-----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, F3+sNRUWpHrgqFwy/CsrO7pN/GKT9a/EYU9xdZw7WOLj8IM9F8aJaNgEiExJu8NS Z9GneQ1TWGAQbFu8RON2Wg== 0000912057-00-008644.txt : 20000229 0000912057-00-008644.hdr.sgml : 20000229 ACCESSION NUMBER: 0000912057-00-008644 CONFORMED SUBMISSION TYPE: SC TO-T PUBLIC DOCUMENT COUNT: 17 FILED AS OF DATE: 20000228 GROUP MEMBERS: ELYO GROUP MEMBERS: SUEZ LYONNAISE DES EAUX GROUP MEMBERS: T ACQUISITION CORP. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: TRIGEN ENERGY CORP CENTRAL INDEX KEY: 0000925655 STANDARD INDUSTRIAL CLASSIFICATION: STEAM & AIR CONDITIONING SUPPLY [4961] IRS NUMBER: 133378939 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13E3 SEC ACT: SEC FILE NUMBER: 005-44567 FILM NUMBER: 554856 BUSINESS ADDRESS: STREET 1: ONE WATER ST CITY: WHITE PLAINS STATE: NY ZIP: 10601 BUSINESS PHONE: 9142866600 MAIL ADDRESS: STREET 1: ONE WATER ST CITY: WHITE PLAINS STATE: NY ZIP: 10601 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: TRIGEN ENERGY CORP CENTRAL INDEX KEY: 0000925655 STANDARD INDUSTRIAL CLASSIFICATION: STEAM & AIR CONDITIONING SUPPLY [4961] IRS NUMBER: 133378939 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC TO-T SEC ACT: SEC FILE NUMBER: 005-44567 FILM NUMBER: 554857 BUSINESS ADDRESS: STREET 1: ONE WATER ST CITY: WHITE PLAINS STATE: NY ZIP: 10601 BUSINESS PHONE: 9142866600 MAIL ADDRESS: STREET 1: ONE WATER ST CITY: WHITE PLAINS STATE: NY ZIP: 10601 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: SUEZ LYONNAISE DES EAUX CENTRAL INDEX KEY: 0001089764 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: SC TO-T BUSINESS ADDRESS: STREET 1: 1 REE D'ASTONG CITY: PARIS FRANCE FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: SUEZ LYONNAISE DES EAUX CENTRAL INDEX KEY: 0001089764 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: SC TO-T BUSINESS ADDRESS: STREET 1: 1 REE D'ASTONG CITY: PARIS FRANCE SC TO-T 1 SC TO-T - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 SCHEDULE TO (RULE 14D-100) TENDER OFFER STATEMENT UNDER SECTION 14(D)(1) OR 13(E)(1) OF THE SECURITIES EXCHANGE ACT OF 1934. (Amendment No. )* TRIGEN ENERGY CORPORATION ------------------------------------ (Name of Subject Company (Issuer)) T ACQUISITION CORP. (OFFEROR) ELYO SUEZ LYONNAISE DES EAUX ------------------------------ (Names of Filing Persons (identifying status as offeror, issuer or other person)) COMMON STOCK, PAR VALUE $0.01 PER SHARE ------------------------------ (Title of Class of Securities) 895930105 ------------------------------ (CUSIP Number of Class of Securities) MICHEL BLEITRACH ELYO 235 AVENUE GEORGES CLEMONCEAU BP 4601 92746 NANTERRE CEDEX, FRANCE 011-331-41-20-10-10 WITH A COPY TO: JEFFREY BAGNER FRIED, FRANK, HARRIS, SHRIVER & JACOBSON ONE NEW YORK PLAZA NEW YORK, NEW YORK 10004-1980 (212) 859-8000 -------------------------------------------------------- (Name, address, and telephone numbers of person authorized to receive notices and communications on behalf of filing persons) CALCULATION OF FILING FEE Transaction Valuation* $173,487,223 Amount Of Filing Fee $34,698
* ESTIMATED FOR PURPOSES OF CALCULATING THE AMOUNT OF THE FILING FEE ONLY. THIS AMOUNT ASSUMES THE PURCHASE OF 7,382,435 SHARES OF COMMON STOCK, PAR VALUE $.01 PER SHARE (THE "SHARES"), OF TRIGEN ENERGY CORPORATION, A DELAWARE CORPORATION (THE "COMPANY"), AT THE TENDER PRICE OF $23.50 PER SHARE NET TO THE SELLER IN CASH, WITHOUT INTEREST THEREON. PURSUANT TO THE AGREEMENT AND PLAN OF MERGER, DATED AS OF JANUARY 19, 2000, AMONG ELYO ("PARENT"), T ACQUISITION CORP. AND THE COMPANY, THE COMPANY REPRESENTED THAT AS OF SUCH DATE, IT HAD 12,416,297 SHARES OUTSTANDING AND 849,210 SHARES RESERVED FOR ISSUANCE UPON EXERCISE OF ALL OUTSTANDING OPTIONS UNDER THE COMPANY'S EMPLOYEE BENEFIT PLANS. PARENT ALREADY BENEFICIALLY OWNS 6,507,944 SHARES, OF WHICH THE 1,637,274 SHARES HELD BY COMPAGNIE PARISENNE DE CHAUFFAGE URBAIN ("CPCU"), A NON-WHOLLY-OWNED SUBSIDIARY OF PARENT, WILL BE TENDERED. PARENT HAS SEPARATELY AGREED TO PURCHASE 1,012,402 SHARES FROM THOMAS R. CASTEN ON MARCH 29, 2000, PURSUANT TO A PURCHASE AGREEMENT, DATED JANUARY 19, 2000 BETWEEN PARENT AND MR. CASTEN. BASED ON THE FOREGOING, THE TRANSACTION VALUE IS EQUAL TO THE PRODUCT OF (I) (A) 12,416,297 SHARES (THE NUMBER OF SHARES OUTSTANDING), PLUS (B) 849,210 SHARES (THE NUMBER OF SHARES RESERVED FOR ISSUANCE UPON EXERCISE OF OPTIONS), MINUS (C) THE DIFFERENCE OF (1) 6,507,944 (THE NUMBER OF SHARES BENEFICIALLY OWNED BY PARENT) MINUS (2) 1,637,274 (THE NUMBER OF SHARES HELD BY CPCU BEING TENDERED), MINUS (D) 1,012,402 (THE NUMBER OF SHARES HELD BY MR. CASTEN), MULTIPLIED BY (II) $23.50. THE AMOUNT OF THE FILING FEE, CALCULATED IN ACCORDANCE WITH RULE 0-11 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, EQUALS 1/50 OF ONE PERCENT OF THE AGGREGATE OF THE CASH OFFERED BY THE BIDDER. / / CHECK THE 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: Not applicable. Form or Registration No.: Not applicable. Filing Party: Not applicable. Date Filed: Not applicable.
/ / Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer. Check the appropriate boxes below to designate any transactions to which the statement relates: /X/ third-party tender offer subject to Rule 14d-1. / / issuer tender offer subject to Rule 13e-4. /X/ going-private transaction subject to Rule 13e-3. / / amendment to Schedule 13D under Rule 13d-2. Check the following box if the filing is a final amendment reporting the results of the tender offer: / / - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- INTRODUCTION This Tender Offer Statement on Schedule TO (this "Statement") relates to the offer by T Acquisition Corp., a Delaware corporation ("Purchaser") and an indirect wholly owned subsidiary of Elyo, a SOCIETE ANONYME organized and existing under the laws of the Republic of France ("Parent") and an indirect wholly owned subsidiary of Suez Lyonnaise des Eaux, a SOCIETE ANONYME organized and existing under the laws of the Republic of France, to purchase any and all outstanding shares of Common Stock, par value $.01 per share, of Trigen Energy Corporation, a Delaware corporation (the "Company"), at a purchase price of $23.50 per share, net to the seller in cash, without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase dated February 28, 2000 (the "Offer to Purchase"), and in the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer"), copies of which are filed as Exhibits (a)(1)(i) and (a)(1)(ii) hereto, respectively, and which are incorporated herein by reference. All information in the Offer to Purchase, including all schedules thereto, is incorporated by reference in answer to all of the items in this Statement. EXHIBITS. (a)(1)(i) Offer to Purchase, dated February 28, 2000. (a)(1)(ii) Letter of Transmittal. (a)(1)(iii) Notice of Guaranteed Delivery. (a)(1)(iv) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (a)(2) Letter to stockholders from Richard E. Kessel, President and Chief Executive Officer of the Company. (a)(3) Exhibit (a)(1)(i) is incorporated herein by reference. (a)(4) Not applicable. (a)(5)(i) Letter from Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees to Clients. (a)(5)(ii) Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9. (a)(5)(iii) Agreement and Plan of Merger dated as of January 19, 2000, among Elyo, T Acquisition Corp. and the Company. (a)(5)(iv) Audited financial statements for the Company's 1998 and 1997 fiscal years, beginning on page F-1 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1998 (incorporated by reference to the Company's Annual Report on Form 10-K filed with the Commission on March 31, 1999). (a)(5)(v) Pages 1 through 8, inclusive, of the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 1999 (incorporated by reference to the Company's Quarterly Report on Form 10-Q filed with the Commission on November 12, 1999). (a)(5)(vi) Joint Press Release, dated January 19, 2000. (a)(5)(vii) Joint Press Release, dated February 28, 2000. (b) Not applicable. (c)(i) Summary Presentation prepared for Parent by Lazard Freres & Co., LLC, dated January 19, 2000.
2 (c)(ii) Written Presentation prepared for the Special Committee by Credit Suisse First Boston Corporation, dated January 19, 2000. (c)(iii) Opinion of Credit Suisse First Boston Corporation, dated January 19, 2000 (incorporated by reference from Annex A of the Solicitation/Recommendation Statement on Schedule 14D-9 of the Company, dated February 28, 2000). (d)(i) Tender and Voting Agreement, dated as of January 19, 2000, among Elyo, T Acquisition Corp. and the Stockholders. (d)(ii) Letter Agreement between Thomas R. Casten and Elyo, dated January 19, 2000. (d)(iii) Separation Agreement and Release, dated as of January 19, 2000, between Trigen Energy Corporation and Thomas R. Casten. (f) Section 262 of the Delaware General Corporation Law (included as Schedule II to the Offer to Purchase filed herewith as Exhibit (a)(1)(i)). (g) Not applicable. (h) Not applicable. (i) Power of Attorney, dated October 27, 1998.
3 SIGNATURE After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. T ACQUISITION CORP. By: /s/ MICHEL BLEITRACH ----------------------------------------- Name: Michel Bleitrach Title: President ELYO By: /s/ MICHEL BLEITRACH ----------------------------------------- Name: Michel Bleitrach Title: Chief Executive Officer SUEZ LYONNAISE DES EAUX By: /s/ M. PATRICE HERBERT ----------------------------------------- Name: M. Patrice Herbert* Title: Authorized Representative
Dated: February 28, 2000 - ------------------------ * A Power of Attorney authorizing M. Patrice Herbert to sign on behalf of Suez Lyonnaise des Eaux is filed herewith as Exhibit (i). 4 EXHIBIT INDEX
EXHIBIT NUMBER TITLE - ----------- ----- (a)(1)(i) Offer to Purchase, dated February 28, 2000. (a)(1)(ii) Letter of Transmittal. (a)(1)(iii) Notice of Guaranteed Delivery. (a)(1)(iv) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (a)(2) Letter to stockholders from Richard E. Kessel, President and Chief Executive Officer of the Company. (a)(3) Exhibit (a)(1)(i) is incorporated herein by reference. (a)(4) Not applicable. (a)(5)(i) Letter from Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees to Clients. (a)(5)(ii) Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9. (a)(5)(iii) Agreement and Plan of Merger dated as of January 19, 2000, among Elyo, T Acquisition Corp. and the Company. (a)(5)(iv) Audited financial statements for the Company's 1998 and 1997 fiscal years, beginning on page F-1 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1998 (incorporated by reference to the Company's Annual Report on Form 10-K filed with the Commission on March 31, 1999). (a)(5)(v) Pages 1 through 8, inclusive, of the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 1999 (incorporated by reference to the Company's Quarterly Report on Form 10-Q filed with the Commission on November 12, 1999). (a)(5)(vi) Joint Press Release, dated January 19, 2000. (a)(5)(vii) Joint Press Release, dated February 28, 2000. (b) Not applicable. (c)(i) Summary Presentation prepared for Parent by Lazard Freres & Co., LLC, dated January 19, 2000. (c)(ii) Written Presentation prepared for the Special Committee by Credit Suisse First Boston Corporation, dated January 19, 2000. (c)(iii) Opinion of Credit Suisse First Boston Corporation, dated January 19, 2000 (incorporated by reference from Annex A of the Solicitation/Recommendation Statement on Schedule 14D-9 of the Company, dated February 28, 2000). (d)(i) Tender and Voting Agreement, dated as of January 19, 2000, among Elyo, T Acquisition Corp. and the Stockholders. (d)(ii) Letter Agreement between Thomas R. Casten and Elyo, dated January 19, 2000. (d)(iii) Separation Agreement and Release, dated as of January 19, 2000, between Trigen Energy Corporation and Thomas R. Casten. (f) Section 262 of the Delaware General Corporation Law (included as Schedule II to the Offer to Purchase filed herewith as Exhibit (a)(1)(i)). (g) Not applicable. (h) Not applicable. (i) Power of Attorney, dated October 27, 1998.
5 EX-99.(A)(1)(I) 2 EXHIBIT 99(A)(1)(I) OFFER TO PURCHASE FOR CASH ANY AND ALL OF THE OUTSTANDING SHARES OF COMMON STOCK OF TRIGEN ENERGY CORPORATION AT $23.50 NET PER SHARE BY T ACQUISITION CORP. AN INDIRECT WHOLLY OWNED SUBSIDIARY OF ELYO AN INDIRECT WHOLLY OWNED SUBSIDIARY OF SUEZ LYONNAISE DES EAUX THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, MARCH 24, 2000, UNLESS THE OFFER IS EXTENDED. THE OFFER IS CONDITIONED UPON SATISFACTION OF CERTAIN TERMS AND CONDITIONS DESCRIBED IN "THE TENDER OFFER--CONDITIONS OF THE OFFER." THE BOARD OF DIRECTORS OF TRIGEN ENERGY CORPORATION BY UNANIMOUS VOTE OF ALL DIRECTORS, BASED ON, AMONG OTHER THINGS, THE UNANIMOUS RECOMMENDATION OF A SPECIAL COMMITTEE COMPRISED OF INDEPENDENT DIRECTORS, (I) DETERMINED THAT THE MERGER IS ADVISABLE AND THAT THE TERMS OF THE OFFER AND THE MERGER, THE MERGER AGREEMENT AND THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED THEREBY ARE FAIR TO, AND IN THE BEST INTERESTS OF, THE COMPANY AND ITS STOCKHOLDERS, (II) APPROVED THE OFFER AND THE MERGER AND APPROVED AND ADOPTED THE MERGER AGREEMENT, AND (III) RECOMMENDED THE OFFER TO, AND THE APPROVAL AND ADOPTION OF THE MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY BY, THE STOCKHOLDERS OF THE COMPANY. ------------------------ THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE FAIRNESS OR MERITS OF THIS TRANSACTION NOR UPON THE ACCURACY OR ADEQUACY OF THE INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL. ------------------------ The Dealer Manager for the Offer is: LAZARD FRERES & CO. LLC ---------------- The date of this Offer to Purchase is February 28, 2000. QUESTIONS AND ANSWERS ABOUT THE OFFER AND THE MERGER Q: WHO IS OFFERING TO BUY MY SECURITIES? A: The offer is being made by T Acquisition Corp., a newly formed Delaware corporation. We are a subsidiary of Elyo, a French company. Elyo is part of the energy division of Suez Lyonnaise des Eaux, a French publicly held company and a major worldwide provider of private infrastructure services. Elyo is already a major stockholder of Trigen. It currently owns approximately 53% of Trigen's outstanding common stock. Elyo has also agreed to buy, at $23.50 per share, an additional 1,012,402 shares of Trigen common stock, or approximately 8% of Trigen's outstanding common stock, from Thomas Casten, the former president and chief executive officer of Trigen. TO READ MORE ABOUT T ACQUISITION CORP., ELYO AND SUEZ LYONNAISE DES EAUX, SEE PAGES 47 THROUGH 49. Q: WHAT ARE THE CLASSES AND AMOUNTS OF SECURITIES SOUGHT IN THE OFFER? A: We are making the offer for any and all shares of common stock of Trigen. There are no other outstanding equity securities of Trigen. Q: HOW MUCH IS THE BIDDER OFFERING TO PAY AND WHAT IS THE FORM OF PAYMENT? A: We are offering to pay $23.50 per share in cash, without interest. Q: DOES THE BIDDER HAVE THE FINANCIAL RESOURCES TO MAKE PAYMENT? A: Yes. Elyo will provide T Acquisition Corp. with sufficient funds to purchase tendered shares. Elyo will provide those funds from existing credit lines and financial support of Suez Lyonnaise des Eaux's other affiliates. Q: IS THE BIDDER'S FINANCIAL CONDITION RELEVANT TO MY DECISION ON WHETHER TO TENDER IN THE OFFER? A: No. We do not believe that the financial condition of Elyo is important to your decision. We base this conclusion on several factors. We are paying you cash for your shares. The offer is not subject to any financing condition. The offer is for any and all outstanding securities of Trigen. In addition, we will purchase your shares without any requirement that any other shares be tendered. Q: HOW LONG DO I HAVE TO DECIDE WHETHER TO TENDER IN THE OFFER? A: You have until the expiration date of March 24, 2000 to tender your shares. We will purchase all properly tendered shares on the expiration date if the conditions to our offer are then met. After making these purchases, we will continue for a limited period of time to purchase shares submitted to us. On the other hand, if the conditions to our offer are not met on the expiration date, we may extend the offer. FOR MORE INFORMATION ON WHEN YOU CAN TENDER YOUR SHARES IN THE OFFER, SEE PAGES 38 THROUGH 41. Q: HOW WILL I BE NOTIFIED IF THE OFFER IS EXTENDED? A: If the offer is extended past March 24, 2000, we will make a public announcement of the new expiration date. Q: WHAT ARE THE MOST SIGNIFICANT CONDITIONS OF THE OFFER? A: The most significant condition of the offer is the absence of litigation that is reasonably likely to delay the offer or to make the offer materially more expensive for the bidder. FOR A COMPLETE DISCUSSION OF THE CONDITIONS TO THE OFFER, SEE PAGES 50 THROUGH 52. Q: HOW DO I TENDER MY SHARES? A: If you hold your shares "of record," you can tender your shares by sending the enclosed letter of transmittal to the depositary, Harris Trust Company of New York, at the address listed on the enclosed letter of transmittal. If your broker holds your shares in "street name" for you, you must direct your broker to tender. Please contact your broker. FOR A COMPLETE DISCUSSION OF HOW TO TENDER YOUR SHARES, SEE PAGES 41 THROUGH 43. Q: UNTIL WHAT TIME CAN I WITHDRAW PREVIOUSLY TENDERED SHARES? A: You can withdraw tendered shares at any time prior to the expiration date of March 24, 2000. If the expiration date is extended, you can withdraw tendered shares at any time prior to the new expiration date. Q: HOW DO I WITHDRAW PREVIOUSLY TENDERED SHARES? A: You can withdraw shares that you have already tendered by sending a notice of withdrawal to the depositary. FOR A COMPLETE DISCUSSION OF HOW TO WITHDRAW PREVIOUSLY TENDERED SHARES, SEE PAGES 43 THROUGH 44. i Q: WHAT DOES MY BOARD OF DIRECTORS THINK OF THE OFFER? A: Your board of directors recommends the offer. FOR A MORE DETAILED DESCRIPTION OF THE BOARD OF DIRECTORS' RECOMMENDATION, SEE PAGE 8. Q: WHY IS MY BOARD OF DIRECTORS RECOMMENDING THE OFFER? A: A special committee of independent directors evaluated the fairness of the offer. The special committee negotiated the terms of the offer and recommended that the full board approve the offer. FOR A COMPLETE DISCUSSION OF THE FACTORS THE SPECIAL COMMITTEE CONSIDERED IN RECOMMENDING THE OFFER, SEE PAGES 6 THROUGH 7. Q: DID THE DIRECTORS WHO ARE NOT EMPLOYEES OF THE BIDDER, ELYO OR SUEZ RECEIVE ANY OPINIONS, APPRAISALS, OR REPORTS REGARDING THE FAIRNESS OF THE OFFER? A: Yes. The special committee of independent directors received a written opinion, dated January 19, 2000, from Credit Suisse First Boston Corporation to the effect that, as of that date and based on and subject to the matters described in the opinion, the price per share of $23.50 to be received in the offer and the merger, taken together, by the holders of shares of Trigen common stock was fair, from a financial point of view, to the holders of shares of Trigen common stock, other than Elyo and its affiliates. FOR A MORE COMPLETE DESCRIPTION OF THE OPINION OF CREDIT SUISSE FIRST BOSTON, SEE PAGES 11 THROUGH 14. Q: IS THIS THE FIRST STEP IN A GOING-PRIVATE TRANSACTION? A: Yes. Because Elyo already owns over 50% of Trigen's common stock, this offer is considered a going-private transaction. Q: WILL THE TENDER OFFER BE FOLLOWED BY A MERGER IF ALL TRIGEN'S SHARES ARE NOT TENDERED IN THE OFFER? A: Yes. If we purchase any shares in the offer, the offer will likely be followed by a merger that will result in Elyo owning 100% of Trigen. If we complete the merger, the public stockholders of Trigen will receive $23.50 in cash in exchange for each of their shares of Trigen common stock. Elyo has sufficient voting power to approve the merger without the vote of any other stockholder of Trigen. Q: IF I DECIDE NOT TO TENDER, HOW WILL THE OFFER AFFECT MY SHARES? A: If a significant number of shares are purchased in the offer, the Trigen shares are not likely to continue to trade on the New York Stock Exchange. FOR A MORE COMPLETE DESCRIPTION OF HOW THE OFFER WILL AFFECT TRIGEN'S SHARES, SEE PAGES 49 THROUGH 50. Q: WHAT IS THE MARKET VALUE OF MY SHARES AS OF A RECENT DATE? A: On February 24, 2000, the last practicable trading day before the start of the offer, the reported closing sale price of the Trigen shares was $23.00. FOR MORE INFORMATION ON THE PRICE RANGE OF SHARES OF TRIGEN'S COMMON STOCK, SEE PAGE 44. Q: IF I OBJECT TO THE PRICE BEING OFFERED, WILL I HAVE APPRAISAL RIGHTS? A: Yes. You may elect not to tender your shares, dissent from the merger, and have the fair value of your shares paid to you in cash. FOR INFORMATION ON HOW TO EXERCISE APPRAISAL RIGHTS, SEE PAGES 19 THROUGH 21. Q: WHO CAN I TALK TO IF I HAVE QUESTIONS ABOUT THE TENDER OFFER? A: If you have more questions about the tender offer, you should contact: MORROW & CO., INC. Banks and Brokers Call Toll-Free: (800) 662-5200 All Others Please Call Toll-Free: (800) 566-9061 or LAZARD FRERES & CO. LLC (212) 632-6717 ii IMPORTANT Any holder of shares of common stock of Trigen Energy Corporation desiring to tender all or any portion of the shares owned by such holder should either (i) complete and sign the Letter of Transmittal (as defined below) or a copy thereof in accordance with the instructions in the enclosed Letter of Transmittal and mail or deliver it, together with the certificate(s) evidencing tendered shares, and any other required documents, to the Depositary (as defined below), (ii) where applicable, cause the holder's broker, dealer, commercial bank, trust company or custodian to tender the shares pursuant to the procedures for book-entry transfer of shares or (iii) comply with the guaranteed delivery procedures, in each case upon the terms set forth in "THE TENDER OFFER--Procedures for Tendering Shares." Any holder whose shares are registered in the name of a broker, dealer, commercial bank, trust company or custodian must contact the holder's broker, dealer, commercial bank, trust company or custodian if such holder desires to tender the shares. See "THE TENDER OFFER--Procedures for Tendering Shares." Any holder who desires to tender shares of common stock of Trigen Energy Corporation and whose certificate(s) evidencing the shares are not immediately available, or who cannot comply with the procedures for book-entry transfer described in this Offer to Purchase on a timely basis, may tender such shares by following the procedures for guaranteed delivery set forth in "THE TENDER OFFER--Procedures for Tendering Shares." Questions and requests for assistance may be directed to the Information Agent (as defined below) or the Dealer Manager at their respective addresses and telephone numbers set forth on the back cover of this Offer to Purchase. Additional copies of this Offer to Purchase, the Letter of Transmittal or other related tender offer materials may be obtained from the Information Agent or from brokers, dealers, commercial banks or trust companies. iii TABLE OF CONTENTS
PAGE -------- QUESTIONS AND ANSWERS ABOUT THE OFFER AND THE MERGER............. i INTRODUCTION..................................................... 1 SPECIAL FACTORS.................................................. 2 1. Background of the Offer and the Merger; Contacts with the Company..................................................... 2 2. Recommendation of the Special Committee and the Board of Directors of the Company; Fairness of the Offer and the Merger...................................................... 6 3. Position of Suez, Parent and Purchaser Regarding Fairness of the Offer and the Merger.................................... 8 4. Analysis of Financial Advisor to Parent..................... 9 5. Opinion of the Special Committee's Financial Advisor........ 11 6. Company Financial Projections............................... 14 7. Forward Looking Statements.................................. 17 8. Purpose and Structure of the Offer and the Merger; Plans for the Company................................................. 18 9. Rights of Stockholders in the Offer and the Merger.......... 19 10. The Transaction Documents................................... 21 11. Interests of Certain Persons in the Offer and the Merger.... 33 12. Beneficial Ownership of Shares.............................. 34 13. Related Party Transactions.................................. 35 14. Certain United States Federal Income Tax Consequences....... 36 15. Fees and Expenses........................................... 37 THE TENDER OFFER................................................. 38 1. Terms of the Offer.......................................... 38 2. Acceptance for Payment and Payment for Shares............... 40 3. Procedures for Tendering Shares............................. 41 4. Withdrawal Rights........................................... 43 5. Price Range of Shares....................................... 44 6. Dividends and Distributions................................. 45 7. Certain Information Concerning the Company.................. 45 8. Certain Information Concerning Purchaser, Parent, Suez, CAC and Societe Generale........................................ 47 9. Source and Amount of Funds.................................. 49 10. Effect of the Offer on the Market for the Common Stock; Exchange Act Registration................................... 49 11. Conditions of the Offer..................................... 50 12. Certain Legal Matters; Regulatory Approvals................. 52 13. Fees and Expenses........................................... 54 14. Miscellaneous............................................... 54 SCHEDULE I Information Concerning the Directors and Executive Officers of Suez Lyonnaise des Eaux, Elyo and T Acquisition Corp.................................... I-1 SCHEDULE II Section 262 of the General Corporation Law of the State of Delaware................................... II-1 SCHEDULE III Certain Projections relating to Trigen Energy Corporation........................................ III-1
iv To the Holders of Common Stock of Trigen Energy Corporation: INTRODUCTION T Acquisition Corp., a Delaware corporation ("Purchaser") and an indirect wholly owned subsidiary of Elyo, a SOCIETE ANONYME organized and existing under the laws of the Republic of France ("Parent"), hereby offers to purchase any and all of the issued and outstanding shares of common stock, par value $0.01 per share (the "Shares" or "Common Stock"), of Trigen Energy Corporation, a Delaware corporation (the "Company"), at a price of $23.50 per Share, 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, as they may be amended and supplemented from time to time, together constitute the "Offer"). Parent is an indirect wholly owned subsidiary of Suez Lyonnaise des Eaux, a SOCIETE ANONYME organized and existing under the laws of the Republic of France ("Suez"). Holders of Shares whose Shares are registered in their own name and who tender directly to Harris Trust Company of New York, as Depositary (the "Depositary"), will not be obligated to pay brokerage fees or commissions or, except as set forth in Instruction 6 of the Letter of Transmittal, stock transfer taxes on the purchase of Shares by Purchaser pursuant to the Offer. Purchaser will pay all charges and expenses incurred in connection with the Offer by Lazard Freres & Co. LLC, as Dealer Manager (the "Dealer Manager" or "Lazard Freres"), the Depositary, and Morrow & Co., Inc., as Information Agent (the "Information Agent"). See "SPECIAL FACTORS--Fees and Expenses" and "THE TENDER OFFER--Fees and Expenses." As of February 24, 2000, there were 12,401,808 Shares outstanding. Parent currently beneficially owns 6,507,944 Shares, constituting approximately 52.5% of the outstanding Shares. Nominees of Parent currently constitute a majority of the members of the Board of Directors of the Company (the "Board of Directors"). In addition, on March 29, 2000, Parent will purchase the 1,012,402 Shares (approximately 8% of the outstanding Shares) beneficially owned by Mr. Thomas R. Casten, the former President and Chief Executive Officer of the Company, at $23.50 per Share. This purchase will be made under the terms of a purchase agreement, dated January 19, 2000 (the "Casten Stock Purchase Agreement"), between Parent and Mr. Casten. The Shares being purchased pursuant to the Casten Stock Purchase Agreement do not include the Options (as defined below) and Restricted Stock (as defined below) held by Mr. Casten. Also on January 19, 2000, Messrs. George Keane and Charles Bayless, the independent directors of the Company who are the members of the special committee formed to consider Parent's proposal to acquire 100% of the equity of the Company (the "Special Committee"), entered into a Tender and Voting Agreement with Purchaser and Parent. Under the terms of the Tender and Voting Agreement, Messrs. Keane and Bayless have agreed, among other things, to tender their Shares (representing in the aggregate less than 1% of the outstanding Shares) into the Offer (the "Tender and Voting Agreement"). See "SPECIAL FACTORS--The Transaction Documents--The Tender and Voting Agreements" and "--Arrangements with Thomas R. Casten." The Offer is being made pursuant to the terms of the Agreement and Plan of Merger, dated as of January 19, 2000 (the "Merger Agreement"), among Parent, Purchaser and the Company. The Merger Agreement provides that, among other things, as promptly as practicable after consummation of the Offer and the satisfaction of the other conditions contained in the Merger Agreement, Purchaser will be merged with and into the Company (the "Merger"), with the Company continuing as the surviving corporation (the "Surviving Corporation"). At the effective time of the Merger (the "Effective Time"), except for Shares held by holders exercising their rights to dissent in accordance with the Delaware General Corporation Law (the "DGCL") and Shares held, directly or indirectly, by Parent, each then outstanding Share will, by virtue of the Merger and without any action on the part of the holder thereof, be canceled and be converted into the right to receive an amount per Share (the "Merger Consideration") equal to the Offer Price, without interest. The terms and conditions of the Merger Agreement are more fully described in "SPECIAL FACTORS--The Transaction Documents--The Merger Agreement." AS THE INDIRECT BENEFICIAL OWNER OF MORE THAN 50% OF THE OUTSTANDING SHARES, PARENT CURRENTLY POSSESSES SUFFICIENT VOTING POWER TO CAUSE THE COMPANY TO CONSUMMATE THE MERGER WITHOUT THE VOTE OF ANY OTHER STOCKHOLDERS OF THE COMPANY. Such ownership, however, does not compel any stockholder to accept the Offer or tender such stockholder's Shares. Subject to dissenters' rights under the DGCL, Shares not tendered in the Offer shall be cancelled in the Merger and converted into the right to receive the Merger Consideration, without interest. Stockholders who hold their Shares at the time of the Merger and who fully comply with the statutory dissenters' procedures set forth in the DGCL, the relevant provisions of which are attached as Schedule II of the Offer to Purchase, will be entitled to dissent from the Merger and have the fair value of their Shares (which may be more than, equal to, or less than the Merger Consideration) judicially determined and paid to them in cash pursuant to the procedures prescribed by the DGCL. NO DISSENTERS RIGHTS ARE AVAILABLE TO STOCKHOLDERS IN CONNECTION WITH THE OFFER. See "SPECIAL FACTORS--Rights of Stockholders in the Offer and the Merger." The Offer is conditioned upon the satisfaction of certain conditions described in "THE TENDER OFFER--Conditions of the Offer." The Board of Directors, by unanimous vote of all directors, based on, among other things, the unanimous recommendation of the Special Committee, (i) determined that the Merger is advisable and that the terms of the Offer and the Merger, the Merger Agreement and the consummation of the transactions contemplated thereby are fair to, and in the best interests of, the Company and its stockholders, (ii) approved the Offer and the Merger and approved and adopted the Merger Agreement, and (iii) recommended the Offer to, and the approval and adoption of the Merger Agreement and the transactions contemplated thereby by, the stockholders of the Company. The Company has advised Purchaser that Credit Suisse First Boston Corporation ("CSFB"), financial advisor to the Special Committee, has delivered to the Special Committee its written opinion, dated January 19, 2000, to the effect that, as of that date and based on and subject to the matters described in the opinion, the $23.50 per Share cash consideration to be received in the Offer and the Merger, taken together, by the holders of Shares was fair, from a financial point of view, to such holders (other than Parent and its affiliates). A copy of CSFB's opinion, which sets forth the assumptions made, procedures followed, matters considered and limitations on the review undertaken by CSFB, is contained in the Company's Solicitation/Recommendation Statement on Schedule 14D-9 (the "Schedule 14D-9") filed with the Securities and Exchange Commission (the "Commission"). The Schedule 14D-9 is being mailed to the stockholders concurrently with the mailing of this Offer to Purchase. The Schedule 14D-9 may be inspected at, and copies may be obtained from, the same places and in the manner set forth in "THE TENDER OFFER--Certain Information Concerning the Company--Additional Information." Holders of Shares are urged to read the opinion carefully in its entirety. 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. SPECIAL FACTORS 1. BACKGROUND OF THE OFFER AND THE MERGER; CONTACTS WITH THE COMPANY Parent and its affiliates (the "Parent Group") initially acquired an interest in the Company in 1986. Since that time, Parent has beneficially owned a majority of the outstanding Shares and representatives of the Parent Group have constituted a majority of the Board of Directors. For a number of years, the Parent Group has periodically reviewed the nature of its investment in the Company and has had numerous discussions with senior management and members of the Board of Directors. These discussions included, from time to time, a variety of potential transactions including transactions that would increase either Parent's or the public's ownership of the equity of the Company. On September 20, 1999, Parent made a written proposal to the Board of Directors to acquire all of the Shares not owned by the Parent Group for a cash purchase price of $22 per share (the "$22 Offer"). 2 On September 21, 1999, as a result of the $22 Offer, the Board of Directors appointed the Special Committee. The Special Committee was authorized, among other things, to retain legal and financial advisors and to exercise all of the powers and authority of the Board of Directors as the Special Committee deemed appropriate in the best interests of the Company in connection with or in response to the $22 Offer. The Board of Directors also agreed that because of the time and energy involved in reviewing the transaction, the members of the Special Committee should be entitled to receive a per diem fee of $2,500 each, up to a maximum of $75,000 each. The Special Committee appointed CSFB as financial advisor to the Special Committee and Troutman Sanders LLP as legal counsel to the Special Committee. On the same day, Mr. Thomas Casten, then the President and the Chief Executive Officer and a director of the Company, circulated a memorandum to the members of the Board of Directors expressing significant concerns about Parent's proposal and how it would affect the Company and requesting that Parent meet with the Company, as soon as possible, to discuss, among other things, Parent's plans for the Company following the proposed acquisition. On October 1, 1999, the members of the Special Committee and representatives of CSFB met with representatives of Parent and its financial advisor, Lazard Freres, to organize a procedure for reviewing the $22 Offer. The Special Committee also indicated that it had requested that the Company's management prepare appropriate business and financial projections and that it would need at least several weeks for those projections to be prepared. On October 15, 1999, the members of the Special Committee, together with representatives of CSFB and members of management, including Mr. Casten, met with representatives of Parent as well as with Lazard Freres. The primary purpose of the meeting, which had been called by the Special Committee, was to provide Parent the opportunity to describe its plans for the Company to the Company's management, and to answer any questions it might have, in order to allay any concerns management had. At the meeting, Parent read a prepared statement reiterating its long-term commitment to the Company. Parent elected not to respond to any specific questions regarding its future intentions concerning management and the operations of the Company because Parent believed it was an inappropriate time to do so. Following the departure of the financial advisors and management, the Special Committee indicated that it wished to be able to provide incentives to management of the Company in order that they would continue to focus on the Company's business and be assured that adequate arrangements would be put into place if and when a going private transaction were completed. Parent agreed that it would be appropriate to retain a third party compensation expert to make recommendations in this regard and preferred to defer discussing any specific proposals for these incentives and arrangements at that time. Following the October 15, 1999 meeting, the Special Committee asked the Company's regular compensation consultants to propose a "key manager" retention program, and the consultants recommended enhanced "change in control" benefits in order to reassure and retain key executives of the Company. Copies of the recommendations were also sent to Parent and its advisors. Upon receipt of these recommendations, Parent advised the Special Committee and its legal counsel that it believed that the Special Committee did not have authority to enter into new or enhanced employment or severance contracts with employees of the Company without the prior specific approval of a majority of the full Board of Directors. The Special Committee was also advised that Parent's nominees on the Board of Directors, which comprised a majority, were opposed at that time to entering into enhanced employment or severance contracts. The Special Committee advised Parent of its disagreement with these positions. Between October 15, 1999 and November 16, 1999, there were several conversations between Parent and the Special Committee and their respective legal and financial advisors regarding timetables and procedures for responding to the $22 Offer. During this period, the Special Committee advised Parent that management was in the process of preparing the projections that had been requested, and that the Special Committee would be unable to meet with Parent and its financial advisors until these projections were completed by management. The Special Committee requested that Parent and its advisors defer conducting further due diligence of the Company until that time. 3 On November 4, 1999, copies of the projections (the "November 1999 Projections") were delivered to Parent and Lazard Freres. Following receipt of the November 1999 Projections, representatives of Lazard Freres advised representatives of CSFB that Parent believed that the November 1999 Projections were aggressive and unrealistic for a number of reasons, including the fact that it was unclear to Parent how the Company would be able to generate sufficient capital to fund the capital expenditures needed to support the proposed revenue growth. At the direction of the Special Committee, CSFB relayed to Lazard Freres the Special Committee's disagreement with Parent's concerns regarding the November 1999 Projections and the Special Committee's belief that appropriate financing would be available. On November 16, 1999, the members of the Special Committee, together with the Special Committee's legal and financial advisors, met with representatives of Parent and its legal and financial advisors. At this meeting, representatives of Parent and Lazard Freres reiterated that Parent believed that the November 1999 Projections should not be the basis for valuing the Company because there was no explanation satisfactory to Parent as to how the Company's projected growth could be financed. The Special Committee indicated that it believed that the November 1999 Projections reasonably provided a basis for negotiation of a purchase price to be offered to the Public Stockholders. The Special Committee also indicated that, based on the projections, it believed that a proper price to commence negotiations would be substantially in excess of $22 per Share. The Special Committee asked that Parent meet with the Company's management to review the November 1999 Projections in order to identify aspects of the November 1999 Projections that Parent thought were incorrect. Since Parent withdrew the $22 Offer (as described below), no such meeting was held. In the course of the November 16 meeting, and in response to questions from Parent, the Special Committee indicated that it had solicited, and had authorized management of the Company to solicit, third party indications of interest for providing equity capital to the Company or for making an offer to purchase the entire Company at a higher price. In that regard, the Special Committee had authorized the distribution, pursuant to customary confidentiality agreements, of certain confidential information concerning the Company. The Special Committee did not receive any formal offers as a result of this process; it did, however, identify one party that was interested in making a substantial equity investment, but not under circumstances that might involve litigation or other disputes with Parent. The representatives of Parent advised the Special Committee that Parent had previously indicated that its interest in the Company was not for sale. Parent also indicated that it was unacceptable for either management or the Special Committee to disseminate confidential information concerning the Company to third parties since its majority interest in the equity of the Company was not for sale. The Parent's representatives therefore requested that the members of the Special Committee agree that they would instruct management of the Company and other representatives of the Company to cease soliciting third party offers and distributing confidential information. The Special Committee indicated that it was not prepared to make such a commitment. At the conclusion of these discussions, Parent advised the Special Committee that it was withdrawing the $22 Offer because Parent disagreed with the November 1999 Projections, and because the Special Committee had indicated that, based on those November 1999 Projections, the Special Committee believed that a proper price to commence negotiations would be substantially in excess of $22 per Share. On November 16, 1999, Parent issued a press release publicly announcing such withdrawal, which Parent attributed to its fundamental disagreement with the Company over the November 1999 Projections. Over the last several years, management and the Board of Directors have periodically held discussions concerning long-term financing for the Company. During the month of December, there were a series of meetings of the Board of Directors at which management proposed several interim and long-term financing plans to fund the proposed existing and future capital needs of the Company, including certain immediate funding requirements. Parent's representatives on the Board of Directors took the position that approval of these financing proposals should be deferred until management prepared a multi-year business plan which reflected the then contemplated capital needs of the Company. Parent's representatives also indicated that they were not aware, before these financial proposals were presented to them, of the 4 Company's immediate need for interim financing. The Special Committee indicated that the November 1999 Projections, which had been previously delivered to the directors, had reflected the Company's ongoing capital needs and believed that these projections were sufficient for the Board of Directors to make a decision. In any event, Parent agreed to provide interim bridge financing pending review, at a meeting of the Board of Directors to be held on January 19, 2000, of a comprehensive funding program. On January 7, 2000, Mr. Keane, in a memorandum sent to the Board of Directors, expressed concern over the uncertainty created by the $22 Offer and its abrupt withdrawal and also advised the directors of his view that there were serious issues of strategic vision, governance and long term financing that needed to be resolved by the Board of Directors and that resolution of these issues centered around whether the Company remained a public company or would be taken private. Subsequently, in a memorandum dated January 12, 2000, Mr. Bleitrach responded in writing to Mr. Keane's January 7, 2000 memorandum, contesting statements made by Mr. Keane in such memorandum, including Mr. Keane's statement that the withdrawal of the $22 Offer was abrupt. Mr. Bleitrach also reiterated Parent's concerns about the reasonableness of the November 1999 Projections. During 1998 and 1999, Parent and Mr. Casten had several meetings in which they attempted to arrive at a shared view regarding strategic and governance issues relating to the Company. Such meetings did not result in general agreement over such issues, and Parent came to believe that the Company required new leadership. Because of this decision, and as a result of Parent's belief that its designees on the Board of Directors had not been kept adequately informed of the immediate capital requirements of the Company, Parent determined in early January 2000 to request that Mr. Casten resign as President, Chief Executive Officer and as a director of the Company. Parent also decided to ask Mr. Keane to resign as Chairman of the Board of Directors, but to remain as a director. Accordingly, at a meeting in Paris on January 10, 1999 that had been scheduled to review the Company's multi-year business plan, a representative of Parent requested that Mr. Casten immediately resign from his positions with the Company. Parent indicated that in light of Mr. Casten's many years of service to the Company, it was prepared to recommend to the Board of Directors a severance package that would include continued compensation for a two year period, continued vesting of Mr. Casten's Options and Restricted Stock, and continuation of certain other employee benefits. Parent told Mr. Casten and subsequently the Special Committee that Mr. Casten would be replaced if he did not resign. Parent called a special meeting of the Board of Directors on Thursday, January 13, 2000 at which it was expected that Mr. Casten would resign or be replaced. On January 12, 2000, Mr. Keane, on behalf of the Special Committee, wrote a memorandum to Parent indicating that the Special Committee had serious reservations concerning the actions proposed by Parent to be taken at a special meeting of the Board of Directors scheduled for January 13, 2000, particularly the resignation or removal of Mr. Casten. Mr. Keane proposed that Parent re-initiate its going private proposal by offering to purchase the remainder of the Shares and informed Parent that if the going private transaction was re-initiated at a fair price, it would be fully supported by the Special Committee. The Special Committee asked for a response the following day. Following receipt of that memorandum, at the Special Committee's direction, CSFB contacted Lazard Freres by telephone to suggest that the parties resume discussions concerning the $22 Offer. On January 12, 2000, CSFB indicated that the Special Committee had requested that CSFB inform Lazard Freres that the members of the Special Committee might view an offer at $26 per Share favorably. On January 12, 2000, Fried, Frank, Harris, Shriver & Jacobson, Parent's legal counsel ("Fried Frank"), provided an initial draft of the Merger Agreement to the Special Committee through its representatives. On January 13, 2000, Lazard Freres communicated to CSFB that Parent would consider increasing its Offer to $22.75. That proposal was rejected by the Special Committee, which indicated that it was seeking an amount in excess of $24 per Share. Also on January 13, 2000, the Board of Directors met and formally reappointed the Special Committee. Action with respect to Mr. Casten's resignation was deferred until January 19, 2000. 5 On January 16, 2000, representatives from Fried Frank negotiated the draft Merger Agreement with Troutman Sanders, and Fried Frank circulated a revised draft of the Merger Agreement later that day. On January 17, 2000, Lazard Freres indicated to CSFB that Parent would be prepared to increase its offer to $23.25. Lazard Freres was advised that the Special Committee was still seeking at least $24 per Share. On January 18, 2000, Lazard Freres indicated that, subject to the preparation of acceptable documents, including agreements from the members of the Special Committee and Mr. Casten in their individual capacities to accept the proposal and vote and/or tender their Shares to support the transaction, Parent would be prepared to increase its offer to $23.50. The Special Committee also contacted Parent directly in order to attempt to negotiate a higher price. At the same time, Fried Frank and Troutman Sanders continued to negotiate the remaining issues in the draft Merger Agreement. On January 19, 2000, at the request of the Special Committee, CSFB advised Lazard Freres that the Special Committee was likely to respond favorably to Parent's proposed offer of $23.50. The Special Committee then met to review the offer and the terms of the draft Merger Agreement with CSFB and Troutman Sanders. Also at this meeting, CSFB delivered to the Special Committee an oral opinion (which opinion was confirmed by delivery of a written opinion dated January 19, 2000) to the effect that, as of that date and based on and subject to the matters described in the opinion, the $23.50 per Share cash consideration to be received in the Offer and the Merger, taken together, by the holders of Shares was fair, from a financial point of view, to such holders (other than Parent and its affiliates). After full discussion, the Special Committee unanimously determined to recommend that the Board of Directors approve the Offer and the Merger and approve and authorize the Merger Agreement and the other transactions contemplated thereby. Later that day, the Board of Directors met to consider the recommendation of the Special Committee. After receiving the recommendation of the Special Committee, the members of the Board of Directors unanimously approved the Offer and the Merger, approved and adopted the Merger Agreement and the transactions contemplated thereby, and recommended the Offer to the stockholders of the Company. The Board of Directors also approved the separation arrangements with Mr. Casten, and the terms of a $16 million short-term loan from Elyo. Over the course of that day, Fried Frank and Troutman Sanders finalized the Merger Agreement and the related documentation, including the Tender and Voting Agreement. Fried Frank and Mr. Casten's attorney also finalized the severance arrangements with Mr. Casten. By the end of the day, the parties had agreed to the definitive terms of the Merger Agreement and the tender and voting agreement, and those agreements were executed by the various parties. Mr. Casten also executed a separation agreement with the Company and the Casten Stock Purchase Agreement. For a description of the separation arrangements with Mr. Casten, see "--The Transaction Documents; Arrangements with Thomas R. Casten." 2. RECOMMENDATION OF THE SPECIAL COMMITTEE AND THE BOARD OF DIRECTORS OF THE COMPANY; FAIRNESS OF THE OFFER AND THE MERGER THE SPECIAL COMMITTEE. In reaching its decision to recommend that the Board of Directors approve the Offer and the Merger and authorize the Merger Agreement, the Special Committee considered a number of factors, including the following, which generally supported a recommendation in favor of the Offer: (i) The Company's uncertain financial prospects as a result of (a) the current rate at which the Company is utilizing its available funds and (b) uncertainty as to whether the Company would be able to raise additional capital which would be adequate for its ongoing needs (particularly in light of Parent's requirement that it would first need to consider meaningful long-term business plans before it could respond to a request for approval of a long-term financing plan). (ii) The fact that the Company's projections reflected unprecedented growth, and that there can be no assurances that these projections can be realized since unprecedented growth by its nature contains certain risks. 6 (iii) The historical market prices and recent trading activity of the Shares, including the fact that the $23.50 per Share cash consideration to be paid in the Offer and the Merger represented a substantial premium over the recent trading price of the Shares. (iv) The history of negotiations between the Special Committee and its representatives and the Parent and its representatives, including the facts that (a) the negotiations resulted in an increase in the price at which Parent and Purchaser were prepared to acquire the Company's outstanding Shares from $22.00 per Share to $23.50 per Share, and (b) the Special Committee's belief that the Parent and Purchaser would not further increase the Offer. (v) The express unwillingness of the Parent to consider a sale of its interest in the Company which made pursuit of other potential business combinations impracticable. (vi) The structure of the transaction which is designed, among other things, to result in the receipt by stockholders at the earliest practicable time of the consideration to be paid in the Offer and the fact that the per Share consideration to be paid in the Offer and the Merger is the same. (vii) The volatility in the energy industry during the current deregulation of the electric industry and the impracticability of accurately predicting the future results of the Company. (viii) The opinion of CSFB dated January 19, 2000 to the effect that, as of that date and based on and subject to the matters described in the opinion, the $23.50 per Share cash consideration to be received in the Offer and the Merger, taken together, by the holders of Shares was fair, from a financial point of view, to such holders (other than Parent and its affiliates). The full text of CSFB's written opinion dated January 19, 2000, which sets forth the assumptions made, procedures followed, matters considered and limitations on the review undertaken by CSFB, is attached to the Schedule 14D-9 as Annex A and is incorporated herein by reference. CSFB's opinion is directed only to the fairness, from a financial point of view, of the $23.50 per Share cash consideration to be received in the Offer and the Merger, taken together, by the holders of Shares (other than Parent and its affiliates) and is not intended to constitute, and does not constitute, a recommendation as to whether any stockholder should tender Shares pursuant to the Offer or as to any other matter relating to the Offer or the Merger. Holders of Shares are urged to read the opinion carefully in its entirety. (ix) The availability of dissenters' rights with respect to the Merger under Delaware law. (x) The absence of any "minimum condition" or other requirement that a particular number of Shares be tendered in the Offer or that dissenters' rights be exercised with respect to only a limited number of Shares. (xi) The impact of the departure of Mr. Casten from the Company's management team. (xii) The likelihood that the proposed acquisition would be consummated based in part on the financial resources of the Parent. (xiii) The terms and conditions of the Merger Agreement, including the absence of any financing condition. (xiv) The expectation that, in the absence of Mr. Casten's leadership, the trading price of the Shares might decline in the future. In addition to the factors listed above, the Special Committee considered the fact that the consummation of the Offer and the Merger would eliminate the opportunity of the stockholders of the Company other than Parent and its affiliates (the "Public Stockholders") to participate in any potential future growth of the value of the Company, but believed that this loss of opportunity was appropriately reflected by the price of $23.50 per Share to be paid in the Offer and Merger. The Special Committee also observed the potential future values for the Company that had been suggested in publicly released analytical reports produced by various investment banking firms. In light of the number and variety of factors the Special Committee considered in connection with its evaluation of the Offer and the Merger, the Special Committee did not find it practicable to quantify or 7 otherwise assign relative weights to any of the foregoing factors and, accordingly, the Special Committee did not do so. THE BOARD OF DIRECTORS OF THE COMPANY. All of the directors of the Company other than the members of the Special Committee (Messrs. Keane and Bayless) may be considered to have an interest in the Offer and the Merger. Accordingly, the Board of Directors based its determination that the terms of the Offer are fair to the Public Stockholders primarily upon the conclusion of the Special Committee described above and the other factors described above under the caption "The Special Committee." 