (or its affiliates) to exercise full rights of ownership of the Shares purchased by it, including, without limitation, the right to vote the Shares purchased by it on all matters properly presented to the stockholders of the Company, or (b) there shall have been instituted and pending any action or proceeding by any governmental entity which, in the opinion of the Parent's counsel (assuming, for purposes of such opinion only, the validity of the allegations) has a reasonable likelihood of success on the merits, and which (1) seeks to challenge the acquisition by the Purchaser or the Parent of the Shares pursuant to the Offer, restrain, prohibit or delay the making or consummation of the Offer or the Merger, or obtain any material damages in connection therewith, (2) seeks to make the purchase of or payment for some or all of Shares pursuant to the Offer or the Merger illegal, (3) seeks to impose material limitations on the ability of the Parent (or any of its affiliates) effectively to acquire or hold, or to require Parent or the Company or any of their respective affiliates or subsidiaries to dispose of or hold separate, any material portion of the assets or the business of Parent and its affiliates taken as a whole or the Company and its subsidiaries taken as a whole, or (4) seeks to impose material limitations on the ability of Parent (or its affiliates) to exercise full rights of ownership of the Shares purchased by it, including, without limitation, the right to vote the Shares purchased by it on all matters properly presented to the stockholders of the Company; or (ii) There shall have occurred (a) 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, (b) the declaration of a banking moratorium or any suspension of payments in respect of banks in the United States, (c) the commencement of a war, armed hostilities or other international or national calamity directly or indirectly involving the United States, or (d) any limitation (whether or not mandatory) by any governmental or regulatory authority on, or any other event which has a material adverse effect on the extension of credit by banks or other lending institutions in the United States; or (iii) There shall have been promulgated, enacted, entered, enforced or deemed applicable to the Offer or the Merger, by any governmental entity, any law or there shall have been issued any injunction resulting in any of the consequences referred to in subsection (i) above. The foregoing conditions (i) through (iii) are for the sole benefit of Parent and the Purchaser and may be asserted by Parent regardless of the circumstances giving rise to any such condition and may be waived by Parent, in whole or in part, at any time and from time to time, in the sole discretion of Parent. The failure by the 32 Purchaser and the Parent at any time to exercise any of the foregoing rights will not be deemed a waiver of any right, the waiver of such right with respect to any particular facts or circumstances shall not be deemed a waiver with respect to any other facts or circumstances, and each right will be deemed an ongoing right which may be asserted at any time and from time to time. Should the Offer be terminated pursuant to the foregoing provisions, all tendered Shares not theretofore accepted for payment shall forthwith be returned by the depositary to the tendering stockholders. 15. Certain Regulatory and Legal Matters. Except as set forth in this Offer to Purchase, including, but not limited to Section 11 and this Section 15, based on its review of publicly available filings by the Company with the Commission and other publicly available information regarding the Company, the Purchaser is not aware of any licenses or regulatory permits that would be material to the business of the Company and its subsidiaries, taken as a whole, and that might be adversely affected by the Purchaser's acquisition of Shares (and the indirect acquisition of the stock of the Company's subsidiaries) as contemplated herein, or any filings, approvals or other actions by or with any domestic, foreign or supranational governmental authority or administrative or regulatory agency that would be required prior to the acquisition of Shares (or the indirect acquisition of the stock of the Company's subsidiaries) by Purchaser pursuant to the Offer as contemplated herein. Should any such approval or other action be required, there can be no assurance that any such additional approval or action, if needed, would be obtained without substantial conditions or that adverse consequences might not result to the Company's business, or that certain parts of the Company's or the Purchaser's business might not have to be disposed of or held separate or other substantial conditions complied with in order to obtain such approval or action or in the event that such approvals were not obtained or such actions were not taken. Purchaser's obligation to purchase and pay for Shares is subject to certain conditions, including conditions with respect to governmental actions. See the Introduction and Section 14 for a description of certain conditions to the Offer, including with respect to litigation and governmental actions. Antitrust. Under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), and the rules and regulations that have been promulgated thereunder by the Federal Trade Commission (the "FTC"), certain acquisition transactions may not be consummated until certain information and documentary material has been furnished for review by the Antitrust Division of the Department of Justice (the "Antitrust Division") and the FTC and certain waiting period requirements have been satisfied. The Antitrust Division and the FTC frequently scrutinize the legality under the antitrust laws of transactions such as the acquisition of Shares by the Purchaser pursuant to the Offer and the Merger. At any time before or after the Purchaser's purchase of Shares, the Antitrust Division or the FTC could take such action under the antitrust laws as either deems necessary or desirable in the public interest, including seeking to enjoin the purchase of Shares pursuant to the Offer, the divestiture of Shares purchased pursuant to the Offer or the divestiture of substantial assets of the Acquirors. Private parties as well as state attorneys general may also bring legal actions under the antitrust laws under certain circumstances. The Acquirors believe that the Purchaser's acquisition of Shares would not violate the antitrust laws. There can be no assurance, however, that a challenge to the Offer on antitrust grounds will not be made or that, if such a challenge is made, the Purchaser will prevail. See Section 14. If the HSR Act were deemed applicable to the acquisition of Shares pursuant to the Offer, the consummation of the Offer could be delayed until compliance therewith. Based upon an examination of publicly available information relating to the businesses in which the Company is engaged, the Purchaser believes that the acquisition of Shares pursuant to the Offer and the Merger would not violate the antitrust laws. The Purchaser believes that retention of all of the operations of the Company and the Purchaser should be permitted under the antitrust laws. Nevertheless, 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 result will be. See Section 14. Federal Reserve Board Regulations. Regulations G, U and X (the "Margin Regulations") of the Federal Reserve Board 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 by margin stock. Such secured credit may not be extended or maintained in an amount that exceeds the maximum loan value of all the direct and indirect collateral securing the credit, including margin stock and other collateral. 33 State Takeover Laws. A number of states (including Delaware, where the Company is incorporated) have adopted laws and regulations applicable to attempts to acquire securities of corporations which are incorporated, or have substantial assets, stockholders, principal executive offices or principal places of business, or whose business operations otherwise have substantial economic effects, in such states. In Edgar v. MITE Corp., the Supreme Court of the United States invalidated on constitutional grounds the Illinois Business Takeover statute, which, as a matter of state securities law, made takeovers of corporations meeting certain requirements more difficult. However in 1987, in CTS Corp. v. Dynamics Corp. of America, the Supreme Court held that the State of Indiana may, as a matter of corporate law and, in particular, with respect to 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 presenting stockholders. The state law before the Supreme Court was by its terms applicable only to corporations that had a substantial number of stockholders in the state and were incorporated there. Subsequently, in TLX Acquisition Corp., v Telex Corp., a Federal district court in Oklahoma ruled that the Oklahoma statutes were unconstitutional insofar as they apply to corporations incorporated outside Oklahoma in that they would subject such corporations to inconsistent regulations. Similarly, in Tyson Foods, Inc., v McReynolds, a Federal district court in Tennessee ruled that four Tennessee takeover statutes were unconstitutional as applied to corporations incorporated outside Tennessee. This decision was affirmed by the United States Court of Appeals for the Sixth Circuit. In December 1988, a Federal district court in Florida held in Grand Metropolitan PLC v Butterworth that the provisions of the Florida Affiliated Transactions Act and Florida Control Share Acquisition Act were unconstitutional as applied to corporations incorporated outside of Florida. The Company, directly or through subsidiaries, conducts business in a number of states throughout the United States, some of which have enacted takeover laws. The Purchaser does not know whether any of these laws will, by their terms, apply to the Offer or the Merger and has not complied with any such laws. Should any person seek to apply any state takeover law, the Purchaser will take such action as then appears desirable, which may include challenging the validity or applicability of any such statute in appropriate court proceedings. In the event it is asserted that one or more state takeover laws is applicable to the Offer or the Merger, and an appropriate court does not determine that it is inapplicable or invalid as applied to the Offer, the Purchaser might be required to file certain information with, or receive approvals from, the relevant state authorities. In addition, if enjoined, the Purchaser might be unable to accept for payment any Shares tendered pursuant to the Offer, or be delayed in continuing or consummating the Offer and the Merger. In such case, the Purchaser may not be obligated to accept for payment any Shares tendered. See Section 14. Foreign Laws. The Company and certain of its subsidiaries conduct business in several foreign countries where regulatory filings or approvals may be required or desirable in connection with the consummation of the Offer. Certain of such filings or approvals, if required or desirable, may not be made or obtained prior to the expiration of the Offer. The Purchaser is seeking further information regarding the applicability of any such laws and currently intends to take such action as may be required or desirable. If any approvals required by law to be obtained prior to consummation of the Offer under any foreign antitrust or competition law to the purchase of Shares pursuant to the Offer shall not have been obtained prior to the Expiration Date, the Purchaser will not be obligated to proceed with the Offer or the purchase of any Shares not theretofore purchased pursuant to the Offer. In addition, if any foreign governmental entity takes any action prior to the completion of the Offer that might have certain adverse effects, the Purchaser will not be obligated to accept for payment or pay for any Shares tendered pursuant to the Offer. See Section 14. 16. Certain Fees and Expenses. The Purchaser has retained Georgeson & Company Inc. as Information Agent in connection with the Offer. The Information Agent may contact holders of Shares by mail, telephone, telex, telegraph and personal interview and may request brokers, dealers and other nominee stockholders to forward material relating to the Offer to beneficial owners. The Information Agent will receive reasonable and customary compensation for all such services in addition to reimbursement of reasonable out-of-pocket expenses. The Purchaser has agreed to indemnify the Information Agent against certain liabilities and expenses, including liabilities under the federal securities laws. 34 In addition, Marine Midland Bank has been retained as the Depositary. The Depositary has not been retained to make solicitations or recommendations in its role as Depositary. The Depositary will receive reasonable and customary compensation for its services in connection with the Offer, will be reimbursed for its reasonable out-of-pocket expenses and will be indemnified against certain liabilities and expenses in connection therewith. Except as set forth above, the Purchaser will not pay any fees or commissions to any broker, dealer or other person (other than the Information Agent) for soliciting tenders of Shares and Rights pursuant to the Offer. Brokers, dealers, commercial banks and trust companies and other nominees will, upon request, be reimbursed by the Purchaser for customary clerical and mailing expenses incurred by them in forwarding materials to their customers. 17. Miscellaneous. The Offer is not being made to (nor will tenders be accepted from or on behalf of) holders of Shares or Rights residing in any jurisdiction in which the making of the Offer or the acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. Neither the Purchaser nor the Parent is aware of any jurisdiction in which the making of the Offer or the acceptance thereof would not be in compliance with the laws of such jurisdiction. To the extent the Purchaser or the Parent becomes aware of any state law that would limit the class of offerees in the Offer, the Purchaser may, in its discretion, take such action as it may deem necessary to make the Offer in any jurisdiction and extend the Offer to holders of Shares in such jurisdiction. In any jurisdiction where the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer will be deemed to be made on behalf of the Purchaser by one or more registered brokers or dealers that are licensed under the laws of such jurisdiction. The Acquirors have filed with the Commission the Purchaser Schedule 14D-1, together with exhibits, pursuant to Rule 14d-3 under the Exchange Act, furnishing certain additional information with respect to the Offer, and may file amendments thereto. Such Purchaser Schedule 14D-1 and any amendments thereto, including exhibits, may be examined and copies may be obtained from the office of the Commission in the same manner as described in Section 8 with respect to information concerning the Company, except that they will not be available at the regional offices of the Commission. No person has been authorized to give any information or to make any representation on behalf of the Purchaser not contained in this Offer to Purchase or in the Letter of Transmittal and, if given or made, any such information or representation must not be relied upon as having been authorized. Neither the delivery of the Offer to Purchase nor any purchase pursuant to the Offer shall, under any circumstances, create any implication that there has been no change in the affairs of the Purchaser or the Company since the date as of which information is furnished or the date of this Offer to Purchase. GREENMARINE ACQUISITION CORP. August 8, 1997 35 Schedule I DIRECTORS, EXECUTIVE OFFICERS OR CONTROLLING PERSONS OF THE ACQUIRORS. 1. The Purchaser. Set forth below are the name, business address and present principal occupation or employment, and material occupations, positions, offices or employments for the past five years of each director and executive officer of the Purchaser. Except as otherwise noted, the business address of each such person is 277 Park Avenue, 27th Floor, New York, NY 10172 and such person is a United States citizen.
Present Principal Occupation or Employment; Material Occupations, Positions, Offices or Name Employments for the Past Five Years - -------------------- --------------------------------------------------------------- Alfred D. Kingsley Mr. Kingsley is the Chief Executive Officer and President of the Purchaser. Mr. Kingsley is also a principal of Green- way Partners, L.P. ("Greenway"), the principal business of which is investing in securities. Mr. Kingsley joined Carl Icahn at Icahn & Co. Inc. in 1968. Mr. Kingsley served as senior adviser to Mr. Icahn until October 1992. Mr. Kings- ley was a director of Trans World Airlines Inc. from Sep- tember 1985, and served as Vice Chairman of the Board from February 1989, until January 1993. Mr. Kingsley con- tinues to serve as Director of ACF Industries, Incorporated, a rail car leasing and manufacturing firm, and as a director of the general partner of American Real Estate Partners, L.P., a real estate investment partnership. Gary K. Duberstein Mr. Duberstein is the Vice President, Secretary and Trea- surer of the Purchaser. Mr. Duberstein is also a principal of Greenway. Mr. Duberstein served as general counsel to Carl Icahn and vice president of various of his entities from 1985 until March 1993. From 1979 to 1985, Mr. Duber- stein was associated with the New York City law firm of Weil, Gotshal & Manges LLP. Richard Katz See Part 10 below.
2. The Parent. Set forth below are the name, business address and present principal occupation or employment, and material occupations, positions, offices or employments for the past five years of each member of the management committee of the Parent. Each such person is a citizen of the United States.
Present Principal Occupation or Employment; Material Occupations, Positions, Offices or Name Employments for the Past Five Years - -------------------- -------------------------------------------- Alfred D. Kingsley See Part 1 above. Gary K. Duberstein See Part 1 above. Richard Katz See Part 10 below.
3. Greenlake. Set forth below are the name, business address and present principal occupation or employment, and material occupations, positions, offices or employments for the past five years of each member of the management committee of the Greenlake. Each such person is a citizen of the United States.
Present Principal Occupation or Employment; Material Occupations, Positions, Offices or Name Employments for the Past Five Years - -------------------- -------------------------------------------- Alfred D. Kingsley See Part 1 above. Gary K. Duberstein See Part 1 above.
36 4. QIH. Set forth below are the name, business address and present principal occupation or employment of the directors and executive officers of QIH.
Name/Title/Citizenship Principal Occupation Business Address - ------------------------- ---------------------- --------------------- Curacao Corporation Managing Director of Kaya Flamboyan 9 Company N.V. Netherlands Antilles Willemstad Managing Director corporations Curacao, (Netherlands Antilles) Netherlands Antilles
5. QIP. Set forth below are the name, business address and present principal occupation or employment of the directors and executive officers of QIP.
Name/Title/Citizenship Principal Occupation Business Address - ---------------------------------- ------------------------- ----------------------- Curacao Corporation Managing Director of Kaya Flamboyan 9 Company N.V. Netherlands Antilles Willemstad Managing Director corporations Curacao, (Netherlands Antilles) Netherlands Antilles Inter Caribbean Services Limited Administrative services Citco Building Secretary Wickhams Cay (British Virgin Islands) Road Town Tortola British Virgin Islands
6. QIH Management. Set forth below are the name, business address and present principal occupation or employment, and material occupations, positions, offices or employments for the past five years of the directors and executive officers of QIH Management. The business address of each such person is 888 Seventh Avenue, 33rd Floor, New York, New York 10106 and such person is a United States citizen.
Present Principal Occupation or Employment; Material Occupations, Positions, Offices or Name Employments for the Past Five Years - ----------------- --------------------------------------------------------- Gary Gladstein See Part 7 below Sean C. Warren See Part 7 below Peter Streinger Mr. Streinger is the Chief Financial Officer of SFM LLC. He has held this position since 1990 Michael C. Neus Mr. Neus is the Assistant General of SFM LLC. He has held this position since April of 1994. From 1990 until joining SFM LLC in 1994, Mr. Neus was associated with the law firm of Coudert Brothers.
37 7. SFM LLC. Set forth below is the name, present principal occupation or employment, and material occupations, positions, offices, or employments during the last five years of each of the managing directors of SFM LLC. Unless otherwise noted, such persons have held their positions as managing directors of SFM LLC for the last five years. As used herein SFM LLC means Soros Fund Management LLC from and after January 1, 1997, and Soros Fund Management, a sole proprietorship, prior to January 1, 1997. The business address of each person listed below is c/o Soros Fund Management LLC, 888 Seventh Avenue, 33rd Floor, New York, New York 10106. Each of the managing directors is a United States citizen.
Present Principal Occupation or Employment; Material Occupations, Positions, Offices or Employments Name for the Past Five Years - -------------------------- ------------------------------------------------------------------------ Scott K.H. Bessent Mr. Bessent has been associated with SFM LLC since 1991. His primary responsibility is the research and selection of European securities. Walter Burlock Mr. Burlock has been associated with SFM LLC since 1990. His primary responsibility is the research and selection of United States securities. Brian J. Corvese Mr. Corvese has been associated with SFM LLC since 1997. His primary responsibility is the research and selection of United States securities. From 1987 until joining SFM LLC in 1997, he was a partner and portfolio manager at Chancellor LGI Asset Management. Stanley F. Druckenmiller Mr. Druckenmiller has been associated with SFM LLC since 1988 and is SFM LLC's lead portfolio manager. His primary responsibilities include "macro" trading strategies aimed at taking advantage of broad market opportunities, both for hedging and speculative purposes. In addition, Mr. Druckenmiller is an owner and managing member of Duquesne Capital Management, L.L.C., an investment advisory firm in Pittsburgh, Pennsylvania which advises several U.S. and non-U.S. investment funds. Jeffrey L. Feinberg Mr. Feinberg has been associated with SFM LLC since 1996. His primary responsibility is the research and selection of United States equity securities. From March of 1992 through December of 1995, Mr. Feinberg was a portfolio assistant at Fidelity Investments. Arminio Fraga Mr. Fraga has been associated with SFM LLC since 1993. His primary responsibility is investment strategies for emerging markets. From June of 1991 through November of 1992, Mr. Fraga was a Director for the Central Bank of Brazil. Gary S. Gladstein Mr. Gladstein has been associated with SFM LLC since 1985. His primary responsibilities include the administrative and financial operations of SFM LLC, including relationships with banks and brokerage firms. Ron Hiram Mr. Hiram has been associated with SFM LLC since 1995. His primary responsibility is private equity investments with a specific focus on QIH. Since 1992, he served as a Managing Director at Lehman Brothers and was responsible for managing a diversified portfolio of direct investments. Robert K. Jermain Mr. Jermain has been associated with SFM LLC since 1995. His primary responsibility is the research and selection of United States equities. From 1987 through 1994, Mr. Jermain was the President of Osprey Funds Management Inc., a manager of hedged portfolios for a variety of funds.
38 David N. Kowitz Mr. Kowitz has been associated with SFM LLC since 1995. His primary responsibility is investment research and portfolio management in Asian emerging markets. From February of 1994 until joining SFM LLC, he was a portfolio manager at Kingdon Capital Management. From December of 1992 until joining Kingdon Capital Management, he was a securities analyst for Goldman, Sachs & Co. in Hong Kong. From March of 1989 until joining Goldman Sachs & Co., Mr. Kowitz was a securities analyst at Jardine Fleming Broking Limited in Hong Kong and Pesaka Jardine Fleming Sdn. Bhd. in Malaysia. Mr. Kowitz is a Chartered Financial Analyst. Alexander C. McAree Mr. McAree has been associated with SFM LLC since March of 1992. His primary responsibility is the research and selection of United States and Eastern European securities. Paul McNulty Mr. McNulty has been associated with SFM LLC since 1993. His primary responsibility is the research and selection of United States securities. From 1989 until joining SFM LLC, Mr. McNulty was a venture capitalist and securities analyst with MVP Ventures. Gabriel S. Nechamkin Mr. Nechamkin has been associated with SFM LLC since 1988. His primary responsibility is trading operations in the risk arbitrage, bankruptcy/reorganization and high yield markets. Steven Okin Mr. Okin has most recently been associated with SFM LLC since 1988. Mr. Okin's primary responsibility is trading operations in government bonds, currencies, commodities, indices and derivative products. Dale Precoda Mr. Precoda has been associated with SFM LLC since 1989. His primary responsibility is portfolio management of securities of both United States and non-United States issuers. Lief D. Rosenblatt Mr. Rosenblatt has been associated with SFM LLC since 1988. His primary responsibility is portfolio management in securities in the risk arbitrage, bankruptcy/reorganization and high yield markets. Mark D. Sonnino Mr. Sonnino has been associated with SFM LLC since 1988. His primary responsibility is investment research in the risk arbitrage, bankruptcy/reorganization and high yield markets. Filiberto H. Verticelli Mr. Verticelli has been associated with SFM LLC since 1996. His primary responsibility is equity trading operations with an emphasis on United States securities. From June of 1991 until joining SFM LLC, Mr. Verticelli was the head equity trader at Duquesne Capital Management, L.L.C. Sean C. Warren Mr. Warren has been associated with SFM LLC since 1991, serving as its General Counsel. His primary responsibilities include all legal and compliance matters at SFM LLC.
39 8. Quasar. Set forth below are the name, business address and present principal occupation or employment of the directors and executive officers of Quasar.
Name/Title/Citizenship Principal Occupation Business Address - ------------------------- ------------------------ --------------------- Curacao Corporation Managing Director of Kaya Flamboyan 9 Company N.V. Netherlands Antilles Willemstad Managing Director corporations Curacao, (Netherlands Antilles) Netherlands Antilles
9. Quasar Partners. Set forth below are the name, business address and present principal occupation or employment of the directors and executive officers of Quasar Partners.
Name/Title/Citizenship Principal Occupation Business Address - ----------------------------- --------------------------- --------------------- Quasar Fund Management C.V. Managing General Partner Kaya Flamboyan 9 Managing General Partner of Quasar International Willemstad (Netherlands Antilles) Partners C.V. Curacao, Netherlands Antilles Club Moss Company N.V. Executive General Partner Kaya Flamboyan 9 Executive General Partner of Quasar International Willemstad (Netherlands Antilles) Partners C.V. Curacao, Netherlands Antilles
10. QSP. Set forth below (as applicable) are the name, business address and present principal occupation or employment, and material occupations, positions, offices or employments for the past five years of the directors and executive officers of QSP.