3. POSITION OF SUEZ, PARENT AND PURCHASER REGARDING FAIRNESS OF THE OFFER AND THE MERGER Because Parent currently beneficially owns a majority of the outstanding Shares, Purchaser, Parent and their affiliates are deemed "affiliates" of the Company engaging in a Rule 13e-3 transaction under Rule 13e-3 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Accordingly, Suez, Parent and Purchaser are required to consider the fairness of the Offer to the holders of the Shares (other than Parent and its affiliates). Suez, Parent and Purchaser believe the Offer and the Merger to be substantially and procedurally fair to the Public Stockholders. Although Lazard Freres did not deliver and was not requested to deliver an opinion as to the fairness of the transaction, Suez, Parent and Purchaser have considered the analysis of Lazard Freres as set forth below (see "--Analysis of Financial Advisor to Parent"), in addition to the following factors: (i) The Board of Directors and the Special Committee concluded that the Offer and the Merger are fair to, and in the best interests of, the Public Stockholders. (ii) The historical and projected financial performance of the Company. (iii) The Offer Price represents a 22.08% premium over the closing price for the Shares on September 17, 1999, the last full trading day prior to announcement of the $22 Offer. (iv) The Offer Price represents a 38.24% premium over the closing price for the Shares on January 18, 2000, the last full trading day prior to the announcement of the execution of the Merger Agreement. (v) The Offer is not subject to a financing condition. (vi) The Offer provides the Public Stockholders who are considering selling their Shares with the opportunity to sell their Shares at the Offer Price without incurring the transaction costs typically associated with market sales. (vii) The ability of Public Stockholders who object to the Merger to obtain "fair value" for their Shares if they exercise and perfect their appraisal rights under the DGCL. (viii) The terms of the Merger Agreement were determined through arm's-length negotiations between the Special Committee and its legal and financial advisors, on the one hand, and representatives of Parent, on the other hand, and provide for the Offer in order to allow Public Stockholders to receive payment for their Shares on an accelerated basis. (ix) The Parent Group has sufficient stock ownership to control a disposition of the Company and informed the Special Committee that it would not be interested in a third-party sale of the Company. (x) The Company's request for Parent to provide the short-term financing to the Company to meet certain capital expenditures. 8 (xi) The pendancy of the Class Action Litigation (as defined in "The Tender Offer--Certain Legal Matters; Regulatory Approvals") asserting that the per share price in the $22 Offer was inadequate. (xii) Notwithstanding that CSFB's opinion, dated January 19, 2000, was provided solely for the information and assistance of the Special Committee and that Suez, Parent and Purchaser are not entitled to rely on such opinion, the fact that the Special Committee received an opinion from CSFB to the effect that, as of that date and based on and subject to the matters described in the opinion, the $23.50 per Share cash consideration to be received in the Offer and the Merger, taken together, by the holders of Shares was fair, from a financial point of view, to such holders (other than Parent and its affiliates). Suez, Parent and Purchaser have reviewed the factors considered by the Board of Directors in support of its decision, as described above, and have no basis to question their consideration of or reliance on these factors. Suez, Parent and Purchaser did not find it practicable to assign, nor did any of them assign, specific relative weights to the foregoing factors in reaching their opinion as to the fairness of the Offer and the Merger to the Public Stockholders. Affiliates of Parent and Suez (other than the Company) are in the process of engaging CSFB to provide certain financial services unrelated to the Offer and the Merger. These services consist of an engagement of CSFB by an affiliate of Suez regarding the monetization of water assets of a large paper company and a potential privatization of a water distribution facility in Brazil. 4. ANALYSIS OF FINANCIAL ADVISOR TO PARENT LAZARD FRERES ENGAGEMENT. On October 21, 1998, Parent engaged Lazard Freres to act as its financial advisor to advise it of its strategic alternatives with respect to its majority interest in the Company. In connection with its engagement as Parent's financial advisor, Lazard Freres: - reviewed the publicly available business and financial information relating to the Company that Lazard Freres deemed relevant; - reviewed selected information, including financial forecasts, relating to the business, earnings, cash flow, assets, liabilities and prospects of the Company, furnished to Lazard Freres by the Company and Parent; - conducted discussions with members of senior management and representatives of the Company and Parent concerning the matters described above, as well as their respective businesses and prospects; - reviewed the market prices and valuation multiples for the Common Stock and compared them with those of selected publicly traded companies that Lazard Freres deemed to be relevant; - reviewed the results of operations of the Company and compared them with those of selected publicly traded companies that Lazard Freres deemed to be relevant; - compared the proposed financial terms of the Offer and Merger with the financial terms of other transactions that Lazard Freres deemed to be relevant; - participated in discussions and negotiations among representatives of the Company and its financial and legal advisors and Parent and its legal advisors; - reviewed the executed Merger Agreement; and - reviewed such other financial studies and analyses and took into account such other matters as Lazard Freres deemed necessary, including an assessment of general economic, market, and monetary conditions. 9 Lazard Freres made available to the Board of Directors of Parent a summary presentation of the significant analyses performed by Lazard Freres (the "Lazard Freres Presentation"). The Lazard Freres Presentation was based on the "Committed Case" projections provided by Company management. See "--Company Financial Projections." The data contained in the Lazard Freres Presentation were intended solely to provide additional information for the use and benefit of the Board of Directors of Parent, and were not prepared for the purpose of providing an opinion as to the fairness of the consideration to be paid by Purchaser or for the purpose of addressing the merits of the underlying business decision by Parent to engage in the Offer and Merger. A copy of the Lazard Freres Presentation has been filed as an exhibit to the Schedule TO (the "Schedule TO") filed with the Commission with respect to the Offer and may be inspected and copied from the Commission in the manner specified in "THE TENDER OFFER--Certain Information Concerning the Company--Available Information." The following is a summary of the various types of analyses presented to the Board of Directors of Parent in the Lazard Freres Presentation: DISCOUNTED CASH FLOW ANALYSIS. Lazard Freres performed a discounted cash flow analysis, based upon selected operating and financial assumptions, the "Committed Case" forecasts and other information provided by the management of Parent and the Company. Lazard Freres used a range of discount rates of 8.0% to 9.0% and a range of perpetuity growth rates for cash flow from .30% to 1.80% to arrive at an enterprise value range of $710 to $775 million. Lazard Freres subtracted from the enterprise value range aggregate estimated net debt (which equaled short- and long-term debt PLUS minority interest PLUS preferred stock MINUS cash) of $472 million to determine a range of estimated aggregate equity values. Lazard Freres selected a representative range of $18.71 to $23.82 per Share implied by this analysis for the Shares to be acquired. ANALYSIS OF SELECTED MINORITY BUY-OUTS. Lazard Freres also analyzed selected minority buy-out transactions, which involved repurchases of remaining interests over $50 million from December 1991 to the present. Lazard Freres analyzed the premium paid in these transactions to the price of the stock one day prior to, and one month prior to, the announcement of the proposed merger. The median premium of initial bid to one day and one month prior to announcement was approximately 12.3% and 20.0%, respectively. The median premium of final bid to one day and one month prior to announcement was approximately 20.0% and 27.5%, respectively. Lazard Freres selected a representative range of $19.08 to $21.99 per Share implied by this analysis for the Shares to be acquired. OTHER ANALYSES. Lazard Freres analyzed actual and estimated financial information for five publicly-traded independent power producers, which Lazard Freres considered to some extent similar to the Company, although not necessarily representative of truly comparable companies. Based on this analysis, Lazard Freres selected representative ranges of $15.17 to $20.28 per Share implied by EBITDA multiples analysis for the Shares to be acquired. Lazard Freres also reviewed publicly-available information for five recent acquisitions Lazard Freres considered to some extent similar to the Merger, although not necessarily representative of truly comparable transactions. Lazard Freres selected representative ranges of $17.53 to $23.03 per Share implied by this analysis for the Shares to be acquired. The foregoing summary is not a complete description of the analysis performed by Lazard Freres in connection with the Lazard Freres Presentation. Lazard Freres believes that its analysis and the summary set forth above must be considered as a whole and that selecting portions of its analysis, without considering all factors and analyses, could create an incomplete view of the process underlying the analyses set forth in the Lazard Freres Presentation. The Lazard Freres Presentation was prepared solely for the purposes discussed above and is not an appraisal or reflection of the prices at which businesses or securities actually may be sold. Analyses based upon projected future results are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by such analyses. Because such analyses are inherently subject to uncertainty, as they are based upon numerous factors or 10 events beyond the control of the parties or their respective advisors, none of Parent's personnel or any other person assumes responsibility if the future results are materially different from those projected. In preparing the Lazard Freres Presentation, Lazard Freres assumed and relied on the accuracy and completeness of all information supplied or otherwise made available to it, discussed with or reviewed by or for it, or publicly-available, and did not independently verify the information or independently evaluate or appraise any of the assets or liabilities of the Company. In addition, Lazard Freres was not furnished with such evaluation or appraisal and did not assume any obligation to conduct any physical inspection of the properties or facilities of the Company. The Lazard Freres Presentation is necessarily based upon market, economic and other conditions as they exist and can be based on the information made available to it as of the date of the Lazard Freres Presentation. Lazard Freres assumed that in the course of obtaining any necessary regulatory or other consents or approvals (contractual or otherwise) for the Offer and the Merger, no restrictions, including any divestiture requirements or amendments or modifications, will be imposed that will have a material adverse effect on the contemplated benefits of the Offer and the Merger. Lazard Freres is acting as a financial advisor to Parent in connection with the Offer and the Merger and will receive a fee from Parent for its services, a significant portion of which is contingent upon the consummation of the Offer and the Merger. In addition, Parent has agreed to indemnify Lazard Freres for certain liabilities arising out of its engagement. Lazard Freres is currently engaged by Parent to act as its financial advisor and has, in the past, provided financial advisory services to Parent and its affiliates and may continue to do so and has received, and may receive, fees for the rendering of such services. Lazard Freres's engagement with Parent was formalized in an engagement letter ("Engagement Letter"), originally dated October 21, 1998 and amended and renewed on August 25, 1999. Under the terms of the Engagement Letter, Parent agreed to pay Lazard Freres for its services a cash fee of $1,400,000, which is payable as follows: $400,000 upon delivery of the Lazard Freres Presentation and $1,000,000 upon the closing of a transaction like the Offer and Merger during the period of Lazard Freres's retention. Parent also agreed to reimburse Lazard Freres for reasonable out-of-pocket expenses and reasonable fees and disbursements of its legal counsel. Under the terms of the Engagement Letter, Lazard Freres is to act as financial adviser to Parent in connection with the Merger. In addition, Parent has agreed to indemnify Lazard Freres against certain liabilities. 5. OPINION OF THE SPECIAL COMMITTEE'S FINANCIAL ADVISOR CSFB has acted as exclusive financial advisor to the Special Committee in connection with the Offer and the Merger. The Special Committee selected CSFB based on CSFB's experience, expertise and familiarity with the Company and its business. CSFB is an internationally recognized investment banking firm and is regularly engaged in the valuation of businesses and securities in connection with mergers and acquisitions, leveraged buyouts, negotiated underwritings, competitive biddings, secondary distributions of listed and unlisted securities, private placements and valuations for corporate and other purposes. In connection with CSFB's engagement, the Special Committee requested that CSFB evaluate the fairness, from a financial point of view, to the holders of Shares (other than Parent and its affiliates) of the consideration to be received by such holders pursuant to the Offer and the Merger, taken together. On January 19, 2000, at a meeting of the Special Committee held to evaluate the proposed Offer and the Merger, CSFB rendered to the Special Committee an oral opinion (which opinion was confirmed by delivery of a written opinion dated January 19, 2000) to the effect that, as of that date and based on and subject to the matters described in the opinion, the $23.50 per Share cash consideration to be received in the Offer and the Merger, taken together, by the holders of Shares, was fair, from a financial point of view, to such holders (other than Parent and its affiliates). THE FULL TEXT OF CSFB'S WRITTEN OPINION, DATED JANUARY 19, 2000, TO THE SPECIAL COMMITTEE, WHICH SETS FORTH THE ASSUMPTIONS MADE, PROCEDURES FOLLOWED, MATTERS CONSIDERED AND LIMITATIONS ON THE REVIEW UNDERTAKEN BY CSFB, IS ATTACHED TO THE SCHEDULE 14D-9 AS ANNEX A AND IS INCORPORATED HEREIN BY REFERENCE. 11 HOLDERS OF SHARES ARE URGED TO READ THIS OPINION CAREFULLY IN ITS ENTIRETY. CSFB'S OPINION IS ADDRESSED TO THE SPECIAL COMMITTEE, RELATES ONLY TO THE FAIRNESS, FROM A FINANCIAL POINT OF VIEW, OF THE $23.50 PER SHARE CASH CONSIDERATION TO BE RECEIVED IN THE OFFER AND THE MERGER, TAKEN TOGETHER, BY THE HOLDERS OF SHARES (OTHER THAN PARENT AND ITS AFFILIATES), DOES NOT ADDRESS ANY OTHER ASPECT OF THE PROPOSED OFFER OR MERGER OR ANY RELATED TRANSACTION AND DOES NOT CONSTITUTE A RECOMMENDATION TO ANY STOCKHOLDER AS TO WHETHER SUCH STOCKHOLDER SHOULD TENDER SHARES IN THE OFFER OR AS TO ANY OTHER MATTER RELATING TO THE OFFER OR THE MERGER. In arriving at its opinion, CSFB reviewed the Merger Agreement and publicly available business and financial information relating to the Company. CSFB also reviewed other information relating to the Company, including financial forecasts, that the Company provided to or discussed with CSFB, and met with the management of the Company to discuss the business and prospects of the Company. CSFB also considered financial and stock market data of the Company and compared those data with similar data for other publicly held companies in businesses similar to the Company and considered, to the extent publicly available, the financial terms of other business combinations and other transactions recently effected. CSFB also considered other information, financial studies, analyses and investigations and financial, economic and market criteria which CSFB deemed relevant. In connection with its review, CSFB did not assume any responsibility for independent verification of any of the information provided to or otherwise reviewed by it and relied on that information being complete and accurate in all material respects. With respect to the financial forecasts, CSFB was advised, and assumed, that such forecasts were reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company. CSFB was not requested to, and did not, make an independent evaluation or appraisal of the assets or liabilities, contingent or otherwise, of the Company, and was not furnished with any evaluations or appraisals. CSFB's opinion was necessarily based on information available to it, and financial, economic, market and other conditions as they existed and could be evaluated, on the date of its opinion. Although CSFB evaluated, from a financial point of view, the $23.50 per Share cash consideration to be received in the Offer and Merger, taken together, by the holders of Shares (other than Parent and its affiliates), CSFB was not requested to, and did not, recommend the specific consideration to be received in the Offer and the Merger, which consideration was determined between the Special Committee and Parent. In connection with its engagement, CSFB was not requested to, and did not, solicit third party indications of interest in the possible acquisition of all or part of the Company. No other limitations were imposed on CSFB with respect to the investigations made or procedures followed by CSFB in rendering its opinion. In preparing its opinion to the Special Committee, CSFB performed a variety of financial and comparative analyses, including those described below. The summary of CSFB's analyses described below is not a complete description of the analyses underlying its opinion. The preparation of a fairness opinion is a complex analytical process involving various determinations as to the most appropriate and relevant methods of financial analyses and the application of those methods to the particular circumstances and, therefore, a fairness opinion is not readily susceptible to summary description. In arriving at its opinion, CSFB made qualitative judgments as to the significance and relevance of each analysis and factor considered by it. Accordingly, CSFB believes that its analyses must be considered as a whole and that selecting portions of its analyses and factors, without considering all analyses and factors, could create a misleading or incomplete view of the processes underlying its analyses and opinion. In its analyses, CSFB considered industry performance, regulatory, general business, economic, market and financial conditions and other matters, many of which are beyond the control of the Company. No company, transaction or business used in CSFB's analyses as a comparison is identical to the Company or the proposed Offer and Merger, and an evaluation of the results of those analyses is not entirely mathematical. Rather, the analyses involve complex considerations and judgments concerning financial and operating characteristics and other factors that could affect the acquisition, public trading or other values of the companies, business segments or transactions analyzed. 12 The estimates contained in CSFB's analyses and the ranges of valuations resulting from any particular analysis are not necessarily indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than those suggested by the analyses. In addition, analyses relating to the value of businesses or securities do not purport to be appraisals or to reflect the prices at which businesses or securities actually may be sold. Accordingly, CSFB's analyses and estimates are inherently subject to substantial uncertainty. CSFB's opinion and financial analyses were only one of many factors considered by the Special Committee in its evaluation of the Offer and the Merger and should not be viewed as determinative of the views of the Special Committee, the Board of Directors or management of the Company with respect to the Offer and the Merger or the consideration to be received in the Offer and the Merger. The following is a summary of the material financial analyses underlying CSFB's opinion dated January 19, 2000 delivered to the Special Committee in connection with the Offer and the Merger: DISCOUNTED CASH FLOW ANALYSES. CSFB estimated the present value of the unlevered after-tax free cash flows that the Company could produce on a stand-alone basis. CSFB evaluated the Company's projected free cash flows for the years 2000 through 2009 under three scenarios based on internal estimates of the management of the Company. The first scenario, the management case (which is substantially similar to the "Committed Case" in "--Company Financial Projections" below), was based on management's forecast of cash flows derived from current operational contracts and signed development contracts. The second scenario, the adjusted case, was based on the management case and adjusted to reflect additional cash flows that may result from the Company's identified but unsigned contracts and limited merchant electric power plant development at existing Company facilities. The third scenario, the limited development case, was based on the management case and adjusted to reflect lower cash flows from certain of the Company's backlog of signed development contracts than was forecasted under the management case. Ranges of terminal values for the discounted cash flow analyses were estimated using multiples of terminal year 2009 earnings before interest, taxes, depreciation and amortization, commonly known as EBITDA, of 8.0x to 9.0x in the case of the Company's operations other than its merchant power operations, and 6.5x to 7.0x in the case of the Company's merchant power operations. CSFB then discounted to present value the free cash flow streams and terminal values using discount rates of 8.5% to 9.0% in the case of the Company's operations other than its merchant power operations, and 14.0% to 15.0% in the case of the Company's merchant power operations. This analysis indicated an implied enterprise reference range for the Company of approximately $716 million to $798 million for the management case, approximately $742 million to $843 million for the adjusted case and approximately $630 million to $703 million for the limited development case, each as compared to the enterprise value implied by the consideration payable in the Offer and the Merger of approximately $763 million. SELECTED COMPANIES ANALYSES. CSFB compared financial and operating data of the Company with corresponding data of the following selected publicly traded companies in the independent power production industry: - The AES Corporation - Calpine Corporation - Cogeneration Corporation of America CSFB reviewed enterprise values, calculated as equity market value, plus total debt, preferred stock and minority interests, less cash and cash equivalents, of the selected companies as multiples of, among other things, estimated years 1999 and 2000 EBITDA and earnings before interest and taxes, commonly known as EBIT, and equity values of the selected companies as multiples of estimated years 1999 and 2000 net income. Estimated financial data for the selected companies were based on publicly available research analysts' estimates. All multiples were based on closing stock prices on January 14, 2000, except for Cogeneration Corporation of America, the multiples of which were based on its closing stock price on 13 August 26, 1999 (the last trading day prior to Calpine Corporation's acquisition of Cogeneration Corporation of America). CSFB then applied a range of selected multiples derived from the selected companies data to estimated years 1999 and 2000 EBITDA, EBIT and net income of the Company based on the adjusted case estimates. This analysis indicated an implied enterprise reference range for the Company of approximately $670 million to $770 million, as compared to the enterprise value implied by the consideration payable in the Offer and the Merger of approximately $763 million. SELECTED MERGERS AND ACQUISITIONS ANALYSES. Using publicly available information, CSFB analyzed the purchase prices and implied transaction multiples paid in the following selected merger and acquisition transactions in the independent power production industry:
ACQUIROR TARGET - -------- ------ - - Calpine Corporation - Cogeneration Corporation of America - - El Paso Natural Gas Company - CE Generation LLC - - Enron Corporation - Cogen Technologies - - Cogentrix Energy, Inc. - Bechtel/USGen - - NGC Corporation/The AES Corporation - Destec Energy, Inc. - - CalEnergy Company, Inc. - Falcon Seaboard Resources, Inc.
CSFB reviewed enterprise values of the selected transactions as multiples of latest 12 months and estimated forward year EBITDA. All multiples for the selected transactions were based on financial information available at the time of the announcement of the relevant transaction. CSFB then applied a range of selected multiples derived from the selected transactions data to the latest 12 months and estimated year 2000 EBITDA of the Company based on the adjusted case estimates. This analysis indicated an implied enterprise reference range for the Company of approximately $650 million to $780 million, as compared to the enterprise value implied by the consideration payable in the Offer and the Merger of approximately $763 million. OTHER FACTORS. In the course of preparing its opinion, CSFB considered other information and data, including the premiums implied by the consideration payable in the Offer and the Merger relative to historical stock prices for the Shares. MISCELLANEOUS. Pursuant to the terms of CSFB's engagement, the Company has agreed to pay CSFB an aggregate fee of $1.3 million for its financial advisory services in connection with the Offer and the Merger. The Company also has agreed to reimburse CSFB for its out-of-pocket expenses, including the fees and expenses of its legal counsel, and to indemnify CSFB and related parties against liabilities, including liabilities under the federal securities laws, arising out of CSFB's engagement. CSFB and its affiliates have in the past provided financial services to the Company and Suez, and currently are providing financial services to the Company, unrelated to the Offer and Merger, for which CSFB has received and may receive compensation. In the ordinary course of business, CSFB and its affiliates may actively trade the debt and equity securities of the Company and Suez for their own accounts and for the accounts of customers and, accordingly, may at any time hold long or short positions in such securities. A copy of CSFB's written presentation to the Special Committee, dated January 19, 2000, has been included as an exhibit to the Schedule TO and may be inspected, copied and obtained in the manner specified in "THE TENDER OFFER--Certain Information Concerning the Company--Available Information." 6. COMPANY FINANCIAL PROJECTIONS The Company does not, as a matter of course, make public forecasts or projections as to future sales, earnings or other income statement data. However, management of the Company does prepare internal financial projections prior to the start of each year. Such projections represent what management of the Company believes to be a reasonable estimate of the Company's future financial performance and reflect significant assumptions and subjective judgments by the Company's management regarding industry 14 performance and general business and economic conditions, including assumptions regarding the Company's future development projects. The projections set forth below were not prepared with a view to public disclosure and are included herein for the limited purpose of giving the Company's stockholders access to financial projections prepared by the Company's management in January 2000 in the ordinary course of business as part of the Company's budgeting and planning process and that were made available to Parent and Purchaser in connection with the Offer. The January 2000 projections reflect developments which were finalized after the preparation of the November 1999 Projections and different assumptions from such earlier projections as described below. The "Committed Case" scenario reflects management's forecasts based on facilities which were either under operation, under construction or pending construction and the addition of new customers to the Company's existing facilities. In addition, the Committed Case assumes that the Company's existing credit facility could be increased to support the Company's additional capital requirements for the periods presented. The "No New Development Beyond 2000 Case" scenario was based on the Committed Case, was adjusted to reflect management's assumptions regarding identified but unsigned development contracts (based on management's assessment of probability) with startup dates ranging from 2000 to 2002 and assumes the issuance in 2000 of $240 million in public debt (and a related increase in interest cost as a result thereof) and the continuation of the Company's existing credit facilities to support the Company's additional capital requirements for the periods presented. The "Target With $50 Million Additional Equity Case" scenario was based on the Committed Case and was adjusted to reflect management's assumptions that projected growth for 2000 as set forth in the No New Development Beyond 2000 Case will continue at the same level in each year from 2001 through 2005 and assumes the issuance in 2000 of $240 million in public debt (and a related increase in interest cost as a result thereof), the issuance in 2001 of $50 million in equity and the continuation of the Company's existing credit facilities to support the Company's additional capital requirements for the periods presented. No analysis beyond 2001 was made regarding the need for additional equity to support the Company's additional capital requirements. The November 1999 Projections did not include a scenario analogous to the Committed Case scenario. More detailed financial projections relating to the "Committed Case" scenario described above, which contain business segment information, is attached as Schedule III to this Offer to Purchase. In addition to the three scenario's set forth below, management of the Company also prepared in January 2000 two variations of the "Target With $50 Million Additional Equity Case" scenario, one of which assumed no issuance of additional equity and was entitled "Target With No Additional Equity Case" and the other of which assumed the issuance of $100 million of equity and was entitled "Target With $100 Million Additional Equity Case." The principal impact of these two scenarios from the Target With $50 Million Additional Equity Case, which was the case endorsed by management, are changes in the Company's total interest costs (i.e., higher in the Target With No Additional Equity Case and lower in the Target With $100 Million Additional Equity Case) and level of indebtedness. The following assumptions were not considered by management in the preparation of the projections in January 2000 although they were reflected in the November 1999 Projections, including the projections set forth in the Development Growth Case scenario described in the paragraph following the tables: (i) the sale (which had been reviewed from time to time by management but never recommended by management or the Board of Directors) in 2000 of one of the Company's district energy systems and an associated write-off (which together would represent an aggregate pre-tax loss of $40 million), (ii) a pre-tax gain in 2000 in the amount of $20 million representing the receipt of proceeds in connection with the Company's judgment in its antitrust suit against Oklahoma Gas & Electric Company and (iii) the vesting of all outstanding shares of Restricted Stock granted under the Trigen Energy Corporation 1994 Stock Incentive Plan. The November 1999 Projections also assumed that the Company's existing credit facilities could be increased to support the Company's additional capital requirements for the periods presented. In addition, the January 2000 projections and the November 1999 Projections reflect the settlement in May 1999 of the Company's litigation with PECO Energy Company and Adwin (Schuylkill) Cogeneration, Inc. concerning 15 the Company's Grays Ferry project (the "PECO Litigation"). The January 2000 projections included updated financial information and revisions relating to several development projects for which development contracts were finalized between the date of preparation of the November 1999 Projections and the January 2000 projections. The updated financial information and revisions reflected in the January 2000 projections did not result in materially different projections from any comparable projections prepared as part of the November 1999 Projections. JANUARY PROJECTIONS
COMMITTED CASE 2000 2001 2002 2003 2004 2005 - -------------- -------- -------- -------- ---------- ---------- ---------- ($ IN THOUSANDS) Total Revenues....... $375,474 $403,371 $421,575 $436,927 $446,405 $453,035 Operating Income..... 66,319 63,241 67,853 70,800 71,530 71,218 Net Income........... 16,076 11,488 13,547 16,733 18,797 20,017 EBITDA............... 98,996 99,982 107,439 111,160 112,622 112,899 Indebtedness......... 507,926 525,407 479,745 441,582 390,177 342,346 Debt to Capital...... 71.7% 71.0% 67.3% 63.8% 59.1% 54.0%
NO NEW DEVELOPMENT BEYOND 2000 CASE 2000 2001 2002 2003 2004 2005 - ------------------ -------- -------- -------- ---------- ---------- ---------- ($ IN THOUSANDS) Total Revenues....... $404,483 $470,585 $542,083 $574,146 $586,662 $596,328 Operating Income..... 73,491 75,768 88,752 95,829 97,211 97,562 Net Income........... 16,755 12,973 16,785 20,758 23,294 24,986 EBITDA............... 107,619 116,580 136,632 145,996 148,151 149,091 Indebtedness......... 605,639 688,775 689,948 644,733 578,008 513,998 Debt to Capital...... 71.6% 71.8% 71.8% 69.4% 65.3% 60.7%
TARGET WITH $50 MILLION ADDITIONAL EQUITY CASE 2000 2001 2002 2003 2004 2005 - ----------------------- -------- -------- -------- ---------- ---------- ---------- ($ IN THOUSANDS) Total Revenues........ $425,644 $545,106 $716,485 $ 896,002 $1,074,587 $1,251,596 Operating Income...... 74,510 86,660 116,964 150,207 182,968 214,104 Net Income............ 16,261 15,414 22,196 29,726 37,075 43,997 EBITDA................ 109,447 130,208 173,004 218,181 262,874 305,799 Indebtedness.......... 633,060 788,009 984,284 1,177,061 1,336,994 1,464,309 Debt to Capital....... 72.5% 68.7% 70.0% 71.1% 71.1% 70.4%
As part of the November 1999 Projections, management of the Company included a "Development Growth Case" scenario. The projections set forth in this scenario reflected management's forecasts based on facilities which were either under operation, under construction or pending construction and the addition of new customers to the Company's existing facilities. In addition, the Development Growth Case reflected management's assumptions that projected growth for 2000, based on management's assumptions (including an assessment of probability) regarding identified but unsigned development contracts with startup dates ranging from 2000 to 2002, will increase at a compounded annual growth rate of 20% per year from 2001 through 2005, which resulted in revenues increasing from $401 million in 2000 to $1,233 million in 2005, operating income increasing from $67 million in 2000 to $268 million in 2005 and EBITDA increasing from $105 million in 2000 to $376 million in 2005. The projections made available to Parent in January 2000 did not include a scenario analogous to the Development Growth Case scenario. THE COMPANY HAS ADVISED SUEZ, PARENT AND PURCHASER THAT IT DOES NOT, AS A MATTER OF COURSE, DISCLOSE PROJECTIONS AS TO FUTURE REVENUES, EARNINGS OR OTHER INCOME STATEMENT DATA AND THE PROJECTIONS WERE NOT PREPARED WITH A VIEW TO PUBLIC DISCLOSURE. IN ADDITION, THE PROJECTIONS WERE NOT 16 PREPARED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES, OR WITH A VIEW TO COMPLIANCE WITH THE PUBLISHED GUIDELINES OF THE COMMISSION OR THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS REGARDING PROJECTIONS, WHICH WOULD REQUIRE A MORE COMPLETE PRESENTATION OF THE DATA THAN AS SHOWN ABOVE. THE PROJECTIONS HAVE NOT BEEN EXAMINED, REVIEWED OR COMPILED BY THE COMPANY'S INDEPENDENT AUDITORS, AND ACCORDINGLY THEY HAVE NOT EXPRESSED AN OPINION OR ANY OTHER ASSURANCE ON SUCH PROJECTIONS. THE FORECASTED INFORMATION IS INCLUDED HEREIN SOLELY BECAUSE SUCH INFORMATION WAS FURNISHED TO PARENT AND PURCHASER PRIOR TO THE OFFER. ACCORDINGLY, NONE OF SUEZ, PARENT, PURCHASER OR THE COMPANY OR ANY OTHER PERSON IS MAKING ANY REPRESENTATION AS TO THE PROJECTIONS INCLUDED IN THIS OFFER TO PURCHASE, AND NONE OF SUEZ, PARENT, PURCHASER, THE COMPANY OR ANY OTHER PERSON ASSUMES ANY RESPONSIBILITY AS TO THE ACCURACY THEREOF. IN ADDITION, BECAUSE THE ESTIMATES AND ASSUMPTIONS UNDERLYING THE PROJECTIONS ARE INHERENTLY SUBJECT TO SIGNIFICANT ECONOMIC AND COMPETITIVE UNCERTAINTIES AND CONTINGENCIES, WHICH ARE DIFFICULT OR IMPOSSIBLE TO PREDICT ACCURATELY AND ARE BEYOND THE CONTROL OF THE COMPANY, SUEZ, PARENT AND PURCHASER, THERE CAN BE NO ASSURANCE THAT RESULTS SET FORTH IN THE ABOVE PROJECTIONS WILL BE REALIZED AND IT IS EXPECTED THAT THERE WILL BE DIFFERENCES BETWEEN ACTUAL AND PROJECTED RESULTS, AND ACTUAL RESULTS MAY BE MATERIALLY HIGHER OR LOWER THAN THOSE SET FORTH ABOVE. 7. FORWARD LOOKING STATEMENTS THE MATTERS DISCUSSED UNDER THE HEADINGS "--BACKGROUND OF THE OFFER AND THE MERGER; CONTACTS WITH THE COMPANY," "--RECOMMENDATION OF THE SPECIAL COMMITTEE AND THE BOARD OF DIRECTORS OF THE COMPANY; FAIRNESS OF THE OFFER AND THE MERGER," "--ANALYSIS OF FINANCIAL ADVISOR TO PARENT," "--OPINION OF THE SPECIAL COMMITTEE'S FINANCIAL ADVISOR," "--COMPANY FINANCIAL PROJECTIONS" AND "THE TENDER OFFER--CERTAIN INFORMATION CONCERNING THE COMPANY" CONTAIN FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES. STOCKHOLDERS ARE CAUTIONED THAT, IN ADDITION TO THE OTHER FACTORS SET FORTH UNDER THE HEADINGS "--BACKGROUND OF THE OFFER AND THE MERGER; CONTACTS WITH THE COMPANY," "--RECOMMENDATION OF THE SPECIAL COMMITTEE AND THE BOARD OF DIRECTORS OF THE COMPANY; FAIRNESS OF THE OFFER AND THE MERGER," "--POSITION OF SUEZ, PARENT AND PURCHASER REGARDING FAIRNESS OF THE OFFER AND THE MERGER," "--ANALYSIS OF FINANCIAL ADVISOR TO PARENT," AND "--OPINION OF THE SPECIAL COMMITTEE'S FINANCIAL ADVISOR," THE FOLLOWING FACTORS MAY CAUSE THE COMPANY'S ACTUAL FINANCIAL PERFORMANCE TO DIFFER MATERIALLY FROM THOSE EXPRESSED IN SUCH FORWARD-LOOKING STATEMENTS: - supply and demand for the Company's products; - competitive pricing pressures; - weather patterns; - changes in industry laws and regulations; - failure to sign up new development projects on the terms, conditions and timing projected by management; - competitive technology; and - failure to achieve the Company's cost reduction targets or complete construction on schedule. 17 8. PURPOSE AND STRUCTURE OF THE OFFER AND THE MERGER; PLANS FOR THE COMPANY PURPOSE AND STRUCTURE OF THE OFFER AND THE MERGER. The purpose of the Offer and the Merger is to enable Parent, through Purchaser, to acquire the entire equity interest in the Company. Parent desires to own the entire equity interest in the Company at this time to integrate certain of the Company's operations into Parent's existing energy business. This integration will allow Parent to achieve additional operating efficiencies and will provide the flexibility to respond quickly to an increasingly competitive industry. This will be accomplished by Parent, through Purchaser, making the Offer, which will enable Parent to acquire as many outstanding Shares not beneficially owned by Parent as possible as a first step in acquiring the entire equity interest in the Company. Through the Merger, Parent will acquire all Shares not purchased pursuant to the Offer. Upon consummation of the Merger, the Company will become an indirect wholly owned subsidiary of Parent. Under the DGCL, the approval of the Board of Directors and the affirmative vote of the holders of a majority of the outstanding Common Stock is required to approve and adopt the Merger Agreement and the transactions contemplated thereby, including the Merger. While the approval and adoption of the Merger Agreement and the transactions contemplated thereby requires the affirmative vote of a majority of the votes cast by all stockholders of the Company entitled to vote thereon, Parent already has voting power in excess of that amount. Furthermore, if Purchaser acquires at least 90% of the outstanding Shares pursuant to the Offer or otherwise, Purchaser would be able to effect the Merger pursuant to the "short-form" merger ("Short-Form Merger") provisions of Section 253 of the DGCL, without any action by any other stockholder of the Company or the Board of Directors. In such event, Purchaser intends to effect a Short-Form Merger as promptly as practicable following the purchase of Shares in the Offer. The Offer is structured so that no approval of the holders of the Shares held by the Public Stockholders is required. The Purchaser will, subject to the conditions of the Offer, accept for payment any and all Shares validly tendered in accordance with the terms of the Offer. PLANS FOR THE COMPANY AFTER THE OFFER AND THE MERGER. Pursuant to the Merger Agreement, upon completion of the Offer, Parent and Purchaser intend to effect the Merger in accordance with the Merger Agreement. See "SPECIAL FACTORS--The Transaction Documents; The Merger Agreement." After consummation of the Merger, Parent intends to explore ways in which the Company's new position as an indirect wholly owned subsidiary of Parent might allow the Company to lower its cost of capital and administrative costs and respond quickly to opportunities and changes in the energy market. Parent intends that U.S. citizens continue to play a very significant role in the management of the Company. Parent will continue to evaluate all aspects of the business, operations, capitalization and management of the Company during the pendency of the Offer and after the consummation of the Offer and the Merger and will take such further actions as it deems appropriate under the circumstances then existing. As a result of the Offer, the interest of Parent in the Company's net book value and net earnings will be increased in proportion to the number of Shares acquired in the Offer. If the Merger is consummated, Parent's interest in the net book value, net earnings and equity of the Company will equal 100% and Parent will be entitled to all benefits resulting from such interest, including all income generated by the Company's operations and any future increase in the Company's value. Similarly, Parent will also bear the risk of losses generated by the Company's operations and any future decrease in the value of the Company after the Merger. Subsequent to the Merger, the Public Stockholders will cease to have any equity interest in the Company, will not have the opportunity to participate in the earnings and growth of the Company after the Merger and will not have any right to vote on corporate matters. Similarly, the Public Stockholders will not face the risk of losses generated by the Company's operations or decline in the value of the Company after the Merger. 18 The Shares are currently traded on the New York Stock Exchange. However, as a result of the Merger, Parent will be the sole stockholder of the Company and there will be no public market for the Shares. Following the consummation of the Merger, Shares will no longer be quoted on the New York Stock Exchange and the registration of the Shares under the Exchange Act will be terminated. Accordingly, after the Merger there will be no publicly traded equity securities of the Company. Moreover, the Company will no longer be required to file periodic reports with the Commission under the Exchange Act, and will no longer be required to comply with the proxy rules of Regulation 14A under Section 14 under the Exchange Act. In addition, the Company's officers, directors and 10% stockholders will be relieved of the reporting requirements and restrictions on "short-swing" trading contained in Section 16 of the Exchange Act with respect to the Shares. See "THE TENDER OFFER--Effect of the Offer on the Market for the Common Stock; Exchange Act Registration." It is expected that, if Shares are not accepted for payment by Purchaser pursuant to the Offer and the Merger is not consummated, the Company's current management, under the general direction of the Board of Directors, will continue to manage the Company as an ongoing business. The Merger Agreement provides that the directors of Purchaser immediately prior to the Effective Time, and the officers of the Company immediately prior to the Effective Time, will be the directors and the officers, respectively, of the Surviving Corporation after the Merger, until their respective successors are elected or appointed and qualified in accordance with applicable law. The directors of Purchaser are Michel Bleitrach and Olivier Degos, each of whom is an employee of Parent. See Schedule I to this Offer to Purchase for more information concerning these persons. After consummation of the Merger, Parent plans to cause the Company to fulfill its existing contractual commitments and to exploit the business opportunities that are available to the Company in order to maximize the Company's opportunities for revenues and profit. Parent believes that a full integration of the Company into Parent will enable the combined entity to realize efficiencies and economies of scale. See "--Background of the Offer and the Merger; Contacts with the Company." Other than by virtue of the Merger and the other transactions contemplated by the Merger Agreement and except as otherwise described above or elsewhere in this Offer to Purchase, Suez, Parent and Purchaser have no current plans or proposals that relate to or would result in: (i) an extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving the Company or any of its subsidiaries; (ii) a sale or transfer of a material amount of assets of the Company or any of its subsidiaries; (iii) any material change in the Company's capitalization or dividend policy or indebtedness; (iv) any change in the management of the Company, the composition of the Board of Directors or any change in any material term of the employment contract of any executive officer; or (v) any other material change in the Company's corporate structure or business. 9. RIGHTS OF STOCKHOLDERS IN THE OFFER AND THE MERGER No dissenter's or appraisal rights are available to stockholders in connection with the Offer. If the Merger is consummated, however, record stockholders of the Company who have not validly tendered their Shares or voted in favor of the Merger (if a vote is required) will have certain rights under the DGCL to an appraisal of, and to receive payment in cash of the fair value of, their Shares (the "Appraisal Shares"). Stockholders who perfect appraisal rights by complying with the procedures set forth in Section 262 of the DGCL ("Section 262"), a copy of which is attached as Schedule II to this Offer to Purchase, will have the fair value of their Appraisal Shares (exclusive of any element of value arising from the accomplishment or expectation of the Merger) determined by the Delaware Court of Chancery and will be entitled to receive a cash payment equal to such fair value from the Surviving Corporation. Any such judicial determination of the fair value of Shares could be based upon any valuation method or combination of methods the court deems appropriate to use. The value so determined could be more or less than the Offer Price or Merger Consideration. In addition, such stockholders may be entitled to receive payment of a fair rate of interest from the Effective Time on the amount determined to be the fair 19 value of their Appraisal Shares. THE PRESERVATION AND EXERCISE OF APPRAISAL RIGHTS REQUIRE STRICT ADHERENCE TO THE APPLICABLE PROVISIONS OF THE DGCL. Under Section 262, if the Merger is submitted to a vote of the stockholders of the Company at a meeting thereof, the Company must, not less than 20 days prior to the meeting held for the purpose of obtaining stockholder approval of the Merger, notify each of the Company's stockholders entitled to appraisal rights that such rights are available. If the Merger is accomplished by a Short-Form Merger, the Company, either before the Effective Time or within ten days thereafter, must notify each of the stockholders entitled to appraisal rights of the Effective Time and that appraisal rights are available. In either case, the notice must include a copy of Section 262. If the Merger is not a Short-Form Merger, a holder of Appraisal Shares wishing to exercise appraisal rights will be required to deliver to the Company before the taking of the vote on the Merger or within 20 days after the date of mailing the notice described in the preceding paragraph, a written demand for appraisal of such holder's Appraisal Shares. A holder of Appraisal Shares wishing to exercise such holder's appraisal rights must be the record holder of such Appraisal Shares on the date the written demand for appraisal is made and must continue to hold of record such Appraisal Shares through the Effective Time. Accordingly, a holder of Appraisal Shares who is the record holder of Appraisal Shares on the date the written demand for appraisal is made, but who thereafter transfers such Appraisal Shares prior to the Effective Time, will lose any right to appraisal in respect of such Appraisal Shares. If the Merger is a Short-Form Merger, a holder of Appraisal Shares wishing to exercise appraisal rights will be required to deliver to the Company, within 20 days after the date of mailing the notice by the Company described above, a written demand for appraisal of such holder's Appraisal Shares. A demand for appraisal must be executed by or on behalf of the stockholder of record and must reasonably inform the Company of the identity of the stockholder of record and that such stockholder intends thereby to demand an appraisal of such Appraisal Shares. A person having a beneficial interest in Appraisal Shares that are held of record in the name of another person, such as a broker, fiduciary, depository or other nominee, will have to act to cause the record holder to execute the demand for appraisal and to follow the requisite steps properly and in a timely manner to perfect appraisal rights. If Appraisal Shares are owned of record by more than one person, as in joint tenancy or tenancy in common, the demand will have to be executed by or for all joint owners. An authorized agent, including an agent for two or more joint owners, may execute a demand for appraisal for a stockholder of record, provided that the agent identifies the record owner and expressly discloses, when the demand is made, that the agent is acting as agent for the record owner. If a stockholder owns Appraisal Shares through a broker who in turn holds the Appraisal Shares through a central securities depository nominee such as CEDE & Co., a demand for appraisal of such Appraisal Shares will have to be made by or on behalf of the depository nominee and must identify the depository nominee as Appraisal Shares' record holder. A record holder, such as a broker, fiduciary, depository or other nominee, who holds Appraisal Shares as a nominee for others, will be able to exercise appraisal rights with respect to the Appraisal Shares held for all or less than all of the beneficial owners of those Appraisal Shares as to which such person is the record owner. In such case, the written demand must set forth the number of Shares covered by the demand. Where the number of Shares is not expressly stated, the demand will be presumed to cover all Appraisal Shares standing in the name of such record owner. Within 120 days after the Effective Time, but not thereafter, the Company or any stockholder who has complied with the statutory requirements summarized above and who is otherwise entitled to appraisal rights may file a petition in the Delaware Court of Chancery demanding a determination of the fair value of such holders' Appraisal Shares. There is no present intention on the part of Purchaser to file an appraisal petition on behalf of the Company, and stockholders who seek to exercise appraisal rights should 20 not assume that the Company will file such a petition or that the Company will initiate any negotiations with respect to the fair value of Appraisal Shares. Accordingly, it will be the obligation of the stockholders seeking appraisal rights to initiate all necessary action to perfect any appraisal rights within the time prescribed in Section 262. Within 120 days after the Effective Time, any stockholder who has theretofore complied with the provisions of Section 262 will be entitled, upon written request, to receive from the Company a statement setting forth the aggregate number of Shares not voting in favor of the Merger (if applicable) and with respect to which demands for appraisal were received as well as the number of holders of such Shares. Such statement must be mailed within ten days after the written request therefor has been received by the Company. If a petition for appraisal is timely filed, after a hearing on such petition the Delaware Court of Chancery will determine the stockholders entitled to appraisal rights and will appraise the fair value of their Appraisal Shares, exclusive of any element of value arising from the accomplishment or expectation of the Merger, together with a fair rate of interest, if any, to be paid upon the amount determined to be the fair value from the Effective Time. The costs of the proceeding may be determined by the Delaware Court of Chancery and taxed upon the parties as the Delaware Court of Chancery deems equitable under the circumstances. However, costs do not include attorneys' fees or expert witness fees. Upon application of a stockholder, the Delaware Court of Chancery may also order all or a portion of the expenses incurred by any stockholder, including reasonable attorneys' fees and the fees and expenses of experts, to be charged pro rata against the value of all of the Appraisal Shares entitled to appraisal. At any time within 60 days after the Effective Time, any stockholder shall have the right to withdraw its demand for appraisal and to accept the Merger Consideration. After this period, the stockholder may withdraw such holder's demand for appraisal only with the consent of Purchaser. If any stockholder who properly demands appraisal of such holder's Appraisal Shares under Section 262 fails to perfect, or effectively withdraws or loses, such holder's right to appraisal as provided in the DGCL, the Appraisal Shares of such stockholder will be converted into the right to receive the Merger Consideration. A stockholder will fail to perfect, or effectively lose or withdraw, such stockholder's right to appraisal if, among other things, no petition for appraisal is filed within 120 days after the Effective Time or if the stockholder delivers to the Company a written withdrawal of such stockholder's demand for appraisal. Except as otherwise disclosed in the Offer to Purchase, none of Purchaser, Parent or Suez have made any provision in connection with the Offer or the Merger to obtain counsel or appraisal services for unaffiliated security holders at the expense of Purchaser, Parent or Suez. 10. THE TRANSACTION DOCUMENTS THE MERGER AGREEMENT The following is a summary of the material terms of the Merger Agreement. The summary is qualified in its entirety by reference to the Merger Agreement, which is incorporated herein by reference and a copy of which has been included an exhibit to the Schedule TO. The Merger Agreement may be inspected at, and copies may be obtained from, the same places and in the manner set forth in "THE TENDER OFFER--Certain Information Concerning the Company--Additional Information". THE OFFER. The Merger Agreement provides for the commencement of the Offer. The obligation of Purchaser, and of Parent to cause Purchaser, to commence the Offer and to accept for payment, and to pay for, any shares of Common Stock tendered pursuant to the Offer, is subject to the satisfaction of certain conditions that are set forth below the caption "THE TENDER OFFER--Conditions of the Offer" (such conditions, the "Offer Conditions"). Purchaser may waive any of the Offer Conditions or make any other changes in the terms and conditions of the Offer without the prior written consent of the Company or the Special Committee. Notwithstanding the foregoing, Purchaser and Parent have agreed that, without the 21 prior written consent of the Company, no changes may be made that (i) reduce the maximum number of Shares subject to the Offer, (ii) decrease the Offer Price, (iii) change the form of consideration payable in the Offer, or (iv) amend or modify the Offer Conditions in any manner adverse to the holders of Shares. Under the terms of the Merger Agreement, Purchaser may, without the consent of the Company, extend the Offer: (i) if at the then scheduled expiration date of the Offer any of the Offer Conditions shall not have been satisfied or waived, until such time as all such conditions shall have been satisfied or waived; (ii) for any period required by any statute or rule, regulation, interpretation or position of the Commission applicable to the Offer; (iii) for any period required by applicable law in connection with an increase in the consideration to be paid pursuant to the Offer; and (iv) from time to time, for an aggregate period of not more than ten business days (for all such extensions under this clause (iv)) beyond the latest expiration date that would be permitted under clause (i), (ii) or (iii) of this sentence. If at the scheduled Expiration Date of the Offer, all of the Offer Conditions have been satisfied, Purchaser shall, regardless of the number of Shares tendered, immediately accept and promptly pay for all Shares tendered. Following announcement of the results of the Offer (and notwithstanding the provision in the Merger Agreement permitting Purchaser to extend the Offer for up to ten business days), Purchaser shall begin the Subsequent Offering Period (as defined below) for a period of three