Name/Title/Citizenship Principal Occupation Business Address - ---------------------------------- ------------------------- ------------------------ Curacao Corporation Managing Director of Kaya Flamboyan 9 Company N.V. Netherlands Antilles Willemstad Managing Director corporations Curacao, (Netherlands Antilles) Netherlands Antilles Richard Katz President of Quasar Villa La Sirena President Strategic Partners LDC* Vico dell'Olivetta 12 (United Kingdom) 18039 Mortola Inferiore Ventimiglia Italy Inter Caribbean Services Limited Administrative services Citco Building Secretary Wickhams Cay (British Virgin Islands) Road Town Tortola British Virgin Islands
- ------------ * From 1977 through March of 1993, Mr. Katz was a Director of N.M. Rothschild & Sons Limited, London England. Mr. Katz was also a Managing Director of Rothschild Italia S.p.A., Milan, Italy from 1989 until December of 1992. Since 1986 Mr. Katz has served as a Supervisory Director for a number of Quantum entities. 40 Schedule II TRANSACTIONS IN SHARES WITHIN 60 DAYS PRIOR TO THE OFFER 1) On August 6, 1997, Greenbelt Corp. sold, in a private transaction, 410,000 Shares at a price of $1,760,000 to Greensea Offshore, L.P. 2) On August 7, 1997, in connection with the formation of Greenlake, each of the following entities transferred the number of shares listed below to Greenlake in exchange for membership interests, pursuant to a private transaction: Shares transferred Entity to Greenlake - --------------------------------------------------------- ------------------- Greenway Partners, L.P. 702,100 Greensea Offshore, L.P. 410,000 Greentree Partners, L.P. 200,000 Greenbelt Corp. (on behalf of certain accounts managed by it) 687,000 41 Facsimile copies of the Letter of Transmittal, properly completed and duly executed, will be accepted. The Letter of Transmittal, certificates for Shares and Rights and any other required documents should be sent or delivered by each stockholder of the Company or his broker, dealer, commercial bank, trust company or other nominee to the Depositary at one of its addresses set forth below: The Depositary for the Offer is: MARINE MIDLAND BANK By Mail: By Facsimile: By Hand or Overnight Delivery: 140 Broadway, Level A (212) 658-2292 140 Broadway, Level A New York, NY 10005-1180 New York, NY 10005-1180 Attn: Corporate Trust Operations Attn: Corporation Trust Operations Attn: Corporate Trust Operations Confirm Facsimile by Telephone: (212) 658-5931
Questions and requests for assistance may be directed to the Information Agent at its address and telephone number listed below. Additional copies of this Offer to Purchase, the Letter of Transmittal and other tender offer materials may be obtained from the Information Agent as set forth below, and will be furnished promptly at the Purchaser's expense. You may also contact your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Offer. The Information Agent for the Offer is: GEORGESON & COMPANY INC. -------------- Wall Street Plaza New York, New York 10005 (212) 509-6240 (collect) Banks and Brokers call collect (212) 440-9800 or Call Toll-Free (800) 322-2885 EX-99.(A)(2) 3 EXHIBIT 99.(A)(2) LETTER OF TRANSMITTAL TO TENDER SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS) of OUTBOARD MARINE CORPORATION Pursuant to the Offer to Purchase Dated August 8, 1997 by GREENMARINE ACQUISITION CORP. a wholly-owned subsidiary of GREENMARINE HOLDINGS LLC THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON MONDAY, SEPTEMBER 8, 1997, UNLESS THE OFFER IS EXTENDED (AS EXTENDED, THE "EXPIRATION DATE"). TO: MARINE MIDLAND BANK, AS DEPOSITARY By Mail: By Overnight Courier: By Hand Delivery: 140 Broadway, Level A 140 Broadway, Level A 140 Broadway, Level A New York, NY 10005-1180 New York, NY 10005-1180 New York, NY 10005-1180 Attn: Corporate Trust Attn: Corporate Trust Attn: Corporate Trust Operations Operations Operations By Facsimile Transmission: (212) 658-2292 To Confirm: (212) 658-5931 ----------------- DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS, OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER, OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF TRANSMITTAL IN THE APPROPRIATE SPACE PROVIDED BELOW AND COMPLETE THE SUBSTITUTE FORM W-9 INCLUDED HEREIN. 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 of Outboard Marine Corporation either if (1) certificates evidencing Shares and/or Rights (as such terms are defined below) are to be forwarded herewith or (2) unless an Agent's Message (as defined in the Offer to Purchase (as defined below)) is utilized, delivery of Shares and/or Rights is to be made by book-entry transfer to the Depositary's account at The Depository Trust Company, Midwest Securities Trust Company or Philadelphia Depository Trust Company (hereinafter collectively referred to as the "Book-Entry Transfer Facilities") pursuant to the procedures set forth in Section 3 of the Offer to Purchase. Stockholders whose Share Certificates (as defined below) and, if applicable, Rights Certificates (as defined below), are not immediately available (including, if the Distribution Date (as defined in the Offer to Purchase) has occurred and Rights Certificates have not yet been distributed), or who cannot deliver their Shares and Rights and all other documents required hereby to the Depositary on or prior to the Expiration Date or who cannot comply with the book-entry transfer procedures on a timely basis, may nevertheless tender their Shares and Rights pursuant to the guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase. See Instruction 2. - -------------------------------------------------------------------------------- DESCRIPTION OF SECURITIES TENDERED - -------------------------------------------------------------------------------- SHARE CERTIFICATE(S) TENDERED (ATTACH ADDITIONAL LIST IF NECESSARY) - --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED OWNER(S) (PLEASE FILL IN, IF BLANK, TOTAL NUMBER OF NUMBER OF EXACTLY AS NAME(S) CERTIFICATE SHARES REPRESENTED SHARES APPEAR(S) ON CERTIFICATE(S)) NUMBER(S)(1) BY CERTIFICATES(S)(1) TENDERED (2) Total Shares
- -------------------------------------------------------------------------------- (1) Need not be completed by stockholders tendering by book-entry transfer. (2) Unless otherwise indicated, it will be assumed that all Shares represented by any Share Certificates delivered to the Depositary are being tendered. See Instruction 4. ----------------------------------------------------------------------------- RIGHTS CERTIFICATE(S) TENDERED(1) (ATTACH ADDITIONAL LIST IF NECESSARY) - --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF TOTAL NUMBER OF NUMBER OF REGISTERED OWNER(S) CERTIFICATE SHARES REPRESENTED SHARES (PLEASE FILL IN, IF BLANK) NUMBER(S)(2)(3) BY CERTIFICATES(S)(3) TENDERED(2) Total Rights
- -------------------------------------------------------------------------------- (1) Need not be completed by stockholders if the Distribution Date has not occurred. (2) If the tendered Rights are represented by separate Rights Certificates, complete using the certificate numbers of such Rights Certificates. If the tendered Rights are not represented by separate Rights Certificates, or if such Rights Certificates have not been distributed, complete using the certificate numbers of the Shares with respect to which the Rights were issued. Stockholders tendering Rights that are not represented by separate Rights Certificates should retain a copy of this description in order to accurately complete the Notice of Guaranteed Delivery if the Distribution Date occurs. (3) Need not be completed by stockholders tendering by book-entry transfer. (4) Unless otherwise indicated, it will be assumed that all Rights represented by any Rights Certificates delivered to the Depositary are being tendered. See Instruction 4. ---------------------------------------------------------------------------- The names and addresses of the registered holders should be printed, if not already printed above, exactly as they appear on the certificates representing Shares and/or Rights tendered hereby. The certificates and number of Shares and/or Rights that the undersigned wishes to tender should be indicated in the appropriate boxes. / / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER TO THE DEPOSITARY'S ACCOUNT AT ONE OF THE BOOK-ENTRY TRANSFER FACILITIES AND COMPLETE THE FOLLOWING: Name of Tendering Institution: ------------------------------------------------ Account No. at --------------------------------------------------------- / / The Depository Trust Company / / Midwest Securities Trust Company / / Philadelphia Depository Trust Company Transaction Code Number: ------------------------------------------------------- / / CHECK HERE IF TENDERED RIGHTS ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER TO THE DEPOSITARY'S ACCOUNT AT ONE OF THE BOOK-ENTRY TRANSFER FACILITIES AND COMPLETE THE FOLLOWING: Name of Tendering Institution: ------------------------------------------------ Account No. at --------------------------------------------------------- / / The Depository Trust Company / / Midwest Securities Trust Company / / Philadelphia Depository Trust Company Transaction Code Number: --------------------------------------------------------------- / / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING: Name(s) of Tendering Stockholder(s): ------------------------------------------- Date of Execution of Notice of Guaranteed Delivery: --------------------------- Name of Institution which Guaranteed Delivery: -------------------------------- If delivered by book-entry transfer, check box of Book-Entry Transfer Facility: / / The Depository Trust Company / / Midwest Securities Trust Company / / Philadelphia Depository Trust Company Name of Tendering Institution: ------------------------------------------------- Account No. ------------------------------------------------------------------- Transaction Code Number: ------------------------------------------------------ / / CHECK HERE IF TENDERED RIGHTS ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING: Name(s) of Tendering Stockholder(s): ------------------------------------------ Date of Execution of Notice of Guaranteed Delivery: --------------------------- Name of Institution which Guaranteed Delivery: -------------------------------- If delivered by book-entry transfer, check box of Book-Entry Transfer Facility: / / The Depository Trust Company / / Midwest Securities Trust Company / / Philadelphia Depository Trust Company Account No. ------------------------------------------------------------------- Transaction Code Number: ------------------------------------------------------ Holders of Shares will be required to tender one Right for each Share tendered to effect a valid tender of such Share. Until the Distribution Date occurs, the Rights are represented by and transferred with the Shares. Accordingly, if the Distribution Date does not occur prior to the Expiration Date, a tender of Shares will constitute a tender of the associated Rights. If the Distribution Date has occurred and separate certificates for rights ("Rights Certificates") have been distributed to holders of Shares prior to the date of tender pursuant to the Offer (as defined below), Rights Certificates representing a number of Rights equal to the number of Shares being tendered must be delivered to the Depositary in order for such Shares to be validly tendered. If the Distribution Date has occurred and Rights Certificates have not been distributed prior to the time Shares are tendered pursuant to the Offer, a tender of Shares without the associated Rights constitutes an agreement by the tendering stockholder to deliver Rights Certificates representing a number of Rights equal to the number of Shares tendered pursuant to the Offer to the Depositary within five business days after the date Rights Certificates are distributed. The Offeror reserves the right to require that the Depositary receive such Rights Certificates, or a Book-Entry Confirmation (as defined in the Offer to Purchase), if available, with respect to such Rights, prior to accepting the associated Shares for payment pursuant to the Offer, if the Distribution Date occurs prior to the Expiration Date. Payment for Shares tendered and purchased pursuant to the Offer will be made only after timely receipt by the Depositary of, among other things, Rights Certificates, if such certificates have been distributed to holders of Shares. The Offeror will not pay any additional consideration for the Rights tendered pursuant to the Offer. NOTE: SIGNATURES MUST BE PROVIDED BELOW PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY Ladies and Gentlemen: The undersigned hereby tenders to Greenmarine Acquisition Corp., a Delaware corporation (the "Offeror") and wholly-owned subsidiary of Greenmarine Holdings LLC, a Delaware limited liability company (the "Parent"), the above-described shares of common stock, $0.15 par value per share (the "Shares"), of Outboard Marine Corporation, a Delaware corporation (the "Company"), pursuant to the Offeror's offer to purchase all outstanding Shares at a purchase price of $18.00 per Share, net to the seller in cash, without interest thereon, together with an equal number of the associated preferred stock purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated as of April 24, 1996, as amended (the "Rights Agreement"), between the Company and First Chicago Trust Company of New York, as Rights Agent, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated August 8, 1997 (the "Offer to Purchase"), receipt of which is hereby acknowledged, and this Letter of Transmittal (which, together with the Offer to Purchase and any amendments or supplements to such documents, constitutes the "Offer"). Unless the context requires otherwise, all references to Shares herein shall include the associated Rights, and all references to Rights shall include all benefits that may inure to the holders of the Rights pursuant to the Rights Agreement. The members of the Parent are Quasar Strategic Partners LDC, a Cayman Islands limited duration company, Quantum Industrial Partners LDC, a Cayman Islands limited duration company, and Greenlake Holdings LLC, a Delaware limited liability company. Subject to and effective upon acceptance for payment of, and payment for, the Shares and Rights tendered herewith, the undersigned hereby sells, assigns and transfers to, or upon the order of, the Offeror all right, title and interest in and to all the Shares and Rights that are being tendered hereby (and any and all other Shares, Rights, securities or rights issued or issuable in respect thereof) and appoints the Depositary the true and lawful agent and attorney-in-fact of the undersigned with respect to such Shares and Rights (and all such other Shares, Rights, securities or rights issued or issuable in respect thereof), with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest), to (1) deliver certificates for such Shares and Rights (and all such other Shares, Rights, securities or rights issued or issuable in respect thereof), or transfer ownership of such Shares and Rights (and all such other Shares, Rights, securities or rights issued or issuable in respect thereof) on the account books maintained by any of the Book-Entry Transfer Facilities, together, in any such case, with all accompanying evidences of transfer and authenticity, to, or upon the order of, the Offeror, (2) present such Shares and Rights (and all such other Shares, Rights, securities or rights issued or issuable in respect thereof) for transfer on the books of the Company and (3) receive all benefits and otherwise exercise all rights of beneficial ownership of such Shares and Rights (and all such other Shares, Rights, securities or rights issued or issuable in respect thereof), all in accordance with the terms of the Offer. THE UNDERSIGNED UNDERSTANDS THAT, UNLESS THE RIGHTS ARE REDEEMED BY THE BOARD OF DIRECTORS OF THE COMPANY OR THE OFFEROR IS SATISFIED, IN ITS SOLE DISCRETION, THAT THE RIGHTS HAVE BEEN INVALIDATED OR ARE OTHERWISE INAPPLICABLE TO THE OFFER AND THE PROPOSED SECOND-STEP MERGER (COLLECTIVELY, THE "RIGHTS CONDITION"), STOCKHOLDERS WILL BE REQUIRED TO TENDER ONE RIGHT FOR EACH SHARE TENDERED IN ORDER TO EFFECT A VALID TENDER OF SUCH SHARE. The undersigned understands that if the Distribution Date has occurred and Rights Certificates have been distributed to holders of Shares prior to the date of tender pursuant to the Offer, Rights Certificates representing a number of Rights equal to the number of Shares being tendered herewith must be delivered to the Depositary or, if available, a Book-Entry Confirmation must be received by the Depositary with respect thereto. The undersigned also understands that if the Distribution Date has occurred and Rights Certificates have not been distributed prior to the date of tender pursuant to the Offer, Rights may be tendered prior to a stockholder receiving Rights Certificates by use of the guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase. See Instruction 2. In any case, the undersigned hereby agrees to deliver Rights Certificates representing a number of Rights equal to the number of Shares tendered herewith to the Depositary within five business days after the date such Rights Certificates are distributed. The Offeror reserves the right to require that the Depositary receive such Rights Certificates, or a Book-Entry Confirmation, if available, with respect to such Rights, prior to accepting Shares for payment. Payment for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of, among other things, Rights Certificates if such certificates have been distributed to holders of Shares. The Offeror will not pay any additional consideration for the Rights tendered pursuant to the Offer. The undersigned hereby irrevocably appoints Alfred D. Kingsley and Gary K. Duberstein, and each of them, and any other designees of the Offeror, the attorneys-in-fact and proxies of the undersigned, each with full power of substitution, to exercise all voting and other rights of the undersigned in such manner as each such attorney-in-fact and proxy or his substitute shall, in his sole discretion, deem proper with respect to all of the Shares and Rights tendered hereby (and any and all other Shares, Rights, securities or rights issued or issuable in respect thereof) which have been accepted for payment by the Offeror prior to the time of any vote or other action at any meeting of stockholders of the Company (whether annual or special and whether or not an adjourned meeting) or otherwise. This power of attorney and proxy are irrevocable, and are granted in consideration of, and are effective upon, the acceptance for payment of such Shares and Rights by the Offeror in accordance with the terms of the Offer. Such acceptance for payment shall revoke any other proxy or written consent granted by the undersigned at any time with respect to such Shares and Rights (and all such other Shares, Rights, securities or rights issued or issuable in respect thereof), and no subsequent proxies shall be given or written consents executed by the undersigned (and if given or executed, will not be deemed effective). The undersigned acknowledges that in order for Shares and Rights to be deemed validly tendered, immediately upon the acceptance for payment of such Shares and Rights, the Offeror or the Offeror's designee must be able to exercise full voting and all other rights which inure to a record and beneficial holder with respect to such Shares and Rights. The undersigned hereby represents and warrants that the undersigned has full power and authority to tender, sell, assign and transfer the Shares and Rights tendered hereby (and any and all other Shares, Rights, securities or rights issued or issuable in respect thereof) and that when the same are accepted for payment by the Offeror, the Offeror will acquire good and unencumbered title thereto, free and clear of all liens, restrictions, charges and encumbrances and not subject to any adverse claims. The undersigned will, upon request, execute and deliver any additional documents deemed by the Depositary or the Offeror to be necessary or desirable to complete the sale, assignment and transfer of the Shares and Rights tendered hereby (and all such other Shares, Rights, securities or rights issued or issuable in respect thereof). All authority herein conferred or agreed to be conferred 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. Except as stated in the Offer, this tender is irrevocable, provided that Shares and Rights tendered pursuant to the Offer may be withdrawn at any time prior to their acceptance for payment. The undersigned hereby agrees that, if, on or after August 8, 1997, the Company should declare or pay any cash dividend on the Shares or other distribution on the Shares, or issue with respect to the Shares any additional Shares, shares of any other class of capital stock, other than voting securities or any securities convertible into, or rights, warrants or options, conditional or otherwise, to acquire, any of the foregoing, payable or distributable to stockholders of record on a date prior to the transfer of the Shares purchased pursuant to the Offer to the Offeror or its nominee or transferee on the Company's stock transfer records, then, subject to the provisions of Section 14 of the Offer to Purchase, (1) the Offer Price (as defined in the Offer to Purchase) may, in the sole discretion of the Offeror, be reduced by the amount of any such cash dividends or cash distributions and (2) the whole of any such noncash dividend, distribution or issuance to be received by the tendering stockholders will (a) be received and held by the tendering stockholders for the account of the Offeror and will be required to be promptly remitted and transferred by each tendering stockholder to the Depositary for the account of the Offeror, accompanied by appropriate documentation of transfer, or (b) at the direction of the Offeror, be exercised for the benefit of the Offeror, in which case the proceeds of such exercise will promptly be remitted to the Offeror. Pending such remittance and subject to applicable law, the Offeror will be entitled to all rights and privileges as owner of any such noncash dividend, distribution, issuance or proceeds and may withhold the entire Offer Price or deduct from the Offer Price the amount or value thereof, as determined by the Offeror in its sole discretion. The undersigned understands that tenders of Shares and Rights pursuant to any one of the procedures described in Section 3 of the Offer to Purchase and in the instructions hereto will constitute an agreement between the undersigned and the Offeror upon the terms and subject to the conditions of the Offer. Without limiting the foregoing, if the Offer Price is amended in accordance with the Offer, the price to be paid to the undersigned will be the amended price notwithstanding the fact that a different price is stated in this Letter of Transmittal. The undersigned recognizes that under certain circumstances set forth in the Offer to Purchase, the Offeror may not be required to accept for payment any of the Shares or Rights tendered hereby. The undersigned acknowledges that, subject to the applicable rules of the Securities and Exchange Commission (the "Commission"), the Offeror expressly reserves the right, in its sole discretion, at any time and from time to time, to extend the period during which the Offer is open for any reason, including the occurrence of any of the conditions specified in Section 14 of the Offer to Purchase, by giving oral or written notice of such extension to the Depositary. During any such extension, all Shares and Rights previously tendered and not withdrawn will remain subject to the Offer and subject to the right of a tendering stockholder to withdraw such stockholder's Shares and Rights. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE FOR TENDERED SHARES, WHETHER OR NOT THE OFFEROR EXERCISES ITS RIGHTS TO EXTEND THE OFFER. The undersigned also acknowledges that, subject to the applicable regulations of the Commission, the Offeror also expressly reserves the right, in its sole discretion, at any time and from time to time, to (1) delay acceptance for payment of or, regardless of whether such Shares or Rights were theretofore accepted for payment, payment for any Shares or Rights pending receipt of any regulatory or governmental approvals specified in Section 15 of the Offer to Purchase, (2) terminate the Offer (whether or not any Shares or Rights have theretofore been accepted for payment) if any of the conditions referred to in Section 14 of the Offer to Purchase have not been satisfied or upon the occurrence of any of the events specified in Section 14 of the Offer to Purchase and (3) waive any condition or otherwise amend the Offer in any respect, in each case by giving oral or written notice of such delay, termination, waiver or amendment to the Depository and by making a public announcement thereof. Unless otherwise indicated under "Special Payment Instructions," please issue the check for the purchase price of any Shares or Rights purchased, and return any Shares or Rights not tendered or not purchased, in the name(s) of the undersigned (and, in the case of Shares or Rights tendered by book-entry transfer, by credit to the account at the Book-Entry Transfer Facility designated above). Similarly, unless otherwise indicated under "Special Delivery Instructions," please mail the check for the purchase price of any Shares or Rights purchased, and return any certificates for Shares or Rights not tendered or not purchased (and accompanying documents, as appropriate), to the undersigned at the address shown below the undersigned's signature(s). In the event that both "Special Payment Instructions" and "Special Delivery Instructions" are completed, please issue the check for the purchase price of any Shares or Rights purchased, and return any Shares or Rights not tendered or not purchased, in the name(s) of, and mail said check and any certificates to, the person(s) so indicated. Unless otherwise indicated under "Special Payment Instructions," please credit any Shares and Rights tendered herewith by book-entry transfer that are not accepted for payment by crediting the account at the Book-Entry Transfer Facility designated above. The undersigned recognizes that the Offeror has no obligation, pursuant to the "Special Payment Instructions," to transfer any Shares or Rights from the name of the registered holder(s) thereof if the Offeror does not accept for payment any of the Shares or Rights so tendered. SPECIAL PAYMENT INSTRUCTIONS (SEE INSTRUCTIONS 1, 5, 6 AND 7) To be completed ONLY if the check for the purchase price of Shares and Rights purchased and/or certificates for Shares and Rights not tendered or not purchased are to be issued in the name of someone other than the undersigned, or if Shares and Rights tendered by book-entry transfer that are not purchased are to be returned by credit to an account at one of the Book-Entry Transfer Facilities other than that designated above. Issue check and/or certificates to: Name: ------------------------------------------------------------------------- (PLEASE PRINT) Address: ---------------------------------------------------------------------- - ------------------------------------------------------------------------------- (ZIP CODE) - ------------------------------------------------------------------------------- (TAXPAYER IDENTIFICATION NO.) (SEE SUBSTITUTE FORM W-9) / / Credit unpurchased Shares and Rights tendered by book-entry transfer to the account set forth below: Name of Account Party ----------------------------------------------------------- Account No. at --------------------------------------------------------- / / The Depository Trust Company / / Midwest Securities Trust Company / / Philadelphia Depository Trust Company SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 1, 5, 6 AND 7) To be completed ONLY if the check for the purchase price of Shares and Rights purchased and/or certificates for Shares and Rights not tendered or not purchased are to be mailed to someone other than the undersigned or to the undersigned at an address other than that shown below the undersigned's signature(s). Mail check and/or certificates to: Name: ------------------------------------------------------------------------- (PLEASE PRINT) Address: ---------------------------------------------------------------------- - ------------------------------------------------------------------------------- (ZIP CODE) - ------------------------------------------------------------------------------- (TAXPAYER IDENTIFICATION NO.) SIGN HERE (ALSO COMPLETE SUBSTITUTE FORM W-9 BELOW) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Signature(s) of Owner(s)* * Must be signed by registered holder(s) exactly as name(s) appear(s) on Share Certificate(s) and/or Rights Certificate(s) or on a security position listing or by the person(s) authorized to become registered holder(s) by certificates and documents transmitted herewith. If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, agent, officer of a corporation or other person acting in a fiduciary or representative capacity, please provide the following information and see Instruction 5. Name(s): ----------------------------------------------------------------------- - -------------------------------------------------------------------------------- (PLEASE PRINT) Name of Firm (if applicable): -------------------------------------------------- Capacity (full title): --------------------------------------------------------- Address: ----------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (ZIP CODE) Daytime Area Code and Telephone Number ----------------------------------------- Taxpayer Identification Number: ------------------------------------------------ Dated: , 1997 ----------------------------------------------------------- GUARANTEE OF SIGNATURE(S) (See Instructions 1 and 5) FOR USE BY FINANCIAL INSTITUTIONS ONLY. PLACE MEDALLION GUARANTEE IN SPACE BELOW - -------------------------------------------------------------------------------- PAYER'S NAME: MARINE MIDLAND BANK - --------------------------------------------------------------------------------
SUBSTITUTE Part I--PLEASE Part III--Social Security Number OR Form W-9 PROVIDE YOUR TIN IN Employer Identification Number Department of the Treasury THE BOX AT RIGHT Internal Revenue Service AND CERTIFY BY SIGNING AND DATING ------------------------------------------ BELOW. (If awaiting TIN write "Applied For") -------------------------------------------------------------------- Payer's Request for Taxpayer Part II--For Payees exempt from backup withholding, see the enclosed Identification Number (TIN) Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9 and complete as instructed therein.
- -------------------------------------------------------------------------------- Certification--Under penalty of perjury, I certify that: (1) The number shown on this form is my correct TIN (or I am waiting for a number to be issued to me); and (2) I am not subject to backup withholding either because I have not been notified by the IRS that I am subject to backup withholding as a result of a failure to report all interest or dividends, or the IRS has notified me that I am no longer subject to backup withholding. Certificate Instructions--You must cross out item (2) above if you have been notified by the IRS that you are subject to backup withholding because of underreporting 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 were no longer subject to backup withholding, do not cross out item (2). (Also see instructions in the enclosed Guidelines.) - ------------------------------------------------------------------------------ NAME ------------------------------------------------------------------------- (Please Print) SIGNATURE DATE ----------------------------------------------- ------------------- - ------------------------------------------------------------------------------- NOTE: FAILURE TO COMPLETE AND RETURN THIS SUBSTITUTE FORM W-9 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 ARE AWAITING YOUR TIN. - ------------------------------------------------------------------------------- CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER I certify under penalty of perjury that a TIN has not been issued to me, and either (1) I have mailed or delivered an application to receive a TIN to the appropriate IRS 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 TIN by the time of payment, 31% of all payments pursuant to the Offer made to me thereafter will be withheld until I provide a number. SIGNATURE DATE ----------------------------------------------- ------------------- - ------------------------------------------------------------------------------- INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER 1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, signatures on all Letters of Transmittal must be guaranteed by a firm that is a bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of the Securities Transfer Agent's Medallion Program (each of the foregoing constituting an "Eligible Institution") unless the Shares and/or Rights tendered thereby are tendered (i) by a registered holder of Shares and/or Rights who has not completed either the box labeled "Special Payment Instructions" or the box labeled "Special Delivery Instructions" on the Letter of Transmittal or (ii) for the account of an Eligible Institution. See Instruction 5. If the certificates are registered in the name of a person or persons other than the signatory to this Letter of Transmittal, or if payment is to be made or delivered to, or certificates evidencing unpurchased Shares and/or Rights are to be issued or returned to, a person other than the registered owner or owners, then the tendered certificates must be endorsed or accompanied by duly executed stock powers, in either case signed exactly as the name or names of the registered owner or owners appear on the certificates or stock powers, with the signatures on the certificates or stock powers guaranteed by an Eligible Institution as provided herein. See Instruction 5. 2. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES. UNLESS THE RIGHTS CONDITION IS SATISFIED, STOCKHOLDERS WILL BE REQUIRED TO TENDER ONE RIGHT FOR EACH SHARE TENDERED IN ORDER TO EFFECT A VALID TENDER OF SHARES. Unless the Distribution Date has occurred, a tender of Shares will also constitute a tender of the associated Rights. The Rights are currently represented by the certificates for the Shares with respect to which the Rights were issued. The Rights Agreement provides that until the close of business on the Distribution Date, the Rights will be evidenced by Share Certificates and may be transferred with and only with the Shares. The Rights Agreement further provides that, as soon as practicable following the Distribution Date, separate Rights Certificates are to be mailed by the Company or the Rights Agent to holders of record of Shares as of the close of business on the Distribution Date. If the Distribution Date occurs and separate Rights Certificates are distributed prior to the time Shares are tendered herewith, Rights Certificates representing a number of Rights equal to the number of Shares being tendered herewith must be delivered to the Depositary or, if available, a Book-Entry Confirmation must be received by the Depositary with respect thereto, in order for such Shares tendered herewith to be validly tendered. If the Distribution Date occurs and separate Rights Certificates are not distributed prior to the time Shares are tendered herewith, Rights may be tendered prior to a stockholder receiving separate Rights Certificates by use of the guaranteed delivery procedures described below. This Letter of Transmittal is to be used either if certificates are to be forwarded herewith or, unless an Agent's Message is utilized, if the delivery of Shares or Rights is to be made by book-entry transfer pursuant to the procedures set forth in Section 3 of the Offer to Purchase. Certificates for all physically delivered Shares and/or Rights, or a confirmation of a book-entry transfer into the Depositary's account at one of the Book-Entry Transfer Facilities of all Shares and/or Rights delivered electronically, as well as a properly completed and duly executed Letter of Transmittal (or facsimile thereof) and any other documents required by this Letter of Transmittal, or an Agent's Message in the case of a book-entry transfer, must be received by the Depositary at its address set forth on the front page of this Letter of Transmittal on or prior to the Expiration Date and, if the Distribution Date has occurred, Rights Certificates, or Book-Entry Confirmation of a transfer of Rights into the Depositary's account at the Book-Entry Transfer Facility, if available (together with, if Rights are forwarded separately from Shares, a properly completed and duly executed Letter of Transmittal (or a facsimile thereof) with any required signature guarantee, or an Agent's Message in the case of a book-entry delivery, and any other documents required by the Letter of Transmittal), must be received by the Depositary at its address set forth on the front page of this Letter of Transmittal on or prior to the Expiration Date, or if later, within five business days after the date on which such Rights Certificates are distributed. Stockholders who cannot deliver their Shares and/or Rights and all other required documents to the Depositary on or prior to the Expiration Date must tender their Shares pursuant to the guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase. Pursuant to such procedures: (a) such tender must be made by or through an Eligible Institution; (b) a properly completed and duly executed Notice of Guaranteed Delivery, substantially in the form provided by the Offeror, must be received by the Depositary on or prior to the Expiration Date; and (c) the certificates for all tendered Shares and/or Rights, in proper form for tender, or Book-Entry Confirmation of a transfer into the Depositary's account at one of the Book-Entry Transfer Facilities of all Shares and/or Rights delivered electronically, as well as a properly completed and duly executed Letter of Transmittal (or facsimile thereof), and any other documents required by this Letter of Transmittal, or an Agent's Message in the case of a book-entry transfer, must be received by the Depositary (a) in the case of Shares, within five New York Stock Exchange ("NYSE") trading days after the date of execution of such Notice of Guaranteed Delivery or (b) in the case of Rights, a period ending on the later of (1) five NYSE trading days after the date of execution of such Notice of Guaranteed Delivery and (2) five business days after Rights Certificates are distributed to stockholders, all as provided in Section 3 of the Offer to Purchase. If Share Certificates and Rights Certificates are forwarded separately to the Depositary, a properly completed and duly executed Letter of Transmittal (or facsimile thereof) must accompany each such delivery. THE METHOD OF DELIVERY OF SHARE CERTIFICATES AND, IF APPLICABLE, RIGHTS CERTIFICATES, THE LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH A BOOK-ENTRY TRANSFER FACILITY, IS AT THE OPTION AND RISK OF THE TENDERING STOCKHOLDER. SHARES WILL BE DEEMED DELIVERED ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY (INCLUDING, IN THE CASE OF A BOOK-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. No alternative, conditional or contingent tenders will be accepted, and no fractional Shares will be purchased. By executing this Letter of Transmittal (or facsimile thereof), the tendering stockholder waives any right to receive any notice of the acceptance for payment of the Shares or Rights. 3. INADEQUATE SPACE. If the space provided herein is inadequate, the certificate numbers and/or the number of Shares and, if applicable, Rights, should be listed on a separate schedule attached hereto. 4. PARTIAL TENDERS (NOT APPLICABLE TO STOCKHOLDERS WHO TENDER BY BOOK-ENTRY TRANSFER). If fewer than all of the Shares or Rights represented by any certificate delivered to the Depositary are to be tendered, fill in the number of Shares or Rights which are to be tendered in the box entitled "Number of Shares Tendered" or "Number of Rights Tendered." In such case, a new certificate for the remainder of the Shares or Rights represented by the old certificate will be sent to the person(s) signing this Letter of Transmittal, unless otherwise provided in the appropriate box on this Letter of Transmittal, as promptly as practicable following the expiration or termination of the Offer. All Shares and Rights represented by certificates delivered to the Depositary will be deemed to have been tendered unless otherwise indicated. 5. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS. If this Letter of Transmittal is signed by the registered holder(s) of the Shares and Rights tendered hereby, the signature(s) must correspond with the name(s) as written on the face of the certificates without alteration, enlargement or any change whatsoever. If any of the Shares or Rights tendered hereby are held of record by two or more persons, all such persons must sign this Letter of Transmittal. If any of the Shares or Rights tendered hereby are registered in different names on different certificates, it will be necessary to complete, sign and submit as many separate Letters of Transmittal as there are different registrations of certificates. If this Letter of Transmittal is signed by the registered holder(s) of the Shares or Rights tendered hereby, no endorsements of certificates or separate stock powers are required unless payment of the purchase price is to be made, or Shares or Rights not tendered or not purchased are to be returned, in the name of any person other than the registered holder(s). Signatures on any 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 Shares or Rights tendered hereby, the certificates 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 certificates for such Shares or Rights. Signature(s) on any such certificates or stock powers must be guaranteed by an Eligible Institution. If this Letter of Transmittal or any certificate or stock power is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, such person should so indicate when signing, and proper evidence satisfactory to the Offeror of the authority of such person so to act must be submitted. 6. STOCK TRANSFER TAXES. The Offeror will pay any stock transfer taxes with respect to the sale and transfer of any Shares or Rights to it, or to its order, pursuant to the Offer. If, however, payment of the purchase price is to be made to, or Shares and/or Rights not tendered or not purchased are to be returned in the name of, any person other than the registered holder(s), then the amount of any stock transfer taxes (whether imposed on the registered holder(s), such other person or otherwise) payable on account of the transfer to such person will be deducted from the purchase price unless satisfactory evidence of the payment of such taxes, or exemption therefrom, is submitted. EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY FOR TRANSFER TAX STAMPS TO BE AFFIXED TO THE CERTIFICATES LISTED IN THIS LETTER OF TRANSMITTAL. 7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the purchase price of any Shares or Rights purchased is to be issued, or any Shares or Rights not tendered or not purchased are to be returned, in the name of a person other than the person(s) signing this Letter of Transmittal, or if the check or any certificates for Shares or Rights not tendered or not purchased are to be mailed to someone other than the person(s) signing this Letter of Transmittal or to the person(s) signing this Letter of Transmittal at an address other than that shown above, the appropriate boxes on this Letter of Transmittal should be completed. Stockholders tendering Shares or Rights by book-entry transfer may request that Shares or Rights not purchased be credited to such account at any of the Book-Entry Transfer Facilities as such stockholder may designate under "Special Payment Instructions." If no such instructions are given, any such Shares or Rights not purchased will be returned by crediting the account at the Book-Entry Transfer Facilities designated above. 8. SUBSTITUTE FORM W-9. The tendering stockholder is required to provide the Depositary with such stockholder's correct TIN on Substitute Form W-9, which is provided above, unless an exemption applies. Failure to provide the information on the Substitute Form W-9 may subject the tendering stockholder to a $50 penalty imposed by the Internal Revenue Service and to 31% federal income tax backup withholding on the payment of the purchase price for the Shares. 9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance or additional copies of the Offer to Purchase and this Letter of Transmittal may be obtained from the Information Agent at the address or telephone number set forth below. 10. WAIVER OF CONDITIONS. Subject to the applicable rules and regulations of the Commission, the conditions of this Offer may be waived, in whole or in part, by the Offeror, in its sole discretion, at any time and from time to time, in the case of any Shares or Rights tendered. 11. LOST, DESTROYED OR STOLEN CERTIFICATES. If any certificate(s) representing Shares or Rights has been lost, destroyed or stolen, the stockholder should promptly notify the Depositary. The stockholder will then be instructed as to the steps that must be taken in order to replace the certificate(s). This Letter of Transmittal and related documents cannot be processed until the procedures for replacing lost or destroyed certificates have been followed. IMPORTANT: THIS LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF), TOGETHER WITH ANY REQUIRED SIGNATURE GUARANTEES, OR, IN THE CASE OF A BOOK-ENTRY TRANSFER, AN AGENT'S MESSAGE, AND ANY OTHER REQUIRED DOCUMENTS, MUST BE RECEIVED BY THE DEPOSITARY ON OR PRIOR TO THE EXPIRATION DATE AND EITHER CERTIFICATES FOR TENDERED SHARES AND RIGHTS MUST BE RECEIVED BY THE DEPOSITARY OR SHARES AND RIGHTS MUST BE DELIVERED PURSUANT TO THE PROCEDURES FOR BOOK-ENTRY TRANSFER, IN EACH CASE ON OR PRIOR TO THE EXPIRATION DATE, OR THE TENDERING STOCKHOLDER MUST COMPLY WITH THE PROCEDURES FOR GUARANTEED DELIVERY. IMPORTANT TAX INFORMATION Under federal income tax law, a stockholder whose tendered Shares are accepted for payment is required to provide the Depositary with such stockholder's correct TIN on the Substitute Form W-9. If such stockholder is an individual, the TIN is such stockholder's social security number. If the Depositary is not provided with the correct TIN, the stockholder may be subject to a $50 penalty imposed by the Internal Revenue Service. In addition, payments that are made to such stockholder with respect to Shares and Rights purchased pursuant to the Offer may be subject to backup withholding. Part III of the Substitute Form W-9 may be utilized if the tendering stockholder or other payee has not been issued a TIN and has applied for a TIN or intends to apply for a TIN in the near future. If the tendering stockholder or other payee acknowledges in Part III the foregoing, the stockholder or other payee must also complete the Certificate of Awaiting Taxpayer Identification Number in order to avoid backup withholding. Notwithstanding that Part III has been completed in such manner and the Certificate of Awaiting Taxpayer Identification Number is completed, the Depositary will withhold 31% on all payments made prior to the time a properly certified TIN is provided to the Depositary. However, such amounts will be refunded to such stockholder if a TIN is provided to the Depositary within 60 days. Certain stockholders (including, among others, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements. In order for a foreign individual to qualify as an exempt recipient, that stockholder must submit a statement, signed under penalty of perjury, attesting to that individual's exempt status. Such statements may be obtained from the Depositary. All exempt recipients (including foreign persons wishing to qualify as exempt recipients) should see the enclosed Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9 for additional instructions. If backup withholding applies, the Depositary is required to withhold 31% of any payments made to the stockholder. 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 backup withholding results in an overpayment of taxes, a refund may be obtained by the stockholder upon filing an income tax return. PURPOSE OF SUBSTITUTE FORM W-9 To prevent backup federal income tax withholding on payments that are made to a stockholder with respect to Shares and Rights purchased pursuant to the Offer, the stockholder is required to notify the Depositary of his or her correct TIN by completing the form certifying that the TIN provided on the Substitute Form W-9 is correct. WHAT NUMBER TO GIVE THE DEPOSITARY The stockholder is required to give the Depositary the social security number or employer identification number of the record owner of 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 guidelines on which number to report. The Information Agent for the Offer is: GEORGESON & COMPANY INC. Wall Street Plaza New York, New York 10005 (800) 223-2064 EX-99.(A)(3) 4 EXHIBIT 99.(A)(3) OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS) of OUTBOARD MARINE CORPORATION at $18.00 Net Per Share by GREENMARINE ACQUISITION CORP. a wholly-owned subsidiary of GREENMARINE HOLDINGS LLC - ------------------------------------------------------------------------------ THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON MONDAY, SEPTEMBER 8, 1997, UNLESS THE OFFER IS EXTENDED (AS EXTENDED, THE "EXPIRATION DATE"). - ------------------------------------------------------------------------------ August 8, 1997 To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees: Greenmarine Acquisition Corp., a Delaware corporation (the "Offeror") and wholly-owned subsidiary of Greenmarine Holdings LLC, a Delaware limited liability company (the "Parent"), is offering to purchase (i) all outstanding shares of common stock, $0.15 par value per share (the "Shares"), of Outboard Marine Corporation, a Delaware corporation (the "Company"), at a purchase price of $18.00 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 August 8, 1997 (the "Offer to Purchase"), and in the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer") enclosed herewith, and (ii) unless and until the Offeror declares that the Rights Condition (as defined below) is satisfied, the associated preferred stock purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated as of April 24, 1996, as amended (the "Rights Agreement"), between the Company and First Chicago Trust Company of New York, as Rights Agent. Holders of Shares or Rights whose certificates for such Shares (the "Share Certificates") or Rights (the "Rights Certificates") are not immediately available, or who cannot deliver such certificates and all other required documents to the Depositary (as defined in the Offer to Purchase) or complete the procedures for book-entry transfer on or prior to the Expiration Date must tender their Shares and/or Rights according to the guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase. Unless the context requires otherwise, all references to Shares herein shall include the associated Rights, and all references to Rights shall include all benefits that may inure to the holders of Rights pursuant to the Rights Agreement. The members of the Parent are Quasar Strategic Partners LDC, a Cayman Islands limited duration company, Quantum Industrial Partners LDC, a Cayman Islands limited duration company, and Greenlake Holdings LLC, a Delaware limited liability company. UNLESS THE RIGHTS ARE REDEEMED BY THE BOARD OF DIRECTORS OF THE COMPANY, OR THE OFFEROR IS SATISFIED, IN ITS SOLE DISCRETION, THAT THE RIGHTS HAVE BEEN INVALIDATED OR ARE OTHERWISE INAPPLICABLE TO THE OFFER AND THE PROPOSED SECOND-STEP MERGER (COLLECTIVELY, THE "RIGHTS CONDITION"), HOLDERS OF SHARES WILL BE REQUIRED TO TENDER ONE ASSOCIATED RIGHT FOR EACH SHARE TENDERED IN ORDER TO EFFECT A VALID TENDER OF SUCH SHARE. ACCORDINGLY, STOCKHOLDERS WHO SELL THEIR RIGHTS SEPARATELY FROM THEIR SHARES AND DO NOT OTHERWISE ACQUIRE RIGHTS MAY NOT BE ABLE TO SATISFY THE REQUIREMENTS OF THE OFFER FOR THE TENDER OF SHARES. IF THE DISTRIBUTION DATE (AS DEFINED IN THE OFFER TO PURCHASE) HAS NOT OCCURRED PRIOR TO THE EXPIRATION DATE, A TENDER OF SHARES WILL ALSO CONSTITUTE A TENDER OF THE ASSOCIATED RIGHTS. If the Distribution Date has occurred and Rights Certificates have been distributed to holders of Shares prior to the time a holder's Shares are purchased pursuant to the Offer, in order for Rights (and the corresponding Shares) to be validly tendered, Rights Certificates representing a number of Rights equal to the number of Shares tendered must be delivered to the Depositary or, if available, a Book-Entry Confirmation (as defined in the Offer to Purchase) must be received by the Depositary with respect thereto. If the Distribution Date has occurred and Rights Certificates have not been distributed prior to the time Shares are purchased pursuant to the Offer, Rights may be tendered prior to a stockholder receiving Rights Certificates by use of the guaranteed delivery procedures described in Section 3 of the Offer to Purchase. In any case, a tender of Shares constitutes an agreement by the tendering stockholder to deliver Rights Certificates representing a number of Rights equal to the number of Shares tendered pursuant to the Offer to the Depositary within five business days after the date Rights Certificates are distributed. The Offeror reserves the right to require that the Depositary receive Rights Certificates, or a Book-Entry Confirmation, if available, with respect to such Rights, prior to accepting the related Shares for payment pursuant to the Offer if the Distribution Date has occurred prior to the Expiration Date. If a stockholder desires to tender Shares and Rights pursuant to the Offer and such stockholder's Share Certificates or, if applicable, Rights Certificates are not immediately available (including, if the Distribution Date has occurred and Rights Certificates have not yet been distributed), or time will not permit all required documents to reach the Depositary on or prior to the Expiration Date or the procedure for book-entry transfer cannot be completed on a timely basis, such Shares or Rights may nevertheless be tendered according to the guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase. See Instruction 2 of the Letter of Transmittal. Delivery of documents to a Book-Entry Transfer Facility (as defined in the Offer to Purchase) in accordance with the Book-Entry Transfer Facility's procedures does not constitute delivery to the Depositary. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY TENDERED, AND NOT PROPERLY WITHDRAWN PRIOR TO THE EXPIRATION DATE, THAT NUMBER OF SHARES THAT, WHEN ADDED TO THE NUMBER OF SHARES BENEFICIALLY OWNED BY THE OFFEROR AND THE PARENT, WOULD REPRESENT 90% OF ALL OUTSTANDING SHARES ON THE DATE OF PURCHASE AND, AS A RESULT THEREOF, THE OFFEROR BEING SATISFIED, IN ITS SOLE DISCRETION, THAT ON THE DATE OF PURCHASE IT WILL BE ABLE TO CONSUMMATE THE PROPOSED SECOND-STEP MERGER AS A "SHORT-FORM MERGER" PURSUANT TO THE PROVISIONS OF SECTION 253 OF THE DELAWARE GENERAL CORPORATION LAW IMMEDIATELY AFTER CONSUMMATION OF THE OFFER, (2) THE RIGHTS CONDITION BEING SATISFIED, (3) THE OFFEROR BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE PROPOSED MERGER CAN BE CONSUMMATED WITHOUT THE NEED FOR A SUPERMAJORITY VOTE OF THE COMPANY'S STOCKHOLDERS PURSUANT TO ARTICLE EIGHTEENTH OF THE COMPANY'S RESTATED CERTIFICATE OF INCORPORATION, (4) THE PURCHASER SHALL HAVE RECEIVED THE LOAN PROCEEDS COMMITTED TO BE PROVIDED BY AMERICAN FINANCIAL GROUP, INC. ("AFG") IN ACCORDANCE WITH THE COMMITMENT LETTER ISSUED BY AFG TO THE PURCHASER, DATED AUGUST 7, 1997, (5) THE OFFEROR BEING SATISFIED, IN ITS SOLE DISCRETION, THAT, UPON CONSUMMATION OF THE OFFER AND THE PROPOSED MERGER, THE COMPANY WILL NOT BE IN DEFAULT UNDER ANY INSTRUMENT EVIDENCING THE COMPANY'S THEN OUTSTANDING INDEBTEDNESS, OR, IF IN DEFAULT, THE OFFEROR AND THE PARENT HAVING OBTAINED, PRIOR TO THE EXPIRATION DATE, ON TERMS REASONABLY ACCEPTABLE TO THE PARENT, SUFFICIENT FINANCING TO ENABLE THE COMPANY TO REFINANCE OR REDEEM ANY SUCH INDEBTEDNESS UPON CONSUMMATION OF THE OFFER AND THE PROPOSED MERGER, AND (6) THE OFFEROR BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE PREVIOUSLY ANNOUNCED AGREEMENT AND PLAN OF MERGER BETWEEN THE COMPANY AND DETROIT DIESEL CORPORATION HAS BEEN TERMINATED IN ACCORDANCE WITH ITS TERMS. THE OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS CONTAINED IN THE OFFER TO PURCHASE. SEE THE INTRODUCTION AND SECTIONS 1, 12, 14 AND 15 OF THE OFFER TO PURCHASE. Please furnish copies of the enclosed materials to those of your clients for whose accounts you hold Shares or Rights 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: 2 1. The Offer to Purchase, dated August 8, 1997. 2. The Letter of Transmittal to tender Shares and Rights for your use and for the information of your clients. Facsimile copies of the Letter of Transmittal may be used to tender Shares and Rights. 3. The Notice of Guaranteed Delivery for Shares and Rights to be used to accept the Offer if Share Certificates or Rights Certificates are not immediately available (including if Rights Certificates have not yet been distributed), or if such certificates and all other required documents cannot be delivered to the Depositary on or prior to the Expiration Date or if the procedure for book-entry transfer cannot be completed on or prior to the Expiration Date. 4. A printed form of letter which may be sent to your clients for whose accounts you hold Shares or Rights registered in your name, including an instruction form for obtaining such clients' instructions with regard to the Offer. 5. Guidelines of the Internal Revenue Service for Certification of Taxpayer Identification Number on Substitute Form W-9. 6. A return envelope addressed to the 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 5:00 P.M., NEW YORK CITY TIME, ON MONDAY, SEPTEMBER 8, 1997, UNLESS THE OFFER IS EXTENDED. Subject to the applicable rules and regulations of the Securities and Exchange Commission (the "Commission"), the Offeror expressly reserves the right, in its sole discretion, at any time and from time to time, to extend the period during which the Offer is open for any reason, including the occurrence of any of the conditions specified in Section 14 of the Offer to Purchase, by giving oral or written notice of such extension to the Depositary. During any such extension, all Shares and Rights previously tendered and not withdrawn will remain subject to the Offer and subject to the right of a tendering stockholder to withdraw such stockholder's Shares and Rights. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE FOR TENDERED SHARES, WHETHER OR NOT THE OFFEROR EXERCISES ITS RIGHTS TO EXTEND THE OFFER. Subject to the applicable rules and regulations of the Commission, the Offeror also expressly reserves the right, in its sole discretion, at any time and from time to time, to (1) delay acceptance for payment of or, regardless of whether such Shares or Rights were theretofore accepted for payment, payment for any Shares or Rights pending receipt of any regulatory or governmental approvals specified in Section 15 of the Offer to Purchase, (2) terminate the Offer (whether or not any Shares or Rights have theretofore been accepted for payment) if any of the conditions referred to in Section 14 of the Offer to Purchase have not been satisfied or upon the occurrence of any of the events specified in Section 14 of the Offer to Purchase and (3) waive any condition or otherwise amend the Offer in any respect, in each case by giving oral or written notice of such delay, termination, waiver or amendment to the Depository and by making a public announcement thereof. In order to take advantage of the Offer, (i) a duly executed and properly completed Letter of Transmittal (or facsimile thereof) 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 Rights, and any other required documents should be sent to the Depositary, and (ii) either Share Certificates and Rights Certificates representing the tendered Shares and Rights should be delivered to the Depositary, or such Shares or Rights should be tendered by book-entry transfer into the Depositary's account maintained at one of the Book-Entry Transfer Facilities (as described in the Offer to Purchase), all in accordance with the instructions set forth in the Letter of Transmittal and the Offer to Purchase. If holders of Shares or Rights wish to tender, but it is impracticable for them to forward their Share Certificates or Rights Certificates or other required documents on or prior to the Expiration Date or to comply with the book-entry transfer procedures on a timely basis, a tender may be effected by following the guaranteed delivery procedures specified in Section 3 of the Offer to Purchase. 3 The Offeror will not pay any fees or commissions to any broker, dealer or any other person for soliciting tenders of Shares or Rights pursuant to the Offer. The Offeror will, however, upon request, reimburse you for customary mailing and handling expenses incurred by you in forwarding any of the enclosed materials to your customers. The Offeror 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 Georgeson & Company Inc., as the Information Agent, at the address and telephone number set forth on the back cover page of the Offer to Purchase. Additional copies of the enclosed materials may be obtained from the Information Agent. Very truly yours, Greenmarine Acquisition Corp. NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL RENDER YOU OR ANY OTHER PERSON THE AGENT OF THE OFFEROR, THE DEPOSITARY, 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. 4 EX-99.(A)(4) 5 EXHIBIT 99.