days. If, following the expiration of the initial offering period and the purchase of all Shares tendered pursuant to the Offer during that period and the first three days of the Subsequent Offering Period, Parent and Purchaser own less than 90% of the outstanding Shares following consummation of the Offer, Purchaser will extend the Subsequent Offering Period until the earlier of (i) twenty business days from the Expiration Date and (ii) the time Parent and Purchaser become the owners of at least 90% of the outstanding Shares so that a Short-Form Merger can be effected. See "THE TENDER OFFER--Terms of the Offer." THE MERGER. The Merger Agreement provides that, subject to the terms and conditions set forth in the Merger Agreement and the applicable provisions of the DGCL, Purchaser will be merged with and into the Company and the separate existence of Purchaser will cease. The Company will be the Surviving Corporation of the Merger and will be an indirect wholly owned subsidiary of Parent. In the Merger, each share of common stock of Purchaser outstanding immediately prior to the Effective Time will be converted into and exchanged for one validly issued, fully paid and non-assessable share of Common Stock, $.01 par value per share, of the Surviving Corporation. At the Effective Time, each Share issued and outstanding immediately prior to the Effective Time (other than Shares owned by Parent or Purchaser or held by the Company, all of which shall be cancelled, and Shares held by stockholders who perfect appraisal rights under the DGCL) will, by virtue of the Merger and without any action on the part of the holder thereof, be converted into the right to receive the Merger Consideration. The Merger Agreement provides that (subject to the provisions of the Merger Agreement and the applicable provisions of the DGCL) the closing of the Merger shall occur promptly following the satisfaction or, to the extent permitted under the Merger Agreement, waiver of the conditions to the Merger set forth in the Merger Agreement. TREATMENT OF STOCK OPTIONS AND RESTRICTED STOCK. The Merger Agreement provides that all options to acquire Shares (individually, an "Option" and collectively, the "Options") outstanding immediately prior to the Effective Time under any stock option plan or under any agreement, whether or not then exercisable, shall be cancelled at the Effective Time. Promptly after the Effective Time, each holder of an Option will receive from the Surviving Corporation, for each Share subject to an Option, whether or not then exercisable, an amount in cash equal to the excess, if any, of the Merger Consideration over the per Share exercise price of such Option without interest, in full settlement of the Company's (and the Surviving Corporation's) obligations under each Option. To the extent that the per Share exercise price of any Option equals or exceeds the Merger Consideration, at the Effective Time, such Option will be cancelled and the holder of such Option will not receive or be entitled to receive any consideration from Parent, Purchaser or the Surviving Corporation. All amounts payable in respect of Options shall be subject to all applicable withholding of taxes. Immediately prior to the filing of the certificate of merger (the "Certificate of Merger") relating to the Merger with the Secretary of State of the State of Delaware, all shares of Restricted Stock (as defined in the Trigen Energy Corporation 1994 Stock Incentive Plan) granted under 22 the Trigen Energy Corporation 1994 Stock Incentive Plan will be canceled and each holder of shares of Restricted Stock will promptly after the Effective Time receive from the Surviving Corporation, for each share of Restricted Stock, an amount of cash equal to one-fourth of the Merger Consideration. Under the terms of the Separation Agreement, if the Merger is consummated, on January 19, 2002, Mr. Casten will also receive, in respect of each Share of Restricted Stock owned by him, an amount of cash equal to three-fourths of the Merger Consideration. See "--Arrangements with Thomas P. Casten." In connection with the foregoing, the Surviving Corporation intends, in accordance with the Trigen Energy Corporation 1994 Stock Incentive Plan, to implement an incentive plan following the Effective Time. BOARD REPRESENTATION. The Merger Agreement provides that, promptly upon the purchase of Shares pursuant to the Offer, Parent shall be entitled to designate such number of directors as will give Parent representation on the Board of Directors equal to the product of (i) the number of directors on the Board of Directors and (ii) the percentage that the number of Shares owned by Purchaser or Parent bears to the number of Shares outstanding (the "Percentage"). The Company has agreed, upon request by Parent, promptly to increase the size of the Board of Directors and/or exercise its best efforts to secure the resignations of such number of directors as is necessary to enable Parent's designees to be elected to the Board of Directors and to cause Parent's designees to be so elected. However, Parent has agreed that until the Effective Time the Board of Directors will have at least one member who is not designated by Parent or Purchaser. At the request of Parent, the Company will use its best efforts to cause such individuals designated by Parent to constitute the same Percentage of (i) each committee of the Board of Directors, (ii) the board of directors of each subsidiary of the Company, and (iii) each committee of each such subsidiary's board of directors. The Company's obligations to appoint designees to the Board of Directors are subject to Section 14(f) of the Exchange Act. Following the election or appointment of the designees of Parent to the Board of Directors but prior to the Effective Time, any permitted termination of the Merger Agreement by the Company, any amendment of the Merger Agreement requiring action by the Board of Directors, any extension of time for the performance of any of the obligations or other acts of Parent or Purchaser, and any waiver of compliance with any of the agreements or conditions contained in the Merger Agreement for the benefit of the Company must be authorized by a majority of the Board of Directors not designated by Parent. STOCKHOLDER MEETING. The Merger Agreement provides that, if required by applicable law, the Company, acting through the Board of Directors, shall (i) call a meeting of its stockholders (the "Stockholder Meeting") for the purpose of voting on the Merger, (ii) hold the Stockholder Meeting as soon as practicable after the purchase of Shares pursuant to the Offer and (iii) unless taking such action would be inconsistent with the fiduciary duties of the Board of Directors or the directors constituting the Special Committee, as determined by such directors in good faith after consultation with independent legal counsel, recommend to its stockholders the approval of the Merger and the transactions contemplated thereby. If a Stockholder Meeting is called, the Company will use its reasonable best efforts to solicit from the stockholders of the Company proxies in favor of the approval and adoption of the Merger Agreement and the transactions contemplated thereby, unless otherwise required by applicable fiduciary duties, as determined by such directors in good faith after consultation with independent legal counsel. At the Stockholder Meeting, Parent will cause all the Shares then owned by Parent, Purchaser or any other subsidiary or affiliate of Parent to be voted in favor of the Merger. The Merger Agreement provides that, notwithstanding the foregoing, if Purchaser, or any other direct or indirect subsidiary of Parent, acquires at least 90 percent of the outstanding Shares, the parties to the Merger Agreement shall take all necessary and appropriate action to cause the Merger to become effective as soon as practicable after the expiration of the Offer, without a vote of stockholders of the Company, in accordance with the "Short-Form Merger" provisions of the DGCL. The Merger Agreement is required to be submitted to the stockholders of the Company whether or not the Board of Directors determines at any time subsequent to declaring its advisability that the Merger Agreement is no longer advisable and recommends that the stockholders reject it. 23 REPRESENTATIONS AND WARRANTIES. The Merger Agreement contains various representations and warranties of the parties thereto. These include representations and warranties by the Company with respect to (i) the due organization, existence and, subject to certain limitations, the qualification, good standing, corporate power and authority of the Company and its subsidiaries; (ii) the due authorization, execution, and delivery of the Merger Agreement and certain ancillary documents executed in connection therewith and the consummation of the transactions contemplated thereby, and the validity and enforceability thereof; (iii) subject to certain exceptions and limitations, the compliance by the Company and its subsidiaries with all applicable foreign, federal, state or local laws, statutes, ordinances, rules, regulations, orders, judgments, rulings and decrees of any foreign, federal, state or local judicial, legislative, executive, administrative or regulatory body or authority, or any court, arbitration, board or tribunal; (iv) the capitalization of the Company, including the number of shares of capital stock of the Company outstanding and the number of Options outstanding; (v) subject to certain exceptions and limitations, the absence of consents and approvals necessary for consummation by the Company of the Merger and the absence of any violations, breaches or defaults which would result from compliance by the Company with any provision of the Merger Agreement; (vi) compliance with the Securities Act of 1933, as amended (the "Securities Act") and the Exchange Act, in connection with each registration statement, report, proxy statement or information statement (as defined under the Exchange Act) prepared by the Company since December 31, 1996, the Schedule 14D-9, the information statement, if any, filed by the Company in connection with the Offer pursuant to Rule 14f-1 under the Exchange Act and any schedule required to be filed by the Company with the Commission or any amendment or supplement thereto; (vii) subject to certain exceptions and limitations, the absence of pending or (to the knowledge of the Company) threatened claims, actions, suits, proceedings, arbitrations, investigations or audits; (viii) the absence of certain changes or effects; (ix) certain tax matters; (x) certain employee benefit and ERISA matters; (xi) certain labor and employment matters; (xii) certain fees in connection with the transactions contemplated by the Merger Agreement; (xiii) subject to certain limitations, the possession by the Company and its subsidiaries of necessary franchises, grants, authorizations, licenses, permits, easements, variances, exceptions, consents, certificates, approvals and orders; (xiv) certain environmental matters; (xv) certain insurance policy matters; (xvi) the opinion of CSFB; (xvii) state takeover statutes; (xviii) the required vote of stockholders of the Company with respect to the transactions contemplated by the Merger Agreement; (xix) regulation as a utility and (xx) year 2000 compliance. Parent and Purchaser have also made certain representations and warranties, including with respect to (i) the due incorporation, existence, good standing and, subject to certain limitations, corporate power and authority of Parent and Purchaser; (ii) the due authorization, execution and delivery of the Merger Agreement and certain ancillary documents executed in connection therewith and the consummation of the transactions contemplated thereby, and the validity and enforceability thereof; (iii) subject to certain exceptions and limitations, the absence of consents and approvals necessary for consummation of the transactions contemplated by the Merger Agreement by Parent and Purchaser and the absence of any violations, breaches or defaults which would result from compliance by Parent and Purchaser with any provision of the Merger Agreement; (iv) the interim operations by Purchaser; (v) the sufficiency of funds available to Parent and Purchaser for the consummation of the Offer and the Merger and (vi) absence of any material misstatements or omissions in this Offer to Purchase, the Schedule TO and the exhibits thereto. CONDUCT UNTIL THE MERGER. The Company has agreed that from the date of the Merger Agreement to the Effective Time, unless disclosed to Parent at the time of the execution of the Merger Agreement or Parent has consented in writing thereto, the Company will, and will cause each of its subsidiaries to: (i) conduct its operations according to its ordinary course of business consistent with past practice; (ii) use its reasonable best efforts to preserve intact its business organizations and goodwill, keep available the services of its officers and employees and maintain satisfactory relationships with those persons having business relationships with them; (iii) promptly upon the discovery thereof, notify Parent of the existence of any breach of any representation or warranty contained in the Merger Agreement (or, in the case of any 24 representation or warranty that makes no reference to Material Adverse Effect, any breach of such representation or warranty in any material respect). The Merger Agreement defines a Material Adverse Effect as a material adverse effect on the business, operations, or financial condition of the Company and its subsidiaries taken as a whole or the ability of the Company and its subsidiaries to conduct their business after the Closing consistent in all material respects with the manner conducted in the past; provided, however, that "Material Adverse Effect" does not include any change, effect, condition, event or circumstance arising out of or attributable to (i) any decrease in the market price of the Shares (but not any change, effect, condition, event or circumstance underlying such decrease to the extent that it would otherwise constitute a Material Adverse Effect), (ii) changes, effects, conditions, events or circumstances that generally affect the industries in which the Company or its subsidiaries operate (including legal and regulatory changes), (iii) general economic conditions or changes, effects, conditions or circumstances affecting the securities markets generally or (iv) changes arising from the consummation of the transactions contemplated by the Merger Agreement or the announcement of the execution of the Merger Agreement. The Company has also agreed that from the date of the Merger Agreement to the Effective Time, unless disclosed to Parent at the time of the execution of the Merger Agreement or Parent has consented in writing thereto, the Company will not, and will not permit any of its subsidiaries to, (i) amend its certificate of incorporation or by-laws; (ii) issue, sell or pledge (A) any shares of its capital stock or other ownership interest in the Company (other than issuances of Common Stock in respect of any exercise of Options outstanding on the date of the Merger Agreement and as disclosed to Parent at the time of the execution of the Merger Agreement) or its subsidiaries, (B) any securities convertible into or exchangeable for any such shares or other ownership interest, or (C) any rights, warrants or options to acquire or with respect to any such shares of capital stock, ownership interest, or convertible or exchangeable securities (or derivative instruments in respect of the foregoing); (iii) effect any stock split or otherwise change its capitalization as it existed on the date of the Merger Agreement, or directly or indirectly redeem, purchase or otherwise acquire any shares of its capital stock or capital stock of its subsidiaries; (iv) (A) grant, confer or award any option, warrant, convertible security or other right to acquire any shares of its capital stock or take any action to cause to be exercisable any otherwise unexercisable option under any existing stock option plan (except as otherwise required by the terms of such unexercisable options), (B) accelerate or waive any or all of the goals, restrictions or conditions imposed under any award under the Trigen Energy Corporation 1994 Performance Stock Incentive Plan, or (C) issue, sell, grant or award any shares of capital stock or any right to acquire shares of capital stock under any Company stock plan (except as otherwise required by such plan); (v) declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than such payments by the subsidiaries to the Company); (vi) mortgage or otherwise encumber, subject to any encumbrance, or sell, lease or otherwise dispose of any of its property or assets (including capital stock of its subsidiaries), other than encumbrances that are incurred in the ordinary course of business, consistent with past practice, the sale or disposition of inventory in the ordinary course of business or the sale, lease, encumbrance or other disposition of assets which, individually or in the aggregate, are obsolete or not material to the Company and its subsidiaries taken as a whole; (vii) (A) acquire by merger, purchase or any other manner, any business or entity or any division thereof for consideration in excess of $1,000,000 in the aggregate; or (B) otherwise acquire any assets which would be material, individually or in the aggregate, to the Company and its subsidiaries taken as a 25 whole, except for purchases of inventory, supplies or capital equipment in the ordinary course of business consistent with past practice and the acquisition of assets for consideration in excess of $1,000,000 in the aggregate; (viii) except for borrowings under existing credit facilities and excepting transactions between the Company and any subsidiary, incur or assume any long-term or short-term debt or issue any debt securities or assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the debt or other obligations of any other person, other than obligations (other than debt) of its subsidiaries incurred in the ordinary course of business; (ix) (A) make any loans, advances or capital continuations to, or investments in, any other person (other than to subsidiaries of the Company), except with respect to commitments outstanding on the date of the Merger Agreement, or (B) forgive any loans, advances or capital contributions to, or investments in, any other person (other than with respect to subsidiaries of the Company) for an amount in excess of $1,000,000 in the aggregate (as to clauses (A) and (B) collectively); (x) except as contemplated by the Merger Agreement or in the ordinary course of business consistent with past practice (A) increase the compensation payable or to become payable to its officers or employees, (B) other than in accordance with existing policies and arrangements, grant any severance pay to the Company's officers, directors or employees or (C) establish, adopt, enter into or amend any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any director, officer or employee, except to the extent required by applicable law or the terms of a collective bargaining agreement or a contractual obligation existing on the date of the Merger Agreement; (xi) change any of the accounting principles or practices used by the Company, except as may be required by generally accepted accounting principles; (xii) pay, discharge or satisfy any material claims, material liabilities or material obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of (A) any such material claims, material liabilities or material obligations in the ordinary course of business and consistent with past practice or (B) material claims, material liabilities or material obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) contained in the Company's filings with the Commission; (xiii) agree to the settlement of any claim or litigation, which settlement would have a Material Adverse Effect; (xiv) make, change or rescind any material tax election (other than recurring elections that customarily are made in connection with the filing of any tax return; provided that any such elections are consistent with the past practices of the Company or its Subsidiaries, as the case may be); or settle or compromise any material tax liability that is the subject of any audit, claim for delinquent taxes, examination, action, suit, proceeding or investigation by any taxing authority; (xv) except to the extent required under existing employee and director benefit plans, agreements or arrangements as in effect on the date of the Merger Agreement or as contemplated by the Merger Agreement, accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits; (xvi) enter into any agreement, understanding or commitment that restrains, limits or impedes the ability of the Company or any of its subsidiaries to compete with or conduct any business or line of business, including geographic limitations on the activities of the Company or any of its subsidiaries; (xvii) materially modify, amend or terminate any material contract, or waive, relinquish, release or terminate any right or claim, in each case, except in the ordinary course of business consistent with past practice; (xviii) other than with respect to commitments outstanding as of the date of the Merger Agreement, make any capital expenditures for the Company and its subsidiaries in excess $1,000,000, in the aggregate; 26 (xix) take any action to cause the Common Stock to be delisted from the New York Stock Exchange prior to the consummation of the Offer; or (xx) agree in writing or otherwise to take any of the foregoing actions. ACCESS TO INFORMATION. Under the Merger Agreement, from the date of the Merger Agreement to the closing date of the Merger, the Company has agreed, and has agreed to cause its subsidiaries to, (i) give Parent and its authorized representatives reasonable access, upon reasonable notice and during reasonable hours to all books, records, personnel, offices and other facilities and properties of the Company and its subsidiaries and their accountants and accountants' work papers, (ii) permit Parent to make such copies and inspections thereof as Parent may reasonably request and (iii) furnish Parent with such financial and operating data and other information with respect to the business and properties of the Company and its subsidiaries as Parent may from time to time reasonably request; provided that no investigation or information furnished pursuant to the Merger Agreement shall affect any representations or warranties made by the Company therein or the conditions to the obligations of Parent to consummate the transactions contemplated thereby. Parent has agreed to hold all information furnished on a confidential basis by or on behalf of the Company or any of its subsidiaries in confidence. NO SOLICITATION. The Company has agreed in the Merger Agreement (a) that from the date of the Merger Agreement to the Effective Time, neither it nor any of its subsidiaries will, and it will direct and use its best efforts to cause its officers, directors, employees, agents and representatives (including, without limitation, any investment banker, attorney or accountant retained by it or any of its subsidiaries) not to, initiate, solicit or encourage, directly or indirectly, any inquiries or the making or implementation of any proposal or offer (including, without limitation, any proposal or offer to its stockholders) with respect to a merger, acquisition, consolidation or similar transaction involving, or any purchase of all or any significant portion of the assets or any equity securities of, the Company or any of its subsidiaries (any such proposal or offer being hereinafter referred to as an "Alternative Proposal") or engage in any negotiations concerning, or provide any confidential information or data to, afford access to the properties, books or records of the Company or any of its subsidiaries to, or have any discussions with, any person relating to an Alternative Proposal, or otherwise facilitate any effort or attempt to make or implement an Alternative Proposal; (b) that it will immediately cease and cause to be terminated any existing activities, discussions or negotiations with any parties conducted heretofore with respect to any of the foregoing, and it will take the necessary steps to inform such parties of the obligations undertaken under the no solicitation provision of the Merger Agreement; and (c) that it will notify Parent immediately of the identity of the potential acquiror and the terms of such person's or entity's proposal if any such inquiries or proposals are received by, any such information is requested from, or any such negotiations or discussions are sought to be initiated or continued with, the Company; provided, however, that the no solicitation provision shall not prohibit the Company or its subsidiaries, upon approval by the Special Committee, from (i) prior to the acceptance for payment of Shares pursuant to the Offer, furnishing information to, or entering into discussions or negotiations with, any person or entity that makes an unsolicited bona fide proposal to acquire the Company pursuant to a merger, consolidation, share exchange, purchase of substantially all of the assets of the Company, a business combination or other similar transaction, if, and only to the extent that, (A) such proposal was not initially solicited, encouraged or knowingly facilitated by the Company, its subsidiaries or their agents in violation of the no solicitation provision of the Merger Agreement, (B) such proposal is not subject to a financing condition and involves consideration that provides a higher value per share than the Merger Consideration, (C) the Board of Directors, or the Special Committee, determines in good faith based on the advice of outside counsel that the failure to take such action would be inconsistent with its fiduciary duties to stockholders imposed by law, and (D) prior to furnishing information to, or entering into discussions or negotiations with, such person or entity, the Company provides written notice to Parent to the effect that it is furnishing information to, or entering into discussions or negotiations with, such person or entity; and (ii) to the extent applicable, complying with Rule 14e-2(a) promulgated under the Exchange Act with regard to an Alternative Proposal. Nothing in the no solicitation provision of the 27 Merger Agreement (x) permits the Company to terminate the Merger Agreement (except as specifically provided in the termination provisions of the Merger Agreement), (y) permits the Company to enter into any agreement with respect to an Alternative Proposal during the term of the Merger Agreement, or (z) affects any other obligation of the Company under the Merger Agreement. FEES AND EXPENSES. Except as set forth below or as otherwise provided in the Merger Agreement, whether or not the Offer or the Merger is consummated, all fees, costs and expenses incurred in connection with the Merger Agreement and the transactions contemplated by the Merger Agreement will be paid by the party incurring such fees, costs and expenses. In the Merger Agreement, the Company has agreed that, under certain circumstances, it will reimburse Parent and its affiliates for their out-of-pocket expenses incurred in connection with the Offer, the Merger and the other transactions contemplated by the Merger Agreement. The Company is obligated to pay Parent's out-of-pocket expenses under the following circumstances: (i) Parent terminates the Merger Agreement because of the failure of the condition to the Offer that the representations and warranties made by the Company in the Merger Agreement that are qualified by materiality or Material Adverse Effect are true and correct in all respects when made or thereafter have ceased to be true and correct in all respects as if made at the scheduled or extended expiration of the Offer (except to the extent that any such representation or warranty refers specifically to another date, in which case such representation or warranty shall be true and correct in all respects as of such other date), the other representations and warranties made by the Company in the Merger Agreement are true and correct in all material respects when made or thereafter have ceased to be true and correct in all respects as if made at the scheduled or extended expiration of the Offer (except to the extent that any such representation or warranty refers specifically to another date, in which case such representation or warranty shall be true and correct in all material respects as of such other date) or because the Company has breached and failed to have complied in all material respects with any of its obligations under the Merger Agreement; (ii) the Special Committee terminates the Merger Agreement in accordance with its terms because of an Alternative Proposal which the Special Committee in good faith determines is more favorable from a financial point of view to the stockholders of the Company as compared to the Offer and the Merger and the Special Committee determines in good faith based on advice of outside counsel that the failure to take such action would be inconsistent with its fiduciary duties to stockholders imposed by law; or (iii) if prior to purchasing any Shares pursuant to the Offer, Parent terminates the Merger Agreement because the Special Committee shall have withdrawn or modified in a manner that is materially adverse to Parent or Purchaser its approval or recommendation of the Merger Agreement, the Offer, the Merger or any other transaction contemplated by the Merger Agreement or shall have recommended another merger, consolidation or business combination involving, or acquisition of, the Company or its assets or another tender offer for the Shares or the Special Committee shall have resolved to do any of the foregoing. Under the terms of the Merger Agreement, Parent has agreed that, under certain circumstances, it will reimburse the Company for its out-of-pocket expenses incurred in connection with the Offer, the Merger and the other transactions contemplated by the Merger Agreement. Parent will be obligated to pay the Company's out-of-pocket expenses if the Special Committee terminates the Merger Agreement because Parent or Purchaser has breached in any material respect any of their respective representations, warranties or covenants contained in the Merger Agreement. FILINGS; OTHER ACTIONS. The Merger Agreement provides that, subject to the terms and conditions provided in the Merger Agreement, the Company, Parent and Purchaser have agreed to: (a) use their reasonable best efforts to cooperate with one another in (i) determining which filings are required to be made prior to the expiration of the Offer or the Effective Time with, and which consents, approvals, permits or authorizations are required to be obtained prior to the Effective Time from, governmental entities or other third parties in connection with the execution and delivery of the Merger Agreement and other ancillary documents and the consummation of the transactions contemplated thereby and (ii) timely make all such filings and timely seek all such consents, approvals, permits, authorizations and waivers; and 28 (b) use their reasonable best efforts to take, or cause to be taken, all other action and do, or cause to be done, all other things necessary, proper or appropriate to consummate and make effective the transactions contemplated by the Merger Agreement. If, at any time after the Effective Time, any further action is necessary or desirable to carry out the purpose of the Merger Agreement, the proper officers and directors of Parent and the Surviving Corporation are required to take all such necessary action. CONDITIONS TO THE MERGER. The obligations of Parent and the Company to effect the Merger are subject to the satisfaction or waiver, where permissible, prior to the Effective Time, of the following conditions: (i) if approval of the Merger Agreement and the Merger by the holders of Shares is required by applicable law, the Merger Agreement and the Merger shall have been approved by the requisite vote of such holders; (ii) any review or approval required by governmental authorities in countries in which the Company or its subsidiaries have operations material to the Company and its subsidiaries, taken as a whole, shall have been completed or obtained; and (iii) no United States federal or state or Republic of France governmental authority or other agency or commission or court of competent jurisdiction shall have enacted, issued, promulgated, enforced or entered any law, rule, regulation, executive order decree, injunction or other order which is in effect and prohibits or has the effect of prohibiting the consummation of the Merger or makes the consummation of the Merger illegal. TERMINATION. The Merger Agreement, notwithstanding approval thereof by the stockholders of the Company, may be terminated at any time prior to the Effective Time: (a) by mutual written consent of the board of directors of Parent and the Special Committee; (b) by Parent or the Special Committee, (i) if either the purchase of Shares pursuant to the Offer has not been consummated on or before March 15, 2000 or the Effective Time shall not have occurred on or before June 30, 2000 (provided that the right to terminate the Merger Agreement pursuant to this clause (i) shall not be available to any party whose failure to fulfill any obligation under the Merger Agreement has been the cause of or resulted in the failure of the Effective Time to occur on or before such date); (ii) if there shall be any law that makes consummation of the Offer or the Merger illegal or prohibited, or if any court of competent jurisdiction in the United States or the Republic of France shall have issued an order, judgment, decree or ruling, or taken any other action restraining, enjoining or otherwise prohibiting the Merger and such order, judgment, decree, ruling or other action shall have become final and non-appealable; (c) by the Special Committee, (i) if there is an Alternative Proposal which the Special Committee in good faith determines is more favorable from a financial point of view to the stockholders of the Company as compared to the Offer and the Merger, and the Special Committee determines in good faith, based upon advice of outside counsel, that the failure to take such action would be inconsistent with its fiduciary duties to stockholders imposed by law; provided, however, that this right to terminate shall not be available in certain circumstances; or (ii) if Parent or Purchaser shall have breached in any material respect any of their respective representations, warranties or covenants contained in the Merger Agreement; or (d) by Parent, (i) prior to the acceptance of any Shares under the Offer, if due to an occurrence or circumstance that would result in the failure of any of the Offer Conditions, Parent shall have terminated the Offer without having accepted any Shares for payment thereunder, unless such failure to accept Shares for payment or to pay for Shares shall have been caused by or resulted from the failure of Parent or Purchaser to perform any obligation of either of them contained in the Merger Agreement; 29 (ii) prior to the purchase of any Shares validly tendered pursuant to the Offer, if the Special Committee shall have withdrawn or modified in a manner that is materially adverse to Parent or Purchaser its approval or recommendation of the Merger Agreement, the Offer, the Merger or any other transaction contemplated by the Merger Agreement or if the Special Committee shall have recommended another merger, consolidation or business combination involving, or acquisition of, the Company or its assets or another tender offer for the Shares, or the Special Committee shall have resolved to do any of the foregoing. INDEMNIFICATION. The Merger Agreement provides that the Surviving Corporation will maintain in effect for not less than six years after the Effective Time the Company's current directors and officers insurance policies, if such insurance is obtainable (or policies of at least the same coverage containing terms and conditions no less advantageous to the current and all former directors and officers of the Company), with respect to acts or failures to act prior to the Effective Time, including acts relating to the transactions contemplated by the Merger Agreement; provided, however, that in order to maintain or procure such coverage, the Surviving Corporation shall not be required to maintain or obtain policies providing such coverage except to the extent such coverage can be provided at an annual cost of no greater than two times the most recent annual premium paid by the Company prior to the date of the Merger Agreement (the "Cap"); and provided, further, that if equivalent coverage cannot be obtained, or can be obtained only by paying an annual premium in excess of the Cap, the Purchaser or the Surviving Corporation will only be required to obtain only as much coverage as can be obtained by paying an annual premium equal to the Cap. The Merger Agreement also provides that to the extent, if any, not provided by an existing right of indemnification or the agreement or policy, from and after the Effective Time, the Surviving Corporation is required to indemnify and hold harmless each person who is, or has been at any time prior to the date of the Merger Agreement or who becomes prior to the Effective Time, an officer or director of the Company or any of its subsidiaries (each, an "Indemnified Party"), against all losses, expenses, claims, damages or liabilities or, subject to the last sentence of this paragraph, amounts paid in settlement, arising in connection with any claim, action, suit, proceeding or investigation (an "Action") arising out of or pertaining to acts or omissions by such person in his or her capacity as such, which acts or omissions occurred prior to the Effective Time, whether asserted or claimed prior to, at or after the Effective Time to the fullest extent permitted by law. In the event of any such Action, the Company as the Surviving Corporation will control the defense of such Action with counsel selected by the Company as the Surviving Corporation, which counsel shall be reasonably acceptable to the Indemnified Party; provided, however, that the Indemnified Party shall be permitted to participate in the defense of such Action through counsel selected by the Indemnified Party, which counsel shall be reasonably acceptable to the Company as the Surviving Corporation, at the Indemnified Party's expense. Notwithstanding the foregoing, if there is any conflict between the Company as the Surviving Corporation and any Indemnified Parties or there are additional defenses available to any Indemnified Parties, the Indemnified Parties shall be permitted to participate in the defense of such Action with counsel selected by the Indemnified Parties, which counsel shall be reasonably acceptable to the Company as the Surviving Corporation, and the Company as the Surviving Corporation will be required to pay the reasonable fees and expenses of such counsel, as accrued and in advance of the final disposition of such Action to the fullest extent permitted by applicable law; provided, however, that the Company as the Surviving Corporation will not be obligated to pay the reasonable fees and expenses of more than one counsel for all Indemnified Parties in any single Action except to the extent that, in the opinion of counsel for the Indemnified Parties, two or more of such Indemnified Parties have conflicting interests in the outcome of such Action. The members of the Special Committee are entitled to select their own counsel pursuant to the preceding sentence with respect to any litigation relating to the transactions contemplated by the Merger Agreement; provided, however, that such counsel must be reasonably acceptable to Parent. The Surviving Corporation shall not be liable for any settlement effected without its written consent, which consent shall not unreasonably be withheld. 30 Purchaser has also agreed to cause the Company as the Surviving Corporation to keep in effect all provisions in the Surviving Corporation's certificate of incorporation and by-laws that provide for exculpation of director and officer liability and indemnification (and advancement of expenses related thereto) of the past and present officers and directors of the Company at least to the extent they are presently indemnified by the Company and such provisions may not be amended except as either required by applicable law or to make changes permitted by law that would enhance the rights of past or present officers and directors to indemnification or advancement of expenses. These provisions provide that a director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director; provided, however, that the foregoing does not eliminate or limit the liability of a director (i) for any breach of the director's duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL, or (iv) for any transaction from which the director derived an improper personal benefit. AMENDMENT. To the extent permitted by applicable law, the Merger Agreement may be amended by action taken by or on behalf of the boards of directors of the Company and Parent and, in the case of the Company, with the approval of the Special Committee at any time before or after adoption of the Merger Agreement by the stockholders of the Company (if required); provided, however, that after any such stockholder approval, no amendment shall be made which decreases the Merger Consideration or which adversely affects the rights of, or the income tax consequences to, the Public Stockholders thereunder without the approval of such stockholders. The Merger Agreement may not be amended except by an instrument in writing signed on behalf of Parent, Purchaser and the Company. TIMING. The exact timing and details of the Merger will depend upon legal requirements and a variety of other factors, including the number of Shares acquired by Purchaser pursuant to the Offer. Although Purchaser has agreed to cause the Merger to be consummated on the terms, and subject to the conditions, contained in the Merger Agreement, there can be no assurance as to the timing of the Merger. THE TENDER AND VOTING AGREEMENT The following is a summary of the material provisions of the Tender and Voting Agreement, a copy of which has been included as an exhibit to the Schedule TO. The Tender and Voting Agreement may be inspected at, and copies may be obtained from, the same places and in the same manner set forth in "THE TENDER OFFER--Certain Information Concerning the Company--Available Information." The summary is qualified in its entirety by reference to the text of such agreement. Concurrently with the execution and delivery of the Merger Agreement, each of the members of the Special Committee (Messrs. Keane and Bayless) as well as the Bayless Family Trust, of which Mr. Bayless is the trustee, have entered into the Tender and Voting Agreement with Purchaser and Parent. Pursuant to the Tender and Voting Agreement, Messrs. Keane and Bayless have agreed, among other things, to tender promptly pursuant to the Offer the Shares held by them, and not to withdraw any such Shares, and to various other provisions described below. TRANSFER OF THE SHARES. Each of Messrs. Keane and Bayless agreed that during the term of the Tender and Voting Agreement, except as otherwise expressly provided therein, he will not (a) tender into any tender or exchange offer or otherwise sell, transfer, pledge, assign, hypothecate or otherwise dispose of, or encumber with any lien, any of the Shares, (b) acquire any Shares or other securities of the Company (other than in connection with a transaction in connection with certain anti-dilution adjustments provided for in the Tender and Voting Agreement or by exercising any options held by him), (c) deposit the Shares into a voting trust, enter into a voting agreement or arrangement with respect to the Shares or grant any proxy or power of attorney with respect to the Shares, (d) enter into any contract, option or other arrangement (including any profit sharing arrangement) or undertaking with respect to the direct or indirect acquisition or sale, transfer, pledge, assignment, hypothecation or other disposition of any interest 31 in or the voting of any Shares or any other securities of the Company, (e) exercise any rights (including, without limitation, under Section 262 of the DGCL) to demand appraisal of any Shares which may arise with respect to the Merger, or (f) take any other action that would in any way restrict, limit or interfere with the performance of his obligations under the Tender and Voting Agreement or the transactions contemplated by the Tender and Voting Agreement or which would otherwise diminish the benefits of the Tender and Voting Agreement to Parent or Purchaser. TENDER OF SHARES. Each of Messrs. Keane and Bayless agreed that he will validly tender (or cause the record owner of such Shares to validly tender) and sell (and not withdraw) pursuant to and in accordance with the terms of the Offer not later than the fifth business day after commencement of the Offer (or the earlier of the expiration date of the Offer and the fifth business day after such Shares are acquired by him if he acquires Shares after the date of the Merger Agreement), or, if he has not received this Offer to Purchase and related documents by such time, within two business days following receipt of such documents, all of the then outstanding Shares beneficially owned by him (including the Shares outstanding as of the date of the Merger Agreement and Shares issued following the exercise (if any) of his Options). VOTING AGREEMENT. The Tender and Voting Agreement also provides that each of Messrs. Keane and Bayless (a) agrees to appear (or not appear, if requested by Parent or Purchaser) at any annual, special, postponed or adjourned meeting of the stockholders of the Company or otherwise cause the Shares he beneficially owns to be counted as present (or absent, if requested by Parent or Purchaser) thereat for purposes of establishing a quorum and to vote or consent, and (b) constitutes and appoints Parent and Purchaser, or any nominee thereof, with full power of substitution, during and for the term of the Tender and Voting Agreement as his true and lawful attorney and proxy for and in his name, place and stead, to vote all the Shares he beneficially owns at the time of such vote, at any annual, special, postponed or adjourned meeting of the stockholders of the Company (and this appointment will include the right to sign his name (as stockholder) to any consent, certificate or other document relating to the Company that the laws of the State of Delaware may require or permit), in the case of both (a) and (b) above, in favor of approval and adoption of the Merger Agreement and approval and adoption of the Merger and the other transactions contemplated thereby. REPRESENTATIONS AND WARRANTIES. Messrs. Keane and Bayless made customary representations and warranties to Parent and Purchaser, including with respect to their beneficial ownership of Shares, their authority to enter into and perform their obligations under the Tender and Voting Agreement, the due execution and delivery by them of the Tender and Voting Agreement, the absence of any financial advisor or other intermediary and the acknowledgement of Parent's reliance on the Tender and Voting Agreement in executing the Merger Agreement. Each of Parent and Purchaser has also made customary representations and warranties under the Tender and Voting Agreement, including with respect to Parent's and Purchaser's authority to enter into and perform its obligations under the Tender and Voting Agreement and the due execution and delivery by Parent and Purchaser of the Tender and Voting Agreement. TERMINATION. The Tender and Voting Agreement will terminate upon the earliest of: (a) as to any of Messrs. Keane and Bayless and the Bayless Family Trust, upon the purchase of all the Shares beneficially owned by such stockholder pursuant to the Offer in accordance with the Tender and Voting Agreement, or (b) the earlier to occur of (i) the Effective Time and (ii) termination of the Merger Agreement in accordance with its terms. ARRANGEMENTS WITH THOMAS R. CASTEN The following is a summary of the material provisions of the Separation Agreement (as defined below) and the Casten Stock Purchase Agreement, copies of which have been included as exhibits to the Schedule TO. The Separation Agreement and the Casten Stock Purchase Agreement may be inspected at, 32 and copies may be obtained from, the same places and in the same manner set forth in "THE TENDER OFFER--Certain Information Concerning the Company--Available Information." The summary is qualified in its entirety by reference to the text of such agreement. THE SEPARATION AGREEMENT AND RELEASE. Pursuant to a separation agreement and release (the "Separation Agreement"), dated January 19, 2000, between Thomas R. Casten and the Company, Mr. Casten resigned from his positions as President, Chief Executive Officer and a director of the Company. Under the terms of the Separation Agreement, Mr. Casten is eligible for salary and benefits continuation until the earlier of (a) January 19, 2002, or (b) the date on which Mr. Casten breaches any of his obligations under the Separation Agreement. Mr. Casten's obligations include non-disparagement, non-competition, cooperation, non-solicitation and confidentiality covenants. If Mr. Casten breaches any of these covenants, his right to payments under the terms of the Separation Agreement will be extinguished. Restricted Stock and unvested Options held by Mr. Casten will continue to vest in accordance with their terms as if Mr. Casten remained employed by the Company and to the extent not vested on January 19, 2002 will become fully vested on that date to the extent not previously canceled by reason of a breach of this Agreement. Alternatively, immediately prior to the Effective Time if the Merger occurs, (i) Mr. Casten's Options will be canceled and he will receive for each Share subject thereto the excess of the Merger Consideration over the exercise price, and (ii) Mr. Casten's shares of Restricted Stock will be canceled and he will receive an amount per share equal to the Merger Consideration in respect of one-fourth of such shares and will be eligible to receive on January 19, 2002 an amount per share equal to the Merger Consideration in respect of three-fourths of such shares. Under the terms of the Separation Agreement, Mr. Casten is entitled to remain a general partner of the Trenton District Energy Company ("TDEC"), but may not interfere with or participate in the day-to-day operations of TDEC. The Company has agreed that if TDEC refinances, the Company will, subject to certain exceptions, use its good faith efforts so that Mr. Casten does not recognize income as a result of such refinancing as long as such efforts do not adversely impact TDEC, the Company or its affiliates. CASTEN STOCK PURCHASE AGREEMENT. In addition, on January 19, 2000, pursuant to the Casten Stock Purchase Agreement, Mr. Casten agreed to sell to Parent on March 29, 2000, the 1,012,402 Shares beneficially owned by him (which excludes options and Restricted Stock held by Mr. Casten) at $23.50 per Share. If Parent is legally barred at that time from purchasing these Shares by reason of court order or otherwise, Parent will buy these Shares on the date two business days following the date that such legal prohibition ceases. 11. INTERESTS OF CERTAIN PERSONS IN THE OFFER AND THE MERGER In considering the recommendations of the Board of Directors and the Special Committee, stockholders should be aware that certain officers and directors of Suez, Parent, Purchaser and the Company have interests in the Offer and the Merger which are described below and which may present them with certain potential conflicts of interest. As a result of Parent's current ownership of approximately 52.5% of the outstanding Shares and five of the Company's nine directors being officers or directors of Parent or one of its affiliates, Parent may be deemed to control the Company. Mr. Patrick Buffet, a director of the Company, is a director of Parent and executive vice president of Suez. Mr. Philippe Brongniart, a director of the Company, is a director of Parent and a member of the executive board of Suez. Mr. Olivier Degos, a director of the Company, is Parent's corporate vice president in charge of international affairs. Mr. Michel Bleitrach, a director of the Company, is chairman and chief executive officer of Parent. Mr. Dominique Mangin d'Ouince, a director of the Company, is director of the international development of the water division of Suez and was a managing director of Lyonnaise des Eaux from 1990 to 1997. In addition, Mr. Jean M. Malahieude is an executive vice president, engineering of the Company and is an executive vice president of Cofreth American Corporation, a direct, wholly owned subsidiary of Parent ("CAC"). 33 Messrs. Bayless and Keane are the directors of the Company who constitute the Special Committee. These directors have each been compensated in the amount of $2,500 per day up to an aggregate amount of $75,000, for serving as members of the Special Committee. This compensation was authorized by the Board of Directors in order to compensate the members thereof for the significant additional time commitment that was required of them in connection with fulfilling their duties and responsibilities as members of the Special Committee and was paid without regard to whether the Special Committee approved the Offer and the Merger or whether the Offer or the Merger was consummated. As of January 31, 2000, Messrs. Bayless and Keane have earned $39,620 and $73,500, respectively, as compensation for their service on the Special Committee. Mr. Keane is a director of United Water Resources Inc. Parent and United Water Resources Inc. signed a merger agreement in August of 1999 pursuant to which Parent intends to acquire the approximately 70% of United Water Resources Inc. it does not already own. Consummation of that transaction is pending certain regulatory approvals. As of January 27, 2000, the directors and executive officers of the Company, as a group, beneficially owned an aggregate of 547,794 Shares (representing 5.7% of the then outstanding Shares), excluding Shares subject to Options and shares of Restricted Stock. As of January 27, 2000, the members of the Special Committee, as a group, beneficially owned an aggregate of approximately 38,697 Shares (representing less than 1% of the then outstanding Shares), excluding Shares subject to Options. All such Shares held by directors and executive officers will be treated in the Offer and the Merger in the same manner as Shares held by the Public Stockholders. In the aggregate, the directors and executive officers of the Company will be entitled to receive approximately $12,873,182.50 for their Shares upon consummation of the Offer and the Merger (based upon the number of Shares (other than shares of Restricted Stock) owned as of January 27, 2000) and the members of the Special Committee will be entitled to receive an aggregate of approximately $909,380 for their Shares upon consummation of the Offer and the Merger (based upon the number of Shares owned as of January 27, 2000). For a description of certain arrangements with Thomas R. Casten, the former President and Chief Executive Officer of the Company and a former member of the Board of Directors, see "--The Transaction Documents; Arrangements with Thomas R. Casten." As of January 27, 2000, the directors and executive officers of the Company, as a group, had (i) Options to acquire an aggregate of 350,000 Shares at an average exercise price of $16.20 per Share and (ii) 162,143 shares of Restricted Stock. As of January 27, 2000, the members of the Special Committee, as a group, had (i) Options to acquire an aggregate of 40,000 Shares, and no shares of Restricted Stock. All such Options held by such directors and executive officers of the Company will be treated in the Offer and the Merger in the same manner as Options held by other Option holders. All such shares of Restricted Stock held by such directors and executive officers of the Company will be treated in the Merger in the same manner as shares of Restricted Stock held by the other holders of Restricted Stock (except for the arrangements with Mr. Casten; see "--The Transaction Documents; Arrangements with Thomas R. Casten"). See "--The Transaction Documents--The Merger Agreement." Based upon the average exercise price of Options held by directors and executive officers of the Company and the Offer Price, the directors and executive officers of the Company, as a group, will receive total consideration of $3,507,590 (before applicable taxes) for their Options and shares of Restricted Stock. The Special Committee and the Board of Directors were aware of these actual and potential conflicts of interest and considered them along with the other matters described under "--Recommendation of the Special Committee and the Board of Directors; Fairness of the Offer and the Merger." 12. BENEFICIAL OWNERSHIP OF SHARES The following table sets forth certain information, as of January 27, 2000, regarding the ownership of Common Stock by Purchaser, Parent, Suez and any director or executive officer of Purchaser, Parent or Suez. To the best of the knowledge of Purchaser, Parent and Suez after making reasonable inquiry, all such directors and executive officers and all directors of the Company who are representatives of Parent 34 currently intend to tender their Shares into the Offer, except to the extent that the tendering would subject that person to the "short-swing profit" rules of Section 16(b) of the Exchange Act. In addition, based upon disclosures made by the Company in the Schedule 14D-9, Purchaser, Parent and Suez understand that all executive officers, other directors, affiliates and subsidiaries of the Company intend to tender the Shares held of record or beneficially owned by them (other than Restricted Stock or Options). Except as indicated below, the executive officers and directors of Suez, Parent and Purchaser do not own any Shares.
PERCENTAGE NUMBER OF SHARES OF COMMON STOCK NUMBER OF SUBJECT TO BENEFICIALLY NAME OF BENEFICIAL OWNER SHARES OWNED OPTIONS OWNED(1) - ------------------------ ------------ ---------------- --------------- Suez(2).......................................... 6,507,944 -- 52.5% Parent........................................... 6,507,944 -- 52.5% Purchaser........................................ -- -- -- Olivier Degos(3)................................. 764 10,000 * Michel Bleitrach(3).............................. 4,485 10,000 * Dominique Mangin d'Ouince(3)..................... 4,856 10,000 * Philippe Brongniart(3)........................... 2,933 10,000 * Patrick Buffet(3)................................ 1,822 10,000 *
- ------------------------ * Less than 1% of Shares (1) Based upon 12,401,808 Shares outstanding as of January 27, 2000. (2) All Shares are owned indirectly by Suez through its direct wholly owned subsidiary, Societe Generale de Belgique ("Societe Generale"). Societe Generale owns all Shares indirectly through its direct wholly owned subsidiary, Parent. Parent owns all Shares indirectly through its subsidiaries, CAC and Compagnie Parisenne de Chauffage Urbain ("CPCU"). CAC holds 4,870,670 Shares, or 39.3% of the outstanding Shares. The principal address of CAC is c/o Trigen Energy Corporation, One Water Street, White Plains, New York 10601. CPCU holds 1,637,274 Shares, or 13.2% of the outstanding Shares. The principal address of CPCU is 185, Rue de Bercy, Paris 75561 France. CPCU currently intends to tender the Shares held by it into the Offer. CAC currently intends to transfer the Shares held by it to Purchaser after the expiration of the Offer. (3) On January 7, 2000, the following members of the Board of Directors received Shares from the Company as payment of their directors' fees, based on a price of $17.375 per Share: Michel Bleitrach (241 Shares), Philippe Brongniart (201 Shares), Olivier Degos (282 Shares), Dominique Mangin d'Ouince (241 Shares) and Patrick Buffet (241 Shares). These Shares are included in the above table. 13. RELATED PARTY TRANSACTIONS LICENSE AGREEMENT. Parent and the Company have entered into an Intercompany Services and License Agreement (the "License Agreement"), dated August 10, 1994. Under the License Agreement, Parent has the right to use such technical knowledge to construct, operate and maintain community energy systems within North America as well as the right to use patents and licenses of Parent and its subsidiaries in connection with the generation and distribution of electricity, chilled water and waste incineration. Parent may also make available to the Company, upon request, new support letters or other similar credit support, at mutually agreed rates. Pursuant to the License Agreement, the Company has the first right to develop any corporate opportunities relating to the application of the licensed technologies in North America that are presented to Parent or its subsidiaries. Neither the Company nor its subsidiaries may engage in activities that may cause the Company to become or be regulated as a public utility holding company or a subsidiary of a public utility holding company under federal, state or local laws or regulations. The initial term of the License Agreement was for three years with automatic two year renewals, unless terminated sooner as a result of a default or bankruptcy or related event or a change of 35 control with respect to the Company. The Company reimbursed Parent and its affiliates and/or paid third party providers on behalf of Parent $318,786 for salary, bonus, and expenses paid to Jean Malahieude, an executive officer of the Company, and an additional $178,448 for benefits of Mr. Malahieude and other professionals in 1998. CERTAIN INDEBTEDNESS. On December 30, 1998, CAC, a wholly owned subsidiary of Parent, loaned the Company $50 million at a 7.38% interest rate pursuant to an unsecured subordinated redeemable term note (the "Note"), which requires repayment on December 31, 2010. The Note calls for interest payments that are not made by the Company when due to be capitalized, up to an amount equivalent to eight interest payments. Further past due interest or any past due portion of the loan principal is to accrue interest at a rate of 9.38%. A change in control of the Company is not an event of default under the terms of the Note, as long as the change involves transfer of securities of the Company to a majority-owned affiliate of Suez. The indebtedness evidenced by the Note is expressly subordinate to all senior debt of the Company. The Note may be redeemed at the option of CAC from the proceeds of any public or private offering of equity by the Company. In addition, on January 19, 2000, Parent loaned the Company $16 million at an interest rate of LIBOR plus 2.25% pursuant to an unsecured senior promissory note. The note is due and payable on March 31, 2000. See "--Background of the Offer and Merger; Contacts with the Company." 14. CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES THE FOLLOWING IS A SUMMARY OF CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE OFFER AND THE MERGER TO HOLDERS WHOSE SHARES ARE PURCHASED PURSUANT TO THE OFFER OR WHOSE SHARES ARE CONVERTED INTO THE RIGHT TO RECEIVE CASH IN THE MERGER. THE SUMMARY IS BASED ON THE PROVISIONS OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), APPLICABLE CURRENT AND PROPOSED UNITED STATES TREASURY REGULATIONS ISSUED THEREUNDER, JUDICIAL AUTHORITY AND ADMINISTRATIVE RULINGS AND PRACTICE, ALL OF WHICH ARE SUBJECT TO CHANGE, POSSIBLY WITH RETROACTIVE EFFECT, AT ANY TIME AND, THEREFORE, THE FOLLOWING STATEMENTS AND CONCLUSIONS COULD BE ALTERED OR MODIFIED. THE DISCUSSION DOES NOT ADDRESS HOLDERS OF SHARES IN WHOSE HANDS SHARES ARE NOT CAPITAL ASSETS, NOR DOES IT ADDRESS HOLDERS WHO HOLD SHARES AS PART OF A HEDGING, "STRADDLE," CONVERSION OR OTHER INTEGRATED TRANSACTION, OR WHO RECEIVED SHARES UPON CONVERSION OF SECURITIES OR EXERCISE OF WARRANTS OR OTHER RIGHTS TO ACQUIRE SHARES OR PURSUANT TO THE EXERCISE OF EMPLOYEE STOCK OPTIONS OR OTHERWISE AS COMPENSATION, OR TO HOLDERS OF SHARES WHO ARE IN SPECIAL TAX SITUATIONS (SUCH AS INSURANCE COMPANIES, TAX-EXEMPT ORGANIZATIONS, FINANCIAL INSTITUTIONS, UNITED STATES EXPATRIATES OR NON-U.S. PERSONS). FURTHERMORE, THE DISCUSSION DOES NOT ADDRESS THE TAX TREATMENT OF HOLDERS WHO EXERCISE DISSENTERS' RIGHTS IN THE MERGER, NOR DOES IT ADDRESS ANY ASPECT OF FOREIGN, STATE OR LOCAL TAXATION OR ESTATE AND GIFT TAXATION. THE FEDERAL INCOME TAX CONSEQUENCES SET FORTH BELOW ARE INCLUDED FOR GENERAL INFORMATIONAL PURPOSES ONLY. BECAUSE INDIVIDUAL CIRCUMSTANCES MAY DIFFER, EACH HOLDER OF SHARES SHOULD CONSULT SUCH HOLDER'S OWN TAX ADVISOR TO DETERMINE THE APPLICABILITY OF THE RULES DISCUSSED BELOW TO SUCH STOCKHOLDER AND THE PARTICULAR TAX EFFECTS OF THE OFFER AND THE MERGER, INCLUDING THE APPLICATION AND EFFECT OF STATE, LOCAL AND OTHER INCOME TAX LAWS. The receipt of cash for Shares pursuant to the Offer or the Merger will be a taxable transaction for federal income tax purposes under the Code (and also may be a taxable transaction under applicable state, local, foreign and other income tax laws). In general, for federal income tax purposes, a holder of Shares will recognize gain or loss in an amount equal to the difference between its adjusted tax basis in the Shares sold pursuant to the Offer or converted into the right to receive cash in the Merger and the amount of cash received therefor. Gain or loss must be determined separately for each block of Shares (i.e., Shares acquired at the same cost in a single transaction) sold pursuant to the Offer or converted to cash in the Merger. Such gain or loss will be capital gain or loss and will be long-term gain or loss if, on the date of sale (or, if applicable, the Effective Time), the Shares were held for more than one year. 36 Under the United States federal income tax backup withholding rules, payments in connection with the Offer or the Merger may be subject to "backup withholding" at a rate of 31%. In order to avoid backup withholding, each tendering stockholder, unless an exemption applies, must provide the Depositary with such stockholder's correct taxpayer identification number and certify that such stockholder is not subject to such backup withholding by completing the Substitute Form W-9 included in the Letter of Transmittal. Backup withholding is not an additional tax but merely an advance payment, which may be refunded to the extent it results in an overpayment of tax. Certain persons generally are entitled to exemption from backup withholding, including corporations, financial institutions and certain foreign individuals. Each stockholder should consult with such holder's own tax advisor as to such holder's qualification for exemption from backup withholding and the procedure for obtaining such exemption. All stockholders surrendering Shares pursuant to the Offer should complete and sign the main signature form and the Substitute Form W-9 included as part of the Letter of Transmittal to provide the information and certification necessary to avoid backup withholding (unless an applicable exemption exists and is proved in a manner satisfactory to Purchaser and the Depositary). Noncorporate foreign stockholders should complete and sign the main signature form and a Form W-8, Certificate of Foreign Status, a copy of which may be obtained from the Depositary, in order to avoid backup withholding. See Instruction 9 to the Letter of Transmittal. 15. FEES AND EXPENSES The following is an estimate of expenses to be incurred in connection with the Offer and the Merger. The fees and expenses of CSFB are also discussed in "--Opinion of the Special Committee's Financial Advisor," and the fees and expenses of Lazard Freres are also discussed in "--Analysis of Financial Advisor to Parent." The Merger Agreement provides that all costs and expenses incurred in connection with the Offer and the Merger will be paid by the party incurring such costs and expenses, except in certain circumstances where Parent or the Company is required to reimburse the other party for its out-of-pocket expenses. See "--The Transaction Documents; The Merger Agreement--Fees and Expenses." The following table presents the estimated fees and expenses to be incurred in connection with the Offer and the Merger: Financial Advisors Fees..................................... $2,850,000 Legal Fees and Expenses..................................... 1,000,000 Printing and Mailing........................................ 125,000 Filing Fees................................................. 34,000 Depositary Fees............................................. 20,000 Information Agent Fees...................................... 16,000 Special Committee Fees and Expenses......................... 125,000 Miscellaneous............................................... 200,000 ---------- Total................................................. $4,370,000 ==========
37 THE TENDER OFFER 1. TERMS OF THE OFFER Upon the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of any extension or amendment), Purchaser will accept for payment and pay for any and all Shares validly tendered prior to the Expiration Date and not withdrawn in accordance with the procedures set forth below in "--Withdrawal Rights" as soon as practicable after the Expiration Date. The term "Expiration Date" means 12:00 Midnight, New York City time, on March 24, 2000 unless and until Purchaser, in its sole discretion (but subject to the terms of the Merger Agreement), shall have extended the period of time during which the Offer is open, in which event the term "Expiration Date" shall mean the latest time and date at which the Offer, as so extended by Purchaser, shall expire. The Offer is subject to certain conditions set forth in "--Conditions of the Offer." If the Offer Conditions are not satisfied or any of the events specified in "--Conditions of the Offer" have occurred or are determined by Purchaser to have occurred prior to the Expiration Date, Purchaser, subject to the terms of the Merger Agreement, expressly reserves the right (but is not obligated) to (i) terminate the Offer and not accept for payment any Shares and return all tendered Shares to tendering stockholders, (ii) waive all the unsatisfied conditions and, subject to complying with the terms of the Merger Agreement and the applicable rules and regulations of the Commission, accept for payment and pay for all Shares validly tendered prior to the Expiration Date and not theretofore withdrawn, (iii) extend the Offer and, subject to the right of stockholders to withdraw Shares until the Expiration Date, retain the Shares that have been tendered during the period or periods for which the Offer is extended or (iv) amend the Offer. Subject to the terms of the Merger Agreement, the applicable rules and regulations of the Commission and applicable law, Purchaser expressly reserves the right, in its sole discretion, at any time and from time to time, to waive any Offer Condition or otherwise amend the Offer in any respect by giving oral or written notice of such waiver or amendment to the Depositary. In the Merger Agreement, Purchaser has agreed that it will not, without the prior consent of the Company, extend the Offer if all of the Offer Conditions are satisfied or waived, except that Purchaser may, without the consent of the Company, extend the Offer: (i) if at the then scheduled Expiration Date of the Offer any of the Offer Conditions shall not have been satisfied or waived, until such time as all such conditions shall have been satisfied or waived; (ii) for any period required by any statute or rule, regulation, interpretation or position of the Commission applicable to the Offer; (iii) for any period required by applicable law in connection with an increase in the consideration to be paid pursuant to the Offer; and (iv) from time to time, for an aggregate period of not more than ten business days (for all such extensions under this clause (iv)) beyond the latest expiration date that would be permitted under clause (i), (ii) or (iii) of this sentence. However, Parent will not extend the Offer if at the then scheduled Expiration Date all of the Offer Conditions have been satisfied, regardless of the number of Shares tendered (and notwithstanding the provision in the Merger Agreement permitting Purchaser to extend the Offer for up to 10 business days). In addition, Purchaser and Parent have agreed that, without the prior written consent of the Company, no changes may be made that (i) reduce the maximum number of Shares subject to the Offer, (ii) decrease the Offer Price, (iii) change the form of consideration payable in the Offer, or (iv) amend or modify the Offer Conditions in any manner adverse to the holders of Shares. During any such extension, all Shares previously tendered and not withdrawn will remain subject to the Offer. Tendering stockholders will continue to have the right to withdraw any tendered Shares during such extension. See "--Withdrawal Rights." Under no circumstances will interest be paid on the purchase price for tendered Shares, whether or not the Offer is extended. Any such extension, delay, termination, waiver or amendment will be followed, as promptly as practicable, by public announcement thereof, with such announcement in the case of an extension to be made no later than 9:00 a.m., Eastern time, on the next business day after the previously scheduled Expiration Date in accordance with the public announcement requirements of Rule 14e-1 of the Exchange 38 Act. Subject to applicable law (including Rules 14d-4(c), 14d-6(d) and 14e-1 under the Exchange Act, which require that material changes be promptly disseminated to stockholders in a manner reasonably designed to inform them of such changes) and without limiting the manner in which Purchaser may choose to make any public announcement, Purchaser will have no obligation to publish, advertise or otherwise communicate any such public announcement other than by issuing a press release to the Dow Jones News Service or as otherwise may be required by applicable law. If Purchaser makes a material change in the terms of the Offer or the information concerning the Offer, or if it waives a material Offer Condition, Purchaser will extend the Offer to the extent required by Rules 14d-4(c), 14d-6(d) and 14e-1 under the Exchange Act. The minimum period during which an offer must remain open following material changes in the terms of the offer or information concerning the Offer, other than a change in price or a change in the percentage of securities sought, will depend upon the facts and circumstances then existing, including the relative materiality of the changed terms or information. With respect to a change in price or a change in the percentage of securities sought, a minimum period of ten business days is generally required to allow for adequate dissemination to stockholders and investor response. Pursuant to Rule 14d-11 under the Exchange Act, Purchaser may, subject to certain conditions, provide a subsequent offering period of from three business days to twenty business days in length following the purchase of Shares on the Expiration Date (the "Subsequent Offering Period"). Purchaser currently intends to provide a Subsequent Offering Period of at least three days and, if Parent and Purchaser own less than 90% of the outstanding Shares following expiration of the initial offering period and the purchase of all Shares tendered pursuant to the Offer during that period and the first three days of the subsequent Offering Period, Purchaser will extend the Subsequent Offering Period until the earlier of (i) twenty business days from the Expiration Date and (ii) the time at which Parent and Purchaser become the owner of at least 90% of the outstanding Shares so that a Short-Form Merger can be effected. A Subsequent Offering Period is an additional period of time, following the expiration of the Offer and the purchase of Shares in the Offer, during which stockholders may tender Shares that had not been purchased in the Offer. A Subsequent Offering Period is not an extension of the Offer which already will have been completed. During a Subsequent Offering Period, tendering stockholders will not have withdrawal rights and Purchaser will promptly purchase and pay for any Shares tendered at the same price paid in the Offer. Rule 14d-11 provides that Purchaser may provide a Subsequent Offering Period so long as, among other things, (i) the initial twenty business days period of the Offer has expired; (ii) the Purchaser offers the same form and amount of consideration for Shares in the Subsequent Offering Period as in the Offer; (iii) Purchaser accepts and promptly pays for all Shares tendered during the Offer prior to the Expiration Date; (iv) Purchaser announces the results of the Offer, including the approximate number and percentage of Shares deposited in the Offer, no later than 9:00 a.m. Eastern time on the next business day after the Expiration Date and immediately begins the Subsequent Offering Period; and (v) Purchaser immediately accepts and promptly pays for Shares as they are tendered during the Subsequent Offering Period. In the event Purchaser elects to extend the Subsequent Offering Period, it will notify stockholders of the Company consistent with the requirements of the Commission. IF SHARES ARE PURCHASED ON THE EXPIRATION DATE, PURCHASER WILL INCLUDE A SUBSEQUENT OFFERING PERIOD FOR A PERIOD OF THREE DAYS. PURCHASER WILL EXTEND THE SUBSEQUENT OFFERING PERIOD UNTIL THE EARLIER OF (i) THAT TIME AT WHICH PARENT AND PURCHASER OWN AT LEAST 90% OF THE OUTSTANDING SHARES AND (ii) TWENTY BUSINESS DAYS FROM THE EXPIRATION DATE. PURSUANT TO RULE 14D-7 UNDER THE EXCHANGE ACT, NO WITHDRAWAL RIGHTS APPLY TO SHARES TENDERED DURING THE SUBSEQUENT OFFERING PERIOD. THE OFFER PRICE WILL BE PAID TO SHAREHOLDERS TENDERING SHARES IN THE SUBSEQUENT OFFERING PERIOD. 39 The Company has provided Purchaser with the Company's stockholder lists and security position listings in respect of the Shares for the purpose of disseminating this Offer to Purchase, the Letter of Transmittal and other relevant materials to stockholders. This Offer to Purchase, the Letter of Transmittal and other relevant materials will be mailed to record holders of Shares whose names appear on the Company's list of stockholders and will be furnished, for subsequent transmittal to beneficial owners of Shares, to brokers, dealers, commercial banks, trust companies and similar persons whose names, or the names of whose nominees, appear on the Company's list of stockholders or, where applicable, who are listed as participants in the security position listing of The Depository Trust Company. 2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES Upon the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of the Offer as so extended or amended), Purchaser will purchase, by accepting for payment, and will pay for, all Shares validly tendered prior to the Expiration Date (and not properly withdrawn in accordance with "--Withdrawal Rights") as promptly as practicable after the Expiration Date. Subject to applicable rules of the Commission and the terms of the Merger Agreement, Purchaser expressly reserves the right, in its discretion, to delay acceptance for payment of, or payment for, Shares in order to comply, in whole or in part, with any applicable law. See "--Terms of the Offer," and "--Certain Legal Matters--Regulatory Approvals." The reservation by Purchaser of the right to delay the acceptance or purchase of, or payment for, the Shares is subject to the provisions of Rule 14e-1(c) under the Exchange Act, which requires the Purchaser to pay the consideration offered or to return the Shares deposited by, or on behalf of, stockholders, promptly after the termination or withdrawal of the Offer. In all cases, payment for Shares purchased pursuant to the Offer will be made only after timely receipt by the Depositary of (i) the certificates evidencing such Shares (the "Certificates") or timely confirmation of a book- entry transfer (a "Book-Entry Confirmation") of such Shares into the Depositary's account at The Depositary Trust Company (the "Book-Entry Transfer Facility"), pursuant to the procedures set forth in "--Procedures for Tendering Shares", (ii) the Letter of Transmittal (or a manually signed 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 to be included with the Letter of Transmittal under the terms and subject to the conditions thereof and of this Offer to Purchase. The term "Agent's Message" means a message, transmitted by the Book-Entry Transfer Facility to, and received by, the Depositary and forming a part of a Book-Entry Confirmation, which states that the Book-Entry Transfer Facility has received an express acknowledgment from a participant in the Book-Entry Transfer Facility tendering the Shares that such participant has received and agrees to be bound by the terms of the Letter of Transmittal and that Purchaser may enforce such agreement against such participant. For purposes of the Offer, Purchaser will be deemed to have accepted for payment (and thereby purchased) Shares validly tendered and not properly withdrawn if, as and when Purchaser gives oral or written notice to the Depositary of Purchaser's acceptance for payment of such Shares. Upon the terms and subject to the conditions of the Offer, payment for Shares accepted pursuant to the Offer will be made by deposit of the purchase price therefor with the Depositary, which will act as agent for tendering stockholders for the purpose of receiving payments from Purchaser and transmitting payments to such tendering stockholders whose Shares have been accepted for payment. UNDER NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE FOR SHARES BE PAID BY PARENT OR PURCHASER, REGARDLESS OF ANY DELAY IN MAKING SUCH PAYMENT OR EXTENSION OF THE EXPIRATION DATE. If any validly tendered Shares are not accepted for payment for any reason pursuant to the terms and conditions of the Offer, or if Certificates are submitted evidencing more Shares than are tendered, 40 certificates evidencing Shares not purchased will be returned, without expense, to the tendering stockholder (or, in the case of Shares tendered by book-entry transfer into the Depositary's account at the Book-Entry Transfer Facility pursuant to the procedure set forth in "--Procedures for Tendering Shares", such Shares will be credited to an account maintained at the Book-Entry Transfer Facility), as promptly as practicable following the expiration or termination of the Offer. IF, PRIOR TO THE EXPIRATION DATE, PURCHASER INCREASES THE CONSIDERATION TO BE PAID PER SHARE PURSUANT TO THE OFFER, PURCHASER WILL PAY SUCH INCREASED CONSIDERATION FOR ALL SUCH SHARES PURCHASED PURSUANT TO THE OFFER, WHETHER OR NOT SUCH SHARES WERE TENDERED PRIOR TO SUCH INCREASE IN CONSIDERATION. Purchaser reserves the right to assign to Parent, or to any other direct or indirect wholly owned subsidiary of Suez, the right to purchase all or any portion of the Shares tendered pursuant to the Offer, but any such assignment will not relieve Purchaser of its obligations under the Offer and will in no way prejudice the rights of tendering stockholders to receive payment for Shares validly tendered and accepted for payment pursuant to the Offer. 3. PROCEDURES FOR TENDERING SHARES VALID TENDER OF SHARES. In order for Shares to be validly tendered pursuant to the Offer, a stockholder must, prior to the Expiration Date, either (i) deliver to the Depositary at one of its addresses set forth on the back cover of this Offer to Purchase (a) a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile thereof) with any required signature guarantees, (b) the Certificates representing Shares to be tendered and (c) any other documents required to be included with the Letter of Transmittal under the terms and subject to the conditions thereof and of this Offer to Purchase, (ii) cause such stockholder's broker, dealer, commercial bank or trust company to tender applicable Shares pursuant to the procedures for book-entry transfer described below or (iii) comply with the guaranteed delivery procedures described below. THE METHOD OF DELIVERY OF CERTIFICATES, THE LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK-ENTRY TRANSFER FACILITY, IS AT THE OPTION AND RISK OF THE TENDERING STOCKHOLDER, AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY. BOOK-ENTRY TRANSFER. The Depositary will establish an account with respect to the Shares at the Book-Entry Transfer Facility for purposes of the Offer within two business days after the date of this Offer to Purchase. Any financial institution that is a participant in the Book-Entry Transfer Facility's system may make book-entry delivery of Shares by (i) causing such securities to be transferred in accordance with the Book-Entry Transfer Facility's procedures into the Depositary's account and (ii) causing the Letter of Transmittal to be delivered to the Depositary by means of an Agent's Message. Although delivery of Shares may be effected through book-entry transfer, either the Letter of Transmittal (or a manually signed facsimile thereof), properly completed and duly executed, together with any required signature guarantees, or an Agent's Message in lieu of the Letter of Transmittal, and any other required documents, must, in any case, be transmitted to and received by the Depositary prior to the Expiration Date at one of its addresses set forth on the back cover of this Offer to Purchase, or the tendering stockholder must comply with the guaranteed delivery procedures described below. Delivery of documents or instructions to the Book-Entry Transfer Facility in accordance with the Book-Entry Transfer Facility's procedures does not constitute delivery to the Depositary. SIGNATURE GUARANTEE. All signatures on a Letter of Transmittal must be guaranteed by a member in good standing of the Securities Transfer Agents Medallion Program, or by any other firm which is a bank, broker, dealer, credit union or savings association (each of the foregoing being referred to as an "Eligible Institution" and collectively as "Eligible Institutions"), unless the Shares tendered thereby are tendered 41 (i) by the registered holder of Shares who has not completed the box labeled "Special Delivery Instructions" or the box labeled "Special Payment Instructions" on the Letter of Transmittal or (ii) for the account of an Eligible Institution. See Instruction 1 to the Letter of Transmittal. If a Certificate is registered in the name of a person other than the signer of the Letter of Transmittal, or if payment is to be made, or a Certificate not accepted for payment or not tendered is to be returned to, a person other than the registered holder(s), then the Certificate must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name(s) of the registered holder(s) appear(s) on the Certificate, with the signature(s) on such certificate or stock powers guaranteed as described above. See Instructions 1, 5 and 7 to the Letter of Transmittal. GUARANTEED DELIVERY. If a stockholder desires to tender Shares pursuant to the Offer and such stockholder's Certificates are not immediately available 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 may nevertheless be tendered if all 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 provided by Purchaser, is received by the Depositary as provided below prior to the Expiration Date; and (iii) the certificates for all tendered Shares in proper form for transfer, together with a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile thereof) with any required signature guarantee (or, in the case of a book-entry transfer, a Book-Entry Confirmation along with an Agent's Message) and any other documents required by such Letter of Transmittal, are received by the Depositary within three Trading Days after the date of execution of the Notice of Guaranteed Delivery. A "Trading Day" is any day on which the New York Stock Exchange is open for business. Any Notice of Guaranteed Delivery may be delivered by hand, transmitted by facsimile transmission or mailed to the Depositary and must include a guarantee by an Eligible Institution in the form set forth in the Notice of Guaranteed Delivery. OTHER REQUIREMENTS. Notwithstanding any other provision hereof, payment for Shares accepted for payment pursuant to the Offer will, in all cases, be made only after timely receipt by the Depositary of (i) certificates evidencing such Shares or a Book-Entry Confirmation of the delivery of such Shares (unless Purchaser elects, in its sole discretion, to make payment for such Shares pending receipt of the Certificates or a Book-Entry Confirmation, if available, with respect to such Certificates), (ii) a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile thereof) with any required signature guarantees (or, in the case of a book-entry transfer, an Agent's Message) and (iii) any other documents required by the Letter of Transmittal. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE OF THE SHARES TO BE PAID BY PURCHASER, REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN MAKING SUCH PAYMENT. TENDER CONSTITUTES AN AGREEMENT. The valid tender of Shares pursuant to one of the procedures described above will constitute a binding agreement between the tendering stockholder and Purchaser on the terms and subject to the conditions of the Offer. DETERMINATION OF VALIDITY. All questions as to the validity, form, eligibility (including, but not limited to, time of receipt) and acceptance for payment of any tendered Shares pursuant to any of the procedures described above will be determined by Purchaser, in its sole discretion, whose determination will be final and binding on all parties. Purchaser reserves the absolute right to reject any or all tenders of any Shares determined by it not to be in proper form or if the acceptance for payment of, or payment for, such Shares may, in the opinion of Purchaser's counsel, be unlawful. Purchaser also reserves the absolute right, in its 42 sole discretion, to waive any of the Offer Conditions (subject to the terms of the Merger Agreement) or any defect or irregularity in any tender with respect to Shares of any particular stockholder, whether or not similar defects or irregularities are waived in the case of other stockholders. No tender of Shares will be deemed to have been validly made until all defects and irregularities have been cured or waived. None of Suez, Parent, Purchaser or any of their respective affiliates, the Depositary, the Information Agent or any other person or entity 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. 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. APPOINTMENT AS PROXY. By executing a Letter of Transmittal (or delivering an Agent's Message) as set forth above, a tendering stockholder irrevocably appoints each designee of Purchaser as such stockholder's attorney-in-fact and proxy, with full power of substitution, to vote in such manner as such attorney-in-fact and proxy (or any substitute thereof) shall deem proper in its sole discretion, and to otherwise act (including pursuant to written consent) to the full extent of such stockholder's rights with respect to the Shares tendered by such stockholder and accepted for payment by Purchaser (and any and all dividends, distributions, rights or other securities issued or issuable in respect of such Shares on or after January 1, 2000). All such proxies shall be considered coupled with an interest in the tendered Shares and shall be irrevocable. This appointment will be effective if, when, and only to the extent that, Purchaser accepts such Shares for payment pursuant to the Offer. Upon such acceptance for payment, all prior proxies given by such stockholder with respect to such Shares and other securities will, without further action, be revoked, and no subsequent proxies may be given (and, if given, will not be deemed effective). The designees of Purchaser will, with respect to the Shares and other securities for which the appointment is effective, be empowered to exercise all voting and other rights of such stockholder as they in their sole discretion may deem proper at any annual, special, adjourned or postponed meeting of the Company's stockholders, by written consent in lieu of any such meeting or otherwise. Purchaser reserves the right to require that, in order for Shares to be deemed validly tendered, immediately upon Purchaser's acceptance for payment of such Shares, Purchaser must be able to exercise all rights (including, without limitation, all voting rights) with respect to such Shares and receive all dividends and distributions. BACKUP WITHHOLDING. Under United States federal income tax law, the amount of any payments made by the Depositary to stockholders (other than corporate and certain other exempt stockholders) pursuant to the Offer may be subject to backup withholding tax at a rate of 31%. To avoid such backup withholding tax with respect to payments made pursuant to the Offer, a non-exempt, tendering stockholder must provide the Depositary with such stockholder's correct taxpayer identification number and certify under penalties of perjury that such stockholder is not subject to backup withholding tax by completing the Substitute Form W-9 included as part of the Letter of Transmittal. If backup withholding applies with respect to a stockholder or if a stockholder fails to deliver a completed Substitute Form W-9 to the Depositary or otherwise establish an exemption, the Depositary is required to withhold 31% of any payments made to such stockholder. See "SPECIAL FACTORS--Certain United States Federal Income Tax Consequences" of this Offer to Purchase and the information set forth under the heading "Important Tax Information" contained in the Letter of Transmittal. 4. WITHDRAWAL RIGHTS Tenders of Shares made pursuant to the Offer are irrevocable except that such Shares may be withdrawn at any time prior to the Expiration Date and, unless theretofore accepted for payment by Purchaser pursuant to the Offer, may also be withdrawn at any time after April 27, 2000, or at such later time as may apply if the Offer is extended. If Purchaser extends the Offer, is delayed in its acceptance for payment of Shares or is unable to accept Shares for payment pursuant to the Offer for any reason, then, without prejudice to Purchaser's rights under the Offer, the Depositary may, nevertheless, on behalf of Purchaser, retain tendered Shares, 43 and such Shares may not be withdrawn except to the extent that tendering stockholders are entitled to withdrawal rights as described below. Any such delay will be an extension of the Offer to the extent required by law. For a withdrawal to be effective, a written or facsimile transmission notice of withdrawal must be timely received by the Depositary at one of its addresses set forth on the back cover of this Offer to Purchase. Any such notice of withdrawal must specify the name of the person who tendered the Shares to be withdrawn, the number of Shares to be withdrawn, and the name of the registered holder of such Shares, if different from that of the person who tendered such Shares. If Certificates evidencing Shares to be withdrawn have been delivered or otherwise identified to the Depositary, then, prior to the physical release of such Certificates, the serial numbers shown on such Certificates must be submitted to the Depositary and the signature(s) on the notice of withdrawal must be guaranteed by an Eligible Institution, unless such Shares have been tendered for the account of an Eligible Institution. Shares tendered pursuant to the procedure for book-entry transfer as set forth in "--Procedures for Tendering Shares" may be withdrawn only by means of the withdrawal procedures made available by the Book-Entry Transfer Facility, must specify the name and number of the account at the Book-Entry Transfer Facility to be credited with the withdrawn Shares and must otherwise comply with the Book-Entry Transfer Facility's procedures. Withdrawals of tendered Shares may not be rescinded without Purchaser's consent and any Shares properly withdrawn will thereafter be deemed not validly tendered for purposes of the Offer. All questions as to the form and validity (including time of receipt) of notices of withdrawal will be determined by Purchaser in its sole discretion, which determination will be final and binding. None of Suez, Parent, Purchaser or any of their affiliates, the Depositary, the Information Agent, the Dealer Manager or any other person will be under any duty to give notification of any defects or irregularities in any notice of withdrawal or incur any liability for failure to give any such notification. Any Shares properly withdrawn may be re-tendered at any time prior to the Expiration Date by following any of the procedures described in "--Procedures for Tendering Shares." 5. PRICE RANGE OF SHARES The primary market for the Shares is the New York Stock Exchange. The ticker symbol for the Shares is "TGN." The following table sets forth, for the periods indicated, the high and low sales prices per share of Common Stock on the New York Stock Exchange as reported by the Bloomberg Professional Service and the amount of dividends paid on the Common Stock:
HIGH LOW DIVIDEND AMOUNT -------- -------- --------------- 1998: First Quarter............................................. $19 15/16 $14 13/16 $0.035 Second Quarter............................................ 15 1/8 12 1/8 $0.035 Third Quarter............................................. 13 15/16 9 3/4 $0.035 Fourth Quarter............................................ 15 5/16 11 5/16 $0.035 1999: First Quarter............................................. $16 13/16 $11 3/8 $0.035 Second Quarter............................................ 19 7/16 13 5/8 $0.035 Third Quarter............................................. 24 3/16 17 1/8 $0.035 Fourth Quarter............................................ 24 16 $0.035 2000: First Quarter (through February 24, 2000)................. $23 7/16 $16 1/4 --
On September 17, 1999, the last full trading day prior to the public announcement of the $22 Offer, the reported closing sales prices of the Common Stock on the New York Stock Exchange was $19.25 per Share. On January 18, 2000, the last full trading day prior to the public announcement of the execution of the Merger Agreement, the closing sales price of the Common Stock reported on the New York Stock 44 Exchange was $17.00 per Share. On February 24, 2000, the last practicable trading day prior to the date of this Offer to Purchase, the last reported sales price of the Common Stock on the New York Stock Exchange was $23.00 per share. Stockholders are urged to obtain current market quotations for the Common Stock. 6. DIVIDENDS AND DISTRIBUTIONS Pursuant to the Merger Agreement, without Parent's written consent, the Company will not, and will cause each of its subsidiaries not to, (i) with certain exceptions, issue, sell or pledge any shares of its capital stock or other ownership interest in the Company or any subsidiary, or any securities convertible into or exchangeable for any such shares or ownership interest, or any rights, warrants or options to acquire or with respect to any such shares of capital stock, ownership interest, or convertible or exchangeable securities (or derivative instruments in respect of the foregoing); (ii) effect any stock split or otherwise change its capitalization as it exists on the date hereof, or directly or indirectly redeem, purchase or otherwise acquire any shares of its capital stock or capital stock of any subsidiary of the Company; or (iii) declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than any such payments to the Company by any of its subsidiaries). 7. CERTAIN INFORMATION CONCERNING THE COMPANY THE COMPANY. The information concerning the Company contained in this Offer to Purchase, including financial information, has been taken from or is based upon publicly available documents and records on file with the Commission and other public sources. None of Suez, Parent, Purchaser or any of their affiliates assumes any responsibility for the accuracy or completeness of the information concerning the Company contained in such documents and records or for any failure by the Company to disclose events which may have occurred or may affect the significance or accuracy of any such information but which are unknown to them. The Company develops, owns and operates community energy systems and cogeneration facilities. The Company currently operates fourteen district energy systems serving urban customers and sixteen single customer industrial/commercial sites. The Company's major customers include industrial plants, electric utilities, commercial and office buildings, government buildings, colleges and universities, hospitals, residential complexes, hotels, sports arenas and convention centers. The Company is a Delaware corporation. The address of the Company's principal executive offices is One Water Street, White Plains, New York 10601. The telephone number of the Company at such offices is (914) 286-6600. FINANCIAL INFORMATION. Certain financial information relating to the Company is hereby incorporated by reference to the audited financial statements for the Company's 1998 and 1997 fiscal years set forth in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1998 (the "1998 10-K"), beginning on page F-1 of such reports; and (ii) the sections of the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1999 (the "September 1999 10-Q") set forth under the following captions: (a) "The Consolidated Statements of Operations for the Three Months and Nine Months Ended September 30, 1999 and 1998 (Unaudited)", (b) "Consolidated Balance Sheets as of September 30, 1999 (Unaudited) and December 31, 1998", (c) "Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 1999 and 1998 (Unaudited)" and (d) "Notes to Consolidated Financial Statements (Unaudited)." These reports may be inspected at, and copies may be obtained from, the same places and in the manner set forth below under "--Available Information," below. Set forth below is certain selected consolidated financial information relating to the Company and its subsidiaries which has been derived from the financial statements contained in the 1998 10-K and the September 1999 10-Q. More comprehensive financial information is included in these reports and other documents filed by the Company with the Commission. The financial information that follows is qualified in its entirety by reference to these reports and other documents, including the financial statements and related notes contained therein. 45 TRIGEN ENERGY CORPORATION SELECTED CONSOLIDATED FINANCIAL AND OPERATING DATA ($ IN THOUSANDS EXCEPT PER SHARE DATA)
YEAR ENDED NINE MONTHS ENDED DECEMBER 31, SEPTEMBER 30, ------------------- ------------------- 1998 1997 1999 1998 -------- -------- -------- -------- (UNAUDITED) STATEMENT OF OPERATIONS: Revenues.......................................... $242,394 $240,651 $204,052 $176,545 Operating expenses Fuel and consumables............................ 95,957 114,168 84,860 74,012 Production and operating costs.................. 53,840 47,086 39,783 36,068 Depreciation.................................... 19,780 16,021 18,312 17,401 General and administrative...................... 40,994 34,633 30,588 27,785 -------- -------- -------- -------- Total operating expenses.......................... 210,571 211,908 173,543 155,266 -------- -------- -------- -------- Operating income.................................. 31,823 28,743 30,509 21,279 Other income (expense) Interest expense................................ (23,742) (18,976) (18,829) (17,613) Other income, net............................... 5,570 2,448 15,397 4,931 Earnings before minority interests, income taxes and extraordinary item and cumulative effect of a change in an accounting principle............. 13,651 12,215 27,077 8,597 Minority interests in earnings of subsidiaries.... (2,519) (3,699) 2,390 2,374 Earnings before income taxes and extraordinary item and cumulative effect of a change in an accounting principle............................ 11,132 8,516 24,687 6,223 Income taxes...................................... 4,575 3,491 10,220 2,676 -------- -------- -------- -------- Earnings before extraordinary item and cumulative effect of a change in an accounting principle... 6,557 5,025 14,467 3,547 Extraordinary loss from extinguishment of debt, net of income tax benefit....................... (299) -- -- (299) -------- -------- -------- -------- Cumulative Effect of a Change in an Accounting Principle....................................... -- -- (4,903) -- Net Earnings...................................... $ 6,258 $ 5,025 $ 9,564 $ 3,248 ======== ======== ======== ======== PER SHARE: BASIC EARNINGS PER COMMON SHARE Before extraordinary item and cumulative effect of a change in an accounting principle............. $ .55 $ .42 $ 1.20 $ .30 Extraordinary loss................................ (.03) -- -- (.03) Cumulative effect of a change in an accounting principle....................................... -- -- (.41) -- -------- -------- -------- -------- Net Earnings...................................... $ .52 $ .42 $ .79 $ .27 ======== ======== ======== ======== DILUTED EARNINGS PER COMMON SHARE Before extraordinary item and cumulative effect of a change in an accounting principle............. $ .55 $ .41 $ 1.20 $ .30 Extraordinary loss................................ (.03) -- -- (.03) Cumulative effect of a change in an accounting principle....................................... -- -- (.41) -- -------- -------- -------- -------- Net earnings...................................... $ .52 $ .41 $ .79 $ .27 ======== ======== ======== ======== Dividends paid.................................... .14 .14 .105 .105
46