(A)(4) OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS) of OUTBOARD MARINE CORPORATION at $18.00 NET PER SHARE by GREENMARINE ACQUISITION CORP. a wholly-owned subsidiary of GREENMARINE HOLDINGS LLC - ------------------------------------------------------------------------------- THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON MONDAY, SEPTEMBER 8, 1997, UNLESS THE OFFER IS EXTENDED (AS EXTENDED, THE "EXPIRATION DATE"). - ------------------------------------------------------------------------------- To Our Clients: Enclosed for your consideration are the Offer to Purchase, dated August 8, 1997 (the "Offer to Purchase"), and the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer") relating to an offer by Greenmarine Acquisition Corp., a Delaware corporation (the "Offerer") and wholly-owned subsidiary of Greenmarine Holdings LLC, a Delaware limited liability company (the "Parent"), to purchase (i) all outstanding shares of common stock, par value $0.15 per share (the "Shares"), of Outboard Marine Corporation, a Delaware corporation (the "Company"), at a purchase price of $18.00 per Share, net to the seller in cash, without interest thereon, upon the terms and subject to the conditions set forth in the Offer, and (ii) unless and until the Offeror declares that the Rights Condition (as defined below) is satisfied, the associated preferred stock purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated as of April 24, 1996, as amended (the "Rights Agreement"), between the Company and First Chicago Trust Company of New York, as Rights Agent. This material is being forwarded to you as the beneficial owner of Shares carried by us in your account but not registered in your name. Unless the context requires otherwise, all references to Shares herein shall include the associated Rights, and all references to Rights shall include all benefits that may inure to the holders of Rights pursuant to the Rights Agreement. The members of the Parent are Quasar Strategic Partners LDC, a Cayman Islands limited duration company, Quantum Industrial Partners LDC, a Cayman Islands limited duration company, and Greenlake Holdings LLC, a Delaware limited liability company. UNLESS THE RIGHTS ARE REDEEMED BY THE BOARD OF DIRECTORS OF THE COMPANY OR THE PURCHASER IS SATISFIED, IN ITS SOLE DISCRETION, THAT SUCH RIGHTS HAVE BEEN INVALIDATED OR ARE OTHERWISE INAPPLICABLE TO THE OFFER AND THE PROPOSED SECOND- STEP MERGER (COLLECTIVELY, THE "RIGHTS CONDITION"), HOLDERS OF SHARES WILL BE REQUIRED TO TENDER ONE ASSOCIATED RIGHT FOR EACH SHARE TENDERED IN ORDER TO EFFECT A VALID TENDER OF SUCH SHARE. ACCORDINGLY, STOCKHOLDERS WHO SELL THEIR RIGHTS SEPARATELY FROM THEIR SHARES AND DO NOT OTHERWISE ACQUIRE RIGHTS MAY NOT BE ABLE TO SATISFY THE REQUIREMENTS OF THE OFFER FOR THE TENDER OF SHARES. IF THE DISTRIBUTION DATE (AS DEFINED IN THE OFFER TO PURCHASE) HAS NOT OCCURRED PRIOR TO THE EXPIRATION DATE, A TENDER OF SHARES WILL ALSO CONSTITUTE A TENDER OF THE ASSOCIATED RIGHTS. If the Distribution Date has occurred and certificates for Rights ("Rights Certificates") have been distributed to holders of Shares prior to the time a holder's Shares are purchased pursuant to the Offer, in order for Rights (and the corresponding Shares) to be validly tendered, Rights Certificates representing a number of Rights equal to the number of Shares tendered must be delivered to the Depositary (as defined in the Offer to Purchase) or, if available, a Book-Entry Confirmation (as defined in the Offer to Purchase) must be received by the Depositary with respect thereto. If the Distribution Date has occurred and Rights Certificates have not been distributed prior to the time Shares are purchased pursuant to the Offer, Rights may be tendered prior to a stockholder receiving Rights Certificates by use of the guaranteed delivery procedures described in Section 3 of the Offer to Purchase. In any case, a tender of Shares constitutes an agreement by the tendering stockholder to deliver Rights Certificates representing a number of Rights equal to the number of Shares tendered pursuant to the Offer to the Depositary within five business days after the date Rights Certificates are distributed. The Offeror reserves the right to require that the Depositary receive Rights Certificates, or a Book-Entry Confirmation, if available, with respect to such Rights, prior to accepting the related Shares for payment pursuant to the Offer if the Distribution Date has occurred prior to the Expiration Date. If a stockholder desires to tender Shares and Rights pursuant to the Offer and such stockholder's certificates for Shares ("Share Certificates") or, if applicable, Rights Certificates are not immediately available (including, if the Distribution Date has occurred and Rights Certificates have not yet been distributed), or time will not permit all required documents to reach the Depositary on or prior to the Expiration Date or the procedure for book-entry transfer cannot be completed on a timely basis, such Shares or Rights may nevertheless be tendered according to the guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase. See Instruction 2 of the Letter of Transmittal. Delivery of documents to a Book-Entry Transfer Facility (as defined in the Offer to Purchase) in accordance with the Book-Entry Transfer Facility's procedures does not constitute delivery to the Depositary. WE ARE THE HOLDER OF RECORD OF SHARES AND RIGHTS HELD BY US FOR YOUR ACCOUNT. A TENDER OF SUCH SHARES AND RIGHTS CAN BE MADE ONLY BY US AS THE HOLDER OF RECORD AND PURSUANT TO YOUR INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER SHARES HELD BY US FOR YOUR ACCOUNT. Accordingly, we request instructions as to whether you wish to tender any or all of the Shares and/or Rights held by us for your account, upon the terms and conditions set forth in the Offer. Please note the following: 1. The tender price is $18.00 per Share, including the associated Rights, net to you in cash, without interest thereon, upon the terms and subject to the conditions of the Offer. 2. The Offer is being made for all outstanding Shares and Rights. 3. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON MONDAY, SEPTEMBER 8, 1997, UNLESS THE OFFER IS EXTENDED. 4. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY TENDERED, AND NOT PROPERLY WITHDRAWN PRIOR TO THE EXPIRATION DATE, THAT NUMBER OF SHARES THAT, WHEN ADDED TO THE NUMBER OF SHARES BENEFICIALLY OWNED BY THE OFFEROR AND THE PARENT, WOULD REPRESENT 90% OF ALL OUTSTANDING SHARES ON THE DATE OF PURCHASE AND, AS A RESULT THEREOF, THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT ON THE DATE OF PURCHASE IT WILL BE ABLE TO CONSUMMATE THE PROPOSED SECOND-STEP MERGER AS A "SHORT-FORM MERGER" PURSUANT TO THE PROVISIONS OF SECTION 253 OF THE DELAWARE GENERAL CORPORATION LAW IMMEDIATELY AFTER CONSUMMATION OF THE OFFER, (2) THE RIGHTS CONDITION BEING SATISFIED, (3) THE OFFEROR BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE PROPOSED MERGER CAN BE CONSUMMATED WITHOUT THE NEED FOR A SUPERMAJORITY VOTE OF THE COMPANY'S STOCKHOLDERS PURSUANT TO ARTICLE EIGHTEENTH OF THE COMPANY'S RESTATED CERTIFICATE OF INCORPORATION, (4) THE PURCHASER SHALL HAVE RECEIVED THE LOAN PROCEEDS COMMITTED TO BE PROVIDED BY AMERICAN FINANCIAL GROUP, INC. ("AFG") IN ACCORDANCE WITH THE COMMITMENT LETTER ISSUED BY AFG TO THE PURCHASER, DATED AUGUST 7, 1997, (5) THE OFFEROR BEING SATISFIED, IN ITS SOLE DISCRETION, THAT, UPON CONSUMMATION OF THE OFFER AND THE PROPOSED MERGER, THE COMPANY WILL NOT BE IN DEFAULT UNDER ANY INSTRUMENT EVIDENCING THE COMPANY'S THEN OUTSTANDING INDEBTEDNESS, OR, IF IN DEFAULT, THE OFFEROR AND THE PARENT HAVING OBTAINED, PRIOR TO THE EXPIRATION DATE, ON TERMS REASONABLY ACCEPTABLE TO THE PARENT, SUFFICIENT FINANCING TO ENABLE THE COMPANY TO REFINANCE OR REDEEM ANY SUCH INDEBTEDNESS UPON CONSUMMATION OF THE OFFER AND THE PROPOSED MERGER, AND (6) THE OFFEROR BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE PREVIOUSLY ANNOUNCED AGREEMENT AND PLAN OF MERGER BETWEEN THE COMPANY AND DETROIT DIESEL CORPORATION HAS BEEN TERMINATED IN ACCORDANCE WITH ITS TERMS. THE OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS CONTAINED IN THE OFFER TO PURCHASE. SEE THE INTRODUCTION AND SECTIONS 1, 12, 14 AND 15 OF THE OFFER TO PURCHASE. 2 5. 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 transfer of Shares pursuant to the Offer. Subject to the applicable rules and regulations of the Securities and Exchange Commission (the "Commission"), the Offeror expressly reserves the right, in its sole discretion, at any time and from time to time, to extend the period during which the Offer is open for any reason, including the occurrence of any of the conditions specified in Section 14 of the Offer to Purchase, by giving oral or written notice of such extension to the Depositary. During any such extension, all Shares and Rights previously tendered and not withdrawn will remain subject to the Offer and subject to the right of a tendering stockholder to withdraw such stockholder's Shares and Rights. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE FOR TENDERED SHARES, WHETHER OR NOT THE OFFEROR EXERCISES ITS RIGHTS TO EXTEND THE OFFER. Subject to the applicable rules and regulations of the Commission, the Offeror also expressly reserves the right, in its sole discretion, at any time and from time to time, to (1) delay acceptance for payment of or, regardless of whether such Shares or Rights were theretofore accepted for payment, payment for any Shares or Rights pending receipt of any regulatory or governmental approvals specified in Section 15 of the Offer to Purchase, (2) terminate the Offer (whether or not any Shares or Rights have theretofore been accepted for payment) if any of the conditions referred to in Section 14 of the Offer to Purchase have not been satisfied or upon the occurrence of any of the events specified in Section 14 of the Offer to Purchase and (3) waive any condition or otherwise amend the Offer in any respect, in each case by giving oral or written notice of such delay, termination, waiver or amendment to the Depository and by making a public announcement thereof. If you wish to have us tender any or all of your Shares and/or Rights, please so instruct us by completing, executing, detaching and returning to us the instruction form contained in this letter. An envelope to return your instruction form to us is enclosed. If you authorize the tender of your Shares and/or Rights, all such Shares and Rights will be tendered unless otherwise indicated in the instruction form. PLEASE FORWARD YOUR INSTRUCTIONS TO US AS SOON AS POSSIBLE TO ALLOW US AMPLE TIME TO TENDER YOUR SHARES AND RIGHTS ON YOUR BEHALF PRIOR TO THE EXPIRATION OF THE OFFER. The Offer is made solely pursuant to the Offer to Purchase and the related Letter of Transmittal, and any supplements or amendments thereto. The Offer is not being made to, nor will tenders be accepted from, or on behalf of, holders of Shares or Rights residing in any jurisdiction in which the making of the Offer or acceptance thereof would not be in compliance with the securities laws of such jurisdiction. In any jurisdiction where the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer will be deemed to be made on behalf of the Offeror by one or more registered brokers or dealers licensed under the laws of such jurisdiction. For purposes of the Offer, the Offeror will be deemed to have accepted for payment, and thereby purchased, Shares validly tendered to the Offeror and not withdrawn as, if and when the Offeror gives oral or written notice to the Depositary, of the Offeror's acceptance for payment of such Shares. 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 purposes of receiving payment from the Offeror and transmitting payment to tendering stockholders. In all cases, payment for Shares accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of (i) certificates for (or a timely Book-Entry Confirmation with respect to) such Shares and, if the Distribution Date has occurred, certificates for (or a timely Book-Entry Confirmation with respect to) the associated Rights (unless the Offeror elects, in its sole discretion, to make payment for such Shares pending receipt of the certificates for, or a Book-Entry Confirmation with respect to, such Rights), (ii) a Letter of Transmittal (or facsimile thereof), properly completed and duly executed with any required signature guarantees, or, in the case of a book-entry transfer, an Agent's Message (as defined in the Offer to Purchase), and (iii) any other documents required by the Letter of Transmittal. 3 INSTRUCTIONS WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS) OF OUTBOARD MARINE CORPORATION AT $18.00 NET PER SHARE BY GREENMARINE ACQUISITION CORP. a wholly-owned subsidiary of GREENMARINE HOLDINGS LLC The undersigned acknowledge(s) receipt of your letter enclosing the Offer to Purchase, dated August 8, 1997 (the "Offer to Purchase"), and the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer") relating to the Offer by Greenmarine Acquisition Corp., a Delaware corporation and wholly-owned subsidiary of Greenmarine Holdings LLC, a Delaware limited liability company (the "Parent"), to purchase (i) all outstanding shares of common stock, par value $0.15 per share (the "Shares"), of Outboard Marine Corporation, a Delaware corporation (the "Company"), and (ii) unless and until the Offeror declares that the Rights Condition (as defined in the Offer to Purchase) is satisfied, the associated preferred stock purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated as of April 24, 1996, as amended, between the Company and First Chicago Trust Company of New York, as Rights Agent. The members of the Parent are Quasar Strategic Partners LDC, a Cayman Islands limited duration company, Quantum Industrial Partners LDC, a Cayman Islands limited duration company, and Greenlake Holdings LLC, a Delaware limited liability company. You are instructed to tender the number of Shares and Rights indicated below (or, if no number is indicated below, all Shares and Rights) that are held by you for the account of the undersigned, upon the terms and subject to the conditions set forth in the Offer. SIGN HERE _______________________________________ _______________________________________ Signature(s) _______________________________________ Number of Shares to be Tendered* _______________________________________ Please Print Name(s) and Address(es) Here _____________________________ Shares _______________________________________ Area Code and Telephone No. Number of Rights to be Tendered* _____________________________ Rights _______________________________________ Taxpayer Identification or Social Security No.(s) Dated: , 1997 - ------------ * UNLESS THE RIGHTS CONDITION IS SATISFIED, STOCKHOLDERS WILL BE REQUIRED TO TENDER ONE RIGHT FOR EACH SHARE TENDERED TO EFFECT A VALID TENDER OF SUCH SHARES. UNLESS THE DISTRIBUTION DATE OCCURS, A TENDER OF SHARES WILL ALSO CONSTITUTE A TENDER OF THE ASSOCIATED RIGHTS. UNLESS OTHERWISE INDICATED, IT WILL BE ASSUMED THAT ALL OF YOUR SHARES AND RIGHTS ARE TO BE TENDERED. 4 EX-99.(A)(5) 6 EXHIBIT 99.(A)(5) NOTICE OF GUARANTEED DELIVERY for TENDER OF SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS) of OUTBOARD MARINE CORPORATION As set forth in Section 3 of the Offer to Purchase (as defined below), this Notice of Guaranteed Delivery, or one substantially equivalent hereto, must be used to accept the Offer (as defined below) if certificates for shares of common stock, $0.15 par value per share (the "Shares"), of Outboard Marine Corporation, a Delaware corporation (the "Company"), and/or associated preferred stock purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated as of April 24, 1996, as amended, between the Company and First Chicago Trust Company of New York, as Rights Agent, are not immediately available (including, if certificates for Rights have not yet been distributed by the Company or the Rights Agent), or if the procedure for book-entry transfer cannot be completed on a timely basis or time will not permit all required documents to reach the Depositary on or prior to the Expiration Date (as defined in the Offer to Purchase). This Notice of Guaranteed Delivery may be delivered by hand, facsimile transmission or mail to the Depositary and must include a guarantee by an Eligible Institution (as defined in the Offer to Purchase). See Section 3 of the Offer to Purchase, dated August 8, 1997 (the "Offer to Purchase"). TO: MARINE MIDLAND BANK, DEPOSITARY By Mail: By Overnight Courier: By Hand Delivery: 140 Broadway, Level A 140 Broadway, Level A 140 Broadway, Level A New York, NY 10005-1180 New York, NY 10005-1180 New York, NY 10005-1180 Attn: Corporate Trust Attn: Corporate Trust Attn: Corporate Trust Operations Operations Operations By Facsimile Transmission: (212) 658-2292 To Confirm: (212) 658-5931 --------------------- DELIVERY OF THIS INSTRUMENT TO AN ADDRESS, OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER, OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY. This Notice of Guaranteed Delivery is not to be used to guarantee signatures. If a signature on a Letter of Transmittal is required to be guaranteed by an Eligible Institution under the instructions thereto, such signature guarantee must appear in the applicable space provided in the signature box on the Letter of Transmittal. The Eligible Institution that completes this form must communicate the guarantee to the Depositary and must deliver the Letter of Transmittal and certificates for Shares and/or Rights to the Depositary within the time period shown herein. Failure to do so could result in a financial loss to such Eligible Institution. Ladies and Gentlemen: The undersigned hereby tenders to Greenmarine Acquisition Corp., upon the terms and subject to the conditions set forth in the Offer to Purchase and the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer"), receipt of which is hereby acknowledged, Shares and/or Rights of the Company pursuant to the guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase. Number of Shares _______________________ Name(s) of Record Holder(s): Number of Rights _______________________ _____________________________________ Certificate Nos. (if available): _____________________________________ (PLEASE PRINT) ________________________________________ Address(es): ________________________ ________________________________________ _____________________________________ (ZIP CODE) (Check one box if Shares or Rights will be tendered by book-entry transfer) [ ] The Depository Trust Company Area Code and Tel. No.: _____________ [ ] Midwest Securities Trust Company Signature(s): _______________________ [ ] Philadelphia Depository Trust Company _____________________________________ Account Number __________________________ Dated: ______________________________ THE GUARANTEE ON THE REVERSE SIDE MUST BE COMPLETED. 2 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 Agent's Medallion Program, guarantees the delivery to the Depositary of the Shares (or Rights, if applicable) tendered hereby, together with a properly completed and duly executed Letter of Transmittal (or facsimile thereof), or an Agent's Message (as defined in the Offer to Purchase) in the case of a book-entry transfer, and any other required documents, all within (1) in the case of Shares, five New York Stock Exchange ("NYSE") trading days of the date hereof or (2) in the case of Rights, a period ending on the later of (a) five NYSE trading days after the date hereof and (b) five business days after the date certificates for Rights are distributed to stockholders. Name of Firm:___________________________ _____________________________________ AUTHORIZED SIGNATURE Address: _______________________________ Name: _______________________________ (PLEASE PRINT) ________________________________________ (ZIP CODE) Title: ______________________________ Area Code and Tel No.: _______________________________ Dated:_______________________________ DO NOT SEND CERTIFICATES FOR SHARES OR RIGHTS WITH THIS NOTICE OF GUARANTEED DELIVERY. CERTIFICATES SHOULD BE SENT WITH THE LETTER OF TRANSMITTAL. Dated: _____________ , 1997 3 EX-99.A6 7 EXHIBIT (A)(6) EXHIBIT (a)(6) GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 Guidelines for Determining the Proper Identification Number to Give the Payer.--Social Security numbers have nine digits separated by two hyphens: i.e., 000-00-0000. Employer identification numbers have nine digits separated by only one hyphen: i.e., 00-0000000. The table below will help determine the number to give the payer.
- --------------------------------------------------------- --------------------------------------------------------- For this type of account: Give the For this type of account: Give the EMPLOYER SOCIAL SECURITY IDENTIFICATION number of- number of- - --------------------------------------------------------- --------------------------------------------------------- 1. An individual's account The individual 9. A valid trust, estate, or The legal entity (Do not pension trust furnish the identification 2. Two or more individuals The actual owner of the number of the personal (joint account) account or, if combined representative or trustee funds, any one of the unless the legal entity itself individuals(1) is not designated in the account title.)(5) 3. Husband and wife The actual owner of the (joint account) account or, if joint funds. either person(1) 10. Corporate account The corporation 4. Custodian account of a The minor(2) 11. Religious, charitable, or The organization minor (Uniform Gift to educational organization Minors Act) account 12. Partnership account The partnership 5. Adult and minor The adult or, if the minor is (joint account) the only contributor, the 13. Association, club or The organization minor(1) other tax-exempt organization 6. Account in the name of The ward, minor, or guardian or committee incompetent person(3) 14. A broker or registered The broker or nominee for a designated ward, nominee minor or incompetent person 15. Account with the The public entity Department of 7. a. The usual revocable The grantor-trustee(1) Agriculture in the name savings trust account of a public entity (such (grantor is also as a State or local trustee) government, school district, or prison) that b. So-called trust The actual owner(1) receives agricultural account that is not a program payments legal or valid trust under state law 8. Sole proprietorship The owner(4) account - --------------------------------------------------------- ---------------------------------------------------------
(1) List first and circle the name of the person whose number you furnish. (2) Circle the minor's name and furnish the minor's social security number. (3) Circle the ward's, minor's or incompetent person's name and furnish such person's social security number. (4) Show the name of the owner. (5) List first and circle the name of the legal trust, estate or pension trust. NOTE: If no name is circled when there is more then one name, the number will be considered to be that of the first name listed. GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 Page 2 Obtaining a Number If you don't have a taxpayer identification number or you don't know your number, obtain Form SS-5, Application for a Social Security Number Card, or Form SS-4, Application for Employer Identification Number, at the local office of the Social Security Administration or the Internal Revenue Service and apply for a number. Payees Exempt from Backup Withholding Payees specifically exempted from backup withholding on ALL payments include the following: * A corporation. * A financial institution. * An organization exempt from tax under section 501(a) of the Internal Revenue Code of 1986, as amended (the "Code"), or an individual retirement plan. * The United States or any agency or instrumentality thereof. * A State, the District of Columbia, a possession of the United States, or any subdivision or instrumentality thereof. * A foreign government, a political subdivision of a foreign government, or any agency or instrumentality thereof. * An international organization or any agency or instrumentality thereof. * A registered dealer in securities or commodities registered in the United States or a possession of the United States. * A real estate investment trust. * A common trust fund operated by a bank under section 584(a) of the Code. * An exempt charitable remainder trust, or a nonexempt trust described in section 4947(a)(1) of the Code. * An entity registered at all times under the Investment Company Act of 1940. * A foreign central bank of issue. Payments of dividends and patronage dividends not generally subject to backup withholding include the following: * Payments to nonresident aliens subject to withholding under section 1441 of the Code. * Payments to partnerships not engaged in a trade or business in the United States and which have at least one nonresident partner. * Payments of patronage dividends where the amount received is not paid in money. * Payments made by certain foreign organizations. * Section 404(k) payments made by an ESOP. * Payments made to a nominee. Payments of interest not generally subject to backup withholding include the following: * Payments of interest on obligations issued by individuals. Note: You may be subject to backup withholding if this interest is $600 or more and is paid in the course of the payer's trade or business and you have not provided your correct taxpayer identification number to the payer. * Payments of tax-exempt interest (including exempt-interest dividends under section 852 of the Code). * Payments described in section 6049(b)(5) of the Code to non-resident aliens. * Payments on tax-free covenant bonds under section 1451 of the Code. * Payments made by certain foreign organizations. * Payments made to a nominee. EXEMPT PAYEES DESCRIBED ABOVE MUST STILL COMPLETE THE SUBSTITUTE FORM W-9 ENCLOSED HEREWITH TO AVOID POSSIBLE ERRONEOUS BACKUP WITHHOLDING. FILE SUBSTITUTE FORM W-9 WITH THE PAYER, REMEMBERING TO CERTIFY YOUR TAXPAYER IDENTFICATION NUMBER ON PART III OF THE FORM. WRITE "EXEMPT" ON THE FACE OF THE FORM AND SIGN AND DATE THE FORM AND RETURN IT TO THE PAYER. Payments that are not subject to information reporting are also not subject to backup withholding. For details, see sections 6041, 6041A(a), 6042, 6044, 6045, 6049, 6050A, and 6050N of the Code and their regulations. Privacy Act Notice.--Section 6109 requires most recipients of dividends, interest, or other payments to give taxpayer identification numbers to payers who must report the payments to IRS. The IRS uses the numbers for identification purposes and to help verify the accuracy of your tax return. Payers must be given the numbers whether or not recipients are required are required to file a tax return. Payers must generally withhold 31% of taxable interest, dividends, and certain other payments to a payee who does not furnish a taxpayer identification number to a payer. Certain penalties may also apply. Penalties (1) Penalty for Failure to Furnish Taxpayer Identification Number.--If you fail to furnish your taxpayer identification number to a payer, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect. (2) Civil Penalty for False Information With Respect to Withholding.--If you make a false statement with no reasonable basis which results in no imposition of backup withholding, you are subject to a penalty of $500. (3) Criminal Penalty for Falsifying Information.--Falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE SERVICE. EX-99.A7 8 EXHIBIT (A)(7) This announcement is neither an offer to purchase nor a solicitation of an offer to sell Shares or Rights. The Offer is made solely by the Offer to Purchase, dated August 8, 1997, and the related Letter of Transmittal, and is not being made to (nor will tenders be accepted from or on behalf of) holders of Shares or Rights in any jurisdiction in which the making of the Offer or the acceptance thereof would not be in compliance with the laws of such jurisdiction. In any jurisdiction where securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer shall be deemed to be made on behalf of the Purchaser by one or more registered brokers or dealers licensed under the laws of such jurisdiction. Notice of Offer to Purchase for Cash All Outstanding Shares of Common Stock (Including the Associated Preferred Stock Purchase Rights) of OUTBOARD MARINE CORPORATION at $18.00 Net Per Share by GREENMARINE ACQUISITION CORP. a wholly-owned subsidiary of GREENMARINE HOLDINGS LLC Greenmarine Acquisition Corp., a Delaware corporation (the "Purchaser") and wholly-owned subsidiary of Greenmarine Holdings LLC, a Delaware limited liability company (the "Parent"), is offering to purchase (i) all outstanding shares of common stock, par value $0.15 per share (the "Shares"), of Outboard Marine Corporation, a Delaware corporation (the "Company"), at a price of $18.00 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 August 8, 1997 (the "Offer to Purchase"), and the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer"), and (ii) unless and until the Purchaser declares that the Rights Condition (as defined below) is satisfied, the associated preferred stock purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated as of April 24, 1996, as amended (the "Rights Agreement"), between the Company and First Chicago Trust Company of New York, as Rights Agent. Unless the context requires otherwise, all references to Shares herein shall include the associated Rights, and all references to Rights shall include all benefits that may inure to the holders of Rights pursuant to the Rights Agreement. The members of the Parent are Quasar Strategic Partners LDC, a Cayman Islands limited duration company ("QSP"), Quantum Industrial Partners LDC, a Cayman Islands limited duration company ("QIP"), and Greenlake Holdings LLC, a Delaware limited liability company ("Greenlake"). UNLESS THE RIGHTS ARE REDEEMED BY THE BOARD OF DIRECTORS OF THE COMPANY, OR THE PURCHASER IS SATISFIED, IN ITS SOLE DISCRETION, THAT THE RIGHTS HAVE BEEN INVALIDATED OR ARE OTHERWISE INAPPLICABLE TO THE OFFER AND THE PROPOSED SECOND-STEP MERGER (COLLECTIVELY, THE "RIGHTS CONDITION"), STOCKHOLDERS ARE REQUIRED TO TENDER ONE RIGHT FOR EACH SHARE TENDERED IN ORDER TO EFFECT A VALID TENDER OF SHARES IN ACCORDANCE WITH THE PROCEDURES SET FORTH IN SECTION 3 OF THE OFFER TO PURCHASE. UNLESS THE DISTRIBUTION DATE (AS DEFINED IN THE OFFER TO PURCHASE) HAS OCCURRED, A TENDER OF SHARES WILL ALSO CONSTITUTE A TENDER OF THE ASSOCIATED RIGHTS. The purpose of the Offer is to enable the Parent to acquire control of, and the entire equity interest in, the Company. The Offer, as the first step in the acquisition of the Company, is intended to facilitate the acquisition of all outstanding Shares. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON MONDAY, SEPTEMBER 8, 1997, UNLESS THE OFFER IS EXTENDED (AS EXTENDED, THE "EXPIRATION DATE") THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY TENDERED, AND NOT PROPERLY WITHDRAWN PRIOR TO THE EXPIRATION DATE, THAT NUMBER OF SHARES THAT, WHEN ADDED TO THE NUMBER OF SHARES BENEFICIALLY OWNED BY THE PURCHASER AND THE PARENT, WOULD REPRESENT 90% OF ALL OUTSTANDING SHARES ON THE DATE OF PURCHASE AND, AS A RESULT THEREOF, THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT ON THE DATE OF PURCHASE IT WILL BE ABLE TO CONSUMMATE THE PROPOSED SECOND-STEP MERGER AS A 2 "SHORT-FORM MERGER" PURSUANT TO THE PROVISIONS OF SECTION 253 OF THE DELAWARE GENERAL CORPORATION LAW (THE "DGCL") IMMEDIATELY AFTER CONSUMMATION OF THE OFFER, (2) THE RIGHTS CONDITION BEING SATISFIED, (3) THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE PROPOSED MERGER CAN BE CONSUMMATED WITHOUT THE NEED FOR A SUPERMAJORITY VOTE OF THE COMPANY'S STOCKHOLDERS PURSUANT TO ARTICLE EIGHTEENTH OF THE COMPANY'S RESTATED CERTIFICATE OF INCORPORATION, (4) THE PURCHASER SHALL HAVE RECEIVED THE FUNDS COMMITTED TO BE PROVIDED BY AMERICAN FINANCIAL GROUP, INC. ("AFG") IN ACCORDANCE WITH THE COMMITMENT LETTER ISSUED BY AFG TO THE PURCHASER, DATED AUGUST 7, 1997, (5) THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT, UPON CONSUMMATION OF THE OFFER AND THE PROPOSED MERGER, THE COMPANY WILL NOT BE IN DEFAULT UNDER ANY INSTRUMENT EVIDENCING THE COMPANY'S THEN OUTSTANDING INDEBTEDNESS, OR, IF IN DEFAULT, THE PURCHASER AND THE PARENT HAVING OBTAINED, PRIOR TO THE EXPIRATION DATE, ON TERMS REASONABLY ACCEPTABLE TO THE PARENT, SUFFICIENT FINANCING TO ENABLE THE COMPANY TO REFINANCE OR REDEEM ANY SUCH INDEBTEDNESS UPON CONSUMMATION OF THE OFFER AND THE PROPOSED MERGER, AND (6) THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE PREVIOUSLY ANNOUNCED AGREEMENT AND PLAN OF MERGER BETWEEN THE COMPANY AND DETROIT DIESEL CORPORATION HAS BEEN TERMINATED IN ACCORDANCE WITH ITS TERMS. THE OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS CONTAINED IN THE OFFER TO PURCHASE. SEE THE INTRODUCTION AND SECTIONS 1, 12, 14 AND 15 OF THE OFFER TO PURCHASE. For purposes of the Offer, the Purchaser will be deemed to have accepted for payment, and thereby purchased, Shares validly tendered to the Purchaser and not withdrawn as, if and when the Purchaser gives oral or written notice to Marine Midland Bank (the "Depositary"), of the Purchaser's acceptance for payment of such Shares. 