YEAR ENDED NINE MONTHS ENDED DECEMBER 31, SEPTEMBER 30, ------------------- ------------------- 1998 1997 1999 1998 -------- -------- -------- -------- (UNAUDITED) BALANCE SHEET DATA: Working capital (deficit)......................... $ (9,543) $ (2,095) $ 4,236 $ (3,915) Property, plant and equipment, net................ 442,755 388,448 484,768 433,389 Current assets.................................... 66,086 69,687 81,891 60,969 Noncurrent assets................................. 109,315 67,834 128,698 103,167 Total assets...................................... 618,156 525,969 695,357 597,525 Current liabilities............................... 75,629 71,782 77,655 64,884 Noncurrent liabilities............................ 394,599 308,705 459,132 385,192 Stockholders' equity.............................. 147,928 145,482 158,570 147,449 OTHER DATA Ratio of earnings to fixed charges................ 1.2x 1.4x 1.7x 1.1x Book value per share.............................. $ 12.32 $ 11.99 $ 13.12 $ 12.28
AVAILABLE INFORMATION. The Company is subject to the information and reporting requirements of the Exchange Act and is required to file reports and other information with the Commission relating to its business, financial condition and other matters. Information, as of particular dates, concerning the Company's directors and officers, their remuneration, stock options granted to them, the principal holders of the Company's securities, any material interests of such persons in transactions with the Company and other matters is required to be disclosed in reports filed with the Commission. These reports and other information should be available for inspection at the public reference facilities of the Commission located in Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and also should be available for inspection and copying at prescribed rates at regional offices of the Commission located at Seven World Trade Center, New York, New York 10048 and 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of this material may also be obtained by mail, upon payment of the Commission's customary fees, from the Commission's principal office at 450 Fifth Street, N.W., Washington, D.C. 20549. Electronic filings filed through the Commission's Electronic Data Gathering, Analysis and Retrieval, or EDGAR, system, including those made by or in respect of the Company, are publicly available through the Commission's home page on the Internet at http://www.sec.gov. On February 10, 2000, the Company announced its results for the fourth quarter of 1999 and for the year ended December 31, 1999. According to the announcement, the Company had the following results:
THREE MONTHS ENDED TWELVE MONTHS ENDED DECEMBER 31 DECEMBER 31 ------------------- ------------------- 1999 1998* 1999 1998 -------- -------- -------- -------- ($ IN THOUSANDS, EXCEPT PER SHARE DATA) Revenues.............................................. $76,368 $65,849 $280,420 $242,394 Operating Income...................................... 9,042 10,544 39,551 31,823 Net Earnings.......................................... 1,641 3,010 11,205 6,258 Net Earnings per Share (basic)........................ 0.14 0.25 0.93 0.52 Net Earnings per Share (diluted)...................... 0.13 0.25 0.92 0.52
- ------------------------ * Restated to reflect a change in accounting policy for interim reporting for certain operating costs from an average costing method to an actual costing method as of January 1, 1998. 8. CERTAIN INFORMATION CONCERNING PURCHASER, PARENT, SUEZ, CAC AND SOCIETE GENERALE PURCHASER. Purchaser, a newly incorporated Delaware corporation, has not conducted any business other than in connection with the Offer and the Merger Agreement. All of the issued and outstanding shares of capital stock of Purchaser are held by CAC. The principal address of Purchaser is c/o Elyo, 235 47 Avenue Georges Clemenceau BP 4601 92746 Nanterre Cedex, France. The telephone number is 011-331-41-20-10-10. PARENT. Parent, a SOCIETE ANONYME organized and existing under the laws of the Republic of France, is a direct, wholly owned subsidiary of Societe Generale. The principal business of Parent is producing power and services, including cogeneration, district heating and cooling systems, waste-to-energy, electricity distribution and associated production, and operation and maintenance. The principal executive offices of Parent are located at 235 Avenue Georges Clemenceau BP 4601 92746 Nanterre Cedex, France. The telephone number is 011-331-41-20-10-10. SUEZ. Suez Lyonnaise des Eaux is a publicly-held SOCIETE ANONYME organized and existing under the laws of the Republic of France. The principal business of Suez is operating private infrastructure services in more than 120 countries, providing electricity and natural gas, waste treatment, communications services, and water services and maintains interests in construction, and capital investments. Suez was formed as a result of the 1997 merger of Compagnie de Suez (builder of the Suez Canal) and Lyonnaise des Eaux. The principal executive offices of Suez are located at 1, rue d'Astorg, 75008 Paris, France. The telephone number is 011-33-1-40-06-64-00. CAC. Cofreth American Corporation, a Delaware corporation, is a direct, wholly owned subsidiary of Parent which, as of the date of this Offer to Purchase, holds 4,870,670 Shares. The principal business of CAC is holding the Shares on behalf of Parent. The principal address of CAC is c/o Trigen Energy Corporation, One Water Street, White Plains, New York 10601. SOCIETE GENERALE. Societe Generale de Belgique, a SOCIETE ANONYME A DIRECTOIRE ET CONSEIL DE SURVEILLANCE organized and existing under the laws of the Republic of Belgium, is a direct subsidiary of Suez. The principal business of Societe Generale is to hold Suez's equity participation in financial and energy-related businesses. The principal executive offices of Societe Generale are located at Rue Royale 30, B-100 Brussels, Belgium. The name, business address, citizenship, present principal occupation and employment history for the past five years of each of the directors and executive officers of Purchaser, Parent and Suez are set forth in Schedule I to this Offer to Purchase. During the last five years, none of Purchaser, Parent, Suez, CAC, Societe Generale or, to the best of their knowledge, any of the persons listed in Schedule I to this Offer to Purchase (i) has been convicted in a criminal proceeding (excluding traffic violations and similar misdemeanors) or (ii) was a party to any judicial or administrative proceeding that resulted in a judgment, decree or final order enjoining the person from future violations of, or prohibiting activities subject to, federal or state securities laws, or a finding of any violation of federal or state securities laws. Except as described in this Offer to Purchase (i) none of Purchaser, Parent, Suez, CAC, Societe Generale or, to the best of their knowledge, any of the persons listed in Schedule I to this Offer to Purchase, or any associate or majority-owned subsidiary of Suez, Parent, Purchaser or the Company, beneficially owns or has any right to acquire, directly or indirectly, any equity securities of the Company and (ii) none of Purchaser, Parent, Suez, CAC, Societe Generale or to the best of their knowledge, any of the persons or entities referred to above has effected any transaction in such equity securities during the past 60 days. Suez, Parent and Purchaser disclaim beneficial ownership of any Common Stock owned by any pension plans of Suez, Parent, Purchaser or any affiliate of Suez, Parent or Purchaser. Except as described in this Offer to Purchase, none of Purchaser, Parent, Suez, CAC, Societe Generale or, to the best of their knowledge, any of the persons listed in Schedule I to this Offer to Purchase has any contract, arrangement, understanding or relationship with any other person with respect to any securities of the Company, including, but not limited to, any contract, arrangement, understanding or relationship concerning the transfer or voting of such securities, joint ventures, loan or option 48 arrangements, puts or calls, guarantees of loans, guarantees against loss or the giving or withholding of proxies. Except as set forth in this Offer to Purchase, since January 1, 1998, none of Purchaser, Parent, Suez, CAC, Societe Generale or to the best of their knowledge, any of the persons listed on Schedule I to this Offer to Purchase has had any business relationship or transaction with the Company or any of its executive officers, directors or affiliates that is required to be reported under the rules and regulations of the Commission applicable to the Offer. Except as set forth in this Offer to Purchase, since January 1, 1998, there have been no contacts, negotiations or transactions between any of Purchaser, Parent, Suez, CAC, Societe Generale or their affiliates or, to the best of their knowledge, any of the persons listed in Schedule I to this Offer to Purchase, on the one hand, and the Company or its 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. AVAILABLE INFORMATION. None of Purchaser, Parent, Suez, CAC or Societe Generale is subject to the informational reporting requirements of the Exchange Act, nor are any of them required to file reports and other information with the Commission relating to its businesses, financial condition or other matters. Except as otherwise disclosed in this Offer to Purchase, none of Purchaser, Parent or Suez have made, or are making, any provision in connection with the Offer or the Merger to grant unaffiliated security holders access to the files of any of Purchaser, Parent or Suez. 9. SOURCE AND AMOUNT OF FUNDS The Offer is not conditioned upon any financing arrangements. The amount of funds required by Purchaser to purchase all of the outstanding Common Stock pursuant to the Offer and to pay related fees and expenses is expected to be approximately $178 million. Purchaser will obtain such funds from Parent. Parent anticipates that it will obtain such funds from available credit lines and financial support of the Parent Group. The margin regulations promulgated by the Board of Governors of the Federal Reserve System (the "Federal Reserve Board") place restrictions on the amount of credit that may be extended for the purposes of purchasing margin stock, including if such credit is secured directly or indirectly by margin stock. Purchaser believes that the financing of the acquisition of the Shares will be in full compliance with the margin regulations. 10. EFFECT OF THE OFFER ON THE MARKET FOR THE COMMON STOCK; EXCHANGE ACT REGISTRATION MARKET FOR 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. STOCK QUOTATION. Shares are traded primarily on the New York Stock Exchange. According to published guidelines of the New York Stock Exchange, the Shares might no longer be eligible for quotation on the New York Stock Exchange if, among other things, the number of Shares publicly held was less than 1,100,000, there were fewer than 2,000 holders of round lots, the aggregate market value of the publicly held Shares was less than $40,000,000, net tangible assets were less than $40,000,000 and there were fewer than two registered and active market makers for the Shares. Shares held directly or indirectly by directors, officers or beneficial owners of more than 10 percent of the Shares are not considered as being publicly held for this purpose. According to the Company, as of January 27, 2000, there were 458 holders of record of Shares (not including beneficial holders of Shares in street name), and as of January 27, 2000, there were 12,401,808 Shares outstanding. If the Shares were to cease to be quoted on the New York Stock Exchange, the market for the Shares could be adversely affected. It is possible that the Shares would be traded or quoted on other securities exchanges or in the over-the-counter market, and that price quotations would be reported by such exchanges, or through Nasdaq or other sources. The extent of the public market for the Shares and the 49 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 and other factors. EXCHANGE ACT REGISTRATION. The Shares are currently registered under the Exchange Act. Such registration under the Exchange Act may be terminated upon application of the Company to the Commission if the Shares are neither listed on a national securities exchange nor held by 300 or more holders of record. Termination of registration under the Exchange Act would substantially reduce the information required to be furnished by the Company to its stockholders and to the Commission and would make certain provisions of the Exchange Act no longer applicable to the Company, such as the short-swing profit recovery provisions of Section 16(b) of the Exchange Act, the requirement of furnishing a proxy statement pursuant to Section 14(a) of the Exchange Act in connection with stockholders' meetings, the related requirement of furnishing an annual report to stockholders and the requirements of Rule 13e-3 under the Exchange Act with respect to "going private" transactions. 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 may be impaired or eliminated. Parent intends to seek to cause the Company to apply for termination of registration of the Common Stock under the Exchange Act as soon after the consummation of the Offer as the requirements for such termination are met. 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," as such term is defined under the regulations of the Federal Reserve Board, which has the effect, among other things, of allowing brokers to extend credit on the collateral of the Shares. Depending upon factors similar to those described above regarding listing and market quotations, it is possible that, following the Offer, the Shares would no longer constitute "margin securities" for the purposes of the margin regulations of the Federal Reserve Board and therefore could no longer be used as collateral for loans made by brokers. In any event, the Shares will cease to be "margin securities" if registration of the Shares under the Exchange Act is terminated. 11. CONDITIONS OF THE OFFER Notwithstanding any other term of the Offer or the Merger Agreement, Purchaser is not required to accept for payment or to pay for any shares of Common Stock not theretofore accepted for payment or paid for, and may terminate or amend the Offer if at any time on or after the date of the Merger Agreement and before the acceptance of such Shares for payment or the payment therefor, any of the following conditions exist or shall occur and remain in effect: (a) there shall have been instituted, pending or threatened any litigation by the Government of the United States or the Republic of France or by any agency or instrumentality thereof or by any other third person (including any individual, corporation, partnership, limited liability company, association, trust, unincorporated organization, entity or group (as defined in the Exchange Act)) or nongovernmental entity that would be reasonably likely to (i) restrict the acquisition by Parent or Purchaser (or any of its affiliates) of Shares pursuant to the Offer or restrain, prohibit or delay the making or consummation of the Offer or the Merger, (ii) make the purchase of or payment for some or all of the Shares pursuant to the Offer or the Merger illegal, (iii) impose limitations on the ability of Parent or Purchaser (or any of their affiliates) effectively to acquire or hold, or to require Parent, Purchaser or the Company or any of their respective affiliates or subsidiaries to dispose of or hold separate, any portion of their assets or the business of any one of them, (iv) impose material limitations on the ability of Parent, Purchaser or their affiliates to exercise full rights of ownership of 50 the shares of Common Stock 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, (v) limit or prohibit any material business activity by Parent, Purchaser or any of their affiliates, including, without limitation, requiring the prior consent of any person or entity (including the Government of the United States of America and the Republic of France, and any instrumentality thereof) to future transactions by Parent, Purchaser or any of their affiliates (Parent and Purchaser acknowledge that the regulatory nature of some of the Company's assets and businesses may result in the limitation of Parent's and its affiliates in certain utility-related areas) or (vi) make materially more costly (A) the making of the Offer, (B) the acceptance for payment of, or payment for, some or all of the Shares pursuant to the Offer, (C) the purchase of Shares pursuant to the Offer or (D) the consummation of the Merger; or (b) there shall have been a subsequent development in any action or proceeding relating to the Company or any of its subsidiaries that would (i) be reasonably likely to be materially adverse either to Parent and Purchaser or to Company and its subsidiaries taken as a whole or (ii) make materially more costly (A) the making of the Offer, (B) the acceptance for payment of, or payment for, some or all of the Shares pursuant to the Offer, (C) the purchase of Shares pursuant to the Offer or (D) the consummation of the Merger; or (c) there shall have been any action taken, or any law promulgated, enacted, entered, enforced or deemed applicable to the Offer or the Merger by any governmental entity that could directly or indirectly result in any of the consequences referred to in subsection (a) above; or (d) the Merger Agreement shall have been terminated in accordance with its terms; or (e) the Tender and Voting Agreement or the Casten Stock Purchase Agreement shall not be in effect; or (f) (i) any of the representations and warranties made by the Company in the Merger Agreement that are qualified by materiality or Material Adverse Effect shall not have been true and correct in all respects when made, or shall thereafter have ceased to be true and correct in all respects as if made at the scheduled or extended expiration of the Offer (except to the extent that any such representation or warranty refers specifically to another date, in which case such representation or warranty shall be true and correct in all respects as of such other date), or the other representations and warranties made by the Company in the Merger Agreement shall not have been true and correct in all material respects when made, or shall thereafter have ceased to be true and correct in all material respects as if made at the scheduled or extended expiration of the Offer (except to the extent that any such representation or warranty refers specifically to another date, in which case such representation or warranty shall be true and correct in all material respects as of such other date), or (ii) the Company shall have breached or failed to comply in any material respect with any of its obligations under the Merger Agreement; or (g) Parent and the Special Committee shall have agreed that Parent will terminate the Offer or postpone the acceptance for payment of or payment for Shares thereunder; or (h) there shall have occurred (i) any general suspension of, or limitation on prices for, trading in securities on any national securities exchange or in the over-the-counter market in the United States, (ii) a declaration of any banking moratorium by federal or state authorities or any suspension of payments in respect of banks or any limitation (whether or not mandatory) imposed by federal or state authorities on the extension of credit by lending institutions in the United States or the Republic of France, (iii) any mandatory limitation by the federal government that has a material adverse effect generally on the extension of credit by banks and other financial institutions generally, (iv) a commencement of a war, armed hostilities or any other international or national calamity directly or indirectly involving the United States or the Republic of France, or (v) in the case of any of the 51 foregoing existing at the time of the commencement of the Offer, in the sole judgment of the Parent, a material acceleration or worsening thereof. The foregoing conditions are for the sole benefit of Parent and Purchaser and may be asserted by Purchaser or Parent regardless of the circumstances giving rise to any such condition and may be waived by Purchaser or Parent, in whole or in part, at any time and from time to time in their discretion. The failure by Parent or Purchaser at any time to exercise any of the foregoing rights shall not be deemed a waiver of any such right, the waiver of any such right with respect to particular facts and other circumstances shall not be deemed a waiver with respect to any other facts and circumstances, and each such right shall be deemed an ongoing right that may be asserted at any time and from time to time. 12. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS GENERAL. Except as otherwise disclosed herein, neither Parent nor Purchaser is aware of (i) any license or regulatory permit that appears to be material to the business of the Company and its subsidiaries, taken as a whole, that might be adversely affected by the acquisition of Shares by Purchaser pursuant to the Offer or the Merger or otherwise or (ii) any approval or other action by any governmental, administrative or regulatory agency or authority, domestic or foreign, that would be required for the acquisition or ownership of Shares by Purchaser as contemplated herein. Should any such approval or other action be required, Purchaser currently contemplates that it would seek such approval or action. Purchaser's obligation under the Offer to accept for payment and pay for Shares is subject to certain conditions. See "--Conditions of the Offer." While, except as described in this Offer to Purchase, Purchaser does not currently intend to delay the acceptance for payment of Shares tendered pursuant to the Offer pending the outcome of any such matter, there can be no assurance that any such approval or action, if needed, would be obtained or would be obtained without substantial conditions, that adverse consequences might not result to the business of the Company, Suez, Parent or Purchaser or that certain parts of the businesses of the Company, Suez, Parent or Purchaser might not have to be disposed of in the event that such approvals were not obtained or any other actions were not taken. STATE TAKEOVER LAWS. The Company is incorporated under the laws of the State of Delaware. In general, Section 203 of the DGCL prevents an "interested stockholder" (generally a person who owns or has the right to acquire 15% or more of a corporation's outstanding voting stock, or an affiliate or associate thereof) from engaging in a "business combination" (defined to include mergers and certain other transactions) with a Delaware corporation for a period of three years following the date such person became an interested stockholder unless, among other things, prior to the date the interested stockholder became an interested stockholder, the board of directors of the corporation approved either the business combination or the transaction in which the interested stockholder became an interested stockholder. The Company has represented to Parent and Purchaser in the Merger Agreement that the Board of Directors has taken all necessary action so that the restrictions contained in Section 203 of the DGCL applicable to a "business combination" will not apply to the execution, delivery or performance of the Merger Agreement, the Offer, the Merger or the transactions contemplated by the Merger Agreement or the Casten Stock Purchase Agreement. A number of other states 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 acquirer from voting on the affairs of a target corporation without the prior approval of the remaining stockholders. The state law before the Supreme 52 Court was by its terms applicable only to corporations that had a substantial number of holders in the state and were incorporated there. The Company, directly or through subsidiaries, conducts business in a number of states throughout the United States, some of which have enacted takeover laws. Purchaser does not believe that any state takeover statutes apply to the Offer. Neither Parent nor Purchaser has currently complied with any state takeover statute or regulation. Purchaser reserves the right to challenge the applicability or validity of any state law purportedly applicable to the Offer or the Merger and nothing in this Offer to Purchase or any action taken in connection with the Offer or the Merger is intended as a waiver of such right. 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 or the Merger, Purchaser might be required to file certain information with, or receive approvals from, the relevant state authorities. In addition, if enjoined, 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, Purchaser may not be obligated to accept for payment any Shares tendered. See "--Conditions of the Offer." ANTITRUST. Under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules that have been promulgated thereunder by the Federal Trade Commission (the "FTC"), certain transactions may not be consummated unless certain information has been furnished to the Antitrust Division of the Department of Justice and the FTC and certain waiting period requirements have been satisfied. However, the acquisition of Shares by Purchaser pursuant to the Offer is not subject to these requirements because Parent and its affiliates currently owns in excess of 50% of the outstanding Shares. OTHER MATTERS. In September, 1999, three individual stockholders of the Company, namely Michael Fothergill, Rosa Cortez and Sarah Berkowitz, filed complaints (the "Complaints") in the Court of Chancery for the State of Delaware against the Company, Parent and certain officers and directors of the Company, Suez and Parent, with respect to the Company's September 21, 1999 announcement that it had received from Suez, through Parent, an offer to purchase all of the outstanding shares it did not already hold at a price of $22 per Share. The Complaints, which are substantively identical, purport to assert class action claims on behalf of all persons, other than the defendants and their affiliates, who own Shares. The essence of the Complaints is that the per share price of the $22 Offer contained in the September 21, 1999 announcement is inadequate, and that any agreement between Suez and the Company to consummate an offer at that price would constitute a breach of the fiduciary duties owed by the defendants to the minority stockholders of the Company. The Complaints seek injunctive relief, recission, damages, costs (including attorneys' and experts' fees) and other relief. The Complaints have been consolidated into a single class action litigation (the "Class Action Litigation"). On January 20, 2000, one of the lead counsel for the purported class (the "Class") contacted counsel for Parent to discuss the status of the transaction in light of the announcement of the Merger Agreement, and to discuss the pending Class Action Litigation. As a result, counsel for Parent and counsel for the Class began to discuss means of settling the Class Action Litigation. Counsel for Parent advised counsel for the Class that one of the factors that Parent took into account in increasing its proposal from $22 per share to $23.50 was the Class Action Litigation. Over the next several weeks, Parent and counsel for the plaintiffs discussed the transaction. On February 15, 2000, a draft of the Offer to Purchase (the "Draft") was provided to counsel for the Class. On February 22, 2000, counsel for Parent and counsel for the Class reached an agreement in principle, subject to court approval, to settle the Class Action Litigation (the "Proposed Settlement") on behalf of a class consisting of all persons (other than the defendants and their affiliates) who own Shares or owned Shares after September 23, 1999, the date of the announcement of the $22 Offer (except as provided below). The Proposed Settlement is memorialized in a Memorandum of Understanding. The principal elements of the Proposed Settlement are (1) the undertaking by Purchaser, under certain 53 circumstances, to include a Subsequent Offering Period pursuant to Rule 14d-11 (described in "--Terms of the Offer"), and (2) the agreement to include as a schedule to this Offer to Purchase more detailed financial projections, containing business segment information, than the projections that had been contained in the Draft (see "SPECIAL FACTORS--Company Financial Projections") and (3) the agreement to include in the Offer to Purchase enhanced disclosure regarding information concerning engagements between CSFB and Parent (see "SPECIAL FACTORS--Position of Suez, Parent and Purchaser Regarding Fairness of the Offer and the Merger"). The Proposed Settlement further contemplates that the Class Action Litigation will be dismissed with prejudice, and that releases will be given to the Company, Parent, their employees, officers and directors, affiliates and agents, for all matters arising out of this transaction. The Proposed Settlement is subject to the execution of definitive settlement documents by all defendants and to court approval. Parent believes that under existing Delaware precedents and law, an informed stockholder who accepts the benefits of this transaction by having such stockholder's Shares purchased pursuant to the Offer or by voting for the Merger and accepting the consideration paid in connection therewith has accepted the transaction and, accordingly, were the settlement not approved, should not be included as a member of the purported class which participates in any subsequent class action recovery. If the conditions to the Proposed Settlement are not satisfied, Parent may under certain circumstances be entitled to terminate the Offer and not purchase any tendered Shares. See "--Conditions of the Offer." 13. FEES AND EXPENSES Except as set forth in this Offer to Purchase, neither Parent nor Purchaser will pay any fees or expenses to any broker, dealer or other person for soliciting tenders of Shares pursuant to the Offer. Parent and Purchaser have engaged Lazard Freres as the Dealer Manager in connection with the Offer, and as financial advisor in connection with Parent's proposed acquisition of the Company. Parent has also agreed to indemnify Lazard Freres and certain other persons against certain liabilities in connection with the Offer, including certain liabilities under the federal securities laws. See "--SPECIAL FACTORS--Analysis of Financial Advisor to Parent." Purchaser and Parent have also retained Harris Trust Company of New York 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, will be reimbursed for certain reasonable out-of-pocket expenses and will be indemnified against certain liabilities and expenses in connection therewith, including certain liabilities under the United States federal securities laws. In addition, Purchaser and Parent have retained Morrow & Co., Inc. to act as the Information Agent in connection with the Offer. The Information Agent will receive reasonable and customary compensation for its services, will be reimbursed for certain reasonable out-of-pocket expenses and will be indemnified against certain liabilities and expenses in connection therewith, including certain liabilities under the United States federal securities laws. Brokers, dealers, commercial banks and trust companies will be reimbursed by Purchaser for customary mailing and handling expenses incurred by them in forwarding offering material to their customers. 14. MISCELLANEOUS Purchaser is not aware of any jurisdiction where the making of the Offer is prohibited by any administrative or judicial action pursuant to any valid state statute. If Purchaser becomes aware of any valid state statute prohibiting the making of the Offer or the acceptance of Shares pursuant thereto, Purchaser will make a good faith effort to comply with such state statute or seek to have such statute declared inapplicable to the Offer. If, after such good faith effort, Purchaser cannot comply with any such state statute, the Offer will not be made to (and tenders will not be accepted from or on behalf of) the 54 stockholders in such state. In any jurisdiction where the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer shall be deemed to be made on behalf of Purchaser by the Dealer Manager or one or more registered brokers or dealers which are licensed under the laws of such jurisdiction. No person has been authorized to give any information or make any representation on behalf of Suez, Parent or Purchaser not contained in this Offer to Purchase or in the Letter of Transmittal and, if given or made, such information or representation must not be relied upon as having been authorized. Suez, Parent and Purchaser have filed with the Commission the Schedule TO, together with exhibits, pursuant to Sections 13(e) and 14(d)(1) of the Exchange Act and Rules 13e-3 and 14d-3 promulgated thereunder, furnishing certain additional information with respect to the Offer, and may file amendments thereto. The Schedule TO and any amendments thereto, including exhibits, may be inspected at, and copies may be obtained from, the same places and in the manner set forth in "--Certain Information Concerning the Company--Additional Information" (except that they will not be available at the regional offices of the Commission). February 28, 2000 T Acquisition Corp. 55 SCHEDULE I INFORMATION CONCERNING THE DIRECTORS AND EXECUTIVE OFFICERS OF SUEZ LYONNAISE DES EAUX, ELYO AND T ACQUISITION CORP. 1. SUPERVISORY BOARD AND EXECUTIVE OFFICERS OF SUEZ LYONNAISE DES EAUX Set forth below is the name, present principal occupation or employment and material occupations, positions, offices or employments for the past five years of each member of the Supervisory Board and each executive officer of Suez. The principal address of Suez Lyonnaise des Eaux and, unless indicated below, the current business address for each individual listed below is c/o Suez Lyonnaise des Eaux, 1, rue d'Astorg, 75008 Paris, France. Telephone: 011-33-1-40-06-64-00. Each such person is, unless indicated below, a citizen of France.
NAME AND CURRENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT; BUSINESS ADDRESS AGE MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS - ---------------- -------- -------------------------------------------------------- Jerome Monod................ 68 Chairman of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Chairman of the Board, Lyonnaise des Eaux (1980-1997). Jean Guy Gandois............ 69 Vice Chairman of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Chairman and CEO, Cockerill Sambre (1987-1999); President, French National Council of Employers (1996-1997); Chairman and CEO, Pechiney (1986-1996). Gerhard Cromme.............. 56 Chairman of the Executive Board, Thyssen Krupp AG (1999-present); Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Chairman of the Executive Board, Fried. Krupp AG Hoesch-Krupp (1989-1999). Mr. Cromme is a German citizen. Etienne Davignon............ 67 Chairman, Societe Generale de Belgique (1985-present); Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present). Mr. Davignon is a Belgian citizen. Paul Desmarais, Jr.......... 44 Chairman of the Board and Co-Chief Executive, Power Corporation of Canada (1998-present); Chairman of the Board, Power Financial Corporation (1990-present); Member of the Supervisory Board, Suez Lyonnaise des Eaux (1998-present); Director, Tractebel S.A. (1990-present); Director, Electrafina S.A. (1999-present); Director, Investors Group Inc. (1983-present); Director, London Insurance Group Inc. (1997-present); Director, London Life Insurance Company (1997-present); Director, Pargesa Holdings S.A. (1992-present); Director, Groupe Brux- elles Lambert S.A. (1990-present); Director, Imerys (1991-present); Director, Rhodia (1999-present); Director, GWL&A Financial (1998-present); Director, Great-West Life & Annuity Insurance Company (1991-present); Director, The Great-West Life Assurance Company (1994-present); Director, Great-West Lifeco Inc. (1984-present); Director, Gesca Ltd. (1985-present); Director, La Presse Ltd. (1981-present); Director, Les Journaux Trans-Canada Inc. (1996-present); Director, PetroFina S.A. (1992-1999); Director, Gold Circle Insurance
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NAME AND CURRENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT; BUSINESS ADDRESS AGE MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS - ---------------- -------- -------------------------------------------------------- Company (1990-1998); Director, ParFinance (1990-1998); Director, Royale-Vendome S.A. (1991-1998); Director, Fibelpar S.A. (1990-1998); Director, Les Publications J.T.C. Inc. (1985-1996); Director and Member of the International Council, INSEAD; Chairman, Canadian Foundation for International Management for INSEAD; Chairman, McGill University Faculty of Management International Advisory Board; Chairman, HEC Interna- tional Advisory Committee. Mr. Desmarais is a Canadian citizen. Reto Domeniconi............. 62 Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Directeur General, Nestle SA (1983-1996). Mr. Domeniconi is a Swiss citizen. Lucien Douroux.............. 65 Chairman of the Supervisory Board, Credit Agricole Indosuez (1999-present); Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Chief Executive Officer, Caisse Nationale de Credit Agricole (1993-1999). Pierre Faurre............... 57 Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Chairman and Chief Executive Officer, SAGEM (1987-present). Ricardo Fornesa Ribo........ 68 Member of the Supervisory Board, Suez Lyonnaise des Eaux (1998-present); Chief Executive Officer, Sociedad General de Aguas de Barcelona, S.A. (1979-present); Board Secretary and Assistant to the President, Caixa d'Estalvis i Pensions de Barcelona (1979-present); Vice President, Inmobiliara Colonial (1992-present); Director, E. Nacional Hidroelectrica del Ribagorzana (ENHER) Electricity (1994-present); Director, Derivados Forestales (1997-present); (Director, Cia de Telecomunicaciones de Chile (1997-present). President, Cia. de Seguros Adeslas, S.A. (1994-1998). Mr. Fornesa Ribo is a Spanish citizen. Albert Frere................ 73 Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Chairman of the Board, Groupe Bruxelles Lambert S.A. (1988-present); Chairman of the Board, Petrofina S.A. (1990-present); Chairman of the Board, Electrafina S.A. (1982-present); Chairman of the Board, Frere-Bourgeois S.A. (1970-present); Chairman of the Board, Erbe S.A. (1975-present); Deputy Chairman, Managing Director, and Member of the Executive Committee, Pargesa Holding S.A. (1981-present); Deputy Chairman, Compagnie Benelux Paribas S.A. (1973-pre- sent); Deputy Chairman, Total Fina S.A. (1999-present); Director, Coparex S.A. (1978-present); Director, Television Francaise 1, S.A. (1996-present); Director, L.V.M.H. S.A. (1997-present); Director, Audiofina S.A. (1992-present); Director, CLT/UFA (1987-present); Honorary Member of the Council of Regents, Banque Nationale de Belgique S.A. (1995-present). Mr. Frere is a Belgian citizen.
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NAME AND CURRENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT; BUSINESS ADDRESS AGE MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS - ---------------- -------- -------------------------------------------------------- Frederick Holliday.......... 64 Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Chairman, Northumbrian Water Group (1993-present); Chairman, The Go-Ahead Group Plc (as of 1997); Board Member, Brewin Dolphin Plc (as of 1996); Chairman, Northern Venture Capital Fund (1985); Board Member, Shell UK Limited (1980-1998); Board Member, Union Railways (1993-1996); Board Member, British Rail (1990-1993); Vice Chancellor, Durham University (1980-1990); Chairman, Northern Regional Board, Lloyds Bank (1986-1989); President of the Freshwater Biological Association; President, British Trust for Ornithology; former Council Member for WaterAid; former Chairman of the Nature Conservancy Council; Past President of the Scottish Marine Biological Association. Mr. Holliday is a British citizen. Philippe Jaffre............. 53 Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Chairman and Chief Executive Officer, Elf Aquitaine (1993-1999). Jacques Lagarde............. 61 Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Executive Vice President, the Gillette Company (1993-1998). Mr. Lagarde is an American citizen. Jean Peyrelevade............ 59 Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Chairman, Credit Lyonnais (1993-present). Claude Pierre-Brossolette... 71 Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Chairman, Caisse de Refinancement de l'Habit (1995-present); Director, Credit Lyonnais (1994-present); Chairman of the Supervisory Board, Picelli Cables (1992-present); Director, Compagnie des Signaux (1996-present); Chairman, Banque Eurofin (1995-1996). Jean Syrota................. 62 Member of the Supervisory Board, Suez Lyonnaise des Eaux (1997-present); Advisor, CEA (1999-present); Chairman and Chief Executive, Compagnie Generale des Matieres Nucleaires (COGEMA) (1988-present); Director, TOTAL S.A. (1993-present); Director, Framatome (1989-present); Permanent Representative of COGEMA, Usinor (1995-present); Director, SAGEM (1996-present); Board Member, CFC (1989-present); Board Member, FBFC (1989-present); Director, ERAP (1998-present); Director, CEA-Industrie (1993-1999); Permanent representative of COGEMA, EURODIF (1989-1997). Gerard Mestrallet........... 50 President of the Executive Board and Chief Executive Officer, Suez Lyonnaise des Eaux (1997-present); Chairman and Chief Executive Officer, Compagnie de Suez (1995-1997); Chief Executive Officer and Chairman of the Management Committee, Societe Generale de Belgique (1991-1995). Philippe Brongniart......... 61 Member of the Executive Board, Suez Lyonnaise des Eaux (1997-present); Director, Trigen Energy Corporation (199[ ]-present) Executive Vice President, Lyonnaise des Eaux (1993-1997).
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NAME AND CURRENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT; BUSINESS ADDRESS AGE MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS - ---------------- -------- -------------------------------------------------------- Francois Jaclot............. 50 Executive Vice President and Member of the Executive Board, Suez Lyonnaise des Eaux (1997-present); Director, Paris Premiere (1999-present); Director, Societe Generale de Belgique (1996-present); Director, GTM (1998-present); Director, Sita (1998-present); Director, Elyo (1998-present); Director, TPS (1998-present); Director, Banque Sofinco (1996-present); Director, Suez Industrie (1996-present); Director, M6 (1998-present); Director, Lyonnaise Communications (1998-present); Senior Executive Vice President; Compagnie de Suez (1996-1997); Managing Partner, Demachy Worms & Compagnie (1994-1995). Patrick Buffet.............. 46 Executive Vice President, Suez Lyonnaise des Eaux (1998-present); Director, Trigen Energy Corporation (1998-present); Director of International Holdings, Societe Generale de Belgique (1994-1998).
2. DIRECTORS AND EXECUTIVE OFFICERS OF ELYO Set forth below is the name, present principal occupation or employment and material occupations, positions, offices or employment for the past five years of each director and executive officer of Elyo. The principal address of Elyo and, unless indicated below, the current business address for each individual listed below is c/o Elyo, 235 Avenue Georges Clemenceau BP 4601 92746 Nanterre Cedex, France. Telephone: 011-331-41-20-10-10. Each such person is, unless indicated below, a citizen of France. Directors are identified by an asterisk.
NAME AND CURRENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT; BUSINESS ADDRESS AGE MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS - ---------------- -------- -------------------------------------------------------- Jean-Daniel Levy*........... 58 Managing Director, Elyo (1995-present). Christine Morin-Postel*..... 53 Chief Executive Officer of Societe Generale de Belgique (1997-present). Director and Chairman, Trigen Energy Corporation (2000-present); Chairman and Chief Executive Officer, Compagnie Hypothecaire (1995-1998); Chairman and Chief Executive Officer, credisuez (1995-1997); Managing Partner, Financiere Indosuez (1995-1996). Klaus Wendel*............... 56 Directeur des Participations of Societe Generale de Belgique (1998-present); Directeur des Systemes de Gestion, Societe Generale de Belgique (1988-1998). Mr. Wendel is a German citizen. Philippe Brongniart*........ 61 Member of the Executive Board, Suez Lyonnaise des Eaux (1997-present); Director, Trigen Energy Corporation (1997-present); Executive Vice President, Lyonnaise des Eaux (1993-1997). Patrick Buffet*............. 46 Executive Vice President, Suez Lyonnaise des Eaux (1998-present); Director, Trigen Energy Corporation (1998-present); Director of International Holdings, Societe Generale de Belgique (1994-1998). Francois Jaclot*............ 50 Executive Vice President and Member of the Executive Board, Suez Lyonnaise des Eaux (1997-present); Director, Societe
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NAME AND CURRENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT; BUSINESS ADDRESS AGE MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS - ---------------- -------- -------------------------------------------------------- Generale de Belgique (1996-present); Director, GTM (1998-present); Director, Sita (1998-present); Director, Elyo (1998-present); Director, TPS (1998-present); Director, Banque Sofinco (1996-present); Director, Suez Industrie (1996-present); Director, M6 (1998-present); Director, Lyonnaise Communications (1998-present); Senior Executive Vice President; Compagnie de Suez (1996-1997); Managing Partner, Demachy Worms & Com- pagnie (1994-1995). Olivier Kreiss*............. 57 Vice Chairman, GTM Group (1999-Present); Chairman and Chief Executive Officer, Degremont (1992-1999). Jacques Petry*.............. 45 Chairman and Chief Executive Officer, SITA (1996-present); President of the International Water Division, Suez Lyonnaise des Eaux (1995-1996). Bernard Kasriel*............ 53 Vice President and Chief Operating Officer, Lafarge S.A. (1995-present). Michel Bleitrach............ 54 Chairman and Chief Executive Officer, Elyo (1993-present) Director, Trigen Energy Corporation (1995-present); President and Director, T Acquisition Corp. (2000-present).
3. DIRECTORS AND EXECUTIVE OFFICERS OF T ACQUISITION CORP. Set forth below is the name, present principal occupation or employment and material occupations, positions, offices or employment for the past five years of each director and executive officer of T Acquisition Corp. Each person identified below has held his position since the formation of T Acquisition Corp. on January 14, 2000. The principal address of T Acquisition Corp. and, unless indicated below, the current business address for each individual listed below is c/o Cofreth American Corporation, 1 Water Street, White Plains, NY 10601. Telephone: (914) 948-9150. Each such person is, unless indicated below, a citizen of France. Directors are identified by an asterisk.
NAME AND CURRENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT; BUSINESS ADDRESS AGE MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS - ---------------- -------- -------------------------------------------------------- Michel Bleitrach*........... 54 President, T. Acquisition Corp. (2000-present); Chairman and Chief Executive Officer, Elyo (1993-present); Director, Trigen Energy Corporation (1995-present). Olivier Degos*.............. 37 Treasurer and Secretary, T Acquisition Corp. (2000-present); International Director, Elyo (1999-present); Director, Trigen Energy Corporation (1999-present); Chief Financial Officer, Elyo (1995-1998); Deputy Chief Financial Officer; The SITA Group (1994-1995). Michel Caillard............. 46 Vice President, T Acquisition Corp. (2000-present); General Counsel, Elyo (1997-present); General Counsel, F.C.R. (1995-1997).
I-5 SCHEDULE II SECTION 262 OF THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE SECTION 262. APPRAISAL RIGHTS (a) Any stockholder of a corporation of this State who holds shares of stock on the date of the making of a demand pursuant to subsection (d) of this section with respect to such shares, who continuously holds such shares through the effective date of the merger or consolidation, who has otherwise complied with subsection (d) of this section and who has neither voted in favor of the merger or consolidation nor consented thereto in writing pursuant to sec. 228 of this title shall be entitled to an appraisal by the Court of Chancery of the fair value of the stockholder's shares of stock under the circumstances described in subsections (b) and (c) of this section. As used in this section, the word "stockholder" means a holder of record of stock in a stock corporation and also a member of record of a nonstock corporation; the words "stock" and "share" mean and include what is ordinarily meant by those words and also membership or membership interest of a member of a nonstock corporation; and the words "depository receipt" mean a receipt or other instrument issued by a depository representing an interest in one or more shares, or fractions thereof, solely of stock of a corporation, which stock is deposited with the depository. (b) Appraisal rights shall be available for the shares of any class or series of stock of a constituent corporation in a merger or consolidation to be effected pursuant to sec. 251 (other than a merger effected pursuant to sec. 251(g) of this title), secs. 252, 254, 257, 258, 263 or 264 of this title: (1) Provided, however, that no appraisal rights under this section shall be available for the shares of any class or series of stock, which stock, or depository receipts in respect thereof, at the record date fixed to determine the stockholders entitled to receive notice of and to vote at the meeting of stockholders to act upon the agreement of merger or consolidation, were either (i) listed on a national securities exchange or designated as a national market system security on an interdealer quotation system by the National Association of Securities Dealers, Inc. or (ii) held of record by more than 2,000 holders; and further provided that no appraisal rights shall be available for any shares of stock of the constituent corporation surviving a merger if the merger did not require for its approval the vote of the stockholders of the surviving corporation as provided in subsection (f) of sec. 251 of this title. (2) Notwithstanding paragraph (1) of this subsection, appraisal rights under this section shall be available for the shares of any class or series of stock of a constituent corporation if the holders thereof are required by the terms of an agreement of merger or consolidation pursuant to secs. 251, 252, 254, 257, 258, 263 and 264 of this title to accept for such stock anything except: a. Shares of stock of the corporation surviving or resulting from such merger or consolidation, or depository receipts in respect thereof; b. Shares of stock of any other corporation, or depository receipts in respect thereof, which shares of stock (or depository receipts in respect thereof) or depository receipts at the effective date of the merger or consolidation will be either listed on a national securities exchange or designated as a national market system security on an interdealer quotation system by the National Association of Securities Dealers, Inc. or held of record by more than 2,000 holders; c. Cash in lieu of fractional shares or fractional depository receipts described in the foregoing subparagraphs a. and b., of this paragraph; or d. Any combination of the shares of stock, depository receipts and cash in lieu of fractional shares or fractional depository receipts described in the foregoing subparagraphs a., b. and c. of this paragraph. (3) In the event all of the stock of a subsidiary Delaware corporation party to a merger effected under sec. 253 of this title is not owned by the parent corporation immediately prior to the merger, appraisal rights shall be available for the shares of the subsidiary Delaware corporation. II-1 (c) Any corporation may provide in its certificate of incorporation that appraisal rights under this section shall be available for the shares of any class or series of its stock as a result of an amendment to its certificate of incorporation, any merger or consolidation in which the corporation is a constituent corporation or the sale of all or substantially all of the assets of the corporation. If the certificate of incorporation contains such a provision, the procedures of this section, including those set forth in subsections (d) and (e) of this section, shall apply as nearly as is practicable. (d) Appraisal rights shall be perfected as follows: (1) If a proposed merger or consolidation for which appraisal rights are provided under this section is to be submitted for approval at a meeting of stockholders, the corporation, not less than 20 days prior to the meeting, shall notify each of its stockholders who was such on the record date for such meeting with respect to shares for which appraisal rights are available pursuant to subsection (b) or (c) hereof that appraisal rights are available for any or all of the shares of the constituent corporations, and shall include in such notice a copy of this section. Each stockholder electing to demand the appraisal of such stockholder's shares shall deliver to the corporation, before the taking of the vote on the merger or consolidation, a written demand for appraisal of such stockholder's shares. Such demand will be sufficient if it reasonably informs the corporation of the identity of the stockholder and that the stockholder intends thereby to demand the appraisal of such stockholder's shares. A proxy or vote against the merger or consolidation shall not constitute such a demand. A stockholder electing to take such action must do so by a separate written demand as herein provided. Within 10 days after the effective date of such merger or consolidation, the surviving or resulting corporation shall notify each stockholder of each constituent corporation who has complied with this subsection and has not voted in favor of or consented to the merger or consolidation of the date that the merger or consolidation has become effective; or (2) If the merger or consolidation was approved pursuant to sec. 228 or sec. 253 of this title, each constitutent corporation, either before the effective date of the merger or consolidation or within ten days thereafter, shall notify each of the holders of any class or series of stock of such constitutent corporation who are entitled to appraisal rights of the approval of the merger or consolidation and that appraisal rights are available for any or all shares of such class or series of stock of such constituent corporation, and shall include in such notice a copy of this section; provided that, if the notice is given on or after the effective date of the merger or consolidation, such notice shall be given by the surviving or resulting corporation to all such holders of any class or series of stock of a constituent corporation that are entitled to appraisal rights. Such notice may, and, if given on or after the effective date of the merger or consolidation, shall, also notify such stockholders of the effective date of the merger or consolidation. Any stockholder entitled to appraisal rights may, within 20 days after the date of mailing of such notice, demand in writing from the surviving or resulting corporation the appraisal of such holder's shares. Such demand will be sufficient if it reasonably informs the corporation of the identity of the stockholder and that the stockholder intends thereby to demand the appraisal of such holder's shares. If such notice did not notify stockholders of the effective date of the merger or consolidation, either (i) each such constitutent corporation shall send a second notice before the effective date of the merger or consolidation notifying each of the holders of any class or series of stock of such constitutent corporation that are entitled to appraisal rights of the effective date of the merger or consolidation or (ii) the surviving or resulting corporation shall send such a second notice to all such holders on or within 10 days after such effective date; provided, however, that if such second notice is sent more than 20 days following the sending of the first notice, such second notice need only be sent to each stockholder who is entitled to appraisal rights and who has demanded appraisal of such holder's shares in accordance with this subsection. An affidavit of the secretary or assistant secretary or of the transfer agent of the corporation that is required to give either notice that such notice has been given shall, in the absence of fraud, be prima facie evidence of the facts stated therein. For purposes of determining the stockholders entitled to receive either notice, each constitutent corporation may fix, in advance, a record date that shall be not more than 10 days prior to the date the notice is given, provided, that if the notice is given on or after the effective date of the merger or consolidation, the record date shall II-2 be such effective date. If no record date is fixed and the notice is given prior to the effective date, the record date shall be the close of business on the day next preceding the day on which the notice is given. (e) Within 120 days after the effective date of the merger or consolidation, the surviving or resulting corporation or any stockholder who has complied with subsections (a) and (d) hereof and who is otherwise entitled to appraisal rights, may file a petition in the Court of Chancery demanding a determination of the value of the stock of all such stockholders. Notwithstanding the foregoing, at any time within 60 days after the effective date of the merger or consolidation, any stockholder shall have the right to withdraw such stockholder's demand for appraisal and to accept the terms offered upon the merger or consolidation. Within 120 days after the effective date of the merger or consolidation, any stockholder who has complied with the requirements of subsections (a) and (d) hereof, upon written request, shall be entitled to receive from the corporation surviving the merger or resulting from the consolidation a statement setting forth the aggregate number of shares not voted in favor of the merger or consolidation and with respect to which demands for appraisal have been received and the aggregate number of holders of such shares. Such written statement shall be mailed to the stockholder within 10 days after such stockholder's written request for such a statement is received by the surviving or resulting corporation or within 10 days after expiration of the period for delivery of demands for appraisal under subsection (d) hereof, whichever is later. (f) Upon the filing of any such petition by a stockholder, service of a copy thereof shall be made upon the surviving or resulting corporation, which shall within 20 days after such service file in the office of the Register in Chancery in which the petition was filed a duly verified list containing the names and addresses of all stockholders who have demanded payment for their shares and with whom agreements as to the value of their shares have not been reached by the surviving or resulting corporation. If the petition shall be filed by the surviving or resulting corporation, the petition shall be accompanied by such a duly verified list. The Register in Chancery, if so ordered by the Court, shall give notice of the time and place fixed for the hearing of such petition by registered or certified mail to the surviving or resulting corporation and to the stockholders shown on the list at the addresses therein stated. Such notice shall also be given by 1 or more publications at least 1 week before the day of the hearing, in a newspaper of general circulation published in the City of Wilmington, Delaware or such publication as the Court deems advisable. The forms of the notices by mail and by publication shall be approved by the Court, and the costs thereof shall be borne by the surviving or resulting corporation. (g) At the hearing on such petition, the Court shall determine the stockholders who have complied with this section and who have become entitled to appraisal rights. The Court may require the stockholders who have demanded an appraisal for their shares and who hold stock represented by certificates to submit their certificates of stock to the Register in Chancery for notation thereon of the pendency of the appraisal proceedings; and if any stockholder fails to comply with such direction, the Court may dismiss the proceedings as to such stockholder. (h) After determining the stockholders entitled to an appraisal, the Court shall appraise the shares, determining their fair value exclusive of any element of value arising from the accomplishment or expectation of the merger or consolidation, together with a fair rate of interest, if any, to be paid upon the amount determined to be the fair value. In determining such fair value, the Court shall take into account all relevant factors. In determining the fair rate of interest, the Court may consider all relevant factors, including the rate of interest which the surviving or resulting corporation would have had to pay to borrow money during the pendency of the proceeding. Upon application by the surviving or resulting corporation or by any stockholder entitled to participate in the appraisal proceeding, the Court may, in its discretion, permit discovery or other pretrial proceedings and may proceed to trial upon the appraisal prior to the final determination of the stockholder entitled to an appraisal. Any stockholder whose name appears on the list filed by the surviving or resulting corporation pursuant to subsection (f) of this section and who has submitted such stockholder's certificates of stock to the Register in Chancery, if such is required, may participate fully in all proceedings until it is finally determined that such stockholder is not entitled to appraisal rights under this section. II-3 (i) The Court shall direct the payment of the fair value of the shares, together with interest, if any, by the surviving or resulting corporation to the stockholders entitled thereto. Interest may be simple or compound, as the Court may direct. Payment shall be so made to each such stockholder, in the case of holders uncertificated stock forthwith, and the case of holders of shares represented by certificates upon the surrender to the corporation of the certificates representing such stock. The Court's decree may be enforced as other decrees in the Court of Chancery may be enforced, whether such surviving or resulting corporation be a corporation of this State or of any state. (j) The costs of the proceeding may be determined by the Court and taxed upon the parties as the Court deems equitable in the circumstances. Upon application of a stockholder, the Court may order all or a portion of the expenses incurred by any stockholder in connection with the appraisal proceeding, including, without limitation, reasonable attorney's fees and the fees and expenses of experts, to be charged pro rata against the value of all the shares entitled to an appraisal. (k) From and after the effective date of the merger or consolidation, no stockholder who has demanded appraisal rights as provided in subsection (d) of this section shall be entitled to vote such stock for any purpose or to receive payment of dividends or other distributions on the stock (except dividends or other distributions payable to stockholders of record at a date which is prior to the effective date of the merger or consolidation); provided, however, that if no petition for an appraisal shall be filed within the time provided in subsection (e) of this section, or if such stockholder shall deliver to the surviving or resulting corporation a written withdrawal of such stockholder's demand for an appraisal and an acceptance of the merger or consolidation, either within 60 days after the effective date of the merger or consolidation as provided in subsection (e) of this section or thereafter with the written approval of the corporation, then the right of such stockholder to an appraisal shall cease. Notwithstanding the foregoing, no appraisal proceeding in the Court of Chancery shall be dismissed as to any stockholder without the approval of the Court, and such approval may be conditioned upon such terms as the Court deems just. (1) The shares of the surviving or resulting corporation to which the shares of such objecting stockholders would have been converted had they assented to the merger or consolidation shall have the status of authorized and unissued shares of the surviving or resulting corporation. (Last amended by Ch. 339, L. '98, eff. 7-1-98.) II-4 SCHEDULE III TRIGEN ENERGY CORPORATION JANUARY 2000 "COMMITTED CASE" FINANCIAL PROJECTIONS The Company has advised Suez, Parent and Purchaser that it does not, as a matter of course, disclose projections as to future revenues, earnings or other income statement data and the projections were not prepared with a view to public disclosure. In addition, the projections set forth below were not prepared in accordance with generally accepted accounting principles, or with a view to compliance with the published guidelines of the Commission or the American Institute of Certified Public Accountants regarding projections, which would require a more complete presentation of the data than as shown above. The projections have not been examined, reviewed or compiled by the Company's independent auditors, and accordingly they have not expressed an opinion or any other assurance on such projections. However, management of the Company does prepare internal financial projections prior to the start of each year as a matter of course. Such projections represent what management of the Company believes to be a reasonable estimate of the Company's future financial performance and reflect significant assumptions and subjective judgments by the Company's management regarding industry performance and general business and economic conditions, including assumptions regarding the Company's future development projects. The projections are included herein solely because such information was furnished to Parent and Purchaser prior to the Offer. Accordingly, none of Suez, Parent, Purchaser, the Company, or any other person assumes any responsibility as to the accuracy thereof. In addition, because the estimates and assumptions underlying the projections are inherently subject to significant economic and competitive uncertainties and contingencies, which are difficult or impossible to predict accurately and are beyond the control of the Company, Suez, Parent and Purchaser, there can be no assurance that results set forth in the above projections will be realized and it is expected that there will be differences between actual and projected results, and actual results may be materially higher or lower than those set forth below. For a description of certain assumptions relevant to these projections, see "SPECIAL FACTORS--Company Financial Projections." III-1 TRIGEN ENERGY CORPORATION 1 (A) COMMITTED CASE PROJECTIONS REVISED: JANUARY 7, 2000
BUDGET MEDIUM TERM PLAN ---------- -------------------------------------------------------------- 2000 2001 2002 2003 2004 2005 ---------- ---------- ---------- ---------- ---------- ---------- PHYSICALS Sales Steam.............. Mlb/yr 23,521,289 25,403,352 26,478,751 27,021,759 27,225,172 27,334,902 Hot Water.......... MMbtu/yr 1,708,642 2,103,386 2,183,014 2,184,281 2,206,406 2,206,406 Chilled Water...... MtonH/yr 157,488 166,761 227,277 228,914 231,259 232,917 Electricity........ Mwh/yr 1,282,201 1,539,117 1,580,616 1,654,519 1,652,215 1,619,133 REVENUES: Revenues from Sales Heating................................. 232,566 260,768 273,897 284,374 289,413 294,837 Cooling................................. 21,929 25,406 28,324 29,198 31,751 32,373 Electricity............................. 64,111 70,126 72,861 75,078 74,670 74,831 ---------- ---------- ---------- ---------- ---------- ---------- Total Revenues from Sales............... 318,605 356,300 375,082 388,650 395,833 402,042 % CHANGE FROM PRIOR YR................ 23.2% 11.8% 5.3% 3.6% 1.8% 1.6% Fees Earned & Other Revenue............... 41,734 44,110 43,875 45,437 47,567 49,481 Equity in Earnings/(Losses) of Unconsol. Entity.................................. 15,135 2,962 2,618 2,840 3,005 1,512 ---------- ---------- ---------- ---------- ---------- ---------- TOTAL REVENUES.......................... 375,474 403,371 421,575 436,927 446,405 453,034 % CHANGE FROM PRIOR YR................ 31.3% 7.4% 4.5% 3.6% 2.2% 1.5% EXPENSES Fuel & Consumables........................ 136,463 154,367 164,706 171,773 176,370 180,668 % OF TOTAL REVENUES................... 36.3% 38.3% 39.1% 39.3% 39.5% 39.9% Production & Operating Costs.............. 99,540 109,319 107,310 110,735 112,550 113,450 % OF TOTAL REVENUES................... 26.5% 27.1% 25.5% 25.3% 25.2% 25.0% Depreciation Expense...................... 27,674 31,725 34,867 35,644 36,378 36,979 % OF TOTAL REVENUES................... 7.4% 7.9% 8.3% 8.2% 8.1% 8.2% General & Admin. & Amortization........... 45,477 44,719 46,840 47,976 49,577 50,719 % OF TOTAL REVENUES................... 12.1% 11.1% 11.1% 11.0% 11.1% 11.2% ---------- ---------- ---------- ---------- ---------- ---------- Total Operating Expenses.................. 309,155 340,131 353,723 366,127 374,875 381,816 % OF TOTAL REVENUES................... 82.3% 84.3% 83.9% 83.8% 84.0% 84.3% Operating Income.......................... 66,319 63,241 67,853 70,800 71,530 71,218 % OF TOTAL REVENUES................... 17.7% 15.7% 16.1% 16.2% 16.0% 15.7% Interest Expense.......................... 34,377 35,410 37,208 34,340 31,970 28,599 Interest (Income)......................... (1,512) (1,530) (1,501) (1,910) (1,902) (1,893) Other Expense/(Income).................... 485 1,388 1,184 1,157 956 752 Minority Interest in Earn/(Loss) of Cons. Entity.................................. 5,536 8,367 7,843 8,659 8,429 9,602 ---------- ---------- ---------- ---------- ---------- ---------- INCOME BEFORE TAX......................... 27,434 19,605 23,119 28,555 32,077 34,158 % OF TOTAL REVENUES................... 7.3% 4.9% 5.5% 6.5% 7.2% 7.5% Income Tax Expense........................ 11,358 8,116 9,571 11,822 13,280 14,142 % OF INCOME BEFORE TAX................ 41.4% 41.4% 41.4% 41.4% 41.4% 41.4% NET INCOME BEF. EXTRAORD. GAIN / (LOSS)... 16,076 11,488 13,547 16,733 18,797 20,017 % OF TOTAL REVENUES................... 4.3% 2.8% 3.2% 3.8% 4.2% 4.4% Extraord. Gain / (Loss) Net of Tax........ -- -- -- -- -- -- ---------- ---------- ---------- ---------- ---------- ---------- NET INCOME................................ 16,076 11,488 13,547 16,733 18,797 20,017 EARNINGS PER SHARE........................ $ 1.33 $ 0.94 $ 1.11 $ 1.37 $ 1.53 $ 1.63 ---------- ---------- ---------- ---------- ---------- ---------- AVERAGE SHARES OUTSTANDING................ 12,122 12,157 12,194 12,226 12,252 12,269
III-2 TRIGEN ENERGY CORPORATION 1 (A) COMMITTED CASE PROJECTIONS REVISED: JANUARY 7, 2000
BUDGET MEDIUM TERM PLAN -------- ---------------------------------------------------- 2000 2001 2002 2003 2004 2005 -------- -------- -------- -------- -------- -------- CASH FLOWS FROM OPERATIONS Income BeforeTax & Minority Interest........... 32,970 27,972 30,962 37,214 40,506 43,761 Minority Interest in (Earnings)/Losses......... (5,536) (8,367) (7,843) (8,659) (8,429) (9,602) Income Tax Expense............................. (11,358) (8,116) (9,571) (11,822) (13,280) (14,142) ------- ------- ------- ------- ------- ------- NET INCOME................................. 16,076 11,488 13,547 16,733 18,797 20,017 Depreciation Expense........................... 27,674 31,725 34,867 35,644 36,378 36,979 Amortization Expense........................... 6,322 6,216 5,611 5,586 5,413 5,190 Deferred Tax Expense (Benefit)................. 2,092 528 855 (5,595) (242) (404) Minority Interest in Operations................ 5,536 8,367 7,843 8,659 8,429 9,602 Changes in Current Accounts: Accounts Receivable........................ (4,945) (2,672) (2,944) (1,958) 148 363 Inventory.................................. (22) (85) 12 (41) (21) (37) Prepaid Costs & Other Assets............... 1,117 (551) 1,511 1,522 972 (3,553) Accounts Payable........................... 5,819 4,357 (2) (20) (1,726) (1,807) Accrued Expenses........................... 4,435 (592) (449) (1,769) (2,117) (5,155) ------- ------- ------- ------- ------- ------- NET CASH PROVIDED BY OPERATIONS................ 64,104 58,781 60,852 58,761 66,031 61,196 CASH FLOW FROM INVESTING ACTIVITIES Plant, Property, and Equipment................. (93,573) (69,043) (11,452) (10,917) (5,044) (4,091) Investment in Subsidiaries..................... (6,398) (1,475) (1,801) (2,095) (2,260) (768) ------- ------- ------- ------- ------- ------- NET CASH (USED IN) INVESTING ACTIVITIES........ (99,971) (70,518) (13,254) (13,012) (7,304) (4,859) CASH FLOW FROM FINANCING ACTIVITIES Long Term Borrowings:.......................... 50,123 37,191 (23,785) (19,684) (30,598) (31,402) Common Stock Sales / (Repurchases)............. 944 773 773 773 773 579 Short Term Bank Debt, Net...................... 8,739 477 70 1,797 (1,838) (3,150) Change in Minority Interest.................... (5,388) (6,517) (2,709) (8,359) (8,094) (9,085) Payments on Long Term Debt & Obligations....... (18,550) (20,187) (21,947) (20,276) (18,969) (13,279) NET CASH PROVIDED BY FINANCING ACTIVITIES...... 35,868 11,737 (47,599) (45,749) (58,726) (56,337) ------- ------- ------- ------- ------- ------- NET INCREASE/(DECREASE) IN CASH................ 0 0 0 0 0 0 ------- ------- ------- ------- ------- ------- Dividends Paid................................. (1,697) (1,702) (1,707) (1,712) (1,715) (1,718)
III-3 TRIGEN ENERGY CORPORATION 1 (A) COMMITTED CASE PROJECTIONS REVISED: JANUARY 7, 2000
BUDGET MEDIUM TERM PLAN -------- ---------------------------------------------------- 2000 2001 2002 2003 2004 2005 -------- -------- -------- -------- -------- -------- ASSETS Current Assets Cash and Cash Equivalents.................. 15,000 15,000 15,000 15,000 15,000 15,000 Accounts Receivable, Net................... 55,973 58,645 61,589 63,547 63,399 63,036 Inventory, at Cost......................... 7,499 7,584 7,573 7,613 7,634 7,671 Prepaid Costs and other Current Assets..... 7,341 7,892 6,381 4,859 3,887 7,440 ------- ------- ------- ------- ------- ------- Current Assets........................... 85,814 89,122 90,543 91,019 89,920 93,147 Investment in Nonconsolidated Subsidiaries............................... 28,635 30,109 31,910 34,005 36,266 37,034 Non-Current Cash and Equivalents............. 4,581 4,581 4,581 4,581 4,581 4,581 Property, Plant, and Equipment, Net.......... 629,860 666,341 642,499 617,474 586,255 553,992 Other Deferred Costs and Intangible Assets... 66,633 61,666 56,939 52,347 48,176 44,533 ------- ------- ------- ------- ------- ------- TOTAL ASSETS............................. 815,522 851,819 826,473 799,426 765,198 733,287 ======= ======= ======= ======= ======= ======= LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Short Term Bank Debt....................... 41,286 41,763 41,833 43,630 41,792 38,642 Accounts Payable........................... 27,942 32,047 32,941 33,809 35,124 35,744 Accrued Expenses........................... 31,029 30,749 30,362 28,626 25,554 20,399 Current Portion of Long Term Debt.......... 11,942 5,619 22,044 15,039 8,001 7,245 ------- ------- ------- ------- ------- ------- Current Liabilities...................... 112,199 110,178 127,179 121,105 110,471 102,031 Total Long Term Debt......................... 466,640 483,644 437,912 397,952 348,385 303,704 Of Which, Current Portion of Long Term Debt....................................... (11,942) (5,619) (22,044) (15,039) (8,001) (7,245) Deferred Tax Liability....................... 48,577 49,105 49,961 44,365 44,123 43,719 ------- ------- ------- ------- ------- ------- TOTAL LIABILITIES........................ 615,474 637,308 593,007 548,383 494,978 442,209 Minority Interest in Consolidated Entities... 19,590 21,441 26,575 26,874 27,209 27,726 Stockholder's Equity Common Stock............................... 124 124 124 124 124 124 Additional Paid-in Capital................. 120,668 120,668 120,668 120,668 120,668 120,668 Treasury Stock & Restricted, at Cost....... (3,132) (2,359) (1,586) (814) (41) 538 Retained Earnings.......................... 62,796 74,636 87,685 104,190 122,260 142,021 ------- ------- ------- ------- ------- ------- TOTAL STOCKHOLDER'S EQUITY............... 180,457 193,070 206,891 224,169 243,011 263,352 ------- ------- ------- ------- ------- ------- TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY... 815,521 851,819 826,473 799,427 765,198 733,287 ======= ======= ======= ======= ======= =======
III-4 TRIGEN ENERGY CORPORATION 1 (A) COMMITTED CASE PROJECTIONS REVISED: JANUARY 5, 2000
KEY DATA AND RATIOS 2000 2001 2002 2003 2004 2005 - ------------------- -------- -------- -------- -------- -------- -------- EBIT IN '000 $........................ 66,319 63,241 67,853 70,800 71,530 71,218 % OF REVENUES......................... 18% 16% 16% 16% 16% 16% EBITDA IN '000 $...................... 98,996 99,982 107,439 111,160 112,622 112,899 % OF REVENUES......................... 26% 25% 25% 25% 25% 25% ------- ------- ------- ------- ------- ------- EBITDA/ASSETS IN %.................... 12.1% 11.7% 13.0% 13.9% 14.7% 15.4% ------- ------- ------- ------- ------- ------- AVERAGE INTEREST RATE................. 7.0% 6.9% 7.4% 7.5% 7.7% 7.8% ------- ------- ------- ------- ------- ------- Debt Coverage ratio before Tax (1).... 1.57 1.51 1.55 1.82 1.97 2.38 ------- ------- ------- ------- ------- ------- DEBT TO CAPITAL IN %.................. 71.7% 71.0% 67.3% 63.8% 59.1% 54.0% ------- ------- ------- ------- ------- ------- Pretax Interest Coverage.............. 1.89 1.75 1.79 2.03 2.20 2.46 ------- ------- ------- ------- ------- ------- Funds from Operations interest coverage............................ 2.59 2.60 2.64 2.72 3.09 3.42 ------- ------- ------- ------- ------- ------- Funds from Operations/Debt............ 0.18 0.18 0.21 0.21 0.25 0.29 ------- ------- ------- ------- ------- ------- TOTAL DEBT IN '000 $.................. 507,926 525,407 479,745 441,582 390,177 342,346 ------- ------- ------- ------- ------- ------- EBITDA/Interest expense............... 2.88 2.82 2.89 3.24 3.52 3.95 ------- ------- ------- ------- ------- ------- EPS................................... 1.33 0.95 1.12 1.38 1.56 1.66 ------- ------- ------- ------- ------- ------- INCOME BEFORE TAX..................... 27,434 19,605 23,119 28,555 32,077 34,158 ------- ------- ------- ------- ------- ------- NET INCOME............................ 16,076 11,488 13,547 16,733 18,797 20,017 ------- ------- ------- ------- ------- ------- ROE AFTER TAX--ON 1 YEAR (BASED ON AVERAGE EQUITY)..................... 9.3% 6.2% 6.8% 7.8% 8.0% 7.9% ------- ------- ------- ------- ------- ------- ROA BEFORE TAX........................ 13.6% 12.4% 12.7% 12.9% 13.0% 13.0% ------- ------- ------- ------- ------- ------- ROCE (BASED ON NOPAT WITH 41.4% TAXES).............................. 6.3% 5.8% 5.7% 6.1% 6.4% 6.7% ------- ------- ------- ------- ------- -------
III-5 Manually signed copies of the Letters of Transmittal, properly completed and duly signed, will be accepted. The Letter of Transmittal, Certificates and any other required documents should be sent by each stockholder or such stockholder's broker, dealer, commercial bank, trust company or other nominee to the Depositary at one of the addresses set forth below: THE DEPOSITARY FOR THE OFFER IS: HARRIS TRUST COMPANY OF NEW YORK BY MAIL: BY HAND OR OVERNIGHT COURIER: Wall Street Station Receive Window P.O. Box 1023 Wall Street Plaza New York, NY 10268-1023 88 Pine Street, 19(th) Floor New York, NY 10005
BY FACSIMILE TRANSMISSION: (FOR ELIGIBLE INSTITUTIONS ONLY) (212) 701-7636 or 7637 FOR INFORMATION TELEPHONE (CALL COLLECT): (212) 701-7624 Questions and requests for assistance may be directed to the Information Agent or the Dealer Manager at their respective addresses and telephone numbers as set forth below. Additional copies of this Offer to Purchase, the Letter of Transmittal, or other related tender offer materials may be obtained from the Information Agent or from brokers, dealers, commercial banks or trust companies. THE INFORMATION AGENT FOR THE OFFER IS: [LOGO] 445 Park Avenue, 5(th) Floor New York, New York 10022 Collect Call: (212) 754-8000 Banks and Brokerage Firms, Please Call: (800) 662-5200 Stockholders, Please Call: (800) 566-9061 THE DEALER MANAGER FOR THE OFFER IS: LAZARD FRERES & CO. LLC 30 Rockefeller Plaza New York, New York 10020 (212) 632-6717 EX-99.(A)(1)(II) 3 EXHIBIT 99(A)(1)(II) LETTER OF TRANSMITTAL TO TENDER SHARES OF COMMON STOCK OF TRIGEN ENERGY CORPORATION PURSUANT TO THE OFFER TO PURCHASE DATED FEBRUARY 28, 2000 BY T ACQUISITION CORP. AN INDIRECT WHOLLY OWNED SUBSIDIARY OF ELYO AN INDIRECT WHOLLY OWNED SUBSIDIARY OF SUEZ LYONNAISE DES EAUX THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, MARCH 24, 2000, UNLESS THE OFFER IS EXTENDED. THE DEPOSITARY FOR THE OFFER IS: HARRIS TRUST COMPANY OF NEW YORK BY MAIL: BY HAND/OVERNIGHT COURIER: Wall Street Station Receive Window P.O. Box 1023 Wall Street Plaza New York, NY 10268-1023 88 Pine Street, 19(th) Floor New York, NY 10005
BY FACSIMILE TRANSMISSION: (for Eligible Institutions only) (212) 701-7636 or 7637 FOR INFORMATION TELEPHONE (CALL COLLECT) (212) 701-7624 DESCRIPTION OF SHARES TENDERED NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S) (PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) APPEAR(S) ON THE CERTIFICATE(S) ENCLOSED CERTIFICATE(S)) (ATTACH ADDITIONAL SIGNED LIST, IF NECESSARY) CERTIFICATE TOTAL NUMBER OF NUMBER OF SHARES NUMBER(S)* SHARES REPRESENTED TENDERED** BY CERTIFICATE(S)* Total Number of Shares * Need not be completed by stockholders delivering Shares by book-entry transfer through the Depositary. ** Unless otherwise indicated, it will be assumed that all Shares represented by any certificates delivered to the Depositary are being tendered. See Instruction 4. CHECK HERE IF CERTIFICATES HAVE BEEN LOST OR MUTILATED. SEE INSTRUCTION 12.
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE TRANSMISSION TO A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY TO THE DEPOSITARY. YOU MUST SIGN THIS LETTER OF TRANSMITTAL IN THE APPROPRIATE SPACE PROVIDED BELOW AND COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW. 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 Trigen Energy Corporation. If either certificates evidencing Shares (as defined below) ("Certificates") are to be forwarded with this Letter of Transmittal or, unless an Agent's Message (as defined in the Offer to Purchase (as defined below)) is utilized, if delivery of Shares is to be made by book-entry transfer to an account maintained by Harris Trust Company of New York at the Book-Entry Transfer Facility (as defined under "THE TENDER OFFER--Acceptance for Payment and Payment for Shares" of the Offer to Purchase) pursuant to the procedures set forth under "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase. DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY. Stockholders whose Certificates are not immediately available or who cannot deliver their Certificates and all other required documents to the Depositary prior to the Expiration Date (as defined under "THE TENDER OFFER--Terms of the Offer" of the Offer to Purchase), or who cannot complete the procedures for book-entry transfer on a timely basis, must tender their Shares according to the guaranteed delivery procedures set forth under "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase. See Instruction 2. / / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER MADE TO AN ACCOUNT MAINTAINED BY THE DEPOSITARY WITH THE BOOK-ENTRY TRANSFER FACILITY AND COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN THE BOOK-ENTRY TRANSFER FACILITY MAY DELIVER SHARES BY BOOK-ENTRY TRANSFER): Name of Tendering Institution: _____________________________________________ Account Number: ____________________________________________________________ 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. PLEASE ENCLOSE A PHOTOCOPY OF SUCH NOTICE OF GUARANTEED DELIVERY. Name(s) of Registered Stockholder(s): ______________________________________ Window Ticket Number (if any): _____________________________________________ Date of Execution of Notice of Guaranteed Delivery: ________________________ Name of Institution which Guaranteed Delivery: _____________________________ NOTE: SIGNATURES MUST BE PROVIDED BELOW. PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY. 2 Ladies and Gentlemen: The undersigned hereby tenders to T Acquisition Corp., a Delaware corporation ("Purchaser") and a wholly owned subsidiary of Elyo, a SOCIETE ANONYME organized under the laws of the Republic of France ("Parent") and an indirect, wholly owned subsidiary of Suez Lyonnaise des Eaux, a SOCIETE ANONYME organized and existing under the laws of the Republic of France, the above-described shares of Common Stock, par value $0.01 per share (the "Shares"), of Trigen Energy Corporation, a Delaware corporation (the "Company"), pursuant to Purchaser's offer to purchase any and all of the outstanding Shares at a purchase price of $23.50 per Share, net to the seller in cash, without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated February 28, 2000 (the "Offer to Purchase"), receipt of which is hereby acknowledged, and in this Letter of Transmittal (which, as amended from time to time, together with the Offer to Purchase collectively constitute the "Offer"). The Offer is being made pursuant to an Agreement and Plan of Merger, dated as of January 19, 2000 (the "Merger Agreement"), among Parent, Purchaser and the Company. The undersigned understands that Purchaser reserves the right to assign its right to purchase all or any portion of the Shares tendered pursuant to the Offer to a wholly owned subsidiary of Parent, but any such assignment will not relieve Purchaser of its obligations under the Offer or prejudice the rights of the tendering stockholders to receive payment for Shares validly tendered and accepted for payment pursuant to the Offer. Subject to, and effective upon, acceptance for payment of, or payment for, the Shares tendered herewith, the undersigned hereby sells, assigns and transfers to, or upon the order of, Purchaser all right, title and interest in and to all the Shares that are being tendered hereby (and any and all other shares or other securities issued or issuable in respect of such Shares on or after the date of the Offer to Purchase) and irrevocably appoints Harris Trust Company of New York (the "Depositary") the true and lawful agent and attorney-in-fact of the undersigned with respect to such Shares (and such other shares or securities), with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest), to (a) deliver certificates for such Shares (and such other shares or securities), or transfer ownership of such Shares (and such other Shares or securities) on the account books maintained by the Book-Entry Transfer Facility, together, in any such case, with all accompanying evidences of transfer and authenticity, to or upon the order of the Purchaser, (b) present such Shares (and such other shares or securities) for transfer on the books of the Company and (c) receive all benefits and otherwise exercise all rights of beneficial ownership of such Shares (and such other shares or securities), all in accordance with the terms and subject to the conditions of the Offer. The undersigned hereby irrevocably appoints each designee of Purchaser as the attorney-in-fact and proxy of the undersigned, each with full power of substitution, to the full extent of the rights of the undersigned with respect to the Shares tendered herewith and accepted for payment by Purchaser prior to the time of any vote or other action (and any and all other shares or other securities issued or issuable in respect of such Shares on or after the date of the Offer to Purchase). All such powers of attorney and proxies shall be considered irrevocable and coupled with an interest. Such appointment will be effective when, and only to the extent that, Purchaser accepts such Shares for payment. Upon such acceptance for payment, all prior powers of attorney and proxies given by the stockholder with respect to such Shares (and such other shares and securities) will, without further action, be revoked and no subsequent powers of attorney and proxies may be given nor any subsequent written consents executed (and, if given or executed, will not be deemed effective). The designees of Purchaser will, with respect to the Shares (and such other shares and securities) for which such appointment is effective, be empowered to exercise all voting and other rights of such stockholder as they in their sole discretion may deem proper at any annual or special meeting of the Company's stockholders, or any adjournment or postponement thereof, by written consent in lieu of any such meeting or otherwise. Purchaser reserves the right to require that, in order for Shares to be deemed validly tendered, immediately upon Purchaser's payment for such Shares, Purchaser must be able to exercise full voting and other rights with respect to such Shares (and such other shares and securities), including voting at any meeting of stockholders then scheduled. 3 The undersigned hereby represents and warrants that the undersigned has full power and authority to tender, sell, assign and transfer the Shares tendered hereby (and any and all other shares or other securities issued or issuable in respect of such Shares on or after the date of the Offer to Purchase) and that when the same are accepted for payment by Purchaser, Purchaser will acquire good and unencumbered title thereto, free and clear of all liens, restrictions, charges and encumbrances and not subject to any adverse claim. The undersigned, upon request, will execute and deliver any additional documents deemed by the Depositary or Purchaser to be necessary or desirable to complete the sale, assignment and transfer of the Shares tendered hereby (and such other shares or securities). 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. The undersigned understands that tenders of Shares pursuant to any one of the procedures described under "THE TENDER OFFER--Terms of the Offer" of the Offer to Purchase and in the instructions hereto will constitute a binding agreement between the undersigned and Purchaser upon the terms and subject to the conditions of the Offer. The undersigned recognizes that, under certain circumstances set forth in the Offer to Purchase, Purchaser may not be required to accept for payment any of the Shares tendered hereby. Unless otherwise indicated in this Letter of Transmittal under "Special Payment Instructions," please issue the check for the purchase price and return any Shares not tendered or not purchased in the name(s) of the undersigned. Similarly, unless otherwise indicated under "Special Delivery Instructions," please mail the check for the purchase price and return any Certificates 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 and return any Shares not tendered or not purchased in the name(s) of, and mail such check and any certificates to, the person(s) so indicated. Unless otherwise indicated under "Special Payment Instructions," in the case of book-entry delivery of Shares, please credit the account maintained at the Book-Entry Transfer Facility with respect to any Shares not accepted for payment. The undersigned recognizes that Purchaser has no obligation, pursuant to the "Special Payment Instructions," to transfer any Shares from the name of the registered holder(s) thereof if Purchaser does not accept for payment any of the Shares so tendered. 4 - --------------------------------------------- SPECIAL PAYMENT INSTRUCTIONS (SEE INSTRUCTIONS 1, 5, 6 AND 7) To be completed ONLY if the check for the purchase price of Shares accepted for payment and/or Certificates for Shares not tendered or not accepted for payment are to be issued in the name of someone other than the undersigned, or if Shares delivered by book-entry transfer that are not accepted for payment are to be returned by credit to an account maintained at the Book-Entry Transfer Facility other than the account indicated above. Issue check and/or certificate(s) to: Name _______________________________________________________________________ (PLEASE TYPE OR PRINT) Address ____________________________________________________________________ ____________________________________________________________________________ ____________________________________________________________________________ (INCLUDE A ZIP CODE) __________________________________________________________________________ (RECIPIENT'S TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER) (ALSO COMPLETE SUBSTITUTE FORM W-9 BELOW) - --------------------------------------------------------- - --------------------------------------------------------- SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 1, 5, 6 AND 7) To be completed ONLY if the check for the purchase price of Shares accepted for payment and/or Certificates for Shares not tendered or not accepted for payment are to be mailed to someone other than the undersigned or to the undersigned at an address other than that shown above. Mail check and/or certificate(s) to: Name _______________________________________________________________________ (PLEASE TYPE OR PRINT) __________________________________________________________________________ Address ____________________________________________________________________ ____________________________________________________________________________ ____________________________________________________________________________ (INCLUDE A ZIP CODE) - ----------------------------------------------------- 5 - -------------------------------------------------------------------------------- IMPORTANT: STOCKHOLDER: SIGN HERE (PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW) ____________________________________________________________________________ ____________________________________________________________________________ SIGNATURE(S) OF STOCKHOLDER(S) Dated: _______________, 2000 (MUST BE SIGNED BY REGISTERED HOLDER(S) EXACTLY AS NAME(S) APPEAR(S) ON 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 SET FORTH FULL TITLE AND SEE INSTRUCTION 5). Name(s) ____________________________________________________________________ (PLEASE TYPE OR PRINT) Capacity (full title) ______________________________________________________ Address ____________________________________________________________________ ____________________________________________________________________________ (INCLUDE A ZIP CODE) __________________________________________________________________________ Area Code and Telephone No. ________________________________________________ (HOME) _____________________________________ (BUSINESS) Tax Identification Number or Social Security Number: _______________________ (COMPLETE SUBSTITUTE FORM W-9 BELOW) GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5) FOR USE BY FINANCIAL INSTITUTIONS ONLY, PLACE MEDALLION GUARANTEE IN SPACE BELOW. Authorized Signature(s): ___________________________________________________ Name: ______________________________________________________________________ (PLEASE TYPE OR PRINT) Title: _____________________________________________________________________ Name of Firm: ______________________________________________________________ Address: ___________________________________________________________________ ____________________________________________________________________________ (INCLUDE A ZIP CODE) Area Code and Telephone Number: ____________________________________________ Dated: ______________________________________________________________ , 1999 - -------------------------------------------------------------------------------- 6 INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER 1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, signatures on Letters of Transmittal must be guaranteed by a member in good standing of the Securities Transfer Agents Medallion Program, or by any other firm which is a bank, broker, dealer, credit union or savings association (each of the foregoing being referred to as an "Eligible Institution" and, collectively, as "Eligible Institutions"), except in cases where Shares are tendered (i) by a registered holder of Shares who has not completed either the box labeled "Special Delivery Instructions" or the box labeled "Special Payment Instructions" on the Letter of Transmittal or (ii) for the account of any Eligible Institution. See Instruction 5. If the Certificates are registered in the name of a person other than the signer of this Letter of Transmittal, or if payment is to be made, or Certificates not accepted for payment or not tendered are to be returned, to a person other than the registered holder, then the Certificates must be endorsed or accompanied by duly executed stock powers, in either case, signed exactly as the name of the registered holder appears on such Certificates, with the signatures on such Certificates or stock powers guaranteed by an Eligible Institution as provided herein. See Instruction 5. 2. REQUIREMENTS OF TENDER. This Letter of Transmittal is to be used if either Certificates are to be forwarded herewith or, unless an Agent's Message is utilized, if the delivery of Shares is to be made by book-entry transfer pursuant to the procedures set forth under "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase. Certificates for all physically delivered Shares, or a confirmation of a book-entry transfer into the Depositary's account at the Book-Entry Transfer Facility of all Shares delivered electronically, as well as a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile thereof) and any other documents required by this Letter of Transmittal or an Agent's Message (as defined in the Offer to Purchase) in the case of a book-entry delivery, must be received by the Depositary at one of its addresses set forth on the front page of this Letter of Transmittal by the Expiration Date (as defined in the Offer to Purchase). Stockholders who cannot deliver their Shares and all other required documents to the Depositary by the Expiration Date must tender their Shares pursuant to the guaranteed delivery procedures set forth under "THE TENDER OFFER--Procedures for Tendering Shares" 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 Purchaser, must be received by the Depositary prior to the Expiration Date; and (c) the Certificates for all tendered Shares, in proper form for transfer (or a Book-Entry Confirmation (as defined in the Offer to Purchase)), together with a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile thereof), and any required signature guarantees, or, in the case of a book-entry transfer, an Agent's Message, and any other documents required by this Letter of Transmittal must be received by the Depositary within three trading days after the date of execution of such Notice of Guaranteed Delivery, all as provided under "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase. The term "trading day" is any day on which the New York Stock Exchange is open for business. THE METHOD OF DELIVERY OF SHARES, THE LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK-ENTRY TRANSFER FACILITY, IS AT THE OPTION AND RISK OF THE TENDERING STOCKHOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. No alternative, conditional or contingent tenders will be accepted, and no fractional Shares will be purchased. By executing this Letter of Transmittal (or a manually signed facsimile thereof), the tendering stockholder waives any right to receive any notice of the acceptance for payment of the Shares. 3. INADEQUATE SPACE. If the space provided in this Letter of Transmittal is inadequate, the information required under "Description of Shares Tendered" 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 the Shares represented by any Certificate delivered to the Depositary are to be tendered, fill in the number of Shares which are to be tendered in the box entitled "Number of Shares Tendered." In such case, a new Certificate for the remainder of the Shares represented by the old Certificate(s) 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 after the Expiration Date. All Shares represented by Certificate(s) delivered to the Depositary will be deemed to have been tendered unless otherwise indicated. 7 5. SIGNATURES ON LETTER OF TRANSMITTAL; INSTRUMENTS OF TRANSFER AND ENDORSEMENTS. If this Letter of Transmittal is signed by the registered holder(s) of the Shares tendered hereby, the signature(s) must correspond with the name(s) as written on the face of the Certificates without alteration, enlargement or any change whatsoever. If any of the Shares 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 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 tendered hereby, no endorsements of Certificates or separate stock powers are required unless payment of the purchase price is to be made, or Shares not tendered or not purchased are to be returned, in the name of any person other than the registered holder(s), in which case, the Certificate(s) for such Shares tendered hereby must be endorsed, or accompanied by appropriate stock powers, in either case, signed exactly as the name(s) of the registered holder(s) appears(s) on the Certificate(s) for such Shares. 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 tendered hereby, the Certificate 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. 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 Purchaser of the authority of such person so to act must be submitted. 6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, Purchaser will pay any stock transfer taxes with respect to the sale and transfer of any Shares to it or its order pursuant to the Offer. If, however, payment of the purchase price is to be made to, or Shares 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 purchased is to be issued, or any Shares 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 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 by book-entry transfer may request that Shares not purchased be credited to an account maintained at the Book-Entry Transfer Facility as such stockholder may designate under "Special Payment Instructions." If no such instructions are given, any such Shares not purchased will be credited to an account maintained at the Book-Entry Transfer Facility. 8 8. SUBSTITUTE FORM W-9. Each tendering stockholder is required to provide the Depositary with a correct Taxpayer Identification Number ("TIN") on Substitute Form W-9, which is provided under "Important Tax Information" below and to certify that the stockholder is not subject to backup withholding. Failure to provide the information on the Substitute Form W-9 may subject the tendering stockholder to a penalty and 31% federal income tax backup withholding on the payment of the purchase price for the Shares. If the tendering stockholder has not been issued a TIN and has applied for a TIN or intends to apply for a TIN in the near future, the tendering stockholder should follow the instructions set forth in Part 3 of the Substitute Form W-9 and sign and date both the Substitute Form W-9 and the "Certificate of Awaiting Taxpayer Identification Number." If the stockholder has indicated in Part 3 that a TIN has been applied for and the Depositary is not provided with a TIN by the time of payment, the Depositary will withhold 31% of all payments of the purchase price, if any, made thereafter pursuant to the Offer until a TIN is provided to the Depositary. Such amounts, however, will be refunded if a TIN is provided to the Depositary within 60 days. 9. FOREIGN HOLDERS. Foreign holders must submit a completed IRS Form W-8 to avoid 31% backup withholding. IRS Form W-8 may be obtained by contacting the Depositary at one of the addresses on the face of this Letter of Transmittal. 10. 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. 11. WAIVER OF CONDITIONS. The conditions of the Offer may be waived by Purchaser, in whole or in part, at any time or from time to time, in Purchaser's sole discretion, as set forth in the Offer to Purchase. 12. LOST OR DESTROYED CERTIFICATES. If any Certificate(s) representing Shares has been lost or destroyed, the holders should promptly notify the Company's transfer agent, American Stock Transfer and Trust Company, at (800) 937-5449. The holders will then be instructed as to the procedure to be followed in order to replace the Certificate(s). This Letter of Transmittal and related documents cannot be processed until the procedures for replacing lost or destroyed Certificates have been followed. IMPORTANT: THIS LETTER OF TRANSMITTAL OR A MANUALLY SIGNED FACSIMILE COPY HEREOF (TOGETHER WITH CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL OTHER REQUIRED DOCUMENTS) OR A NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY PRIOR TO THE EXPIRATION DATE. 9 TO BE COMPLETED BY ALL TENDERING SHAREHOLDERS OF SECURITIES (SEE INSTRUCTION 11) - -------------------------------------------------------------------------------------------------------------------- PAYER'S NAME: HARRIS TRUST COMPANY OF NEW YORK - -------------------------------------------------------------------------------------------------------------------- SUBSTITUTE Part 1--PLEASE PROVIDE Social Security Number(s) FORM W-9 YOUR TIN IN THE BOX AT OR ------------------------ Department of the Treasury RIGHT AND CERTIFY BY Employer Identification Number(s) Internal Revenue Service SIGNING AND DATING BELOW ----------------------------------------------------------------------- Part 2--CERTIFICATION--Under Penalties of Perjury, I certify that: (1) The number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me), and Payer's Request for Taxpayer (2) I am not subject to backup withholding because: (a) I am exempt Identification Number ("TIN") from backup withholding, or (b) I have not been notified by the Internal Revenue Service (the "IRS") that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding. ----------------------------------------------------------------------- Part 3: Awaiting TIN / / - -------------------------------------------------------------------------------------------------------------------- CERTIFICATION 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 are subject to backup withholding you receive another notification from the IRS stating that you are no longer subject to backup withholding, do not cross out item (2). SIGNATURE DATE , 2000 NAME (please print) - --------------------------------------------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM W-9 MY RESULT IN BACKUP WITHHOLDING OF 31% OF ANY CASH PAYMENTS MADE TO YOU PURSUANT TO THE OFFER PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF THE SUBSTITUTE FORM W-9. CERTIFICATION OF AWAITING TAXPAYER IDENTIFICATION NUMBER I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (1) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service Center or Social Security Administration office or (2) I intend to mail or deliver an application in the near future. I understand that if I do not provide a taxpayer identification number by the time of payment, 31% of all reportable cash payments made to me thereafter will be withheld until I provide a taxpayer identification number to the payer and that, if I do not provide my taxpayer identification number within sixty days, such retained amounts shall be remitted to the IRS as backup withholding. SIGNATURE ____________________________ DATE ___________________________ , 2000 NAME (please print) __________________________________________________________ NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR INSTRUCTIONS. 10 IMPORTANT TAX INFORMATION Under federal income tax law, a stockholder whose tendered Shares are accepted for payment is required to provide the Depositary (as payer) 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 IRS. In addition, payments that are made to such stockholder with respect to Shares purchased pursuant to the Offer may be subject to backup withholding. Certain stockholders (including, among others, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements and should indicate their status by writing "exempt" across the face of, and by signing and dating, the substitute Form W-9. In order for a foreign individual to qualify as an exempt recipient, that stockholder must submit a statement, signed under penalties 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 from the IRS. 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 purchased pursuant to the Offer, the stockholder is required to notify the Depositary of such stockholder's 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 registered 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. 11 MANUALLY SIGNED FACSIMILE COPIES OF THE LETTER OF TRANSMITTAL, PROPERLY COMPLETED AND DULY EXECUTED, WILL BE ACCEPTED. THE LETTER OF TRANSMITTAL, CERTIFICATES FOR SHARES AND ANY OTHER REQUIRED DOCUMENTS SHOULD BE SENT OR DELIVERED BY EACH STOCKHOLDER OF THE COMPANY OR HIS BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR OTHER NOMINEE TO THE DEPOSITARY AT ITS ADDRESS SET FORTH ON THE FIRST PAGE OF THIS LETTER OF TRANSMITTAL. Questions and requests for assistance may be directed to the Information Agent at the address and telephone numbers listed below. Additional copies of the 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 promptly furnished 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: [LOGO] 445 Park Avenue, 5(th) Floor New York, New York 10022 Collect Call: (212) 754-8000 Banks and Brokerage Firms Call: (800) 662-5200 Stockholders Please Call: (800) 566-9061 12 EX-99.(A)(1)(III) 4 EXHIBIT 99(A)(1)(III) NOTICE OF GUARANTEED DELIVERY FOR TENDER OF SHARES OF COMMON STOCK OF TRIGEN ENERGY CORPORATION This form, or one substantially equivalent hereto, must be used to accept the Offer (as defined below) if certificates for shares of Common Stock, par value $0.01 per share (the "Shares"), of Trigen Energy Corporation, a Delaware corporation, are not immediately available or 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 prior to the Expiration Date (as defined in the Offer to Purchase, dated February 28, 2000 (the "Offer to Purchase")). This Notice of Guaranteed Delivery may be delivered by hand, facsimile transmission or mailed to Harris Trust Company of New York (the "Depositary"). See "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase. THE DEPOSITARY FOR THE OFFER IS: HARRIS TRUST COMPANY OF NEW YORK BY MAIL: BY HAND/OVERNIGHT COURIER: Wall Street Station Receive Window P.O. Box 1023 Wall Street Plaza New York, NY 10268-1023 88 Pine Street, 19(th) Floor New York, NY 10005