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 purposes of receiving payment from the Purchaser and transmitting payment to tendering stockholders. In all cases, payment for Shares accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of (i) certificates for (or a timely Book-Entry Confirmation (as defined in the Offer to Purchase) with respect to) such Shares and, if the Distribution Date has occurred, certificates for (or a timely Book-Entry Confirmation with respect to) the associated Rights (unless the Purchaser elects, in its sole discretion, to make payment for 3 such Shares pending receipt of the certificates for, or a Book-Entry Confirmation with respect to, such Rights), (ii) a Letter of Transmittal (or facsimile thereof), properly completed and duly executed with any required signature guarantees, or, in the case of a book-entry transfer, an Agent's Message (as defined in the Offer to Purchase), and (iii) any other documents required by the Letter of Transmittal. Except as otherwise provided below, tenders of Shares and Rights are irrevocable. Shares and Rights tendered pursuant to the Offer may be withdrawn at any time on or prior to the Expiration Date and, unless theretofore accepted for payment and paid for by the Purchaser pursuant to the Offer, may also be withdrawn at any time after October 7, 1997 (or such later date as may apply in case the Offer is extended). A withdrawal of Shares will also constitute a withdrawal of the associated Rights. Rights may not be withdrawn unless the associated Shares are also withdrawn. For a withdrawal to be effective, a written or facsimile transmission notice of withdrawal must be timely received by the Depositary at its address as set forth on the back cover of the Offer to Purchase and must specify the name of the person having tendered the Shares and Rights to be withdrawn, the number of Shares and Rights to be withdrawn and (if certificates have been tendered) the name of the registered holder of the Shares and Rights to be withdrawn, if different from the name of the person who tendered such Shares and Rights. If certificates for Shares or Rights 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, unless such Shares or Rights have been tendered by an Eligible Institution (as defined in the Offer to Purchase), the signatures on the notice of withdrawal must be guaranteed by an Eligible Institution. If Shares or Rights have been tendered pursuant to the procedure for book-entry transfer as set forth in Section 3 of the Offer to Purchase, any notice of withdrawal must also specify the name and number of the account at the appropriate Book-Entry Transfer Facility (as defined in the Offer to Purchase) to be credited with the withdrawn Shares or Rights and otherwise comply with such Book-Entry Transfer Facility's procedures. Withdrawals of tenders of Shares and Rights may not be rescinded, and any Shares and Rights properly withdrawn will thereafter be deemed not validly tendered for any purposes of the Offer. However, withdrawn Shares and Rights may be retendered by again following one of the procedures described in Section 3 of the Offer to Purchase at any time prior to the Expiration Date. All questions as to the form and validity (including time of receipt) of notices of withdrawal will be determined by the Purchaser, in its sole discretion, which determination shall be final and binding. Subject to the applicable rules and regulations of the Securities and Exchange Commission (the "Commission"), the Purchaser expressly reserves the right, in its sole discretion, at any time and from time to time, to extend the period during which the Offer is open for any reason, including the occurrence of any of the conditions specified in Section 14 4 of the Offer to Purchase, by giving oral or written notice of such extension to the Depositary. During any such extension, all Shares and Rights previously tendered and not withdrawn will remain subject to the Offer and subject to the right of a tendering stockholder to withdraw such stockholder's Shares and Rights. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE FOR TENDERED SHARES, WHETHER OR NOT THE PURCHASER EXERCISES ITS RIGHTS TO EXTEND THE OFFER. Subject to the applicable rules and regulations of the Commission, the Purchaser also expressly reserves the right, in its sole discretion, at any time and from time to time, to (1) delay acceptance for payment of or, regardless of whether such Shares or Rights were theretofore accepted for payment, payment for any Shares or Rights pending receipt of any regulatory or governmental approvals specified in Section 15 of the Offer to Purchase, (2) terminate the Offer (whether or not any Shares or Rights have theretofore been accepted for payment) if any of the conditions referred to in Section 14 of the Offer to Purchase have not been satisfied or upon the occurrence of any of the events specified in Section 14 of the Offer to Purchase and (3) waive any condition or otherwise amend the Offer in any respect, in each case by giving oral or written notice of such delay, termination, waiver or amendment to the Depository and by making a public announcement thereof. The information required to be disclosed by paragraph (e)(1)(vii) of Rule 14d- 6 under the Exchange Act is contained in the Offer to Purchase and is incorporated herein by reference. A request is being made to the Company pursuant to Rule 14d-5 under the Securities Exchange Act of 1934, as amended, and Section 220 of the DGCL for the use of the Company's stockholder list, its list of holders of Rights, if any, and security position listings for the purpose of disseminating the Offer to holders of Shares. Upon compliance by the Company with such request, the Offer to Purchase, the related Letter of Transmittal and, if required, other relevant materials will be mailed to record holders of Shares and Rights and will be furnished to brokers, dealers, commercial banks, trust companies and similar persons whose names, or the names of whose nominees, appear on the stockholder list and list of holders of Rights, if applicable, or who are listed as participants in a clearing agency's security position listing for subsequent transmittal to beneficial owners of Shares and Rights. THE OFFER TO PURCHASE AND THE LETTER OF TRANSMITTAL CONTAIN IMPORTANT INFORMATION THAT SHOULD BE READ BEFORE ANY DECISION IS MADE WITH RESPECT TO THE OFFER. 5 Questions and requests for assistance or for copies of the Offer to Purchase, the Letter of Transmittal and other tender offer documents may be directed to the Information Agent, as set forth below, and copies will be furnished at the Purchaser's expense. No fees or commissions will be payable to brokers, dealers or other persons other than the Information Agent for soliciting tenders of Shares and Rights pursuant to the Offer. The Information Agent for the Offer is: GEORGESON & COMPANY INC. Wall Street Plaza New York, New York 10005 Bankers and Brokers Call Collect: (212) 440-9800 All Others Call Toll-Free: (800) 223-2064 August 8, 1997 6 EX-99.(A)(8) 9 EXHIBIT 99(A)(8) Exhibit (a) (8) Contact: Charles Garske Georgeson & Company, Inc. (212) 440-9916 For Immediate Release AFFILIATE OF GREENWAY PARTNERS TO BEGIN AN $18.00 TENDER TOMORROW FOR OUTBOARD MARINE (New York, NY, August 7, 1997) Greenmarine Acquisition Corp., a wholly-owned subsidiary of Greenmarine Holdings LLC, announced that it is commencing tomorrow, August 8, 1997, an all cash tender offer for all outstanding shares of common stock of Outboard Marine Corporation (NYSE:OM) at $18.00 net per share. Following completion of the tender offer, Greenmarine Holdings intends to effect a merger in which all remaining Outboard Marine shareholders will also receive the same cash price paid in the tender offer. The investors in Greenmarine Holdings are an entity affiliated with Messrs. Alfred D. Kingsley and Gary K. Duberstein of Greenway Partners, L.P. and two entities associated with Soros Fund Management LLC. The investors have agreed to contribute to Greenmarine at least $241 million in cash and 2,000,000 shares of Outboard Marine (approximately 9.9% of the outstanding shares). Greenmarine Holdings has also obtained a commitment from American Financial Group to provide up to $150 million of the financing to consummate the transaction. The Greenmarine offer is conditioned upon, among other things, (1) there being validly tendered and not properly withdrawn prior to the expiration date that number of shares that, when added to the number of shares beneficially owned by Greenmarine Acquisition and Greenmarine Holdings, would represent 90% of all outstanding shares on the date of purchase and, as a result thereof, Greenmarine being satisfied, in its sole discretion, that on the date of purchase it will be able to consummate the proposed second-step merger as a "short-form merger" pursuant to the provisions of Section 253 of the Delaware General Corporation Law immediately after consummation of the offer, (2) Outboard Marine's preferred stock purchase rights being redeemed by the Board of Directors of Outboard Marine or being satisfied, in its sole discretion, that such rights have been invalidated or are otherwise inapplicable to its offer and the proposed merger, (3) Greenmarine Acquisition being satisfied, in its sole discretion, that the proposed merger can be consummated without the need for a supermajority vote of Outboard Marine's stockholders pursuant to Article Eighteenth of Outboard Marine's Restated Certificate of Incorporation, (4) Greenmarine Acquisition shall have received the loan proceeds committed to be provided by American Financial Group in accordance with the commitment letter issued by American Financial Group to Greenmarine Acquisition, dated August 7, 1997, (5) Greenmarine Acquisition being satisfied, in its sole discretion, that, upon consummation of the offer and the merger, Outboard Marine will not be in default under any instrument evidencing Outboard Marine's then outstanding indebtedness, or, if in default, the purchaser and the parent having obtained, prior to the expiration date, on terms reasonably acceptable to Greenmarine Holdings, sufficient financing to enable Outboard Marine to refinance or redeem any such indebtedness upon consummation of the offer and the merger, and (6) Greenmarine Acquisition being satisfied, in its sole discretion, that the previously announced Agreement and Plan of Merger between Outboard Marine and Detroit Diesel Corporation has been terminated in accordance with its terms. The Greenmarine offer and withdrawal period for the offer will expire at 5:00 p.m., New York City time, on Monday, September 8, 1997, unless extended. * * * EX-99.B1 10 EXHIBIT 99.(B)(1) [American Financial Group letterhead] August 7, 1997 Greenmarine Acquisition Corp. 277 Park Avenue 27th Floor New York, New York 10172 Attention: Alfred Kingsley Dear Mr. Kingsley: American Financial Group, Inc. ("Lender") agrees to lend (i) to Greenmarine Acquisition Corp. ("Borrower"), up to the sum of One Hundred Fifty Million Dollars ($150,000,000) to be used toward the purchase by Borrower of the outstanding shares of Outboard Marine Corporation ("OMC") in a tender offer and for any required repurchase of OMC outstanding debt pursuant to a "put right" arising as a result of the tender offer and/or the Merger (the "Phase I Loan") and (ii) to OMC, the surviving corporation of a merger involving Borrower and OMC (the "Merger"), up to the sum of One Hundred Fifty Million Dollars ($150,000,000) to be used to repay the Phase I Loan, to pay (in the Merger) for any OMC Shares not acquired in the tender offer and for any required repurchase of OMC outstanding debt pursuant to a "put right" arising as a result of the tender offer and/or Merger (the "Phase II Loan"). The loans to be made pursuant to this commitment will be made upon the following terms and conditions: 1. Amount of Each Loan. Up to a maximum of One Hundred Fifty Million Dollars ($150,000,000). All amounts outstanding under the Phase I Loan shall be fully repaid prior to or with the proceeds of the Phase II Loan. 2. Purpose of Loan. The proceeds of the Phase I Loan shall be used by Borrower solely toward the purchase of shares of outstanding common stock of OMC ("OMC Common Stock") pursuant to a tender offer for such shares by Borrower and for any required repurchase of OMC outstanding debt pursuant to a "put right" arising as a result of the tender offer and/or the Merger. The proceeds of the Phase II Loan shall be used to repay the Phase I Loan, to pay (in the Merger) for any OMC Common Stock not acquired in the tender offer and for any required repurchase of OMC outstanding debt pursuant to a "put right" arising as a result of the tender offer and/or Merger. 3. Collateral. As security for the repayment of the Phase I Loan and the performance of Borrower under the loan documentation to be entered into, the entity which will own all of the equity of Borrower shall pledge to Lender the two million shares of OMC Common Stock which it shall beneficially own ("Initial OM Shares") and Borrower shall pledge to Lender all shares of OMC Common Stock tendered in the tender offer, the aggregate value of which at all times will be equal to or greater than twice the outstanding principal balance of all loans made pursuant to this commitment. The Phase II Loan shall be secured by a pledge of all of the shares of capital stock of the surviving corporation of the Merger. In the event that prior to the Phase II Loan, Borrower makes a loan to OMC to fund OMC's "put right" purchase obligations with respect to its outstanding debt, Borrower shall assign its right to receive repayment of such loan to Lender, as additional collateral securing repayment of the Phase I Loan. 4. Term. The terms of the Phase I Loan shall commence upon the first disbursement of the Phase I Loan proceeds and terminate upon the earlier of the Merger or nine months after the first disbursement under the Phase I Loan, at which time all principal and accrued interest shall be due and payable on the Phase I Loan. The term of the Phase II Loan shall commence upon the Merger and terminate nine months after the first disbursement under the Phase I Loan, at which time all principal and accrued interest shall be due and payable on the Phase II Loan. Lender's obligation to first disburse funds shall remain open for a period of 90 days following the execution of a satisfactory loan agreement and related documentation. 5. Interest. Interest shall accrue on the outstanding principal under the loans at a rate of Ten Percent (10%) per annum. Interest shall be payable monthly in arrears on the first day of each month during the term of the loans. 6. Commitment Fee. Upon the execution of this commitment letter by Borrower, Borrower shall pay Lender, by wire transfer of immediately available funds, a non-refundable commitment fee of One Million Five Hundred Thousand Dollars ($1,500,000) (the "Commitment Fee"). 7. Funding Fee. Upon each disbursement of loan proceeds other than proceeds of the Phase II Loan used to repay the Phase I Loan, Borrower shall pay Lender a funding fee equal to one percent of the amount of proceeds so disbursed. The maximum funding fee payable to Lender under the loan documents will be One Million Five Hundred Thousand Dollars ($1,500,00). 8. Certain Costs and Expenses. In addition to the fees set forth in Paragraphs 6 and 7 above, Borrower shall promptly pay all reasonable costs, fees and expenses incurred by Lender in connection with the loans, including but not limited to, reasonable attorneys fees, recording and filing fees, and other expenses incurred in the preparation and review of loan documentation, whether or not any transaction contemplated hereby is consummated. 9. Expiration Date of Commitment. This commitment shall remain open until August 11, 1997. If the commitment is not accepted and executed by Borrower and received by Lender together with the Commitment Fee prior to the earlier of (a) the public announcement of the tender offer or (b) 5:00 p.m. August 11, 1997, the commitment shall be immediately withdrawn and be null and void. 10. Certain Covenants. The Loan documents will contain customary warranties, representations, indemnities, covenants and conditions for transactions of this size and nature, including, but not limited to those contained herein. Prior to the date of disbursement of any loan proceeds, neither Borrower nor OMC shall have suffered any adverse material change in their financial condition and shall not be the subject of any bankruptcy, reorganization or insolvency proceedings. While any portion of the Phase I Loan is outstanding, Borrower shall not (a) incur any indebtedness other than the Loan, (b) make a distribution to, or repurchase shares from, its shareholders, or (c) pay a dividend to its shareholders. While any portion of the Phase II Loan is outstanding, OMC shall not (a) make a distribution to, or repurchase shares from, its shareholders other than pursuant to the Merger, or (b) pay a dividend to its shareholders. While either the Phase I Loan or the Phase II Loan is outstanding, neither Borrower nor OMC shall expend in excess of $27.5 million in the aggregate for costs and expenses in connection with the transactions contemplated hereby, including, but not limited to, break-up fees, golden parachute payments, and similar expenses arising in connection with the transactions contemplated hereby, and attorney fees, brokers' and finders' fees incurred by or on behalf of Borrower, unless Borrower or OMC shall have received cash equity equal to any such excess in addition to the cash equity provided for in paragraph 11. 11. Conditions Precedent. Immediately prior to the funding of the Phase I Loan, Borrower and its parent on a consolidated basis shall have a minimum shareholders' equity of $265 million, composed of $231 million of cash equity and $34 million allocable to the Initial OM Shares, 2 plus additional equity, if necessary, calculated on the basis of the difference, if any, between the final tender offer price per share and $17.00, as set forth below. The tender offer shall be funded first with the cash equity and any additional equity, as provided in clauses (a), (b) and (c) below, before any portion of the Phase I Loan proceeds are disbursed. Any increase in the tender offer price in excess of $17.00 per share shall be partially funded by additional equity contributions to Borrower as follows: (a) If the tender offer price is greater than $17 per share, but less than or equal to $18 per share, an equity contribution amount equal to $10 million multiplied by a fraction, the numerator of which is the number of cents by which such price exceeds $17 per share, and the denominator of which is 100; (b) If the tender offer price is greater than $18 per share, but less than or equal to $20 per share, an equity contribution amount equal to $10 million, plus $25 million multiplied by a fraction, the numerator of which is the number of cents by which such price exceeds $18 per share, ann the denominator of which is 200; and (c) If the tender offer price is greater than $20 per share, an equity contribution amount equal to $35 million, plus an amount equal to $182,055.20 multiplied by the number of cents by which the tender offer price exceeds $20 per share. In determining the cash equity of Borrower and its parent on a consolidated basis, Borrower and its parent shall receive a credit for up to $27.5 million of any fees and expenses paid directly by Borrower or its parent in connection with the tender offer or the Merger. 12. Indebtedness of OMC. Following the Merger OMC shall not incur any new indebtedness for borrowed money other than (a) the Phase II Loan, (b) pursuant to its existing bank credit facility, or a successor bank credit facility, in an amount up to $150 million and (c) refinancings of other existing debt on terms no less favorable to OMC taken as a whole than the indebtedness being replaced or which would shorten the maturity of such debt to a date prior to the due date of the loans to be made hereunder. 13. Documentation. All Loan documentation shall be prepared by Lender's legal counsel, and shall be in form and substance satisfactory to Borrower and its counsel. 14. Assignment. Lender retains the right to assign this transaction, or any portion thereof, to any of its affiliated companies. The commitment granted herein shall not be assigned by Borrower. Upon acceptance of this commitment, the loan documents shall be prepared and executed as soon as practicable following the execution of this commitment letter. This letter shall be superseded in its entirety by the terms and conditions of the loan documents, when such documents are executed. Very truly yours, AMERICAN FINANCIAL GROUP, INC. By: /s/ James E. Evans ---------------------- James E. Evans Senior Vice President Accepted this 7th day of August, 1997. GREENMARINE ACQUISITION CORP. /s/ Gary K. Duberstein - -------------------------------- By: Gary K. Duberstein Its: Vice-President EX-99.(C)(1) 11 EXHIBIT 99.(C)(1) ================================================================================ OPERATING AGREEMENT OF GREENMARINE HOLDINGS LLC dated as of August 7, 1997 ================================================================================ TABLE OF CONTENTS
Section Page ARTICLE 1 DEFINITIONS..................................................................................................... 1 ARTICLE 2 FORMATION AND OFFICES........................................................................................... 10 2.1 Formation............................................................................................ 10 2.2 Principal Office..................................................................................... 10 2.3 Registered Office and Registered Agent............................................................... 10 2.4 Purpose of Company................................................................................... 10 2.5 Date of Dissolution.................................................................................. 11 2.6 Certificate; Qualification........................................................................... 11 ARTICLE 3 CAPITALIZATION OF THE COMPANY................................................................................... 11 3.1 Initial Capital Contributions........................................................................ 11 3.2 Additional Capital Contributions..................................................................... 11 3.3 Loans................................................................................................ 13 3.4 Certain Expenses..................................................................................... 13 3.5 Maintenance of Capital Accounts...................................................................... 14 3.6 Capital Withdrawal Rights, Interest and Priority..................................................... 15 3.7 Preemptive Rights.................................................................................... 15 3.8 Stock Contributors Preferred Return; Cash Contributors Preferred Return.............................. 17 3.9 Right of First Offer................................................................................. 17 ARTICLE 4 DISTRIBUTIONS................................................................................................... 19 4.1 Distributions of Net Cash Flow....................................................................... 19 4.2 Persons Entitled to Distributions.................................................................... 19 4.3 Limitations on Distributions......................................................................... 20 ARTICLE 5 ALLOCATIONS..................................................................................................... 20 5.1 Profits.............................................................................................. 20 5.2 Losses............................................................................................... 20 5.3 Loss Limitation...................................................................................... 20 5.4 Tax Allocations: Code Section 704(c)................................................................ 20 5.5 Change in Percentage Interests....................................................................... 21 5.6 Withholding.......................................................................................... 21
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ARTICLE 6 MEMBERS' MEETINGS............................................................................................... 22 6.1 Meetings of Members; Place of Meetings............................................................... 22 6.2 Quorum; Voting Requirement........................................................................... 22 6.3 Proxies.............................................................................................. 22 6.4 Action Without Meeting............................................................................... 23 6.5 Notice............................................................................................... 23 6.6 Waiver of Notice..................................................................................... 23 6.7 No Authority......................................................................................... 23 ARTICLE 7 MANAGEMENT AND CONTROL.......................................................................................... 23 7.1 Management Committee................................................................................. 23 7.2 Management Committee Meetings; Authority; Proxies.................................................... 24 7.3 Management Committee's Authority; Certain Limitations................................................ 25 7.4 Officers; Agents..................................................................................... 25 7.5 Resignation of a Management Committee Member......................................................... 26 7.6 Compensation......................................................................................... 26 ARTICLE 8 LIABILITY AND INDEMNIFICATION................................................................................... 26 8.1 Liability of Members................................................................................. 26 8.2 Indemnification...................................................................................... 27 ARTICLE 9 TRANSFERS OF MEMBERSHIP INTERESTS............................................................................... 29 9.1 General Restrictions................................................................................. 29 9.2 Permitted Transferees................................................................................ 29 9.3 Substitute Members................................................................................... 30 9.4 Effect of Admission as a Substitute Member........................................................... 31 9.5 Consent.............................................................................................. 31 9.6 No Dissolution....................................................................................... 31 9.7 Additional Members; Certain Representations of Members............................................... 31 9.8 Right of First Offer................................................................................. 31 9.9 Tag-Along Rights..................................................................................... 33 9.10 Piggyback Registration............................................................................... 35 ARTICLE 10 DISSOLUTION AND TERMINATION..................................................................................... 37 10.1 Events Causing Dissolution........................................................................... 37 10.2 Notices to Secretary of State........................................................................ 37 10.3 Cash Distributions Upon Dissolution.................................................................. 37 10.4 In-Kind.............................................................................................. 38 10.5 No Action for Dissolution............................................................................ 38
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ARTICLE 11 TAX MATTERS MEMBER.............................................................................................. 39 11.1 Tax Matters Member................................................................................... 39 11.2 Certain Authorizations............................................................................... 39 11.3 Indemnity of Tax Matters Member...................................................................... 40 11.4 Information Furnished................................................................................ 40 11.5 Notice of Proceedings, etc........................................................................... 41 11.6 Notices to Tax Matters Member........................................................................ 41 11.7 Preparation of Tax Returns........................................................................... 41 11.8 Tax Elections........................................................................................ 41 11.9 Taxation as a Partnership............................................................................ 41 ARTICLE 12 ACCOUNTING AND BANK ACCOUNTS.................................................................................... 42 12.1 Fiscal Year and Accounting Method.................................................................... 42 12.2 Books and Records.................................................................................... 42 12.3 Delivery to Members; Inspection...................................................................... 42 12.4 Financial Statements................................................................................. 43 12.5 Filings.............................................................................................. 43 12.6 Non-Disclosure....................................................................................... 43 12.7 Bank Accounts........................................................................................ 44 ARTICLE 13 MISCELLANEOUS................................................................................................... 44 13.1 Title to Property.................................................................................... 44 13.2 Waiver of Default.................................................................................... 44 13.3 Amendment............................................................................................ 45 13.4 No Third Party Rights................................................................................ 45 13.5 Severability......................................................................................... 45 13.6 Nature of Interest in the Company.................................................................... 45 13.7 Binding Agreement.................................................................................... 46 13.8 Headings............................................................................................. 46 13.9 Word Meanings........................................................................................ 46 13.10 Counterparts......................................................................................... 46 13.11 Entire Agreement..................................................................................... 46 13.12 Partition............................................................................................ 46 13.13 Governing Law; Consent to Jurisdiction and Venue..................................................... 46 13.14 Discretion........................................................................................... 47 SCHEDULE 1 ..................................................................................................... 49 SCHEDULE 7.5.................................................................................................... 51