BY FACSIMILE TRANSMISSION: (for Eligible Institutions Only) (212) 701-7636 or 7637 FOR INFORMATION TELEPHONE (CALL COLLECT): (212) 701-7624 ------------------------ DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS, OR TRANSMISSION OF INSTRUMENTS VIA FACSIMILE TRANSMISSION, 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 or an Agent's Message (as defined in the Offer to Purchase) and certificates for Shares 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 T Acquisition Corp., a Delaware corporation and an indirect, wholly owned subsidiary of Elyo, a SOCIETE ANONYME organized and existing under the laws of the Republic of France and an indirect wholly owned subsidiary of Suez Lynonnaise des Eaux, a SOCIETE ANONYME organized and existing under the laws of the Republic of France, upon the terms and subject to the conditions set forth in the Offer to Purchase and in the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer"), receipt of each of which is hereby acknowledged, the number of Shares indicated below, pursuant to the guaranteed delivery procedure set forth under "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase. Number of Shares: SIGN HERE Certificate No(s). (if available): Name(s) of Record Holder(s): (Please Type or Print) If Shares will be tendered by book-entry Addresses: transfer: Name of Tendering Institutions (Include a Zip Code) Area Code and Telephone No.: Account No.: Signature(s): Dated: , 2000
THE GUARANTEE SET FORTH BELOW MUST BE COMPLETED GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE) The undersigned, as Eligible Institution (as such term is defined under "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase), hereby guarantees to deliver to the Depositary at one of its addresses set forth above the certificates representing the Shares tendered hereby, in proper form for transfer, or a Book-Entry Confirmation (as defined under "THE TENDER OFFER-- Acceptance for Payment and Payment for Shares" of the Offer to Purchase) with respect to transfer of such Shares into the Depositary's account at The Depository Trust Company, together with a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile thereof) with any required signature guarantees or an Agent's Message (as defined in the Offer to Purchase) in the case of a book-entry delivery of Shares, and any other documents required by the Letter of Transmittal, all within three New York Stock Exchange trading days after the date hereof. Name of Firm: (Authorized Signature) Address: Name: Title: (Include a Zip Code) Area Code and Tel. No.: Date:
DO NOT SEND CERTIFICATES FOR SHARES WITH THIS NOTICE OF GUARANTEED DELIVERY. CERTIFICATES SHOULD BE SENT TOGETHER WITH A LETTER OF TRANSMITTAL. 2 EX-99.(A)(1)(IV) 5 EXHIBIT 99(A)(1)(IV) OFFER TO PURCHASE FOR CASH ANY AND ALL OUTSTANDING SHARES OF COMMON STOCK OF TRIGEN ENERGY CORPORATION AT $23.50 NET PER SHARE BY T ACQUISITION CORP. AN INDIRECT WHOLLY OWNED SUBSIDIARY OF ELYO AN INDIRECT WHOLLY OWNED SUBSIDIARY OF SUEZ LYONNAISE DES EAUX THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, MARCH 24, 2000, UNLESS THE OFFER IS EXTENDED. To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees: February 28, 2000 We are writing to you in connection with the offer by T Acquisition Corp., a Delaware corporation ("Purchaser") and an indirect wholly owned subsidiary of Elyo, a SOCIETE ANONYME organized and existing under the laws of the Republic of France ("Parent") and an indirect wholly owned subsidiary of Suez Lyonnaise des Eaux, a SOCIETE ANONYME organized and existing under the laws of the Republic of France ("Suez Lyonnaise"), to purchase any and all outstanding shares of Common Stock, par value $0.01 per share (the "Shares"), of Trigen Energy Corporation, a Delaware corporation (the "Company"), at a price of $23.50 per Share, net to the seller in cash, without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated February 28, 2000 (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. The Offer is being made in connection with the Agreement and Plan of Merger, dated as of January 19, 2000 (the "Merger Agreement"), among Parent, Purchaser and the Company. Holders of Shares whose certificates for such Shares (the "Certificates") are not immediately available or who cannot deliver their Certificates and all other required documents to Harris Trust Company of New York (the "Depositary") or complete the procedures for book-entry transfer prior to the Expiration Date (as defined under "THE TENDER OFFER--Terms of the Offer" of the Offer to Purchase) must tender their Shares according to the guaranteed delivery procedures set forth under "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase. Please furnish copies of the enclosed materials to those of your clients for whose accounts you hold Shares in your name or in the name of your nominee. Enclosed herewith for your information and for forwarding to your clients are copies of the following documents: 1. The Offer to Purchase, dated February 28, 2000. 2. The Letter of Transmittal to tender Shares for your use and for the information of your clients. Facsimile copies of the Letter of Transmittal may be used to tender Shares. 3. A letter to stockholders of the Company from Richard E. Kessel, President and Chief Executive Officer of the Company, together with a Solicitation/Recommendation Statement on Schedule 14D-9 filed by the Company with the Securities and Exchange Commission and mailed to the stockholders of the Company. 4. The Notice of Guaranteed Delivery for Tender of Shares to be used to accept the Offer if the guaranteed delivery procedures set forth under "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase are to be followed. 5. A printed form of a letter which may be sent to your clients for whose accounts you hold Shares registered in your name, with space provided for obtaining such clients' instructions with regard to the Offer. 6. Guidelines of the Internal Revenue Service for Certification of Taxpayer Identification Number on Substitute Form W-9. 7. A return envelope addressed to the Depositary. YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, MARCH 24, 2000, UNLESS THE OFFER IS EXTENDED. Please note the following: 1. The tender price is $23.50 per Share, net to the seller in cash, without interest. 2. The Offer is being made for any and all of the outstanding Shares. There is no minimum number of Shares required to be tendered. 3. 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. However, federal income tax backup withholding at a rate of 31% may be required unless an exemption is available or unless the required taxpayer identification information is provided. See "Important Tax Information" of the Letter of Transmittal. 4. The special committee of the independent directors of the board of directors of the Company (the "Company Board") has unanimously recommended that the Company Board approve the Offer and the Merger (as defined in the Offer to Purchase) and approve and adopt the Merger Agreement. The Company Board has determined that the Merger is advisable and in the best interests of the stockholders of the Company, and has approved the Merger. The Company Board has also approved the Offer and recommended the Offer to the Company's stockholders. 5. Notwithstanding any other provision of the Offer, payment for Shares accepted for payment pursuant to the Offer will in all cases be made only after timely receipt by the Depositary of (a) Certificates pursuant to the procedures set forth under "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase or a timely Book-Entry Confirmation (as defined in the Offer to Purchase) with respect to such Shares, (b) a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile thereof) with any required signature guarantees or an Agent's Message (as defined in the Offer to Purchase) in connection with a book-entry delivery of Shares, and (c) any other documents required by the Letter of Transmittal. Accordingly, tendering stockholders may be paid at different times depending upon when Certificates for Shares or Book-Entry Confirmations are actually received by the Depositary. In order to take advantage of the Offer, (i) a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile thereof) with any required signature guarantees or an Agent's Message in connection with a book-entry delivery of Shares, and any other documents required by the Letter of Transmittal should be sent to the Depositary and (ii) Certificates representing the tendered Shares or a timely Book-Entry Confirmation should be delivered to the Depositary in accordance with the instructions set forth in the Letter of Transmittal and the Offer to Purchase. 2 If holders of Shares wish to tender, but it is impracticable for them to forward their Certificates or other required documents or complete the procedures for book-entry transfer prior to the Expiration Date, a tender may be effected by following the guaranteed delivery procedures specified under "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase. None of Suez Lyonnaise, Parent or Purchaser or any officer, director, agent or other representative of Purchaser, Parent or Suez Lyonnaise will pay any fees or commissions to any broker, dealer or other person (other than the Depositary and Morrow & Co., Inc. (the "Information Agent") as described in the Offer to Purchase) for soliciting tenders of Shares pursuant to the Offer. Purchaser will, however, upon request, reimburse you for customary mailing and handling expenses incurred by you in forwarding any of the enclosed materials to your clients. Purchaser will pay or cause to be paid any transfer taxes payable on the transfer of Shares to it, except as otherwise provided in Instruction 6 of the Letter of Transmittal. Any inquiries you may have with respect to the Offer should be addressed to the Information Agent or the Dealer Manager at their respective addresses and telephone number set forth on the back cover of the Offer to Purchase. Additional copies of the enclosed materials may be obtained from the Information Agent or from brokers, dealers, commercial banks or trust companies. Very truly yours, T ACQUISITION CORP. NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY OTHER PERSON THE AGENT OF SUEZ LYONNAISE, PARENT, PURCHASER, 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. 3 EX-99.(A)(2) 6 EXHIBIT 99(A)(2) [TRIGEN ENERGY CORPORATION LETTERHEAD] February 28, 2000 Dear Stockholder: On January 19, 2000, Trigen Energy Corporation (the "Company"), Elyo ("Parent"), a societe anonyme organized and existing under the laws of the Republic of France, and T Acquisition Corp. ("Purchaser"), a Delaware corporation and an indirect wholly owned subsidiary of Parent, entered into a merger agreement providing for the acquisition of any and all of the Common Stock, par value $0.01 per share, of the Company at $23.50 cash per share. The Purchaser has today commenced a cash tender offer for any and all of the issued and outstanding shares of Common Stock of the Company at a price of $23.50 net per share. The merger agreement provides that, following the tender offer, Purchaser will merge with and into the Company and any remaining shares of Common Stock of the Company will be converted into the right to receive $23.50 per share in cash, without interest. At a meeting on January 19, 2000, your Board of Directors (the "Board") by unanimous vote of all directors, based on, among other things, the unanimous recommendation of a Special Committee comprised of independent directors, (i) determined that the merger is advisable and that the terms of the offer and the merger, the merger agreement and the consummation of the transactions contemplated thereby are fair to, and in the best interests of, the Company and its stockholders, (ii) approved the offer and the merger and approved and adopted the merger agreement, and (iii) recommended the offer to, and the approval and adoption of the merger agreement and the transactions contemplated thereby by, the stockholders of the Company. In arriving at its recommendation, the Board gave careful consideration to the factors described in the enclosed tender offer materials and Schedule 14D-9, including, among other things, the opinion of Credit Suisse First Boston Corporation, the Special Committee's financial advisor, that as of January 19, 2000, and based on and subject to the matters described in the opinion, the price per share of $23.50 to be received in the offer and the merger, taken together, by the holders of shares of Trigen common stock is fair, from a financial point of view, to the holders of shares of Trigen common stock, other than Elyo and its affiliates. Enclosed for your consideration are copies of the tender offer materials and the Company's Schedule 14D-9, which are being filed today with the Securities and Exchange Commission. These documents should be read carefully. Sincerely, ___________________________________ Richard E. Kessel, President & Chief Executive Officer EX-99.(A)(5)(I) 7 EXHIBIT 99(A)(5)(I) OFFER TO PURCHASE FOR CASH ANY AND ALL OUTSTANDING SHARES OF COMMON STOCK OF TRIGEN ENERGY CORPORATION AT $23.50 NET PER SHARE BY T ACQUISITION CORP. AN INDIRECT WHOLLY OWNED SUBSIDIARY OF ELYO AN INDIRECT WHOLLY OWNED SUBSIDIARY OF SUEZ LYONNAISE DES EAUX THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, MARCH 24, 2000, UNLESS THE OFFER IS EXTENDED. To Our Clients: Enclosed for your consideration are the Offer to Purchase, dated February 28, 2000 (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 T Acquisition Corp., a Delaware corporation ("Purchaser") and an indirect wholly owned subsidiary of Elyo, a SOCIETE ANONYME organized and existing under the laws of the Republic of France ("Parent") and an indirect wholly owned subsidiary of Suez Lyonnaise des Eaux, a SOCIETE ANONYME organized and existing under the laws of the Republic of France, to purchase any and all outstanding shares of Common Stock, par value $0.01 per share (the "Shares"), of Trigen Energy Corporation, a Delaware corporation (the "Company"), at a price of $23.50 per Share, net to the seller in cash, without interest thereon, upon the terms and subject to the conditions set forth in the Offer. The Offer is being made in connection with the Agreement and Plan of Merger, dated as of January 19, 2000 (the "Merger Agreement"), among Purchaser, Parent and the Company. 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. WE ARE (OR OUR NOMINEE IS) THE HOLDER OF RECORD OF SHARES HELD BY US FOR YOUR ACCOUNT. A TENDER OF SUCH SHARES CAN BE MADE ONLY BY US AS THE HOLDER OF RECORD AND PURSUANT TO YOUR INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER SHARES HELD BY US FOR YOUR ACCOUNT. Accordingly, we request instructions as to whether you wish to have us tender any or all of the Shares held by us for your account pursuant to the terms and conditions set forth in the Offer. Please note the following: 1. The tender price is $23.50 per Share, net to the seller in cash, without interest. 2. The Offer is being made for any and all of the outstanding Shares. There is no minimum number of Shares required to be tendered. 3. 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. However, federal income tax backup withholding at a rate of 31% may be required, unless an exemption is available or unless the required taxpayer identification information is provided. See "Important Tax Information" of the Letter of Transmittal. 4. The special committee of the independent directors of the board of directors of the Company (the "Company Board") has unanimously recommended that the Company Board approve the Offer and the Merger (as defined in the Offer to Purchase) and approve and adopt the Merger Agreement. The Company Board has determined that the Merger is advisable and in the best interests of the stockholders of the Company, and has approved the Merger. The Company Board has also approved the Offer and recommended the Offer to the Company's stockholders. 5. Notwithstanding any other provision of the Offer, payment for Shares accepted for payment pursuant to the Offer will in all cases be made only after timely receipt by Harris Trust Company of New York (the "Depositary") of (a) certificates for Shares pursuant to the procedures set forth under "THE TENDER OFFER--Procedures for Tendering Shares" of the Offer to Purchase or a timely Book-Entry Confirmation (as defined in the Offer to Purchase) with respect to such Shares, (b) a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile thereof) with any required signature guarantees or an Agent's Message (as defined in the Offer to Purchase) in connection with a book-entry delivery of Shares, and (c) any other documents required by the Letter of Transmittal. Accordingly, tendering stockholders may be paid at different times depending upon when certificates for Shares or Book-Entry Confirmations are actually received by the Depositary. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, MARCH 24, 2000, UNLESS THE OFFER IS EXTENDED. If you wish to have us tender any or all of the Shares held by us for your account, please so instruct us by completing, executing, detaching and returning to us the instruction form set forth below. If you authorize the tender of your Shares, all such Shares will be tendered unless otherwise indicated in such instruction form. An envelope to return your instruction to us is enclosed. PLEASE FORWARD YOUR INSTRUCTIONS TO US AS SOON AS POSSIBLE TO ALLOW US AMPLE TIME TO TENDER YOUR SHARES ON YOUR BEHALF PRIOR TO THE EXPIRATION OF THE OFFER. The Offer is not being made to, nor will tenders be accepted from or on behalf of, holders of Shares residing in any jurisdiction in which the making of the Offer or acceptance thereof would not be in compliance with the securities laws of such jurisdiction. However, Purchaser may, in its discretion, take such action as it may deem necessary to make the Offer in any jurisdiction and extend the Offer to holders of Shares in such jurisdiction. In any jurisdiction where the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer will be deemed to be made on behalf of Purchaser by Lazard Freres & Co. LLC, the Dealer Manager for the Offer, or one or more registered brokers or dealers licensed under the laws of such jurisdiction. 2 INSTRUCTIONS WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH ANY AND ALL OUTSTANDING SHARES OF COMMON STOCK OF TRIGEN ENERGY CORPORATION The undersigned acknowledge(s) receipt of your letter and the enclosed Offer to Purchase, dated February 28, 2000, and the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer") in connection with the offer by T Acquisition Corp., a Delaware corporation ("Purchaser") and an indirect wholly owned subsidiary of Elyo, a SOCIETE ANONYME organized and existing under the laws of the Republic of France ("Parent"), and an indirect wholly owned subsidiary of Suez Lyonnaise des Eaux, a SOCIETE ANONYME organized and existing under the laws of the Republic of France, to purchase any and all outstanding shares of Common Stock, par value $0.01 per share (the "Shares"), of Trigen Energy Corporation, a Delaware corporation (the "Company"), at a price of $23.50 per Share, net to the seller in cash, without interest thereon, upon the terms and subject to the conditions set forth in the Offer. Purchaser has been formed by Parent in connection with the Offer and the transactions contemplated thereby. The Offer is being made in connection with the Agreement and Plan of Merger dated as of January 19, 2000, among Purchaser, Parent and the Company. This will instruct you to tender to Purchaser the number of Shares indicated below (or if no number is indicated below, all Shares) which are held by you for the account of the undersigned, upon the terms and subject to the conditions set forth in the Offer. Number of Shares to be Tendered:* - --------------------------------------------------------- SIGN HERE Account Number: ---------------------------- -------------------------------------------- Date: ---------------------------------, 2000 -------------------------------------------- Signature(s) -------------------------------------------- -------------------------------------------- (Print Name(s)) -------------------------------------------- (Print Address(es)) -------------------------------------------- (Area Code and Telephone Number(s)) -------------------------------------------- (Taxpayer Identification or Social Security Number(s))
- ------------------------ * Unless otherwise indicated, it will be assumed that all Shares held by us for your account are to be tendered. 3 EX-99.(A)(5)(II) 8 EXHIBIT 99(A)(5)(II) 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.
- --------------------------------------------------- GIVE THE SOCIAL SECURITY FOR THIS TYPE OF ACCOUNT: NUMBER OF-- - --------------------------------------------------- 1. An individual's The individual account 2. Two or more The actual owner of individuals (joint the account or, if account) combined funds, any one of the individuals(1) 3. Husband and wife The actual owner of (joint account) the account or, if joint funds, either person(1) 4. Custodian account of a The minor(2) minor (Uniform Gift to Minors Act) 5. Adult and minor (joint The adult or, if the account) minor is the only contributor, the minor(1) 6. Account in the name of The ward, minor or guardian or committee incompetent person(3) for a designated ward, minor, or incompetent person 7. a) The usual revocable The grantor-trustee(1) savings trust account (grantor is also trustee); b) So-called trust The actual owner(1) account that is not a legal or valid trust under State law - --------------------------------------------------- GIVE THE EMPLOYER IDENTIFICATION FOR THIS TYPE OF ACCOUNT: NUMBER OF-- - --------------------------------------------------- 8. Sole proprietorship The owner(4) account 9. A valid trust, estate, The legal entity (Do or pension trust not furnish the identifying number of the personal representative or trustee unless the legal entity itself is not designated in the account title.)(5) 10. Corporate account The corporation 11. Religious, charitable The organization or educational organization account 12. Partnership account The partnership held in the name of the business 13. Association, club, or The organization other tax-exempt organization 14. A broker or registered The broker or nominee nominee 15. Account with the The public entity Department of Agriculture in the name of a public entity (such as a State or local government, school district, or prison) that receives agricultural program payments.
- --------------------------------------------- - --------------------------------------------- (1) List first and circle the name of the person whose number you furnish. (2) Circle the minor's name and furnish the minor's social security number. (3) Circle the ward's, minor's or incompetent person's name and furnish such person's social security number. (4) You must show your individual name, but you may also enter business or "doing business as" name. You may use either your SSN or EIN (if you have one). (5) List first and circle the name of the legal trust, estate, or pension trust. NOTE: If no name is circled when there is more than one name, the number will be considered to be that of the first name listed. GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 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 (for individuals), or Form SS-4, Application for Employer Identification Number (for businesses and all other entities), at the local office of the Social Security Administration or the Internal Revenue Service and apply for a number. PAYEE EXEMPT FROM BACKUP WITHHOLDING Payees specifically exempted from backup withholding on ALL payments include the following: - A corporation. - A financial institution. - An organization exempt from tax under section 501(a), or an individual retirement plan, or a custodial account under Section 403(b)(7). - The United States or any agency or instrumentality thereof. - A state, the District of Columbia, a possession of the United States, or any subdivision or instrumentality thereof. - A foreign government, a political subdivision of a foreign government, or any agency or instrumentality thereof. - An international organization or any agency, or instrumentality thereof. - A registered dealer in securities or commodities registered in the U.S. or a possession of the U.S. - A real estate investment trust. - A common trust fund operated by a bank under section 584(a). - An exempt charitable remainder trust, or a nonexempt trust described in section 4947(a)(1). - An entity registered at all times under the Investment Company Act of 1940. - A foreign central bank of issue. PAYMENTS EXEMPT FROM BACKUP WITHHOLDINGS Payments of dividends and patronage dividends not generally subject to backup withholding include the following: - Payments to partnerships not engaged in a trade or business in the U.S. and which have at least one nonresident partner. - Payments of patronage dividends not paid in money. - Payments made by certain foreign corporations. - Payments to nonresident aliens subject to withholding under Section 1441. Section 404(k) payments made by an ESOP. Payments of interest not generally subject to backup withholding include the following: - Payments of interest on obligations issued by individuals. Note: you may be subject to backup withholding if this interest is $600 or more and is paid in the course of the payer's trade or business and you have not provided your correct taxpayer identification number to the payer. - Payments of tax-exempt interest (including exempt-interest dividends under section 852). - Payments described in section 6049(b)(5) to nonresident aliens. - Payments on tax-free covenant bonds under section 1451. - Payments made by certain foreign organizations. - Payments made to a nominee. Exempt payees described above should file a Substitute Form W-9 to avoid possible erroneous backup withholding. FILE THIS FORM WITH THE PAYER. FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM. SIGN AND DATE THE FORM AND RETURN IT TO THE PAYER. IF YOU ARE NOT A NON-RESIDENT OR FOREIGN ENTITY NOT SUBJECT TO BACKUP WITHHOLDING, FILE WITH PAYER A COMPLETED INTERNAL REVENUE FORM W-8 (CERTIFICATE OF FOREIGN STATUS). Certain payments other than interest, dividends, and patronage dividends, that are not subject to information reporting are also not subject to backup withholding. For details, see sections 6041, 6041A(a), 6042, 6044, 6045, 6049, 6050A, and 6050N, and the regulations under those sections. PRIVACY ACT NOTICE.--Section 6109 requires most recipients of dividend, interest, or other payments to give taxpayer identification numbers to payers who must report the payments to IRS. The IRS uses the numbers for identification purposes and to help verify the accuracy of tax returns. Payers must be given the numbers whether or not recipients are required to file a tax return. Payers must generally withhold 31% of taxable interest, dividend, and certain other payments to a payee who does not furnish a taxpayer identification number to a payer. Certain penalties may also apply. PENALTIES (1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER.--If you fail to furnish your taxpayer identification number to a payer, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect. (2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.--If you make a false statement with no reasonable basis which results in no imposition of backup withholding, you are subject to a penalty of $500. (3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.--Willfully falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE SERVICE Unless otherwise noted herein, all references to section numbers or regulations are references to the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder. EX-99.(A)(5)(III) 9 EXHIBIT 99(A)(5)(III) Exhibit 99(a)(5)(iii) ============================ AGREEMENT AND PLAN OF MERGER among ELYO S.A. T ACQUISITION CORP. and TRIGEN ENERGY CORPORATION Dated as of January 19, 2000 ============================ AGREEMENT AND PLAN OF MERGER AGREEMENT AND PLAN OF MERGER (this "AGREEMENT"), dated as of January 19, 2000, between Elyo S.A., a societe anonyme organized and existing under the laws of the Republic of France ("PARENT"), T Acquisition Corp., a Delaware corporation and an indirect, wholly owned subsidiary of Parent ("PURCHASER"), and Trigen Energy Corporation, a Delaware corporation (the "COMPANY"). RECITALS WHEREAS, Parent beneficially owns through its wholly and majority owned subsidiaries, an aggregate of 6,507,944 shares (the "PARENT SHARES") of common stock, par value $.01 per share (the "SHARES" or the "COMMON STOCK"), of the Company, constituting approximately 52.7% of the total outstanding Shares, and has proposed to the Company that Purchaser acquire all of the remaining issued and outstanding Shares; WHEREAS, on or prior to the Effective Time (as defined below) Parent will cause the Parent Shares to be transferred to Purchaser; WHEREAS, the special committee of the independent directors of the board of directors of the Company (the "COMPANY BOARD") established to consider Parent's proposal (the "SPECIAL COMMITTEE") has unanimously recommended that the Company Board approve the Offer (as defined below), and approve and authorize the Merger (as defined below) and this Agreement; WHEREAS, in furtherance of Parent's acquisition of all the remaining issued and outstanding Shares, it is proposed that Purchaser may elect to make a cash tender offer (the "OFFER") in compliance with Section 14(d)(i) of the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), to acquire any and all of the issued and outstanding Shares for $23.50 per Share (the "PER SHARE AMOUNT"), net to the sellers in cash, upon the terms and subject to the conditions of this Agreement and the Offer; WHEREAS, the respective boards of directors of Parent, Purchaser and the Company have deemed it advisable and in the best interests of their respective stockholders to consummate, and have approved, the merger of Purchaser with and into the Company (the "MERGER"), upon the terms and subject to the conditions set forth herein; WHEREAS, the Company Board has approved the Offer and resolved to recommend the Offer to the Company's stockholders; and -1- WHEREAS, the parties hereto desire to make certain representations, warranties, covenants and agreements in connection with the transactions contemplated by this Agreement. NOW, THEREFORE, in consideration of the foregoing, and of the representations, warranties, covenants and agreements contained herein, the parties hereto hereby agree as follows: ARTICLE 1 1. THE OFFER. 1.1 THE OFFER. (a) Subject to the provisions of this Agreement and this Agreement not having been terminated, Purchaser shall commence, as promptly as practicable, and Parent shall cause Purchaser to commence, within the meaning of Rule 14d-2 under the Exchange Act, the Offer. The obligation of Purchaser, and of Parent to cause Purchaser, to commence the Offer and to accept for payment, and to pay for any shares of Common Stock tendered pursuant to the Offer shall be subject to the satisfaction of the conditions set forth in EXHIBIT A and the terms and conditions of this Agreement (the "OFFER CONDITIONS"). Subject to the provisions of this Agreement, the Offer shall initially expire on the 20th business day from and after the date the Offer is commenced, including the date of the commencement of the Offer as the first business day in accordance with Rule 14d-2, unless this Agreement is terminated in accordance with ARTICLE 8, in which case the Offer (whether or not previously extended in accordance with the terms hereof) shall expire on such date of termination. (b) Purchaser expressly reserves the right to waive any condition set forth on Exhibit A without the consent of the Company, and to make any other changes in the terms and conditions of the Offer. However, without the prior written consent of the Company, Purchaser shall not (i) reduce the maximum number of Shares subject to the Offer, (ii) decrease the Per Share Amount, (iii) change the form of consideration payable in the Offer, or (iv) amend or modify the Offer Conditions in any manner adverse to the holders of Shares. Notwithstanding the foregoing, Purchaser may, without the consent of the Company, extend the Offer at any time and from time to time: (i) if at the then scheduled expiration date of the Offer any of the Offer Conditions shall not have been satisfied or waived, until such time as all such conditions shall have been satisfied or waived; (ii) for any period required by any statute or rule, regulation, interpretation or position of the Securities and Exchange Commission (the "SEC") or its staff applicable to the Offer; (iii) for any period required by applicable law in connection with an increase in the consideration to be paid pursuant to the Offer; and (iv) from time to time, for an aggregate period of not more than ten (10) business days (for all such extensions under this clause (iv)) beyond the latest expiration date that would be permitted under clause (i), (ii) or (iii) of this sentence. So long as this Agreement is in effect and the Offer -2- Conditions have not been satisfied or waived, Purchaser shall, and Parent shall cause Purchaser to, cause the Offer not to expire. Subject to and in accordance with the terms and conditions of the Offer and this Agreement (but subject to the right of termination in accordance with ARTICLE 8), Purchaser shall, and Parent shall cause Purchaser to, accept for payment and pay for, in accordance with the terms of the Offer, all Shares validly tendered and not withdrawn pursuant to the Offer as soon as practicable after the expiration of the Offer. In addition to the foregoing, Purchaser may provide for a "subsequent offering period" to the extent provided in Rule 14d-11 under the Exchange Act, as in effect as of January 24, 2000, after the purchase of Shares pursuant to the Offer. 1.2. ACTIONS BY PARENT AND PURCHASER. (a) As soon as reasonably practicable following execution of this Agreement, Parent and Purchaser shall file with the SEC a Tender Offer Statement and a Rule 13e-3 Transaction Statement on Schedule TO, including all exhibits thereto (together with all amendments and supplements thereto, the "SCHEDULE TO") with respect to the Offer, the Merger and the other transactions contemplated hereby. The Schedule TO shall contain or incorporate by reference an offer to purchase (the "OFFER TO PURCHASE") and forms of the related letter of transmittal and any related documents (the Schedule TO, the Offer to Purchase and such other documents, together with all supplements or amendments thereto, collectively, the "OFFER DOCUMENTS"). The Offer Documents shall comply in all material respects with the requirements of the Exchange Act. On the date filed with the SEC and on the date first published, sent or given to the Company's stockholders, the Offer Documents shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, except that no representation is made by Parent or Purchaser with respect to information supplied by the Company for inclusion in the Offer Documents. Each of Parent and Purchaser agrees to correct promptly, and the Company agrees to notify Parent promptly as to, any information provided by it for use in the Offer Documents, if and to the extent such information shall have become false or misleading in any material respect, and each of Parent and Purchaser further agrees to take all steps necessary to cause the Offer Documents as so corrected to be filed with the SEC and to be disseminated to all of the holders of Shares, in each case as and to the extent required by applicable federal securities laws. Parent and Purchaser agree to provide the Company and the Special Committee and their respective counsel in writing any comments Parent, Purchaser or their counsel may receive from the SEC or its staff with respect to the Offer Documents promptly after receipt of such comments. Parent and Purchaser shall use their respective reasonable best efforts to respond to such comments promptly and shall provide the Company copies of any written responses and telephonic notification of any verbal responses by Parent, Purchaser or their counsel. -3- (b) Parent shall provide or cause to be provided to Purchaser all of the funds necessary to purchase any Shares that Purchaser becomes obligated to purchase pursuant to the Offer. 1.3. ACTIONS BY THE COMPANY. (a) The Company hereby approves of the Offer and represents and warrants that (i) the Special Committee has recommended that the Company Board approve the Offer and the Merger, and approve and authorize this Agreement, and the other transactions contemplated hereby and (ii) the Company Board at a meeting duly called and held, has, by unanimous vote of all directors and based on the recommendation of the Special Committee described in the preceding clause (i) duly adopted resolutions: (A) approving the Offer and the Merger and approving and adopting this Agreement, (B) determining that the Merger is advisable and that the terms of the Offer and Merger are fair to, and in the best interests of, the Company and the Company's stockholders, (C) recommending that the Company's stockholders accept the Offer and, if approval is required by applicable law, approve the Merger and approve and adopt this Agreement, and (D) taking all actions necessary to render Section 203 of the Delaware General Corporation Law (the "DGCL") inapplicable to the Offer, the Merger, this Agreement or any of the transactions contemplated hereby. The Company hereby consents to the inclusion in the Offer Documents of the recommendation of the Company Board and the recommendation of the Special Committee described in the first sentence of this SECTION 1.3(A). The Company shall provide for inclusion in the Offer Documents any information reasonably requested by Parent or Purchaser, and to the extent requested by Parent or Purchaser, the Company shall cooperate in the preparation of the Offer Documents. The Company further represents and warrants that (i) the Special Committee has been duly authorized and constituted, and (ii) the Special Committee, at a meeting thereof duly called, determined that this Agreement, the Merger and the Offer are fair to and in the best interests of the stockholders of the Company (other than the Parent and its affiliates). (b) As soon as reasonably practicable on the date of the commencement of the Offer, the Company shall file with the SEC a Solicitation/Recommendation Statement on Schedule 14D-9 with respect to the Offer (such Schedule 14D-9, together with all amendments and supplements thereto, "SCHEDULE 14D-9") containing the recommendations of the Company Board and the Special Committee described in SECTION 1.3(A) and shall disseminate the Schedule 14D-9 to the stockholders of the Company to the extent required by Rule 14d-9 promulgated under the Exchange Act and any other applicable federal or state securities laws. To the extent practicable, the Company shall cooperate with Purchaser and/or Parent in mailing or otherwise disseminating the Schedule 14D-9 with the appropriate Offer Documents to the Company's stockholders. Parent, Purchaser and their counsel shall be given an opportunity to review and comment upon the Schedule 14D-9 prior to the filing thereof with the SEC. The Schedule 14D-9 shall comply in all material respects with the requirements of the Exchange Act. On the -4- date filed with the SEC and on the date first published, sent or given to the Company's stockholders, the Schedule 14D-9 shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, except that no representation is made by the Company with respect to information supplied by Parent or Purchaser for inclusion in the Schedule 14D-9. The Company agrees to correct promptly, and each of Parent and Purchaser agrees to notify the Company promptly as to, any information provided by it for use in the Schedule 14D-9, if and to the extent such information shall have become false or misleading in any material respect, and the Company further agrees to take all steps necessary to cause the Schedule 14D-9 as so corrected to be filed with the SEC and to be disseminated to all of the holders of Shares, in each case as and to the extent required by applicable federal securities laws. The Company agrees to provide Parent and Purchaser and their counsel in writing any comments the Company or its counsel may receive from the SEC or its staff with respect to the Schedule 14D-9 promptly after the receipt of such comments. The Company agrees to use its reasonable best efforts, after consultation with Parent, to respond promptly to all such comments of and requests by the SEC. The Company shall provide Parent copies of any written responses and telephonic notification of any verbal responses by the Company and its counsel. (c) In connection with the Offer, the Company shall promptly, or shall cause its transfer agent to promptly, furnish Purchaser with mailing labels containing the names and addresses of the record holders of Shares, each as of the most recent date together with copies of all lists of stockholders and security position listings and all other information in the Company's possession or control regarding the beneficial owners of Common Stock, and shall furnish to Purchaser such information and assistance (including updated lists of stockholders, security position listings and computer files) as Purchaser may reasonably request in communicating the Offer to the Company's stockholders. Subject to the requirements of applicable law, and except for such steps as are necessary to disseminate the Offer Documents and any other documents necessary to consummate the Offer and the Merger, Parent and Purchaser shall hold in confidence the information contained in any of such labels, lists and files, shall use such information only in connection with the Offer and the Merger, and, if this Agreement is terminated in accordance with Section 8.1, shall deliver to the Company all copies of such information then in their possession. (d) Subject to the terms and conditions of this Agreement, if there shall occur a change in law or in a binding judicial interpretation of existing law which would, in the absence of action by the Company or the Company Board, prevent the Purchaser, were it to acquire a specified percentage of the shares of Common Stock then outstanding, from approving and adopting this Agreement by its affirmative vote as the holder of a majority of shares of Common Stock and without the affirmative vote of any -5- other stockholder, the Company will use its best efforts to promptly take or cause such action to be taken. ARTICLE 2 2. THE MERGER. 2.1. THE MERGER. At the Effective Time, subject to the terms and conditions of this Agreement and the applicable provisions of the DGCL, Purchaser shall be merged with and into the Company and the separate corporate existence of Purchaser shall thereupon cease. The Company shall be the surviving corporation in the Merger (sometimes hereinafter referred to as the "SURVIVING CORPORATION"). The Merger shall have the effects specified in the DGCL. 2.2. THE CLOSING. Subject to the terms and conditions of this Agreement, the closing of the Merger (the "CLOSING") shall take place at the offices of Fried, Frank, Harris, Shriver & Jacobson, One New York Plaza, New York, New York, at 10:00 a.m., local time, as soon as practicable following the satisfaction (or waiver if permissible) of the conditions set forth in ARTICLE 7. The date on which the Closing occurs is hereinafter referred to as the "CLOSING DATE." 2.3. EFFECTIVE TIME. If all the conditions to the Merger set forth in ARTICLE 7 shall have been fulfilled or waived in accordance herewith and this Agreement shall not have been terminated as provided in ARTICLE 8 (and subject to SECTION 3.6), the parties hereto shall cause a certificate of merger meeting the requirements of Section 251 of the DGCL ("CERTIFICATE OF MERGER") to be properly executed and filed with the Secretary of State of the State of Delaware in accordance with such Section on the Closing Date. The Merger shall become effective at the time of filing of the Certificate of Merger with the Secretary of State of the State of Delaware in accordance with the DGCL or at such later time which the parties hereto shall have agreed upon and designated in such filing as the effective time of the Merger (the "EFFECTIVE TIME"). 2.4 CERTIFICATE OF INCORPORATION, BY-LAWS, DIRECTORS AND OFFICERS OF THE SURVIVING CORPORATION. Unless otherwise agreed by the Company and Parent prior to the Closing, at the Effective Time: (a) The certificate of incorporation of the Surviving Corporation shall be amended and restated in its entirety as set forth in Exhibit B hereto, until duly amended in accordance with applicable law and the terms thereof; (b) The by-laws of Purchaser as in effect immediately prior to the Effective Time shall be the by-laws of the Surviving Corporation, until duly amended in -6- accordance with applicable law, the terms thereof, and the Surviving Corporation's certificate of incorporation; (c) The officers of the Company immediately prior to the Effective Time shall continue to serve in their respective offices of the Surviving Corporation from and after the Effective Time, until their successors are duly appointed or elected in accordance with applicable law and the Surviving Corporation's certificate of incorporation and by-laws; and (d) The directors of Purchaser immediately prior to the Effective Time shall be the directors of the Surviving Corporation from and after the Effective Time, until their successors are duly appointed or elected in accordance with applicable law, and the Surviving Corporation's certificate of incorporation and by-laws. ARTICLE 3 3. EFFECT OF THE MERGER ON SECURITIES OF PURCHASER AND THE COMPANY. 3.1. PURCHASER STOCK. At the Effective Time, each share of common stock, $.01 par value per share, of Purchaser that is outstanding immediately prior to the Effective Time shall be converted into and exchanged for one validly issued, fully paid and non-assessable share of common stock, $.01 par value per share, of the Surviving Corporation. 