iii OPERATING AGREEMENT OF GREENMARINE HOLDINGS LLC THIS OPERATING AGREEMENT (this "Agreement") of GREENMARINE HOLDINGS LLC (the "Company"), is made and entered into as of the 7th day of August, 1997 by and among the Persons executing this Agreement on the signature pages hereto as a member (together with such other Persons that may hereafter become members as provided herein, referred to collectively as the "Members" or, individually, as a "Member"). WHEREAS, the Members have caused Greenmarine Holdings LLC to be formed on August 4, 1997 as a limited liability company under the Delaware Limited Liability Company Act by causing a certificate of formation of the Company to be filed with the Delaware Secretary of State and, as required thereunder, do hereby adopt this Agreement as the limited liability company agreement of the Company pursuant to Section 18-201(d) of the Act effective as of the date hereof; NOW, THEREFORE, in consideration of the premises and the mutual agreements contained herein, the parties agree as follows: ARTICLE 2 DEFINITIONS As used herein, the following terms shall have the following meanings, unless the context otherwise requires: "Act" means the Delaware Limited Liability Company Act, 6 Del. L. Section 18-101, et seq., as amended from time to time. "Acquisition" shall have the meaning set forth in Section 2.4. "Adjusted Capital Account Deficit" means, with respect to a Member, the deficit balance, if any, in such Member's Capital Account as of the end of the relevant Taxable Year, after giving effect to the following adjustments: (a) Credit to such Capital Account any amounts which such Member is obligated to restore pursuant to any provision of this Agreement or is deemed to be obligated to restore pursuant to the penultimate sentences of Regulation Sections 1.704-2(g)(1) and 1.704-2(i)(5); and (b) Debit to such Capital Account the items described in Regulation Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), and 1.704-1(b)(2)(ii)(d)(6). The foregoing definition of Adjusted Capital Account Deficit is intended to comply with the provisions of Regulation Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith. "Affiliate" of a specified Person means any Person (a) who directly or indirectly controls, is controlled by, or is under common control with, such Person or (b) who has any relationship with such Person by blood, marriage or adoption, not more remote than first cousin. With respect to the Group A Members, the term Affiliate shall include one or more of George Soros or Soros Fund Management LLC or Affiliates thereof, and any Person for which any such Person acts as investment advisor or investment manager. With respect to the Group B Members, the term Affiliate shall include one or more of Alfred D. Kingsley or Gary K. Duberstein or Affiliates thereof, and any Person for which any such Person acts as investment advisor or investment manager. "Agreement" means this Operating Agreement, which shall constitute the limited liability company agreement of the Company for purposes of the Act, as amended from time to time. "Business" shall have the meaning set forth in Section 3.9(a). "Business Day" means any day (other than a day which is a Saturday, Sunday or legal holiday in the state of New York) on which banks are open for business in New York City. "Capital Account" means, with respect to any Member, a separate account established by the Company and maintained for each Member in accordance with Section 3.5 hereof. "Capital Contribution" means, with respect to any Member, the amount of money and the initial Gross Asset Value of any Property (other than money) contributed to the Company with respect to the interests purchased by such Member pursuant to the terms of this Agreement, in return for which the Member contributing such capital shall receive a Membership Interest. "Cash Contributors" shall mean those Members contributing cash as their initial 2 Capital Contributions as reflected on Schedule 1 hereto. "Cash Contributors Preferred Return" shall have the meaning set forth in Section 3.8(b). "Certificate" means the Certificate of Formation of the Company filed with the Secretary of State of Delaware, as amended or restated from time to time. "Code" means the United States Internal Revenue Code of 1986, as amended. "Company" means Greenmarine Holdings LLC. "Company Affiliate" shall have the meaning set forth in Section 8.2. "Depreciation" means, for each Taxable Year or other period, an amount equal to the depreciation, amortization or other cost recovery deduction allowable with respect to an asset for such Taxable Year, except that if the Gross Asset Value of an asset differs from its adjusted basis for federal income tax purposes at the beginning of such Taxable Year, Depreciation shall be an amount which bears the same ratio to such beginning Gross Asset Value as the federal income tax depreciation, amortization or other cost recovery deduction for such Taxable Year bears to such beginning adjusted tax basis; provided, however, that if the adjusted basis for federal income tax purposes of an asset at the beginning of such Taxable Year is zero, Depreciation shall be determined with reference to such beginning Gross Asset Value using any reasonable method selected by the Management Committee. "Disposition" shall have the meaning set forth in Section 3.9(a). "Disposition Notice" shall have the meaning set forth in Section 3.9(a). "GAC" shall mean Greenmarine Acquisition Corp., a Delaware corporation. "Gross Asset Value" means with respect to any asset, the asset's adjusted basis for federal income tax purposes, except as follows and as otherwise provided in clause (ii) of Section 3.2(b): (a) The initial Gross Asset Value of any asset contributed by a Member to the Company shall be the gross fair market value of such asset, as reasonably determined by the Management Committee; provided, however, that the initial Gross Asset Values of the assets contributed to the Company pursuant to Section 3.1 hereof shall be as set forth in such section or the schedule referred to therein; 3 (b) The Gross Asset Values of all Company assets shall be adjusted to equal their respective gross fair market values (taking Code Section 7701(g) into account), as reasonably determined by the Management Committee as of the following times: (i) the acquisition of an additional interest in the Company by any new or existing Member in exchange for more than a de minimis Capital Contribution; (ii) the distribution by the Company to a Member of more than a de minimis amount of Company property as consideration for an interest in the Company; and (iii) the liquidation of the Company within the meaning of Regulation Section 1.704-1(b)(2)(ii)(g); provided, however, that an adjustment described in clauses (i) and (ii) of this paragraph shall be made only if the Management Committee reasonably determines that such adjustment is necessary to reflect the relative economic interests of the Members in the Company; and (c) The Gross Asset Value of any item of Company assets distributed to any Member shall be adjusted to equal the gross fair market value (taking Code Section 7701(g) into account) of such asset on the date of distribution as reasonably determined by the Management Committee. If the Gross Asset Value of an asset has been determined or adjusted pursuant to subparagraph (b), such Gross Asset Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset, for purposes of computing Profits and Losses. "Group A Members" means the Persons listed on Schedule 1 as Group A members and their respective permitted successors or assigns. "Group B Members" means, the Persons listed on Schedule 1 as Group B members and their respective permitted successors or assigns. "Initial Capital Contribution Date" means the earlier to occur of (i) one day prior to the date on which any subsidiary of the Company is required to accept shares of OMC Stock for payment pursuant to a tender offer commenced by such subsidiary for shares of OMC Stock under the Securities Exchange Act of 1934, as amended, or (ii) such date as may be determined by the Management Committee upon not less than three Business Days' notice to the Members of such date. "Initial Tag-Along Notice" shall have the meaning set forth in Section 9.9(a). 4 "Losses" has the meaning set forth in the definition of "Profits" and "Losses". "Majority in Interest" means, with respect to the Members or to any specified group or class of Members, Members owning more than fifty percent (50%) of the total Percentage Interests held by all Members or such specified group or class of Members, as applicable. "Management Committee" means the management committee of the Company established pursuant to Section 7.1. "Managers" means, collectively, the Persons designated and serving in accordance with Article 7 as members of the Management Committee. "Member" or "Members" shall have the meaning set forth in the preamble hereof. "Membership Interest" means a Member's limited liability company interest in the Company which refers to all of a Member's rights and interests in the Company in such Member's capacity as a Member, all as provided in this Agreement and the Act. "Net Cash Flow" shall mean the gross cash proceeds from the Company's operations and any distributions received from its subsidiaries (excluding the proceeds of Company borrowings and capital contributions) and from all sales and other dispositions of the Company's Property and any amount released by the Management Committee from Reserves, less the portion of gross proceeds (other than the proceeds of the Company's borrowings and capital contributions) used to pay or establish Reserves for all the Company's expenses, debt payments (including principal, interest and required redemption payments), capital improvements, replacements and contingencies, all as reasonably determined by the Management Committee. Net Cash Flow shall not be reduced by Depreciation or similar allowances (but shall be reduced by the Stock Contributors Preferred Return and the Cash Contributors Preferred Return, if any, as accrued pursuant to Section 3.8 unless Section 3.8(d) shall be applicable) and shall include the net cash proceeds of all principal and interest payments actually received by the Company with respect to any promissory note or other deferred payment obligation held by the Company in connection with sales and other dispositions of the Company's Property. "Notice" means a writing, containing the information required by this Agreement to be communicated to a party, and shall be deemed to have been received (a) when personally delivered or sent by telecopy, (b) one day following delivery by overnight delivery courier, with all delivery charges pre-paid, or (c) on the third Business Day following the date on which it was sent by United States mail, postage prepaid, to such party at the address or fax number, as the case may be, of such 5 party as shown on the records of the Company. "Notice of Acceptance" shall have the meaning set forth in Section 3.9(a). "OMC" shall mean Outboard Marine Corp., a Delaware corporation. "OMC Stock" shall mean shares of common stock par value $.15 per share of OMC. "Percentage Interest" of a Member means the aggregate limited liability company percentage interest set forth on Schedule 1 hereto, as the same may be modified from time to time as provided herein. "Permitted Transferee" shall have the meaning set forth in Section 9.2. "Person" means any individual, partnership, limited liability company, corporation, cooperative, trust, estate or other entity. "Profits" and "Losses" means, for each Taxable Year, an amount equal to the Company's taxable income or loss for a taxable year, determined in accordance with Section 703(a) of the Code (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Section 703(a)(1) of the Code shall be included in taxable income or loss), with the following adjustments: (a) Any income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Profits or Losses shall be added to such taxable income or loss; (b) Any expenditures of the Company described in Section 705(a)(2)(B) of the Code or treated as Code Section 705(a)(2)(B) expenditures pursuant to Regulation Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Profits or Losses, shall be subtracted from such taxable income or loss; (c) In the event the Gross Asset Value of any Company asset is adjusted pursuant to subparagraphs (b) or (c) of the definition of Gross Asset Value, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the Gross Asset Value of the asset) or an item of loss (if the adjustment decreases the Gross Asset Value of the asset) from the disposition of such asset and shall be taken into account for purposes of computing Profits or Losses; 6 (d) Gain or loss resulting from any disposition of Property with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Gross Asset Value of the Property disposed of, notwithstanding that the adjusted tax basis of such Property differs from its Gross Asset Value; (e) In lieu of the depreciation, amortization, and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Depreciation for such Taxable Year, computed in accordance with the definition of Depreciation; and (f) To the extent an adjustment to the adjusted tax basis of any Company asset pursuant to Code Section 734(b) or Code Section 743(b) is required, pursuant to Regulation Sections 1.704-(b)(2)(iv)(m)(4) to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Member's interest in the Company, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) from the disposition of such asset and shall be taken into account for purposes of computing Profits or Losses. "Property" means all assets, real or intangible, that the Company may own or otherwise have an interest in from time to time. "Purchasing Group B Members" shall have the meaning set forth in Section 3.9(a). "Regulations" means the regulations, including temporary regulations, promulgated by the United States Department of Treasury with respect to the Code, as such regulations are amended from time to time, or corresponding provisions of future regulations. "Regulatory Allocations" shall have the meaning set forth in Section 5.4. "Reserves" means the cash reserves established by the Management Committee to provide for working capital, future investments, debt service and such other purposes as may be deemed reasonably necessary or advisable by the Management Committee. "SEC" means the Securities and Exchange Commission. "Secretary" shall mean the Secretary of the Treasury or his/her delegate or the Internal Revenue Service. 7 "Securities Act" shall mean the Securities Act of 1933, as amended. "Section 9.8 Offeree" shall have the meaning set forth in Section 9.8(a). "Section 9.8 Proposed Purchaser" shall have the meaning set forth in Section 9.8(a). "Section 9.8 Selling Member" shall have the meaning set forth in Section 9.8(a). "Section 9.9 Participating Tagged Members" shall have the meaning set forth in Section 9.9(a). "Section 9.9 Proposed Purchaser" shall have the meaning set forth in Section 9.9(a). "Section 9.9 Tag-Along Membership Interest" shall have the meaning set forth in Section 9.9(a). "Section 9.9 Tagged Members" shall have the meaning set forth in Section 9.9(a). "Stock Contributors" shall mean those Members contributing OMC Stock as their initial Capital Contributions as reflected on Schedule 1 hereto. "Stock Contributors Preferred Return" shall have the meaning set forth in Section 3.8(b). "Tag-Along Right" shall have the meaning set forth in Section 9.9(a). "Tag-Along Notice" shall have the meaning set forth in Section 9.9(a). "Taxable Year" shall mean the taxable year of the Company in accordance with the provisions of Section 706 of the Code. "Tax Distribution" means an amount equal to the taxable income of the Company allocated to the Members for a Taxable Year multiplied by the sum of (x) the highest federal income tax rate applicable to individuals for such Taxable Year and (y) the highest (net of the federal income tax deduction therefor) combined New York State and New York City income tax rate applicable to individuals for such Taxable Year. Cash Distributions in respect of the Tax Distribution shall be made quarterly as provided in 8 Section 4.1 hereof, based on a reasonable estimate of the amount of Tax Distribution for such Taxable Year. The amount of Tax Distribution shall be computed by the Company's regular independent public accounting firm. "Tax Matters Member" shall have the meaning set forth in Article 11. "Transfer" or "Transferred" means (a) when used as a verb, to give, sell, exchange, assign, transfer, pledge, hypothecate, bequeath, devise or otherwise dispose of or encumber, and (b) when used as a noun, the nouns corresponding to such verbs, in either case voluntarily or involuntarily, by operation of law or otherwise. When referring to a Membership Interest, "Transfer" shall mean the Transfer of such Membership Interest whether of record, beneficially, by participation or otherwise. ARTICLE 3 FORMATION AND OFFICES 3.1 Formation. Pursuant to the Act, the Members have formed a Delaware limited liability company effective upon the filing of the Certificate of the Company with the Secretary of State of Delaware. To the extent that the rights or obligations of any Member are different by reason of any provision of this Agreement than they would be in the absence of such provision, to the extent permitted by the Act, this Agreement shall control. 3.2 Principal Office. The principal office of the Company shall be located at 277 Park Avenue, New York, New York 10172 or at such other place(s) as the Management Committee may determine from time to time. 3.3 Registered Office and Registered Agent. The location of the registered office and the name of the registered agent of the Company in the State of Delaware shall be as stated in the Certificate, as determined from time to time by the Management Committee. 3.4 Purpose of Company. The Company's purposes, and the nature of the business to be conducted and promoted by the Company are, (a) to form GAC and to acquire all of the outstanding capital stock of GAC (b) to seek to cause GAC to acquire OMC Stock pursuant to a tender offer and, thereafter, to merge with and into OMC following which the Company shall own all of the issued and outstanding shares of OMC (the "Acquisition"), (c) to engage in any other lawful act or activity for which limited liability companies may be formed under the Act; provided, however, that the Company shall not engage in any business that would cause the Company to be engaged in a trade or business in the United States (it being understood that neither the Company, nor any 9 Manager or Member shall have any liability to any Member if, for any reason, the Company is determined to have engaged in a trade or business in the United States), and (d) to engage in any and all activities necessary, advisable, convenient or incidental to the foregoing. 3.5 Date of Dissolution. The term of the Company shall continue until the close of business on August 1, 2032 or until the earlier dissolution under Article 10 hereof. The existence of the Company as a separate legal entity shall continue until cancellation of the Certificate in the manner required by the Act. 3.6 Certificate; Qualification. The execution, delivery and filing of the Certificate by Gary K. Duberstein, in his capacity as an authorized person, within the meaning of the Act, is hereby ratified, approved and confirmed in all respects. The President and Chief Executive Officer, any Vice President, the Secretary and any Assistant Secretary of the Company is hereby authorized to qualify the Company to do business as a foreign limited liability company in any state or territory in the United States in which the Company may wish to conduct business and each is hereby designated as an authorized person, within the meaning of the Act, to execute, deliver and file any amendments or restatements of the Certificate and any other certificates and any amendments or restatements thereof necessary for the Company to so qualify to do business in any such state or territory. ARTICLE 4 CAPITALIZATION OF THE COMPANY 4.1 Initial Capital Contributions. On the Initial Capital Contribution Date, each Member shall make Capital Contributions to the capital of the Company consisting of cash and/or OMC Stock as specified and as set forth opposite such Member's name on Schedule 1 hereto. For purposes hereof, the Gross Asset Value of shares of OMC Stock shall be $18.00 per share. The amount of Cash Capital Contributions, and the Gross Asset Value of any OMC Stock to be contributed as Capital Contributions, and the Percentage Interest of each Member following such Capital Contributions on the Initial Capital Contribution Date, is likewise set forth on Schedule 1. 4.2 Additional Capital Contributions. (a) Except as otherwise expressly provided in this Agreement, no Member shall be required to make any additional Capital Contribution. No Member shall be permitted to make any additional Capital Contribution without the approval of the Management Committee. 10 (b) Subject to the rights of each Member to purchase its proportionate share of additional Membership Interests issued by the Company in accordance with Section 3.7, the Company may offer additional Membership Interests to: (i) any person that is not an Affiliate of a Member with the approval of the Management Committee; or (ii) any person that is a Member or is an Affiliate of a Member with the approval of (A) the Management Committee, (B) a Majority in Interest of the Group A Members and (C) a Majority in Interest of the Group B Members, it being expressly understood that such approval of the Members shall also include their approval of any related valuations of Gross Asset Value by the Management Committee and, if such Members approve the Transfer without approving said valuation, Gross Asset Value shall be determined by a third Person familiar with the valuation of such transactions selected jointly by a Majority in Interest of the Group A Members and a Majority in Interest of the Group B Members not later than ten (10) days after their approval of the Transfer or, if the Members fail to so select a third Person, then such third Person will be selected in accordance with the rules and procedures of the American Arbitration Association in New York, New York. If any additional Capital Contributions are made by Members but not in proportion to their respective Percentage Interests, the Percentage Interest of each Member shall be adjusted such that each Member's revised Percentage Interest determined immediately following the additional Capital Contributions shall be equal to a fraction (1) the numerator of which is the sum of (a) the positive Capital Account balance of the Member determined immediately preceding the date the additional Capital Contribution is made (such Capital Account to be computed by adjusting the book value for Capital Account purposes of each Company asset to equal its Gross Asset Value as of such date, as provided in subparagraph (b) of the definition herein of "Gross Asset Value"), and (b) the additional Capital Contribution, if any, made by such Member, and (2) the denominator of which is the sum of the positive Capital Account balances and additional Capital Contributions of all Members, including any new Members (in each case calculated as provided in Section 3.2(b)(ii)(1)). The names, addresses and Capital Contributions of the Members shall be reflected in the books and records of the Company. 4.3 Loans. (a) No Member shall be obligated to loan funds to the Company. Loans by a Member to the Company shall not be considered Capital Contributions. The amount of any such purchases shall be a debt of the Company owed to such Member in accordance with the terms and conditions upon which such purchases are made. (b) A Member may (but shall not be obligated to) guarantee a loan made to 11 the Company. If a Member guarantees a loan made to the Company and is required to make payment pursuant to such guarantee to the maker of the loan, then the amounts so paid to the maker of the loan shall be treated as a loan by such Member to the Company and not as an additional capital contribution. 4.4 Certain Expenses. (a) Subject to Section 3.8, in the event that the Acquisition is not consummated, each of the Members shall pay or reimburse the Company for its pro rata share (based on Percentage Interests) of the following fees, costs and expenses (including, but not limited to, those fees, costs and expenses incurred by the Members): costs and expenses incurred in connection with the formation of the Company and GAC; fees, costs and expenses incurred in connection with obtaining financing in connection with the proposed Acquisition including any bank or other commitment fees or finder's fees relating thereto; fees, costs and expenses incurred in connection with the preparation of documentation relating to the proposed acquisition, including any tender offer documentation and filings with the Securities and Exchange Commission; any printing expenses; any fees and disbursements of attorneys, accountants and other advisors; any indemnity obligations of the Company under Section 8.2 or elsewhere hereunder and any fees, costs or expenses related thereto. (b) The Management Committee shall provide notice to the Members of the amount, from time to time, the amounts paid or reimbursed by the Members pursuant to Section 3.4(a) and cash such Members should pay its pro rata share of such amounts within five (5) Business Days of the date of the Company's Notice therefor. 4.5 Maintenance of Capital Accounts. (a) The Company shall maintain for each Member, a separate Capital Account with respect to the Membership Interest owned by such Member in accordance with the following provisions: (i) To each Member's Capital Account there shall be credited (A) such Member's Capital Contributions, (B) such Member's distributive share of Profits and (C) the amount of any Company liabilities assumed by such Member or which are secured by any Property distributed to such Member. The principal amount of a promissory note which is not readily traded on an established securities market and which is contributed to the Company by the maker of the note (or a Member related to the maker of the note within the meaning of Regulation Section 1.704-1(b)(2)(ii)(c)) shall not be included in the Capital Account of any Member until the Company makes a taxable disposition of the note or until (and only to the extent) principal payments are made on the note, all in accordance with Regulation Section 1.704-1(b)(2)(iv)(d)(2); (ii)To each Member's Capital Account there shall be debited (A) the 12 amount of money and the Gross Asset Value of any Property distributed or treated as an advance distribution to such Member pursuant to any provision of this Agreement (including without limitation any distributions pursuant to Section 4.1(a)), (B) such Member's distributive share of Losses and (C) the amount of any liabilities of such Member assumed by the Company or which are secured by any Property contributed by such Member to the Company; (iii) In the event Membership Interests are Transferred in accordance with the terms of this Agreement, the transferee shall succeed to the Capital Account of the transferor to the extent it relates to the Transferred Membership Interests; and (iv) In determining the amount of any liability for purposes of Sections 3.5(a)(i) and 3.5(a)(ii) there shall be taken into account Code Section 752(c) and any other applicable provisions of the Code and Regulations. (b) The foregoing Section 3.5(a) and the other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Regulation Section 1.704-1(b) and, to the greatest extent practicable, shall be interpreted and applied in a manner consistent with such Regulation. The Management Committee in its discretion and to the extent otherwise consistent with this Agreement shall (i) make any adjustments that are necessary or appropriate to maintain equality between the Capital Accounts of the Members and the amount of capital reflected on the Company's balance sheet, as computed for book purposes, in accordance with Regulation Section 1.704-1(b)(2)(iv)(q), and (ii) make any appropriate modifications in the event unanticipated events might otherwise cause this Agreement not to comply with Regulation Section 1.704-1(b). 4.6 Capital Withdrawal Rights, Interest and Priority. Except as expressly provided in this Agreement, no Member shall be entitled (a) to withdraw or reduce such Member's Capital Contribution or to receive any distributions from the Company, or (b) to receive or be credited with any interest on the balance of such Member's Capital Contribution at any time. 4.7 Preemptive Rights. Subject to Section 3.2, if the Company elects to offer and sell Membership Interests other than the Membership Interests set forth on Schedule 1, such additional Membership Interests shall be in the form of Membership Interests having such Percentage Interest, designations and such rights and provisions, including, but not limited to, provisions relating to distributions and allocations of Profits and Losses, as shall be reasonably determined by the Management Committee to be in the best interest of the Company; provided, however, that the Company may not offer and sell any Membership Interests having preferences to the rights of Group A Members or 13 the Group B Members with respect to distributions, allocations or rights upon liquidation, without the prior written consent of a Majority in Interest of the Group A Members, and a Majority in Interest of the Group B Members (it being understood that no such consent shall be required for the offering or sale of Membership Interests that are entitled to distributions, allocations and rights upon liquidation that are pari passu to the rights of the Group A Members and the Group B Members). Prior to the consummation of any sale of additional Membership Interests, the Company shall offer the additional Membership Interests to the Members, on the terms and conditions set forth below: (a) The Company shall give Notice to each Member, setting forth the price, terms and conditions of the proposed sale of the additional Membership Interests. (b) Each Member shall have the option to acquire all or a portion of such Member's pro rata portion (which shall be in proportion to the Percentage Interest of all the Members) at the time of the offering of the additional Membership Interests proposed to be sold, on the same terms and conditions as are set forth in the Notice. The option of Members to purchase all or a portion of their pro rata portions of the additional Membership Interests shall be exercised by delivery of a Notice to the Company of exercise within thirty (30) days following receipt of the Company's Notice of the price, terms and conditions of the sale of the additional Membership Interests. If any Member fails or declines to purchase all or a portion of such Member's pro rata portion of the additional Membership Interests, then such Member's remaining portion of the additional Membership Interests shall be offered to the Members who have exercised their options to purchase their pro rata portions. This procedure shall continue until such time as all the Membership Interests offered hereby have been purchased by such Members or until no such Member desires to purchase any additional Membership Interests hereunder. Each such Member shall have the right to offer to acquire such additional Membership Interests by delivering to the Company such Member's Notice of such offer within ten (10) days following receipt of the Company's Notice that additional portions are available. If less than all the Membership Interests to be sold by the Company are purchased by the Members, the Company may within one hundred twenty (120) days from the initial Notice sell such Membership Interests as shall not have been purchased by the Members upon terms and conditions no less favorable to the Company than those set forth in the Notice. (c) The sale of additional Membership Interests to Members who exercise their options to purchase additional Membership Interests shall occur on the date set forth in a Notice from the Company to such Members, which date shall not be earlier than thirty (30) days after the date of expiration of the last such offer to expire under Section 3.7(b). 14 4.8 Stock Contributors Preferred Return; Cash Contributors Preferred Return. In the event that the Acquisition is not consummated and the Company sells shares of OMC Stock contributed by the Stock Contributors that exceeds $16.00 per share or the Company receives cash or other consideration of or such shares as the result of a merger or other business combination of OMC that exceeds $16.00 per share, the aggregate amount of such excess price or consideration shall be applied as follows: (a) first, to the payment of the expenses referred to in Section 3.4, and (b) the balance, if any, shall be distributed as follows: (i) 80% to the Stock Contributors on a pro rata basis based upon the respective shares of OMC Stock contributed by them as initial Cash Contributions (the "Stock Contributors Preferred Return") and (ii) 20% to the Cash Contributors on a pro rata basis based upon the respective amounts of cash contributed by them as initial Cash Contributions (the "Cash Contributors Preferred Return"). (c) Anything to the contrary herein notwithstanding, the Stock Contributors Preferred Return and the Cash Contributors Preferred Return shall be paid or distributed to such members, as applicable, on a priority basis prior to the making of any other distribution or allocation hereunder to Members. 4.9 Right of First Offer on Sale of the Business. (a) If (i) the Management Committee proposes to sell all or substantially all of the business and operations of the Company (the "Business") to any Person by means of merger, sale of assets or otherwise (a "Disposition"), other than pursuant to a sale of outstanding Membership Interests (as to which the provisions of Article 9 shall be applicable) and (ii) a Majority in Interest of the Group B Members shall not have consented in writing to such Disposition, then the Management Committee shall provide Notice of the proposed Disposition to the Group B Members setting forth in reasonable detail the price, terms and conditions of the proposed Disposition (the "Disposition Notice"). In the event that the consideration proposed to be received by the Company in the Disposition consists all or in part of securities, the Disposition Notice shall specify a cash price that reflects the value, as determined in the reasonable discretion of the Management Committee, of such securities (the "Cash Alternative Price"). One or more of the Group B Members (the "Purchasing Group B Members") shall have the option, exercisable by a Notice to the Company delivered within thirty (30) days after the date of the Disposition Notice and signed by a Majority in Interest of the Group B Members (the "Notice of Acceptance"), to elect to acquire the Business on the price, terms and conditions set forth in the Disposition Notice. The Notice of Acceptance shall indicate 15 the (A) identity of the Purchasing Group B Members, (B) state their acceptance of the price, the terms and conditions of the proposed Disposition, (C) in the event that the Disposition involves the proposed receipt of securities by the Company, whether the Purchasing Group B Members will pay the Cash Alternative Price in respect thereof or will arrange for the delivery of securities which have equivalent value, and (D) may provide that consummation of the proposed Disposition is conditioned upon the Purchasing Group B Members obtaining financing therefor; provided, however, that if such consummation is conditioned upon obtaining financing therefor, the Notice of Acceptance shall be accompanied by commitments from recognized financial institutions evidencing their commitment to provide any financing required to consummate the proposed Disposition, which commitments shall be customary in form and substance and, provided further, in the event that the Management Committee shall determine, in its reasonable discretion, that any securities proposed to be delivered by the Purchasing Group B Members do not have equivalent value to the securities proposed to be received in the Disposition, it shall provide Notice thereof to the Purchasing Group B Members and they shall have five (5) Business Days to elect by Notice to the Company whether to pay the Cash Alternative Price in lieu of delivering such securities or not to proceed with the transaction (it being understood that failure to provide any such Notice within such five (5) Business Days shall be deemed to be an election not to proceed). If the Purchasing Class B Members fail or for any reason (other than a default or breach by the Company) are unable to consummate the proposed Disposition within sixty (60) days from the date of the Disposition Notice in accordance with Section 3.9(b), the Company may effect a Disposition to any Person upon terms and conditions no less favorable to the Company than those set forth in the Disposition Notice during a period of 180 days after the expiration of such 60-day period. Thereafter, any Disposition will again be subject to the rights of the Group B Members under the provisions of this Section 3.9(a). (b) The sale of the Business to the Purchasing Group B Members pursuant to this Section 3.9 shall occur at the office of the Company on a Business Day specified by not less than five (5) Business Days' prior Notice from the Purchasing Group B Members to the Company, which Business Day shall not be later than sixty (60) days after the date of the Disposition Notice. At the closing, the Purchasing Group B Members shall deliver the consideration payable pursuant to the Disposition Notice (or Cash Alternative Price, if applicable) in the form and amount specified therein against the simultaneous delivery of instruments of assignment in form and substance reasonably satisfactory to the Purchasing Group B Members, evidencing the sale of the Business contemplated by the Disposition Notice. 16 ARTICLE 5 DISTRIBUTIONS 5.1 Distributions of Net Cash Flow. Except as otherwise provided in Section 3.8, distributions of Net Cash Flow to the Members shall be made as follows: (a) quarterly, to the Group A Members and Group B Members in proportion to and to the extent of their relative Percentage Interests, an amount not in excess of the Tax Distribution for the Taxable Year; provided, however, that distributions under this Section 4.1(a) shall be treated as advance distributions under Section 4.1(b), with the result that distributions otherwise made under Section 4.1(b) to such Member shall be reduced by the amount of advances made pursuant to this Section 4.1(a)); and (b) upon the approval of and in the amount so approved by the Management Committee acting in its sole discretion, to the Group A Members and Group B Members in proportion to their relative Percentage Interests. 5.2 Persons Entitled to Distributions. All distributions of Net Cash Flow to the Members under this Article 4 shall be made to the Persons shown on the records of the Company to be entitled thereto as of the last day of the fiscal period prior to the time for which such distribution is to be made, unless the transferor and transferee of any Membership Interest otherwise agree in writing to a different distribution and such distribution is consented to in writing by the Management Committee. 5.3 Limitations on Distributions. Notwithstanding anything to the contrary herein provided, no distribution hereunder shall be permitted to the extent prohibited by Section 18-607 of the Act. ARTICLE 6 ALLOCATIONS 6.1 Profits. Profits for any Taxable Year shall be allocated to the Group A Members and Group B Members first to reimburse them to the extent of any prior Losses so as to bring each Member's Capital Account to zero, pro rata in accordance with the sum of each Member's Losses, and then in proportion to their Percentage Interests; provided, however, in the event that the Acquisition is not consummated and there is a Stock Contributors Preferred Return and a Cash Contributors Preferred Return distributable pursuant to Section 3.8, allocations of Profits shall be made in accordance with such distributions. 6.2 Losses. Subject to the limitation in Section 5.4 hereof and subject to Section 5.6 hereof, Losses for any Taxable Year shall be allocated to the Group A Members and Group B Members in proportion to their Percentage Interests. 17 6.3 Loss Limitation. Losses allocated pursuant to Section 5.2 hereof shall not exceed the maximum amount of Losses that can be allocated without causing any Member to have an Adjusted Capital Account Deficit at the end of any Taxable Year. In the event some but not all the Members would have Adjusted Capital Account Deficits as a consequence of an allocation of Losses pursuant to Section 5.2 hereof, the limitation set forth in this Section 5.4 shall be applied on a Member by Member basis and Losses not allocable to any Member as a result of such limitation shall be allocated to the other Members pro rata in accordance with the positive balances in such Members' Capital Accounts so as to allocate the maximum permissible Losses to each Member under Section 1.704-1(b)(2)(ii)(d) of the Regulations. 6.4 Tax Allocations: Code Section 704(c). (a) In accordance with Code Section 704(c) and the Regulations thereunder, income, gain, loss and deduction with respect to any Property contributed to the capital of the Company shall, solely for tax purposes, be allocated among the Members so as to take account of any variation between the adjusted basis of such Property to the Company for federal income tax purposes and its initial Gross Asset Value (computed in accordance with the definition of Gross Asset Value). (b) In the event the Gross Asset Value of any Company asset is adjusted pursuant to subparagraph (b) of the definition of Gross Asset Value, subsequent allocations of income, gain, loss and deduction with respect to such asset shall take account of any variation between the adjusted basis of such asset for federal income tax purposes and its Gross Asset Value in the same manner as under Code Section 704(c) and the Regulations thereunder. (c) Any elections or other decisions relating to such allocations shall be made by the Management Committee in any manner that reasonably reflects the purpose and intention of this Agreement; provided, that the Company, in the discretion of the Management Committee, may make, or not make, "curative" or "remedial" allocations (within the meaning of the Regulations under Code Section 704(c)) including, but not limited to, "curative" allocations which offset the effect of the "ceiling rule" for a prior Taxable Year (within the meaning of Regulation Section 1.704-3(c)(3)(ii) and "curative" allocations from disposition of contributed property (within the meaning of Regulation Section 1.704-3(c)(3)(iii)(B). Allocations pursuant to this Section 5.6 are solely for purposes of federal, state, and local taxes and shall not affect, or in any way be taken into account in computing, any Member's Capital Account or share of Profits, Losses, other items, or distributions (other than Tax Distributions) pursuant to any provision of this Agreement. 18 6.5 Change in Percentage Interests. In the event that the Members' Percentage Interests change during a Taxable Year, Profits and Losses shall be allocated taking into account the Members' varying Percentage Interests for such Taxable Year, determined on a daily, monthly or other basis as determined by the Management Committee, using any permissible method under Code Section 706 and the Regulations thereunder. 6.6 Withholding. Each Member hereby authorizes the Company to withhold and to pay over any taxes payable by the Company or any of its Affiliates as a result of such Member's participation in the Company; if and to the extent that the Company shall be required to withhold any such taxes, such Member shall be deemed for all purposes of this Agreement to have received a payment from the Membership as of the time such withholding is required to be paid, which payment shall be deemed to be a distribution to such Member to the extent that the Member is then entitled to receive a distribution. To the extent that the aggregate of such payments in respect of a Member for any period exceeds the distributions to which such Member is entitled for such period, the amount of such excess shall be considered a demand loan from the Company to such Member, with interest at 8% per annum, which interest shall be treated as an item of Company income, until discharged by such Member by repayment, which may be made in the sole discretion of the Management Committee out of distributions to which such Member would otherwise be subsequently entitled. The withholdings referred to in this Section 5.6 shall be made at the maximum applicable statutory rate under the applicable tax law unless the Management Committee shall have received an opinion of counsel or other evidence, satisfactory to the Management Committee, to the effect that a lower rate is applicable, or that no withholding is applicable. ARTICLE 7 MEMBERS' MEETINGS 7.1 Meetings of Members; Place of Meetings. Regular meetings of the Members may be held on an annual basis or more frequently as determined by a Majority in Interest of the Members. All meetings of the Members shall be held in New York, New York at a location as designated from time to time by the Management Committee and stated in the Notice of the meeting or in a duly executed waiver of the Notice thereof. Special meetings of the Members may be held for any purpose or purposes, unless otherwise prohibited by law, and may be called by the Management Committee or by Members owning not less than twenty-five percent (25%) of the Percentage Interests. Members may participate in a meeting of the Members by means of conference telephone or other similar communication equipment whereby all Members participating in the meeting can hear each other. Participation in a meeting in this manner shall constitute presence in person at the meeting. 19 7.2 Quorum; Voting Requirement. The presence, in person or by proxy, of a Majority in Interest of the Members shall constitute a quorum for the transaction of business by the Members. The affirmative vote of a Majority in Interest of the Members present, in person or by proxy, at any meeting shall constitute a valid decision of the Members, except where a larger vote is required by the Act. 7.3 Proxies. At any meeting of the Members, every Member having the right to vote thereat shall be entitled to vote in person or by proxy appointed by an instrument in writing signed by such Member and bearing a date not more than one year prior to such meeting. 7.4 Action Without Meeting. Any action required or permitted to be taken at any meeting of Members of the Company may be taken without a meeting, without prior notice and without a vote if a consent in writing setting forth the action so taken is signed by Members having not less than the minimum Percentage Interests that would be necessary to authorize or take such action at a meeting of the Members. Prompt Notice of the taking of any action taken pursuant to this Section 6.4 by less than the unanimous written consent of the Members shall be given to those Members who have not consented in writing. 7.5 Notice. Notice stating the place, day and hour of the meeting and the purpose for which the meeting is called shall be delivered personally or sent by mail or by telecopier not less than five (5) days nor more than sixty (60) days before the date of the meeting by or at the direction of the Management Committee or other persons calling the meeting, to each Member entitled to vote at such meeting. 7.6 Waiver of Notice. When any Notice is required to be given to any Member hereunder, a waiver thereof in writing signed by the Member, whether before, at or after the time stated therein, shall be equivalent to the giving of such Notice. 7.7 No Authority. Unless expressly authorized herein or by action of the Members or the Management Committee in accordance herewith and the Act, no Member shall have any authority to act on behalf of the Company or bind the Company in any manner whatsoever, including, without limitation, entering into any agreement on behalf of the Company. 20 ARTICLE 8 MANAGEMENT AND CONTROL 8.1 Management Committee; Managers. (a) Except as otherwise provided hereunder, the business and affairs of the Company shall be managed by a Management Committee comprised of up to a total of four (4) Managers, (i) two of whom shall be designated by a Majority in Interest of the Group A Members and (ii) two of whom shall be designated by a Majority in Interest of the Group B Members, provided, however, that from and after the date that is 12 months after the Initial Capital Contribution Date, the Group A Members shall have the right to elect to have the Management Committee consist of a total of five (5) Managers, (i) three of whom shall be designated by a Majority in Interest of the Group A Members and (ii) two of whom shall be designated by a Majority in Interest of the Group B Members. The Group A Members shall have the right to remove or replace (following death or resignation) any or all of the Managers designated by the Group A Members and designate their successors, and the Group B Members shall have the right to remove or replace (following death or resignation) any or all of the Managers designated by the Group B Members and designate their successors. The initial Managers shall be Alfred D. Kingsley, Gary K. Duberstein and Richard Katz. (b) Except as otherwise expressly provided herein, the power and authority granted to the Management Committee hereunder shall include all those necessary or convenient for the furtherance of the purposes of the Company and shall include the power to make all decisions with regard to the management, operations, assets, financing and capitalization of the Company. (c) Anything to the contrary herein notwithstanding, no Manager shall have any authority to bind the Company or the Management Committee in his individual capacity in any manner whatsoever, except for such authority as shall be expressly delegated to a Manager in this Agreement or by the Management Committee. (d) The board of directors (or similar governing body) of any subsidiary of the Company shall be comprised of such members as may be approved by the Management Committee of the Company; provided, however, that the Class B Members shall have the right to designate one member of any such board of directors (or similar governing body). 8.2 Management Committee Meetings; Authority; Proxies. (a) The Management Committee will establish a regular meeting schedule, and will use its reasonable best efforts to meet at least once every quarter. Unless otherwise agreed by a majority of the Managers, meetings of the Management Committee shall be held in New York, New York. Meetings may be conducted in person, by telephone or in any other manner agreed to by the Management Committee. Any two (2) 21 Managers may call a meeting of the Management Committee upon delivery of written or telephonic Notice at least three (3) Business Days prior to the date of such meeting, which Notice shall be accompanied by a proposed agenda or statement of purpose and by copies of all documents, agreements and information to be considered at such meeting; provided, however, at any such meeting, the Managers may address any and all business matters which may come before it, whether or not such items were provided for in the proposed agenda. (b) A quorum shall exist when three of the Managers are present in person or by proxy. Each Manager is entitled to vote at any meeting of the Management Committee. The vote of three of the Managers present in person or by proxy at any meeting of the Management Committee shall be required for action by the Management Committee. (c) At each meeting of the Management Committee, every Manager shall be entitled to vote in person or by proxy appointed by instrument in writing, subscribed by such Manager. 8.3 Management Committee's Authority; Certain Limitations. (a) Except as expressly set forth herein, the Management Committee shall have the maximum power and authority with respect to the business and operations of the Company permitted by law, including, without limitation, the right to cause the Company to merge or consolidate with, or sell all, or substantially all, of its asset to any Person. (b) Notwithstanding the grant of authority to the Management Committee pursuant to Section 7.3(a) and except as otherwise contemplated in Sections 10.1(a), (b) and (c), the Management Committee shall not authorize the Company to merge or consolidate with, or sell all, or substantially all, of its assets to, a Member or an Affiliate of a Member without the prior written consent of a Majority in Interest 22 of the Group A Members and a Majority in Interest of the Group B Members. 8.4 Officers; Agents. The Management Committee shall have the power to appoint any Person or Persons as agents (who may be referred to as officers) to act for the Company with such titles, if any, as the Management Committee deems appropriate and to delegate to such officers or agents such of the powers as are granted to the Management Committee hereunder, provided, however, that without the express approval of the Management Committee, no officer or agent shall have the authority to take any action (i) outside the ordinary course of business of the Company or (ii) material to the Company and its subsidiaries taken as a whole. Any decision or act of an officer appointed under this Section 7.4 within the scope of the officer's designated or delegated authority shall control and shall bind the Company. The officers or agents so appointed may have such titles as the Management Committee shall deem appropriate, which may include (but need not be limited to) President and Chief Executive Officer, Executive Vice President, Vice President, Chief Operating Officer, Chief Financial Officer, Treasurer or Controller. The initial officers of the Company are set forth on Schedule 7.4. Unless the authority of the agent designated as the officer in question is limited by the Management Committee, any officer so appointed shall have the same authority to act for the Company as a corresponding officer of a Delaware corporation would have to act for a Delaware corporation in the absence of a specific delegation of authority, provided, however, that without the express approval of the Management Committee, no officer or agent shall have the authority to take any action outside the ordinary course of business of the Company or (ii) material to the Company and its subsidiaries taken as a whole. The Management Committee, in its sole discretion, may by vote, resolution or otherwise ratify any act previously taken by an officer or agent acting on behalf of the Company. 8.5 Resignation of a Management Committee Member. A Manager may resign from such position at any time upon giving Notice to the Management Committee. Any vacancy created by any such resignation of a Manager shall be filled by the Persons or Person who designated such vacating Manager in accordance with the provisions of Section 7.1(a). 8.6 Compensation Except as otherwise provided herein, each Manager shall be entitled to reimbursement from the Company for all reasonable direct out-of-pocket expenses incurred on behalf of the Company and shall not be entitled to further compensation except as may be approved by a Majority in Interest by the Group A Members and a Majority in Interest of the Group B Members. 23 ARTICLE 9 LIABILITY AND INDEMNIFICATION 9.1 Liability of Members. A Member shall only be liable to make the payment of its Capital Contribution. No Member, except as otherwise specifically provided in the Act, shall be obligated to pay any distribution to or for the account of the Company or any creditor of the Company. 9.2 Indemnification. (a) The Company shall indemnify and hold harmless each Manager and Member and their respective Affiliates and all officers, directors, members, partners, stockholders, managers and employees thereof, and each officer of the Company and any Person serving in any similar capacity for another Person affiliated with the Company at the request of the Company (solely for purposes of this Section 8.2, each such Person being referred to as, a "Company Affiliate"), from and against any and all losses, claims, demands, costs, damages, liabilities, expenses of any nature (including reasonable attorneys' fees and disbursements), judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, whether civil, criminal, administrative or investigative, in which a Company Affiliate may be involved, or threatened to be involved, as a party or otherwise, arising out of or incidental to the business of the Company, including, without limitation, liabilities under the Federal and state securities laws, regardless of whether a Company Affiliate continues to be a Company Affiliate, at the time any such liability or expense is paid or incurred, if (i) the Company Affiliate acted in good faith and in a manner it or he reasonably believed to be in, or not opposed to, the interests of the Company and, with respect to any criminal proceeding, had no reason to believe its or his conduct was unlawful, and (ii) the Company Affiliate's conduct did not constitute actual fraud, gross negligence or willful or wanton misconduct. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere, or its equivalent, shall not, in and of itself, create a presumption or otherwise constitute evidence that the Company Affiliate acted in a manner contrary to that specified in (i) or (ii) above. (b) Expenses (including reasonable legal fees and expenses) incurred in defending any proceeding subject to subsection (a) of this Section 8.2 shall be paid by the Company in advance of the final disposition of such proceeding upon receipt of a written affirmation by the Company Affiliate of his or its good faith belief that he or it has met the standard of conduct necessary for indemnification under this Section 8.2 and a written undertaking (which need not be secured) by or on behalf of the Company Affiliate to repay such amount if it shall ultimately be determined, by a court of competent jurisdiction or otherwise, that the Company Affiliate is not entitled to be indemnified by the Company as authorized hereunder. (c) The indemnification provided by this Section 8.2 shall be in addition to any other rights to which each Company Affiliate may be entitled under any agreement or vote of the Management Committee by the vote of Managers that are disinterested and 24 unaffiliated with such Company Affiliate, as a matter of law or otherwise, both as to action in the Company Affiliate's capacity as a Company Affiliate or as a Person serving at the request of the Company and shall continue as to a Company Affiliate who has ceased to serve in such capacity and shall inure to the benefit of the heirs, successors, assigns, administrators and personal representatives of such Company Affiliate. (d) The Company may purchase and maintain directors and officers insurance or, similar coverage, for its Managers and its officers in such amounts and with such deductibles or self-insured retentions as are customary for Persons engaged in businesses similar in size and type to those engaged in by the Company. (e) Except as provided in Section 3.4, any indemnification hereunder shall be satisfied only out of the assets of the Company and the Members shall not be subject to personal liability by reason of these indemnification provisions. To the extent the Company does not have adequate cash available to satisfy its obligations under this Article 8, the Company shall pay its obligations under this Article 8 out of Net Cash Flow prior to making any distributions (other than distributions under Section 4.1(a) hereof) to the Members. (f) A Company Affiliate shall not be denied indemnification in whole or in part under this Section 8.2 because the Company Affiliate had an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by the terms of this Agreement and all material facts relating to such indemnitee's interest were adequately disclosed to the Management Committee at the time the transaction was consummated. (g) The provisions of this Section 8.2 are for the benefit of the Company Affiliates and the heirs, successors, assigns, administrators and personal representatives of the Company Affiliates and shall not be deemed to create any rights for the benefit of any other Persons. (h) Any repeal or amendment of any provisions of this Section 8.2 shall be prospective only and shall not adversely affect any Company Affiliates's right existing at the time of such repeal or amendment. ARTICLE 10 TRANSFERS OF MEMBERSHIP INTERESTS 10.1 General Restrictions. (a) No Member may Transfer all or any part of such Member's Membership Interest, except as provided in this Agreement. Any purported Transfer or purported 25 purchase of a Membership Interest or a portion thereof in violation of the terms of this Agreement shall be null and void and of no effect. A permitted Transfer shall be effective as of the date specified in the instruments relating thereto. Any transferee desiring to make a further Transfer shall become subject to all the provisions of this Article 9 to the same extent and in the same manner as any Member desiring to make any Transfer. No Member shall have the right to withdraw as a Member of the Company. (b) In the event that the Membership Interests are registered under the Securities Act, the Transfer restrictions set forth in this Article 9 shall terminate. 10.2 Permitted Transferees. (a) Notwithstanding the provisions of Sections 9.8 and 9.9, each Member shall have the right to Transfer (but not to substitute the transferee as a substitute Member in such Member's place, except in accordance with Section 9.3), by a written instrument, all or any part of a Member's Membership Interest, to any of its Affiliates (each a "Permitted Transferee"); it being understood that any such Permitted Transferee shall be deemed to be an additional or substitute Member as of the date of such Transfer and each Member agrees to take such action and execute such documents as such transferee may deem reasonably necessary and appropriate for such transferee to become a substitute or additional Member. Notwithstanding the provisions of Sections 9.8 and 9.9, each Member shall have the right to pledge such Member's interest as collateral security for a loan to another Member or to a financial institution generally in the business of making commercial loans (including by means of a total equity return swap or similar financing technique); provided, however, that no such pledge shall be made for the purpose of effecting a disguised sale to the pledgee and; provided further, that any such pledgee shall agree in a writing delivered to the Company to be bound by all the terms and conditions of this Agreement, including,without limitation, the terms and conditions set forth in Section 9.10. (b) Unless and until admitted as a substitute Member pursuant to Section 9.3, a transferee of a Member's Membership Interest in whole or in part shall be an assignee with respect to such Transferred Membership Interest and shall not be entitled to participate in the management of the business and affairs of the Company or to become or to exercise the rights of a Member, including the right to vote, the right to require any information or accounting of the Company's business or the right to inspect the Company's books and records. Such transferee shall only be entitled to receive, to the extent of the Membership Interest transferred to such transferee, the share of distributions and profits, including distributions representing the return of Capital Contributions, to which the transferor would otherwise be entitled with respect to the Transferred Interest. The transferror shall have the right to vote such Transferred Interest until the transferee is 26 admitted to the Company as a substituted Member with respect to the Transferred Interest. 10.3 Substitute Members. No transferee of all or part of a Member's Membership Interest shall become a substitute Member in place of the transferor unless and until: (a) the transferee has executed an instrument in form and substance reasonably satisfactory to the Management Committee accepting and adopting the terms and provisions of the Certificate and this Agreement; and (b) the transferee has caused to be paid all reasonable expenses of the Company in connection with the admission of the transferee as a substitute Member. Upon satisfaction of all the foregoing conditions with respect to a particular transferee, the President and Chief Executive Officer shall cause the books and records of the Company to reflect the admission of the transferee as a substitute Member to the extent of the Transferred Interest held by the transferee. 10.4 Effect of Admission as a Substitute Member. A transferee who has become a substitute Member has, to the extent of the transferred Membership Interest, all the rights, powers and benefits of, and is subject to the restrictions and liabilities of a Member under the Certificate, this Agreement and the Act. Upon admission of a transferee as a substitute Member, the transferor of the Membership Interest so held by the substitute Member shall cease to be a Member of the Company to the extent of such transferred Membership Interest. 10.5 Consent. Each Member hereby agrees that upon satisfaction of the terms and conditions of this Article 9 with respect to any proposed Transfer, the Person proposed to be such transferee may be admitted as a Member. 10.6 No Dissolution. If a Member transfers all of its Membership Interest pursuant to this Article 9 and the transferee of such Membership Interest is admitted as a Member pursuant to Section 9.3, such Person shall be admitted to the Company as a Member effective on the effective date of the Transfer or such other date as may be specified when the Member is admitted. In such event, the Company shall not dissolve if the business of the Company is continued without dissolution in accordance with clause (c) of Section 10.1 hereof. 10.7 Additional Members; Certain Representations of Members. Subject to 27 Section 3.7, after the formation of the Company, any Person acceptable to the Management Committee may become an additional Member of the Company for such consideration as the Management Committee shall determine, provided that such additional Member complies with all the requirements of a transferee under Sections 9.3(a) and (b). 10.8 Right of First Offer. (a) Subject to Section 9.1(c), if at any time any Member (hereinafter for purposes of this Section 9.8, the "Section 9.8 Selling Members") proposes to Transfer to any Person other than a Permitted Transferee (hereinafter for purposes of this Section 9.8, the "Section 9.8 Proposed Purchaser") its Membership Interest (or any portion thereof), such Section 9.8 Selling Member shall provide Notice of the proposed Transfer to the other Members (hereinafter for purposes of Section 9.8, the "Section 9.8 Offerees") setting forth the price, terms and conditions of the proposed sale of the Membership Interest. Each of the Section 9.8 Offerees shall have the option to acquire such Member's pro rata portion (which shall be in proportion to the Percentage Interests of all Section 9.8 Offerees) at the time of such Notice on the terms and conditions set forth in such Notice. The option of Section 9.8 Offerees to purchase their pro rata portions of the Membership Interest shall be exercised by delivery of a Notice to the Section 9.8 Selling Member and the Company of exercise within twenty-one (21) days following receipt of the Section 9.8 Selling Member's Notice of the price, terms and conditions of the sale. A Section 9.8 Offeree may exercise such Member's option to purchase such Membership Interest only as to the entire portion thereof that such Member is entitled to purchase. If any Section 9.8 Offeree fails or declines to purchase such Member's pro rata portion of such Membership Interest, then such Member's portion of such Membership Interest shall be offered to the Section 9.8 Offerees who have exercised their options to purchase their pro rata portions. This procedure shall continue until such time as the entire Membership Interest offered hereby has been purchased by such Section 9.8 Offerees or until no such Member desires to purchase any additional Membership Interest hereunder. Each Section 9.8 Offeree shall have the right to offer to acquire such Membership Interest by delivering to the Section 9.8 Selling Member and the Company such Member's Notice of acceptance within three (3) Business Days following receipt of the Company's Notice that additional portions are available. If less than the entire Membership Interest to be sold by the Section 9.8 Selling Member is purchased by the Section 9.8 Offerees, the Section 9.8 Selling Member may sell the entire Membership Interest to be sold within thirty (30) days from the Notice referred in the preceding sentence, upon terms and conditions no less favorable to the Section 9.8 Selling Member than were set forth in the initial Notice (it being understood that such terms may include the receipt by the Selling Member of consideration consisting of only cash and/or securities with a readily ascertainable market value). 28 (b) The sale of any Membership Interest to Section 9.8 Offerees who exercise their options to purchase any Membership Interest shall occur twenty-one (21) days after the expiration of the last option to expire under Section 9.8(a) above. At the closing, each of the Section 9.8 Offerees shall deliver a certified or bank cashier's check in the appropriate amount to the Section 9.8 Selling Member against the simultaneous delivery of an assignment in form and substance reasonably satisfactory to each Section 9.8 Offeree of the Member Interest (or portion thereof) being transferred to such Section 9.8 Offeree, such assignment shall be made free and clear of all liens, claims and encumbrances, except as provided by this Agreement or as otherwise agreed to by such Section 9.8 Offeree. 10.9 Tag-Along Rights. (a) In the event of any proposed Transfer by any Member (hereinafter for purposes of this Section 9.9, the "Section 9.9 Selling Member") of its Membership Interests (or any portion thereof) to any Person (such Person being hereinafter referred to as the "Section 9.9 Proposed Purchaser"), other than to a Permitted Transferee or in a bona fide public distribution pursuant to an effective Registration Statement under the Securities Act, each of the other Members (hereinafter for purposes of this Section 9.9, the "Section 9.9 Tagged Members") shall have the irrevocable and exclusive right, but not the obligation (the "Tag-Along Right"), to require the Section 9.9 Proposed Purchaser to purchase from each of them such Section 9.9 Tagged Member's pro rata portion (i.e., such Tagged Member's Percentage Interest) of the Membership Interests proposed to be sold by the Section 9.9 Selling Members to the Section 9.9 Proposed Purchaser (collectively, the "Section 9.9 Tag-Along Membership Interest"). The Section 9.9 Selling Members shall give Notice (the "Initial Tag-Along Notice") to the Section 9.9 Tagged Members at least thirty (30) days prior to the date of the proposed Transfer and at least three (3) Business Days after the expiration of the last option to expire under Section 9.8(a) above, stating: (i) the name and address of the Section 9.9 Proposed Purchaser; (ii) the proposed amount of consideration and terms and conditions of payment offered by such Section 9.9 Proposed Purchaser (if the proposed consideration is not cash, the Notice shall describe the terms of the proposed consideration) and any other material terms and conditions of the Section 9.9 Proposed Purchaser's offer; (iii) the Membership Interest proposed to be transferred; and (iv) that the Section 9.9 Proposed Purchaser has been informed of the Tag-Along Right and has agreed to purchase Membership Interests in accordance with the terms hereof. 29 The Tag-Along Right shall be exercised by any or all of the Section 9.9 Tagged Members by giving Notice to the Company ("Tag-Along Notice") with a copy to each Section 9.9 Selling Member, within five (5) days following receipt of the Initial Tag-Along Notice, indicating its election to exercise the Tag-Along Right (hereinafter referred to for purposes of this Section 9.9, the "Section 9.9 Participating Tagged Members"). The Tag-Along Notice shall state the amount of Membership Interests that such Section 9.9 Participating Tagged Member proposes to include in such transfer to the Section 9.9 Proposed Purchaser. Failure by any Section 9.9 Tagged Member to give such Tag-Along Notice within such 5 day period shall be deemed an election by such Section 9.9 Tagged Member not to sell its Membership Interests pursuant to the Tag-Along Notice. The closing with respect to any sale to a Section 9.9 Proposed Purchaser pursuant to this Section shall be held at the time and place specified in the Tag-Along Notice but in any event within sixty (60) days of the date the Tag-Along Notice is given. Consummation of the sale of Membership Interests by any Section 9.9 Selling Member to a Section 9.9 Proposed Purchaser shall be conditioned upon consummation of the sale by each Section 9.9 Participating Tagged Member to such Section 9.9 Proposed Purchaser of the Section 9.9 Tag-Along Membership Interest, if any. (b) In the event that the Section 9.9 Proposed Purchaser does not purchase the Section 9.9 Tag-Along Membership Interest from the Section 9.9 Participating Tagged Members on the same terms and conditions as purchased from the Section 9.9 Selling Member, then the Section 9.9 Selling Member making such Transfer shall purchase on such terms and conditions such Section 9.9 Tag-Along Membership Interest if the Transfer occurs. (c) The Section 9.9 Selling Members who are parties to a sale to a Section 9.9 Proposed Purchaser shall arrange for payment directly by the Section 9.9 Proposed Purchaser to each Section 9.9 Participating Tagged Member, upon delivery of an appropriate assignment in form and substance reasonably satisfactory to the Section 9.9 Proposed Purchaser, which assignment shall be made free and clear of all liens, claims and encumbrances except as provided by this Agreement or as otherwise agreed to by such Section 9.9 Proposed Purchaser. (d) If at the end of 60 days following the date on which a Tag-Along Notice was given, the sale of Membership Interests by the Section 9.9 Selling Members and the sale of the Section 9.9 Tag-Along Membership Interests have not been completed in accordance with the terms of the Section 9.9 Proposed Purchaser's offer, all the restrictions on sale, transfer or assignment contained in this Agreement with respect to Membership Interests owned by the Members shall again be in effect. 30 10.10 Piggyback Registration. (a) For the purposes of this Section 9.11, the following capitalized terms shall have the following meanings: (i) "Common Stock" shall mean the common stock of the Company issued upon conversion of the Company to a corporation; (ii) "Other Shares" shall mean at any time those shares of Common Stock or other securities of the Company which do not constitute Primary Shares or Registrable Shares; (iii) "Primary Shares" shall mean at any time authorized but unissued shares of Common Stock or shares of Common Stock held by the Company in its treasury; (iv) "Registrable Shares" shall mean the shares of Common Stock held by the Members in the Company which constitute Restricted Shares and which are not then eligible for sale to the public pursuant to Rule 144 (other than Rule 144(k)) in a single transaction (and including Membership Interests held by Members prior to the conversion of the Company to a corporation). (v) "Restricted Shares" shall mean any Membership Interests, shares of Common Stock or other securities received in respect thereof held or which may be acquired from the Company by the Members as of the applicable date, and which theretofore have not been sold to the public pursuant to a registration statement under the Securities Act or pursuant to Rule 144; and (vi) "Rule 144" shall mean Rule 144 promulgated under the Securities Act or any successor rule thereto or any complementary rule thereto (such as Rule 144A). (b) If the Company at any time proposes for any reason to register Primary Shares or Other Shares under the Securities Act (other than on Form S-4 or Form S-5 promulgated under the Securities Act or any successor forms thereto), it shall promptly give Notice to the Members of its intention so to register the Primary Shares or Other Shares and, upon the written request, given within 30 days after delivery of any such Notice by the Company, of the Members to include in such registration Registrable Shares (which request shall specify the number of Registrable Shares proposed to be included in such registration), the Company shall use its best efforts to cause all such Registrable Shares to be included in such registration on the same terms and conditions as the securities otherwise being sold in such registration; provided, however, that if the 31 managing underwriter advises the Company that the inclusion of all Registrable Shares or Other Shares proposed to be included in such registration would interfere with the successful marketing (including pricing) of Primary Shares proposed to be registered by the Company, then the number of Primary Shares, Registrable Shares and Other Shares proposed to be included in such registration shall be included in the following order: (i) first, the Primary Shares; and (ii) second, the Registrable Shares and Other Shares requested to be included in such registration pro rata, based upon the respective numbers of Restricted Shares owned at the time by each Member and the respective numbers of Other Shares owned at the time by each holder of Other Shares. (c) If at any time after giving written notice pursuant to this Section 9.10 of its intention to register any securities and prior to the effective date of the registration statement filed in connection with such registration, the Company shall determine for any reason either not to register or to delay registration of such securities, the Company may, at its election, give Notice of such determination to the Members and, thereupon, (i) in the case of a determination not to register, shall be relieved of its obligation to register any Registrable Securities in connection with such registration and (ii) in the case of a determination to delay registering, shall be permitted to delay registering any Registerable Securities, for the same period as the delay in registering such other securities. (d) If a registration under this Section 9.11 involves an underwritten offering, the underwriter or underwriters and any additional investment bankers and managers to be used in connection with such registration shall be selected by the Company, and any Member desiring to have Registrable Shares included in such registration, and any such Investor shall be required to sign an underwriting agreement in customary form with such underwriter or underwriters. ARTICLE 11 DISSOLUTION AND TERMINATION 11.1 Events Causing Dissolution. The Company shall be dissolved and its affairs wound up upon the first to occur of the following events: (a) The vote of a Majority in Interest of the Group A Members and a Majority in Interest of the Group B Members to dissolve; (b) The sale, Transfer or other disposition of substantially all of the assets of the Company and the receipt and distribution of all the proceeds therefrom; 32 (c) The death, retirement, resignation, insanity, expulsion, bankruptcy or dissolution of a Member, or any other event which terminates the continued membership of a Member in the Company, unless there is at least one remaining Member; (d) The entry of a decree of judicial dissolution pursuant to Section 18-802 of the Act; or (e) The expiration of the term of the Company as provided in Section 2.5. 11.2 Notices to Secretary of State. When all the remaining property and assets of the Company have been distributed, the Certificate shall be cancelled by filing a certificate of cancellation with the Secretary of State of Delaware. 11.3 Cash Distributions Upon Dissolution. Upon the dissolution of the Company as a result of the occurrence of any of the events set forth in Section 10.1, the Management Committee shall proceed to wind up the affairs of and liquidate the Company and any cash and proceeds therefrom shall be applied and distributed in the following order of priority: (a) First, to the payment (or the making of reasonable provision for payment) of debts and liabilities of the Company in the order of priority as provided by law (including any loans or advances that may have been made by any of the Members to the Company) and the expenses of liquidation including the establishment of any Reserves which the Management Committee may reasonably deem necessary for any contingent, conditional or unasserted claims or obligations of the Company. Such Reserves may be paid over by the Company to an escrow agent to be held for disbursement in payment of any of the aforementioned liabilities and, at the expiration of such period as shall be reasonably deemed advisable by the Management Committee, for distribution of the balance in the manner provided in this Article 10; (b) Finally, the remaining balance, if any, to the Members in proportion to their respective positive Capital Accounts, after giving effect to all contributions, distributions and allocations for all periods, in accordance with the requirements of Regulation Section 1.704-1(b)(2)(ii)(b)(2). 11.4 In-Kind. Notwithstanding the foregoing but subject to Section 18-804(a)(1) of the Act, in the event the Management Committee shall determine that an immediate sale of part of or all the Property would cause undue loss to the Members, or the Management Committee determines that it would be in the best interest of the 33 Members to distribute the Property to the Members in-kind (which distributions do not, as to the in-kind portions, have to be in the same proportions as they would be if cash were distributed, but all such in-kind distributions shall be equalized, to the extent necessary, with cash), then the Management Committee may either defer liquidation of, and withhold from distribution for a reasonable time, any of the Property except that necessary to satisfy the Company's debts and obligations, or distribute the Property to the Members in-kind. 11.5 No Action for Dissolution. The Members acknowledge that irreparable damage would be done to the goodwill and reputation of the Company if any Member should bring an action in court to dissolve the Company under circumstances where dissolution is not required by Section 10.1. Accordingly, except where the Manager has failed to liquidate the Company as required by Section 10.1 and except as specifically provided in Section 18-802 and Section 18-803(a) of the Act, each Member hereby to the fullest extent permitted by law waives and renounces his right to initiate legal action to seek dissolution of the Company or to seek the appointment of a receiver or trustee to wind up the affairs of the Company, except in the cases of fraud, violation of law, bad faith, gross negligence, willful misconduct or willful violation of this Agreement. ARTICLE 12 TAX MATTERS MEMBER 12.1 Tax Matters Member. Greenlake Holdings LLC shall be the initial Tax Matters Member of the Company as provided in the Regulations under Section 6231 of the Code and analogous provisions of state law. The Management Committee shall have the authority to remove or replace (following death or resignation) the Tax Matters Member of the Company and designate its successor. 12.2 Certain Authorizations. The Tax Matters Member shall represent the Company, at the Company's expense, in connection with all examinations of the Company's affairs by tax authorities including any resulting administrative or judicial proceedings. Without limiting the generality of the foregoing, and subject to the restrictions set forth herein, the Tax Matters Member, but only with the consent or approval or at the director of the Management Committee, is hereby authorized: (a) to enter into any settlement with the Secretary with respect to any tax audit or judicial review, in which agreement the Tax Matters Member may expressly state that such agreement shall bind the other Members except that such settlement agreement shall not bind any Member that has not approved such settlement agreement in writing; 34 (b) if a notice of a final administrative adjustment at the Company level of any item required to be taken into account by a Member for tax purposes is mailed to the Tax Matters Member, to seek judicial review of such final adjustment, including the filing of a petition for readjustment with the Tax Court, the District Court of the United States for the district in which the Company's principal place of business is located, or elsewhere as allowed by law, or the United States Claims Court; (c) to intervene in any action brought by any other Member for judicial review of a final adjustment; (d) to file a request for an administrative adjustment with the Secretary at any time and, if any part of such request is not allowed by the Secretary, to file a petition for judicial review with respect to such request; (e) to enter into an agreement with the Internal Revenue Service to extend the period for assessing any tax that is attributable to any item required to be taken into account by a Member for tax purposes, or an item affected by such item; and (f) to take any other action on behalf of the Members (with respect to the Company) or the Company in connection with any administrative or judicial tax proceeding to the extent permitted by applicable law or the Regulations. Each Member shall have the right to participate in any such actions and proceedings to the extent provided for under the Code and Regulations. 12.3 Indemnity of Tax Matters Member. To the maximum extent permitted by applicable law and without limiting Article 8, the Company shall indemnify and reimburse the Tax Matters Member for all expenses (including reasonable legal and accounting fees) incurred as Tax Matters Member pursuant to this Article 13 in connection with any administrative or judicial proceeding with respect to the tax liability of the Members as long as the Tax Matters Member has determined in good faith that the Tax Matters Member's course of conduct was in, or not opposed to, the best interest of the Company. The taking of any action and the incurring of any expense by the Tax Matters Member in connection with any such proceeding, except to the extent provided herein or required by law, is a matter in the sole discretion of the Tax Matters Member. 12.4 Information Furnished. To the extent and in the manner provided by applicable law and Regulations, the Tax Matters Member shall furnish the name, address, 35 profits and loss interest, and taxpayer identification number of each Member to the Internal Revenue Service. 12.5 Notice of Proceedings, etc. The Tax Matters Member shall use best efforts to keep each Member informed of any administrative and judicial proceedings for the adjustment at the Company level of any item required to be taken into account by a Member for income tax purposes or any extension of the period of limitations for making assessments of any tax against a Member with respect to any Company item, or of any agreement with the Internal Revenue Service that would result in any material change either in Income or Loss as previously reported. 12.6 Notices to Tax Matters Member. Any Member that receives a notice of an administrative proceeding under Section 6233 of the Code relating to the Company shall promptly provide Notice to the Tax Matters Member of the treatment of any Company item on such Member's Federal income tax return that is or may be inconsistent with the treatment of that item on the Company's return. Any Member that enters into a settlement agreement with the Internal Revenue Service or any other government agency or official with respect to any Company item shall provide Notice to the Tax Matters Member of such agreement and its terms within sixty (60) days after its date. 12.7 Preparation of Tax Returns. The Tax Matters Member shall arrange for the preparation and timely filing of all returns of Company income, gains, deductions, losses and other items necessary for Federal, state and local income tax purposes and shall use all reasonable efforts to furnish to the Members within ninety (90) days of the close of the taxable year a Schedule K-1 and such other tax information reasonably required for Federal, state and local income tax reporting purposes. The classification, realization and recognition of income, gain, losses and deductions and other items shall be on the cash or accrual method of accounting for Federal income tax purposes, as the Management Committee shall determine in its sole discretion in accordance with applicable law. 12.8 Tax Elections. The Management Committee shall, in its sole discretion, determine whether to make any available election. 12.9 Taxation as a Partnership. No election shall be made by the Company or any Member for the Company to be excluded from the application of any of the provisions of Subchapter K, Chapter I of Subtitle A of the Code or from any similar provisions of any state tax laws or to be treated as a corporation for federal tax purposes. 36 ARTICLE 13 ACCOUNTING AND BANK ACCOUNTS 13.1 Fiscal Year and Accounting Method. The fiscal year and taxable year of the Company shall be as designated by the Management Committee in accordance with the Code. The Company shall use an accrual method of accounting. 13.2 Books and Records. The Company shall maintain at its principal office, or such other office as may be determined by the Management Committee, all the following: (a) A current list of the full name and last known business or residence address of each Member and of the Manager together with information regarding the amount of cash and a description and statement of the agreed value of any other property or services contributed by each Member and which each Member has agreed to contribute in the future, and the date on which each Member became a Member of the Company; (b) A copy of the Certificate and this Agreement, including any and all amendments to either thereof, together with executed copies of any powers of attorney pursuant to which the Certificate, this Agreement, or any amendments have been executed; (c) Copies of the Company's Federal, state, and local income tax or information returns and reports, if any, which shall be retained for at least six fiscal years; (d) The financial statements of the Company, which shall be retained for at least six fiscal years; and (e) The Company's books and records, which shall be retained for at least six fiscal years. 13.3 Delivery to Members; Inspection. Upon the request of any Member, for any purpose reasonably related to such Member's interest as a member of the Company, the Management Committee shall cause to be made available to the requesting Member the information required to be maintained by clauses (a) through (d) of Section 14.2 and such other information regarding the business and affairs of the Company as any Member may reasonably request. 13.4 Financial Statements. The Management Committee shall cause to be prepared for the Members at least annually, at the Company's expense, financial statements of the Company, and its subsidiaries, prepared in accordance with generally 37 accepted accounting principles and audited by a nationally recognized accounting firm. The financial statements so furnished shall include a balance sheet, statement of income or loss, statement of cash flows, and statement of Members' equity. In addition, the Management Committee shall provide on a timely basis to the Members [monthly and] quarterly financials, statements of cash flow, any available internal budgets or forecast or other available financial reports, as well as any reports or notices as are provided by the Company, or any of its subsidiaries to any financial institution. 13.5 Filings. At the Company's expense, the Management Committee shall cause the income tax returns for the Company to be prepared and timely filed with the appropriate authorities and to have prepared and to furnish to each Member such information with respect to the Company as is necessary (or as may be reasonably requested by a Member) to enable the Members to prepare their Federal, state and local income tax returns. The Management Committee, at the Company's expense, shall also cause to be prepared and timely filed, with appropriate Federal, state and local regulatory and administrative bodies, all reports required to be filed by the Company with those entities under then current applicable laws, rules, and regulations. The reports shall be prepared on the accounting or reporting basis required by the regulatory bodies. 13.6 Non-Disclosure. Each Member agrees that, except as otherwise consented to by the Management Committee in writing, all non-public and confidential information furnished to it pursuant to this Agreement will be kept confidential and will not be disclosed by such Member, or by any of its agents, representatives, or employees, in any manner whatsoever, in whole or in part, except that (a) each Member shall be permitted to disclose such information to those of its agents, representatives, and employees who need to be familiar with such information in connection with such Member's investment in the Company, so long as such agents, representatives and employees agree to keep such information confidential on the terms set forth herein, (b) each Member shall be permitted to disclose such information to its partners, stockholders and affiliates so long as they agree to keep such information confidential on the terms set forth herein, (c) each Member shall be permitted to disclose information to the extent required by law, legal process or regulatory requirements, so long as such Member shall have used its reasonable efforts to first afford the Company with a reasonable opportunity to contest the necessity of disclosing such information, (d) each Member shall be permitted to disclose such information to possible purchasers of all or a portion of the Member's Interest, provided that such prospective purchaser shall execute a suitable confidentiality agreement containing terms not less restrictive than the terms set forth herein, and (e) each Member shall be permitted to disclose information to the extent necessary for the enforcement of any right of such Member arising under this Agreement. 13.7 Bank Accounts. All funds of the Company shall be deposited in a separate bank, money market or similar account(s) approved by the Management 38 Committee and in the Company's name. Withdrawals therefrom shall be made only by Persons authorized to do so by the Management Committee. ARTICLE 14 MISCELLANEOUS 14.1 Title to Property. Title to the Property shall be held in the name of the Company. No Member shall individually have any ownership interest or rights in the Property except indirectly by virtue of such Member's ownership of a Membership Interest. 14.2 Waiver of Default. No consent or waiver, express or implied, by the Company or a Member with respect to any breach or default by the Company or a Member hereunder shall be deemed or construed to be a consent or waiver with respect to any other breach or default by any party of the same provision or any other provision of this Agreement. Failure on the part of the Company or a Member to complain of any act or failure to act of the Company or a Member or to declare such party in default shall not be deemed or constitute a waiver by the Company or the Member of any rights hereunder. 14.3 Amendment. (a) Except as otherwise expressly provided elsewhere in this Agreement, this Agreement shall not be altered, modified or changed except by an amendment approved by Members holding a Majority in Interest of the Group A Members and a Majority in Interest of the Group B Members; provided, however, that if any such amendment adversely effects the economic rights of a Member, such amendment shall only be effective if consented to in writing by such Member. (b) In addition to any amendments otherwise authorized herein, the Manager or Management Committee may make any amendments to any of the Schedules to this Agreement from time to time to reflect transfers of Membership Interests and issuances of additional Membership Interests. Copies of such amendments shall be delivered to the Members upon execution thereof. (c) The Manager shall cause to be prepared and filed any amendment to the Certificate that may be required to be filed under the Act as a consequence of any amendment to this Agreement. (d) Any modification or amendment to this Agreement or the Certificate made in accordance with this Section 13.3 shall be binding on all Members and the Manager. 39 14.4 No Third Party Rights. Except as provided in Article 8, none of the provisions contained in this Agreement shall be for the benefit of or enforceable by any third parties, including creditors of the Company. Subject to Article 8, the parties to this Agreement expressly retain any and all rights to amend this Agreement as herein provided, notwithstanding any interest in this Agreement or in any party to this Agreement held by any other Person. 14.5 Severability. In the event any provision of this Agreement is held to be illegal, invalid or unenforceable to any extent, the legality, validity and enforceability of the remainder of this Agreement shall not be affected thereby and shall remain in full force and effect and shall be enforced to the greatest extent permitted by law. 14.6 Nature of Interest in the Company. A Member's Membership Interest shall be personal property for all purposes. 14.7 Binding Agreement. Subject to the restrictions on the disposition of Membership Interests herein contained, the provisions of this Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective heirs, personal representatives, successors and permitted assigns. 14.8 Headings. The headings of the Certificate and sections of this Agreement are for convenience only and shall not be considered in construing or interpreting any of the terms or provisions hereof. 14.9 Word Meanings. The words such as "herein", "hereinafter", "hereof", and "hereunder" refer to this Agreement as a whole and not merely to a subdivision in which such words appear unless the context otherwise requires. The singular shall include the plural, and vice versa, unless the context otherwise requires. 14.10 Counterparts. This Agreement may be executed in several counterparts, all of which together shall constitute one agreement binding on all parties hereto, notwithstanding that all the parties have not signed the same counterpart. 14.11 Entire Agreement. This Agreement contains the entire agreement between the parties hereto and thereto and supersedes all prior writings or agreements with respect to the subject matter hereof. 14.12 Partition. The Members agree that the Property is not and will not be suitable for partition. Accordingly, each of the Members hereby irrevocably waives any and all right such Member may have to maintain any action for partition of any of the Property. No Member shall have any right to any specific assets of the Company upon 40 the liquidation of, or any distribution from, the Company. 14.13 Governing Law; Consent to Jurisdiction and Venue. This Agreement shall be construed according to and governed by the laws of the State of Delaware without regard to principles of conflict of laws. The parties hereby submit to the exclusive jurisdiction and venue of the state courts of New York County, New York or to the Court of Chancery of the State of Delaware and the United States District Court for the Southern District of New York and of the United States District Court for the District of Delaware, as the case may be, and agree that the Company or Members may, at their option, enforce their rights hereunder in such courts. 14.14 Discretion. Whenever a Manager shall have discretion to act hereunder, such Person agrees to act in a reasonable manner on behalf of the Company and its Affiliates. 41 IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date first written above. Group A Members: QUANTUM INDUSTRIAL PARTNERS LDC By: /s/ Ron Hiram ----------------------- Ron Hiram Attorney-in-fact QUASAR STRATEGIC PARTNERS LDC By: /s/ Ron Hiram ----------------------- Ron Hiram Attorney-in-fact Group B Member: GREENLAKE HOLDINGS LLC By: /s/ Gary K. Duberstein ------------------------ Name: Gary K. Duberstein Title: Duly Authorized Member 42 SCHEDULE 1 A. Group A Members
Total Capital Percentage Name and Address Cash Contributed Contribution Interest(1) - --------------------------------------- --------------------- ----------------------- ------------------ Quantum Industrial Partners LDC $96,250,000 $96,250,000 34.7473% Kaya Flamboyan 9 Willemstad CuraHao, Netherlands Antilles Quasar Strategic Partners LDC $96,250,000 $96,250,000 34.7473% Kaya Flamboyan 9 Willemstad CuraHao, Netherlands Antilles
- ---------- (1) Includes both Group A Members and Group B Members. 43 B. GROUP B MEMBERS
Shares of OMC Stock Total Capital Percentage Name and Address Cash Contributed Contributed Gross Asset Value Contribution Interest(1) - ----------------------- ------------------- ---------------- ------------------- ------------------- --------------- Greenlake Holdings LLC $48,500,000 2,000,000 $36,000,000 $84,500,000 30.5054% c/o Greenway Partners, L.P. 277 Park Avenue New York, NY 10172
- ---------- (1) Includes both Group A Members and Group B Members. 44 SCHEDULE 7.5 Initial Slate of Officers Alfred D. Kingsley, President and Chief Executive Officer Gary K. Duberstein, Vice President, Secretary and Treasurer 45 -----END PRIVACY-ENHANCED MESSAGE-----