3.2. COMPANY SECURITIES. (a) Other than as set forth in the immediately following sentence, at the Effective Time, each share of Common Stock issued and outstanding immediately prior to the Effective Time shall, by virtue of the Merger and without any action on the part of Parent, Purchaser, the Company or the holder thereof, be converted into the right to receive the Per Share Amount or any higher per share price as may be paid in the Offer, without interest (the "MERGER CONSIDERATION") in accordance with SECTION 3.3 upon the surrender of a certificate or certificates (a "CERTIFICATE") representing such shares of Common Stock. The following Shares shall not be converted into the right to receive the Per Share Amount at the Effective Time: (i) Restricted Stock granted under and defined in the Trigen Energy Corporation 1994 Stock Incentive Plan, which, in accordance with Section 3.2(c)(ii), shall be canceled immediately prior to the filing of the Certificate of Merger; (ii) shares of Common Stock owned by Parent directly or by Purchaser or held by the Company, all of which shall be canceled; and (iii) Dissenting Shares (as defined below). (b) Each Share issued and held in the Company's treasury at the Effective Time, or held by Purchaser or by Parent directly, or any wholly owned subsidiary of Parent or Purchaser, shall, by virtue of the Merger and without any action on -7- the part of Parent, Purchaser, the Company or the holder thereof, cease to be outstanding and shall be canceled and retired without payment of any consideration therefor. (c) (i) The Company shall, immediately prior to the Effective Time, (A) terminate each Company stock option, stock appreciation rights, restricted stock or similar plan, and any other plan, program or arrangement providing for the issuance, grant or purchase of any other interest in respect of the capital stock of the Company or any of its Subsidiaries (as defined below), and (B) amend the provisions of any other Company Employee Benefit Plan (as defined below), or related trust or funding vehicle, providing for the issuance, holding, transfer or grant of any Shares, or any interest in respect of any Shares (such plans set forth in clauses (A) or (B), collectively, the "COMPANY STOCK PLANS"), to provide no continuing rights to acquire, hold, transfer, or grant any Shares or any interest in any Shares. With respect to the 1994 Employee Stock Purchase Plan, prior to the Effective Time, the Company shall cause the "Exercise Date" for the current "Purchase Period" to be accelerated and occur on a date no later than the date of the Effective Time. (ii) All options to acquire Shares outstanding immediately prior to the Effective Time under any Company Stock Plan or under any agreement (an "OPTION"), whether or not then exercisable, shall (by all necessary and appropriate action taken on or prior to the date of this Agreement of the Company Board or such appropriate committee or committees of the Company Board) be canceled at the Effective Time and each holder of an Option shall promptly after the Effective Time receive from the Surviving Corporation, for each share of Common Stock subject to an Option, an amount in cash equal to the excess, if any, of the Merger Consideration over the per share exercise price of such Option, without interest, in full settlement of the Company's (and the Surviving Corporation's) obligations under each such Option. To the extent that the per share exercise price of any Option equals or exceeds the Merger Consideration, at the Effective Time such Option shall be canceled and the holder of such Option shall not receive or be entitled to receive any consideration from Parent, Purchaser or the Surviving Corporation. The amount payable pursuant to this SECTION 3.2(C) shall be subject to all applicable withholding of taxes. (iii) Immediately prior to the filing of the Certificate of Merger, all shares of Restricted Stock shall be canceled and each holder of a share of Restricted Stock shall promptly after the Effective Time receive from the Surviving Corporation, for each share of Restricted Stock, an amount of cash equal to one-fourth of the Merger Consideration. In connection with the foregoing, the Surviving Corporation intends, in accordance with the Trigen Energy Corporation 1994 Stock Incentive Plan, to implement an incentive plan following the Effective Time. 3.3. EXCHANGE OF CERTIFICATES REPRESENTING COMMON STOCK. (a) Prior to the Effective Time, Parent shall appoint a commercial bank or trust company, subject to -8- the reasonable satisfaction of the Company, to act as paying agent hereunder for payment of the Merger Consideration upon surrender of Certificates (the "PAYING AGENT"). Parent shall take all steps necessary to cause the Surviving Corporation to provide the Paying Agent with cash in amounts necessary to pay for all the shares of Common Stock pursuant to SECTION 3.2(A) and, in connection with the Options, pursuant to SECTION 3.2(C), as and when such amounts are needed by the Paying Agent. Such amounts shall hereinafter be referred to as the "EXCHANGE FUND." (b) As soon as practicable after the Effective Time, Parent shall cause the Paying Agent to mail to each holder of record of shares of Common Stock (i) a letter of transmittal which shall specify that delivery shall be effected, and risk of loss and title to such Certificates shall pass, only upon delivery of the Certificates to the Paying Agent and which letter shall be in such form and have such other provisions as are customary for letters of this nature and (ii) instructions for effecting the surrender of such Certificates in exchange for the Merger Consideration. Upon surrender of a Certificate to the Paying Agent together with such letter of transmittal, duly executed and completed in accordance with the instructions thereto, and such other documents as may be reasonably required by the Paying Agent, the holder of such Certificate shall be entitled to receive in exchange therefor the amount of cash into which shares of Common Stock theretofore represented by such Certificate shall have been converted pursuant to SECTION 3.2, and the shares represented by the Certificate so surrendered shall forthwith be canceled. No interest will be paid or will accrue on the cash payable upon surrender of any Certificate. In the event of a transfer of ownership of Shares that is not registered in the transfer records of the Company, payment may be made with respect to such Common Stock to such a transferee if the Certificate representing such shares of Common Stock is presented to the Paying Agent, accompanied by all documents required to evidence and effect such transfer and to evidence that any applicable stock transfer taxes have been paid. Until surrendered as contemplated by this SECTION 3.3, each Certificate shall be deemed, at any time after the Effective Time, to represent only the right to receive on such surrender the amount, without any interest thereon, of cash into which shares of Common Stock theretofore represented by such Certificate shall have been converted pursuant to SECTION 3.2. (c) At or after the Effective Time, there shall be no transfers on the stock transfer books of the Company of the Shares that were outstanding immediately prior to the Effective Time. If, after the Effective Time, Certificates are presented to the Surviving Corporation, they shall be canceled and exchanged as provided in this ARTICLE 3. (d) Any portion of the Exchange Fund (including the proceeds of any interest and other income received by the Paying Agent in respect of all such funds) that remains unclaimed by the former stockholders of the Company six months after the Effective Time shall be delivered to the Surviving Corporation. Any former stockholders -9- of the Company who have not theretofore complied with this ARTICLE 3 may thereafter look only to the Surviving Corporation for payment of any Merger Consideration, without any interest thereon, that may be payable in respect of each share of Common Stock such stockholder holds as determined pursuant to this Agreement. (e) None of Parent, the Company, the Surviving Corporation, the Paying Agent or any other Person shall be liable to any former holder of shares of Common Stock for any amount properly delivered to a public official pursuant to applicable abandoned property, escheat or similar laws. (f) In the event any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the Person claiming such Certificate to be lost, stolen or destroyed and, if required by the Surviving Corporation, the posting by such Person of a bond in such reasonable amount as the Surviving Corporation may direct as indemnity against any claim which may be made against it with respect to such Certificate, the Paying Agent will issue in exchange for such lost, stolen or destroyed Certificate the Merger Consideration payable in respect thereof pursuant to this Agreement. 3.4. ADJUSTMENT OF MERGER CONSIDERATION. In the event that, subsequent to the date of this Agreement but prior to the Effective Time, the outstanding shares of Common Stock shall have been changed into a different number of shares or a different class as a result of a stock split, reverse stock split, stock dividend, subdivision, reclassification, split, combination, exchange, recapitalization or other similar transaction, the Merger Consideration shall be appropriately adjusted to eliminate the effects of that event. 3.5. DISSENTING COMPANY STOCKHOLDERS. Notwithstanding any provision of this Agreement to the contrary, if required by the DGCL but only to the extent required thereby, Shares that are issued and outstanding immediately prior to the Effective Time and which are held by holders of such Shares who have properly exercised appraisal rights with respect thereto in accordance with Section 262 of the DGCL (the "DISSENTING SHARES") will not be exchangeable for the right to receive the Merger Consideration. Each holder of such Dissenting Shares will be entitled to receive payment of the appraised value of such Shares in accordance with the provisions of such Section 262 unless and until such holder fails to perfect or effectively waive, withdraw or lose his or her rights to appraisal and payment under the DGCL. If, after the Effective Time, any such holder fails to perfect or effectively waives, withdraws or loses such right, such Shares will thereupon be treated as if they had been converted into and to have become exchangeable for, at the Effective Time, the right to receive the Merger Consideration, without any interest or dividends thereon. The Company will give Parent prompt notice of any demands received by the Company for appraisals of Shares prior to the Effective Time and, prior to the Effective Time, the Parent shall have the right to participate in all -10- negotiations and proceedings with respect to such demands. The Company shall not, except with the prior written consent of Parent, voluntarily make any payment with respect to any demands for appraisal or offer to settle or settle any such demands. 3.6. MERGER WITHOUT MEETING OF STOCKHOLDERS. Notwithstanding the foregoing, in the event that Purchaser, or any other direct or indirect subsidiary of Parent, shall acquire at least 90 percent of the outstanding Shares, the parties hereto shall take all necessary and appropriate action to cause the Merger to become effective as soon as practicable after the expiration of the Offer without a meeting of stockholders of the Company, in accordance with Section 253 of the DGCL. ARTICLE 4 4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby represents and warrants to Parent and Purchaser as of the date of this Agreement as follows: 4.1. EXISTENCE; GOOD STANDING; CORPORATE AUTHORITY. Each of the Company and each of its Subsidiaries is (i) duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation and (ii) is duly licensed or qualified to do business as a foreign corporation and is in good standing under the laws of any other state of the United States in which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary, except where the failure to be so qualified or to be in good standing would not have and would not be likely to have, individually or in the aggregate, a material adverse effect on the business, operations, or financial condition of the Company and its Subsidiaries taken as a whole or the ability of the Company and its Subsidiaries to conduct their business after the Closing consistent in all material respects with the manner conducted in the past (a "MATERIAL ADVERSE EFFECT"); provided, however, that "Material Adverse Effect" shall not include any change, effect, condition, event or circumstance arising out of or attributable to (i) any decrease in the market price of the Shares (but not any change, effect, condition, event or circumstance underlying such decrease to the extent that it would otherwise constitute a Material Adverse Effect), (ii) changes, effects, conditions, events or circumstances that generally affect the industries in which the Company or the Subsidiaries operate (including legal and regulatory changes), (iii) general economic conditions or changes, effects, conditions or circumstances affecting the securities markets generally or (iv) changes arising from the consummation of the transactions contemplated hereby or the announcement of the execution of this Agreement. Each of the Company and each of its Subsidiaries has all requisite power and authority to own or lease and operate its properties and carry on its business as now conducted. The Company has heretofore made available to Parent true, accurate and complete copies of -11- the certificate of incorporation and by-laws, each as amended to date as and currently in effect. 4.2. AUTHORIZATION, VALIDITY AND EFFECT OF AGREEMENTS. (a) The Company has the requisite corporate power and authority to execute and deliver this Agreement and all agreements and documents contemplated hereby (the "ANCILLARY DOCUMENTS"), to perform its obligations hereunder and thereunder, and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and the Ancillary Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby have been duly and validly authorized by all necessary corporate action (including without limitation the unanimous approval of the independent directors of the Company Board), and no other corporate proceedings on the part of the Company are necessary to authorize this Agreement and the Ancillary Documents or to consummate the transactions contemplated hereby and thereby (other than the approval of this Agreement by the holders of a majority of the Shares if required by applicable law). This Agreement has been, and any Ancillary Document at the time of execution will have been, duly and validly executed and delivered by the Company, and (assuming this Agreement and such Ancillary Documents to which Parent and/or Purchaser is a party each constitutes a valid and binding obligation of Parent and/or Purchaser as the case may be) constitutes and will constitute valid and binding obligations of the Company, enforceable in accordance with their respective terms, subject to applicable bankruptcy, insolvency, moratorium or other similar laws relating to creditors' rights and general principles of equity. 4.3. COMPLIANCE WITH LAWS. Neither the Company nor any of its Subsidiaries is in violation of any order of any foreign, federal, state or local judicial, legislative, executive, administrative or regulatory body or authority or any court, arbitration board or tribunal ("GOVERNMENTAL ENTITY"), or any foreign, federal, state or local law, statute, ordinance, rule, regulation, order, judgment or decree ("LAWS") applicable to the Company or its Subsidiaries or any of their respective properties or assets, except for violations which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect or prevent or delay or be likely to prevent or delay the consummation of the transactions contemplated hereby. 4.4. CAPITALIZATION, ETC. The authorized capital stock of the Company consists of 60,000,000 shares of Common Stock and 15,000,000 shares of preferred stock, $.01 par value ("PREFERRED STOCK"). As of the date hereof, (a) 12,416,297 shares of Common Stock are outstanding, (b) no shares of Preferred Stock are outstanding and no series of Preferred Stock has been established, (c) 9,670 shares of Common Stock are held by the Company in its treasury, and (d) no shares of capital stock of the Company are held by the Company's Subsidiaries. SECTION 4.4 of the disclosure letter, dated as of the date hereof, delivered by the Company to Parent (the "COMPANY DISCLOSURE LETTER") sets -12- forth a complete and accurate list, as of the date hereof, of (i) the number of outstanding Options, (ii) the number of shares of Common Stock which can be acquired upon the exercise of all outstanding Options, respectively, and (iii) the exercise price of each outstanding Option. The Company has no outstanding bonds, debentures, notes or other obligations entitling the holders thereof to vote (or which are convertible into or exercisable for securities having the right to vote) with the holders of the Common Stock on any matter. Except as set forth in SECTION 4.4 of the Company Disclosure Letter, since September 30, 1999, the Company (i) has not issued any shares of Common Stock other than upon the exercise of Options, (ii) has granted no Options to purchase shares of Common Stock under the Company Stock Plans to the executive officers of the Company, (iii) has not granted any Award (as defined in the Trigen Energy Corporation 1994 Stock Incentive Plan) to any of the executive officers of the Company, and (iv) has not split, combined or reclassified any of its shares of capital stock. All issued and outstanding shares of Common Stock are duly authorized, validly issued, fully paid, nonassessable and free of preemptive rights. Except as set forth above in this SECTION 4.4 or in SECTION 4.4 of the Company Disclosure Letter, there are no other shares of capital stock or voting securities of the Company, and no existing options, warrants, calls, subscriptions, convertible securities, and no stock appreciation rights or limited stock appreciation rights or other rights (including rights of first refusal), agreements or commitments which obligate the Company or any of its Subsidiaries to issue, transfer or sell any shares of capital stock of, or equity interests in, or any material assets of, the Company or any of its Subsidiaries. There are no outstanding obligations of the Company or any Subsidiaries to repurchase, redeem or otherwise acquire any shares of capital stock of the Company. At the Effective Time, each outstanding Option, and each outstanding Award awarded or granted under the Trigen Energy Corporation 1994 Stock Incentive Plan, shall be canceled without the consent of any other party or the payment of any consideration other than as provided in SECTION 3.2. After the Effective Time, the Surviving Corporation will have no obligation to issue, transfer or sell any shares of capital stock of the Company or the Surviving Corporation pursuant to any Company Employee Benefit Plan. There are no voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries is a party with respect to the voting of capital stock of the Company or any of its Subsidiaries. 4.5. NO VIOLATION. (a) Except as set forth in SECTION 4.5 of the Company Disclosure Letter, neither the execution and delivery by the Company of this Agreement or any of the Ancillary Documents nor the consummation by the Company of the transactions contemplated hereby or thereby will: (i) violate, conflict with or result in a breach of any provision of the certificate of incorporation or by-laws of the Company or any Subsidiary; (ii) violate, conflict with, result in a breach of any provision of, constitute a default (or an event which, with notice or lapse of time or both, would constitute a default) under, result in the termination or in a right of termination of, accelerate the performance required by or benefit obtainable under, result in the triggering of any -13- payment or other obligations pursuant to, result in the creation of any lien, pledge, charge, assessment, security interest, mortgage, claim, option, easement, imperfection of title, tenancy or other legal or equitable right of others, or other encumbrance of any character whatsoever (including, without limitation, right of first refusal) (each an "ENCUMBRANCE") upon any of the properties of the Company or any of its Subsidiaries under, or result in there being declared void, voidable, or without further binding effect, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust or any license, franchise, permit, lease, contract, agreement or other instrument, commitment or obligation to which the Company or any of its Subsidiaries is a party, or by which the Company or any of its Subsidiaries or any of their respective properties is bound (each, a "CONTRACT" and, collectively, "CONTRACTS"), except for any of the foregoing matters specified in this clause (ii) which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect or prevent or delay or be likely to prevent or delay the consummation of the transactions contemplated hereby; (iii) other than the filings provided for in SECTION 2.3 and the filings required under the Exchange Act, require any consent, approval or authorization of, or declaration, filing or registration with, any Governmental Entity, the lack of which, individually or in the aggregate, would have or be likely to have a Material Adverse Effect or, by law, prevent or delay the consummation of the transactions contemplated hereby; or (iv) violate any Laws applicable to the Company, any of its Subsidiaries or any of their respective assets, except for violations which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect or materially adversely affect or be likely to materially adversely affect the ability of the Company to consummate the transactions contemplated hereby, except for any of the foregoing matters specified in clauses (ii), (iii) and (iv) which might result from either the nature of Parent's other businesses or assets being such that the Company no longer would qualify as an owner of a "Qualified Facility" or would be subject to state regulatory requirements, including approvals, as a result of Parent's or Purchaser's being a foreign controlled corporation. (b) For purposes of this Agreement, a "Subsidiary" means, with respect to the Parent, the Company or any other Person, any entity of which the Parent, the Company or such other Person, as the case may be (either alone or through or together with any other Subsidiary), owns, directly or indirectly, stock or other equity interests the holders of which are generally entitled to more than 50% of the vote for the election of the board of directors or other governing body of such corporation or other legal entity; provided that for purposes of this Agreement any joint venture with Cinergy Corp., a Delaware corporation shall be a "Subsidiary" of Parent whether or not Parent owns 50% of the stock or other equity interest of such joint venture. 4.6. COMPANY REPORTS; OFFER DOCUMENTS. (a) The Company has made available to Parent each registration statement, report, proxy statement or information statement (as defined under the Exchange Act) prepared by it since December 31, 1996, -14- each in the form (including exhibits and any amendments thereto) filed with the SEC (collectively, the "COMPANY REPORTS"). As of their respective dates, the Company Reports (i) complied as to form in all material respects with the applicable requirements of the Securities Act of 1933, as amended, the Exchange Act, and the rules and regulations thereunder and (ii) did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements made therein, in the light of the circumstances under which they were made, not misleading, except for such untrue statements or omissions which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect. Each of the consolidated balance sheets of the Company included in the Company Reports (including the related notes and schedules) fairly presented in all material respects the consolidated financial position of the Company and its Subsidiaries as of its date, and each of the consolidated statements of operations, cash flows and stockholders' equity of the Company included in or incorporated by reference into the Company Reports (including the related notes and schedules) fairly presented in all material respects the results of operations, cash flows and shareholders' equity of the Company and its Subsidiaries for the periods set forth therein, in each case in accordance with generally accepted accounting principles ("GAAP") consistently applied during the periods involved, except as may be noted therein and except that the unaudited interim financial statements are subject to normal year-end adjustments and do not contain all of the footnote disclosures required by GAAP. (b) None of the Schedule 14D-9, the information statement, if any, filed by the Company in connection with the Offer pursuant to Rule 14f-1 under the Exchange Act (the "INFORMATION STATEMENT"), any schedule required to be filed by the Company with the SEC or any amendment or supplement thereto, at the respective times such documents are filed with the SEC or first published, sent or given to the Company's stockholders, will contain any untrue statement of a material fact or will omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading except that no representation is made by the Company with respect to information supplied by the Parent or Purchaser specifically for inclusion in the Schedule 14D-9 or Information Statement or any amendment or supplement. None of the information supplied or to be supplied by the Company for inclusion or incorporation by reference in the Offer Documents, at the time such documents are filed with the SEC, or first published, sent or given to the Company's stockholders, will contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. If at any time prior to the Effective Time the Company shall obtain knowledge of any facts with respect to itself, any of its officers and directors or any of its Subsidiaries that would require the supplement or amendment to the Schedule 14D-9 or the information supplied by the Company for inclusion or incorporation by reference in the Offer Documents in -15- order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or to comply with applicable Laws, such amendment or supplement shall be promptly filed with the SEC and, as required by Law, disseminated to the stockholders of the Company, and in the event Parent shall advise the Company as to its obtaining knowledge of any facts that would make it necessary to supplement or amend any of the foregoing documents, the Company shall promptly amend or supplement such document as required and distribute the same to its stockholders. 4.7. LITIGATION. As of the date hereof, except as set forth in the Company Reports or in SECTION 4.7 of the Company Disclosure Letter or as may have been or may be brought as a result of Parent's offer to purchase the Company and related transactions, (i) there are no claims, actions, suits, proceedings, arbitrations, investigations or audits (collectively, "LITIGATION") pending or, to the knowledge of the Company, threatened against the Company or any of its Subsidiaries, at law or in equity (other than, in the case of Litigation by non-Governmental Entities, in the ordinary course of business), except Litigation which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect or prevent or delay or be likely to prevent or delay the consummation of the transactions contemplated hereby, nor does the Company have knowledge of any facts or circumstances that it believes would be likely to form the basis for any such claims, actions, suits, proceedings, arbitrations, investigations or audits; (ii) no Governmental Entity has indicated in writing an intention to conduct any audit, investigation or other review with respect to the Company or any of its Subsidiaries, except for audits, investigations or reviews which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect or prevent or delay or be likely to prevent or delay the consummation of the transactions contemplated hereby, if adversely determined; and (iii) there is no material judgment, decree, order, injunction, writ or rule of any court, governmental department, commission, agency, instrumentality or authority or any arbitrator outstanding against the Company or any Subsidiary (except that the Company makes no representation with respect to any such items as may result from litigation brought as a result of Parent's offer to purchase the Company and related transactions). 4.8. ABSENCE OF CERTAIN CHANGES. Since September 30, 1999, there has not been (i) any event, occurrence or condition, except any event, occurrence or condition which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect, (ii) any amendments or changes in the certificate of incorporation or by-laws of the Company, (iii) any material change by the Company or any of its Subsidiaries in its accounting methods, principles or practices, (iv) any declaration, setting aside or payment of any dividend or distribution in respect of any capital stock of the Company or any redemption, repurchase or other acquisition of any of its securities (other than regular quarterly dividends on the shares of Common Stock in an amount no greater than $.035), or (v) other than pursuant to the contractual arrangements referred to in Section 4.10, any -16- increase in or establishment of any bonus, insurance, severance, deferred compensation, pension, retirement, profit sharing, stock option (including, without limitation, the granting of stock options, stock appreciation rights, performance awards, or restricted stock awards), stock purchase or other employee benefit plan, or any other increase in the compensation payable or to become payable to any officers or key employees of the Company or any Subsidiary, except in the ordinary course of business consistent with past practice. 4.9. TAXES. Except as set forth in SECTION 4.9 of the Company Disclosure Letter: (a) The Company and its Subsidiaries have timely filed (taking into account extensions) all material Tax Returns (as defined below) required to be filed by any of them. All such Tax Returns are true, correct and complete, except for such instances which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect. (b) The Company and its Subsidiaries have paid all Taxes (as defined below) required to be paid by any of them or claimed or asserted by any taxing authority to be due, except for failures to so pay which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect, and except for those Taxes being contested in good faith and for which adequate reserves have been established in the financial statements included in the Company Reports in accordance with GAAP. (c) The most recent financial statements contained in the Company Reports reflect full reserves for all Taxes payable by the Company and its Subsidiaries for all Tax periods and portions thereof through the date of such financial statements, except to the extent that any failure to so reserve, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect. For purposes of this Agreement, "TAX" (and, with correlative meaning, "TAXES") means any federal, state, local or foreign income, gross receipts, property, sales, use, license, excise, franchise, employment, payroll, premium, withholding, alternative or added minimum, ad valorem, transfer or excise tax, or any other tax, custom, duty, governmental fee or other like assessment or charge of any kind whatsoever, together with any interest or penalty, imposed by any Governmental Entity. "TAX RETURN" means any return, report or similar statement required to be filed with respect to any Tax (including any attached schedules), including, without limitation, any information return, claim for refund, amended return or declaration of estimated Tax. -17- 4.10. EMPLOYEE BENEFIT PLANS. (a) For purposes of this Agreement, "COMPANY EMPLOYEE BENEFIT PLANS" means all "employee benefit plans," as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and all other material employee benefit or compensation arrangements, including, without limitation, any such arrangements providing severance pay, sick leave, vacation pay, salary continuation for disability, retirement benefits, deferred compensation, bonus pay, incentive pay, stock options (including those held by directors, employees, and consultants), hospitalization insurance, medical insurance, life insurance, scholarships or tuition reimbursements, that are maintained by the Company or any of its Subsidiaries or to which the Company or of its Subsidiaries is obligated to contribute thereunder for current or former directors, employees, independent contractors, consultants and leased employees of the Company or any of its Subsidiaries. (b) Except as set forth in SECTION 4.10 of the Company Disclosure Letter, (i) the execution of, and performance of the transactions contemplated in, this Agreement will not, either alone or upon the occurrence of subsequent events, result in any payment (whether of severance pay or otherwise), acceleration, forgiveness of indebtedness, vesting, distribution, increase in benefits or obligation to fund benefits with respect to any employee or Company Employee Benefit Plan, and (ii) there are no material employment or severance agreements or severance policies applicable to the Company or any of its Subsidiaries. (c) The Company Employee Benefit Plans have been maintained in all material respects in accordance with their terms and with all provisions of ERISA and the Internal Revenue Code of 1986, as amended (including rules and regulations thereunder) (the "CODE") and all other applicable federal and state laws and regulations except for such failures to so maintain which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect. 4.11. LABOR AND EMPLOYMENT MATTERS. Except for such matters which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect, there is no (i) unfair labor practice, labor dispute (other than routine individual grievances) or labor arbitration proceeding pending or, to the knowledge of the Company, threatened against the Company or any of its Subsidiaries relating to their businesses, (ii) activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any of its Subsidiaries, or (iii) lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees. The Company is in compliance with all Laws regarding employment, employment practices, terms and conditions of employment and wages and Laws, except for such noncompliance which, either individually or in the aggregate, would not have or be likely to have a Material Adverse Effect. -18- 4.12. BROKERS. Except for Credit Suisse First Boston Corporation (the "FINANCIAL ADVISOR"), the arrangements of which have been disclosed to Parent in writing, no broker, finder or financial advisor is entitled to any brokerage, finder's or other fee or commission in connection with the transactions contemplated by this Agreement that is based upon any arrangement made by or on behalf of the Company. 4.13. PERMITS. The Company and its Subsidiaries are in possession of all franchises, grants, authorizations, licenses, permits, easements, variances, exceptions, consents, certificates, approvals and orders of any Governmental Entity necessary for the Company and its Subsidiaries to own, lease and operate its properties or to lawfully conduct their respective businesses as presently conducted (the "COMPANY PERMITS"), except where the failure to have any of the Company Permits, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect. As of the date hereof, (a) no modification, revocation, suspension or cancellation of any of the Company Permits is pending or, to the knowledge of the Company threatened, and (b) no Company Permit is subject to any outstanding order, decree, judgment, stipulation or investigation that would be likely to affect such Company Permit, except, in the case of (a) or (b), any suspensions or cancellations which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect. 4.14. ENVIRONMENTAL MATTERS. (a) Except as set forth in the Company Reports filed prior to the date hereof or as would not, individually or in the aggregate, have or be likely to have a Material Adverse Effect: (i) the Company and each of its Subsidiaries has at all times been operated, and is, in compliance with all applicable Environmental Laws (as defined below); (ii) the Company and each of its Subsidiaries has obtained or has applied for all applicable environmental, health and safety permits, licenses, variances, approvals and authorizations required under Environmental Laws (collectively, "ENVIRONMENTAL PERMITS") necessary for the conduct of its operations, and such Environmental Permits are in effect or, where applicable, a renewal application has been timely filed, and the Company and its Subsidiaries are in compliance with all terms and conditions of such Environmental Permits; (iii) there is no Environmental Claim (as defined below) pending or, to the knowledge of the Company, threatened against the Company or any of its Subsidiaries; (iv) to the knowledge of the Company, there have been no Releases (as defined below) of any Hazardous Materials (as defined below) that would be -19- reasonably likely to form the basis of any Environmental Claim against the Company, any of its Subsidiaries or any predecessor thereof; and (v) none of the properties currently owned, leased or operated, or, to the knowledge of the Company, formerly owned, leased or operated, by the Company, its Subsidiaries or any predecessor thereof, are now, or were in the past, listed on the National Priorities List of Superfund Sites, any analogous state list or any database listing sites for the purpose of investigation under Environmental Laws. (b) For purposes of this Agreement: (i) "ENVIRONMENTAL CLAIM" means any and all administrative, regulatory or judicial actions, suits, demands, demand letters, information requests, directives, claims, liens, investigations, proceedings or notices of noncompliance, violation or status as a potentially responsible Person or otherwise liable party by any Person (including any Governmental Entity) relating to or alleging potential liability (including, without limitation, potential responsibility for or liability for enforcement, investigatory costs, cleanup costs, response costs, removal costs, natural resources damages, property damages, personal injuries or penalties) relating to (A) the presence, or Release or threatened Release into the environment, of any Hazardous Materials at any location; or (B) circumstances forming the basis of any violation or alleged violation of any Environmental Law; or (C) any and all claims by any third party seeking damages, contribution, indemnification, cost recovery, compensation or injunctive relief relating to any Environmental Laws. (ii) "ENVIRONMENTAL LAWS" means all applicable federal, state and local laws, rules, requirements, regulations and judicial or administrative opinions, orders or decrees, and any common law causes of action, in each case relating to pollution, the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or protection of human or employee health or safety including, without limitation, laws and regulations relating to Releases of Hazardous Materials. (iii) "HAZARDOUS MATERIALS" means (A) any petroleum or any by-products or fractions thereof, asbestos or asbestos-containing materials, urea formaldehyde foam insulation, any form of natural gas, explosives, polychlorinated biphenyls ("PCBS"), radioactive materials, ionizing radiation or electromagnetic field radiation; (B) any chemicals, materials or substances which are included in the definition of "wastes," "hazardous substances," "hazardous wastes," "hazardous materials," "extremely hazardous substances," "toxic substances," "toxic pollutants," "pollutants," "contaminants," or words of similar import under any Environmental Law; and (C) any other chemical, material or substance, regulated under any Environmental Law. -20- (iv) "RELEASE" means any release, spill, emission, leaking, injection, deposit, disposal, discharge, dispersal, leaching or migration into the environment (including without limitation ambient air, atmosphere, soil, surface water, groundwater or property). 4.15. INSURANCE POLICIES. The Company and its Subsidiaries have obtained and maintained in full force and effect insurance with insurance companies or associations in such amounts, on such terms and covering such risks, as is customarily carried by reasonably prudent persons conducting businesses or owning or leasing assets similar to those conducted, owned or leased by the Company, except any failures to obtain or maintain such insurance which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect. 4.16. OPINION OF FINANCIAL ADVISOR. The Special Committee has received the written opinion of the Financial Advisor to the effect that, as of the date hereof, the proposed consideration to be received, in the Offer and Merger Agreement, taken together, by the holders of shares (other than Parent and its affiliates) of the Company pursuant to the Offer and the Merger is fair to such holders of shares (other than Parent and its affiliates) from a financial point of view (the "OPINION"). The Company hereby represents and warrants that it has been authorized by the Financial Advisor to permit the inclusion of the Opinion and references thereto, subject to prior review and consent by the Financial Advisor (such consent not to be unreasonably withheld), in the Offer to Purchase, the Schedule TO, the Schedule 14D-9 and the Proxy Statement (as defined below). 4.17. STATE TAKEOVER STATUTES. The Company Board has taken all necessary action so that the restrictions contained in Section 203 of the DGCL applicable to a "business combination" (as defined in such Section 203) will not apply to the execution, delivery or performance of the Agreement or to the Offer, the Merger or the transactions contemplated hereby or the letter agreement, dated January 19, 2000 (the "CASTEN STOCK PURCHASE AGREEMENT"), between Mr. Thomas Casten and Parent relating to the purchase by Parent or Purchaser of the Shares owned by Mr. Casten. 4.18. REQUIRED VOTE OF COMPANY STOCKHOLDERS. Unless the Merger may be consummated in accordance with Section 253 of the DGCL, the only vote of the stockholders of the Company required to adopt this Agreement, the Ancillary Documents and to approve the Merger and the transactions contemplated hereby and thereby, is the affirmative vote of the holders of a majority of the outstanding shares of Common Stock. 4.19. REGULATION AS A UTILITY. The Company and/or the Subsidiaries are regulated as a public utility in the states set forth on SECTION 4.19 of the Company Disclosure Letter. Except as set forth on SECTION 4.19 of the Company Disclosure Letter, neither the Company nor any "subsidiary company" or "affiliate" of the Company is -21- subject to regulation as a public utility or public service company (or similar designation) by the United States or any state of the United States. All filings required to be made by the Company or any of its Subsidiaries since December 31, 1998, under any applicable laws or orders relating to the regulation of public utilities, have been filed with the appropriate public utility commission, health agency or other appropriate governmental entity (including, without limitation, to the extent required, the state public utility regulatory agencies in the states identified in SECTION 4.19 of the Company Disclosure Letter), as the case may be, including all forms, statements, reports, agreements (oral or written) and all documents, exhibits, amendments and supplements appertaining thereto, including but not limited to all rates, tariffs, franchises, service agreements and related documents and all such filings complied, as of their respective dates, with all applicable requirements of the appropriate laws or orders, except any filings or failures to comply which, individually or in the aggregate, would not have or be likely to have, a Material Adverse Effect. Except as specified on SECTION 4.19 of the Company Disclosure Letter, no approval of any public utilities regulatory authority (including all public utility control or public service commissions and similar state regulatory bodies) is required for the Company's execution and delivery of this Agreement or the performance of its obligations under this Agreement or the consummation of the transactions contemplated hereby. 4.20. YEAR 2000 COMPLIANCE. (a) The computer systems of the Company and its Subsidiaries are Year 2000 Compliant, except for such failures to be Year 2000 Compliant as would not, individually or in the aggregate, have or be likely to have a Material Adverse Effect. All inventory, products and independently developed applications of the Company and its Subsidiaries that is, consists of, includes or uses computer software is Year 2000 Compliant, except for such failures to be Year 2000 Compliant as would not, individually or in the aggregate, have or be likely to have a Material Adverse Effect. To the knowledge of the Company, any failures on the part of the customers of and suppliers to the Company and its Subsidiaries to be Year 2000 Compliant will not, individually or in the aggregate, have or be likely to have a Material Adverse Effect. (b) The term "YEAR 2000 COMPLIANT", with respect to a computer system or software program, means that such computer system or program: (i) is capable of recognizing, processing, managing, representing, interpreting and manipulating correctly date-related data for dates earlier and later than January 1, 2000; (ii) has the ability to provide date recognition for any data element without limitation; (iii) has the ability to function automatically into and beyond the year 2000 without human intervention and without any change in operations associated with the advent of the year 2000; (iv) has the ability to interpret data, dates and time correctly into and beyond the year 2000; (v) has the ability not to produce noncompliance in existing data, nor otherwise corrupt such data, into and beyond the year 2000; (vi) has the ability to process correctly after January 1, -22- 2000, data containing dates before that date; and (vii) has the ability to recognize all "leap year" dates, including February 29, 2000. ARTICLE 5 5. REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASER. Parent and Purchaser hereby represent and warrant to the Company as of the date of this Agreement as follows: 5.1. EXISTENCE; GOOD STANDING; CORPORATE AUTHORITY. Each of Parent and Purchaser is a corporation duly incorporated, validly existing and in good standing under the laws of its jurisdiction of incorporation and has all requisite corporate power and authority to own, operate and lease its properties and carry on its business as now conducted, except where the failure to have such power and authority, individually or in the aggregate, would not materially adversely affect the ability of Parent and Purchaser to consummate the transactions contemplated hereby and by the Ancillary Documents. 5.2. AUTHORIZATION, VALIDITY AND EFFECT OF AGREEMENTS. Each of Parent and Purchaser has the requisite corporate power and authority to execute and deliver this Agreement and the Ancillary Documents and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and the Ancillary Documents and the consummation by Parent and Purchaser of the transactions contemplated hereby and thereby have been duly and validly authorized by the respective Boards of Directors of Parent and Purchaser and by Parent as the sole stockholder of Purchaser and no other corporate proceedings on the part of Parent or Purchaser are necessary to authorize this Agreement and the Ancillary Documents or to consummate the transactions contemplated hereby and thereby. This Agreement has been, and any Ancillary Documents at the time of execution will have been, duly and validly executed and delivered by Parent and Purchaser, and (assuming this Agreement and such Ancillary Documents each constitutes a valid and binding obligation of the Company) constitutes and will constitute the valid and binding obligations of each of Parent and Purchaser, enforceable in accordance with their respective terms, subject to applicable bankruptcy, insolvency, moratorium or other similar laws relating to creditors' rights and general principles of equity. 5.3. NO VIOLATION. Neither the execution and delivery of this Agreement or any of the Ancillary Documents by the Parent and Purchaser, nor the consummation by them of the transactions contemplated hereby or thereby, will (i) violate, conflict with or result in any breach of any provision of the respective certificates of incorporation or by-laws of the Parent or Purchaser; (ii) other than the filings provided for in SECTION 2.3 and the filings required under the Exchange Act, require any consent, approval or authorization of, or declaration, filing or registration with, any Governmental Entity, the lack of which, individually or in the aggregate, would have or be likely to have a Material -23- Adverse Effect on the ability of the Parent or Purchaser to consummate the transactions contemplated hereby, (iii) violate any Laws applicable to the Parent or the Purchaser or any of their respective assets, except for violations which, individually or in the aggregate, would not have or be likely to have a Material Adverse Effect on the ability of the Parent or Purchaser to consummate the transactions contemplated hereby, and (iv) violate, conflict with or result in a breach of any provision of, constitute a default (or an event which, with notice or lapse of time or both, would constitute a default) under, result in the termination or in a right of termination of, accelerate the performance required by or benefit obtainable under, result in the creation of any Encumbrance upon any of the properties of the Parent or Purchaser under, or result in there being declared void, voidable, or without further binding effect, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust or any license, franchise, permit, lease, contract, agreement or other instrument, commitment or obligation to which the Parent or Purchaser is bound, except for any of the foregoing matters which, individually or in the aggregate, would not materially adversely affect the ability of Parent and Purchaser to consummate the transactions contemplated hereby and by the Ancillary Documents. 5.4. INTERIM OPERATIONS OF PURCHASER. Purchaser was formed solely for the purpose of engaging in the transactions contemplated hereby, has engaged in no other business activities and has conducted its operations as contemplated hereby. 5.5. FINANCING. At the consummation of the Offer and at the Effective Time, Parent will have or will cause the Purchaser to have funds available to it sufficient to consummate the Offer and the Merger on the terms contemplated hereby. 5.6 INFORMATION SUPPLIED. None of the Offer Documents or any amendment or supplement thereto, at the respective times such documents are filed with the SEC or first published, sent or given to the Company's stockholders, will contain any untrue statement of a material fact or will omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading except that no representation is made by the Parent or Purchaser with respect to information supplied by the Company specifically for inclusion in the Offer Documents or any amendment or supplement. None of the information supplied or to be supplied by Parent or Purchaser for inclusion or incorporation by reference in the Schedule 14D-9 will, at the time such documents are filed with the SEC or distributed to the Company's stockholders, contains any untrue statements of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. If at any time prior to the Effective Time the Parent or Purchaser shall obtain knowledge of any facts with respect to itself, any of its officers and directors or any of its Subsidiaries that would require the supplement or amendment to the - 24 - Offer Documents or the information supplied by Parent or Purchaser for inclusion or incorporation by reference in the Schedule 14D-9 in order to make the statements therein, in the light of the circumstances under which they are made, not misleading, or to comply with applicable Laws, such amendment or supplement shall be promptly filed with the SEC and, as required by Law, disseminated to the stockholders of the Company, and in the event the Company shall advise Parent or Purchaser as to its obtaining knowledge of any facts that would make it necessary to supplement or amend any of the foregoing documents, Parent or Purchaser shall promptly amend or supplement such document as required and distribute the same to the Company's stockholders. ARTICLE 6 6. COVENANTS. 6.1. ALTERNATIVE PROPOSALS. The Company agrees (a) that, between the date hereof and the Effective Time, neither it nor any of its Subsidiaries shall, and it shall direct and use its best efforts to cause its officers, directors, employees, agents and representatives (including, without limitation, any investment banker, attorney or accountant retained by it or any of its Subsidiaries) not to, initiate, solicit or encourage, directly or indirectly, any inquiries or the making or implementation of any proposal or offer (including, without limitation, any proposal or offer to its stockholders) with respect to a merger, acquisition, consolidation or similar transaction involving, or any purchase of all or any significant portion of the assets or any equity securities of, the Company or any of its Subsidiaries (any such proposal or offer being hereinafter referred to as an "ALTERNATIVE PROPOSAL") or engage in any negotiations concerning, or provide any confidential information or data to, afford access to the properties, books or records of the Company or any of its Subsidiaries to, or have any discussions with, any Person relating to an Alternative Proposal, or otherwise facilitate any effort or attempt to make or implement an Alternative Proposal; (b) that it will immediately cease and cause to be terminated any existing activities, discussions or negotiations with any parties conducted heretofore with respect to any of the foregoing, and it will take the necessary steps to inform such parties of the obligations undertaken in this SECTION 6.1; and (c) that it will notify Parent immediately of the identity of the potential acquirer and the terms of such Person's or entity's proposal if any such inquiries or proposals are received by, any such information is requested from, or any such negotiations or discussions are sought to be initiated or continued with, the Company; provided, however, that nothing contained in this SECTION 6.1 shall prohibit the Company or its Subsidiaries, upon approval of the Special Committee, from (i) prior to the acceptance for payment of shares of Common Stock by Purchaser pursuant to the Offer, furnishing information to, or entering into discussions or negotiations with, any Person or entity that makes an unsolicited bona fide proposal to acquire the Company pursuant to a merger, consolidation, share exchange, purchase of substantially all of the assets of the Company, a business combination or - 25 - other similar transaction, if, and only to the extent that, (A) such proposal was not initially solicited, encouraged or knowingly facilitated by the Company, its Subsidiaries or their agents in violation of this SECTION 6.1, (B) such proposal is not subject to a financing condition and involves consideration that provides a higher value per share than the Merger Consideration, (C) the Company Board, or the Company's directors constituting the Special Committee, determines in good faith based on the advice of outside counsel that the failure to take such action would be inconsistent with its fiduciary duties to stockholders imposed by Law, and (D) prior to furnishing information to, or entering into discussions or negotiations with, such Person or entity, the Company provides written notice to Parent to the effect that it is furnishing information to, or entering into discussions or negotiations with, such Person or entity. The Company shall keep Parent immediately informed of the status of any such discussions or negotiations (including the identify of such Person or entity and the terms of any proposal); and (ii) to the extent applicable, complying with Rule 14e-2(a) promulgated under the Exchange Act with regard to an Alternative Proposal. Nothing in this SECTION 6.1 shall (x) permit the Company to terminate this Agreement (except as specifically provided in ARTICLE 8 hereof), (y) permit the Company to enter into any agreement with respect to an Alternative Proposal during the term of this Agreement, or (z) affect any other obligation of the Company under this Agreement. Notwithstanding anything to the contrary in this SECTION 6.1, Parent and Purchaser have advised the Company Board that they have no intention of selling the Parent Shares or the Shares acquired by Purchaser in the Offer pursuant to such an Alternative Proposal. 6.2. INTERIM OPERATIONS. (a) From the date of this Agreement until the Effective Time, except as set forth in SECTION 6.2 of the Company Disclosure Letter, unless Parent has consented in writing thereto, the Company shall, and shall cause its Subsidiaries to, (i) conduct its operations according to its ordinary course of business consistent with past practice; (ii) use its reasonable best efforts to preserve intact its business organizations and goodwill, keep available the services of its officers and employees, and maintain satisfactory relationships with those Persons having business relationships with them; and (iii) upon the discovery thereof, promptly notify Parent of the existence of any breach of any representation or warranty contained herein (or, in the case of any representation or warranty that makes no reference to Material Adverse Effect, any breach of such representation or warranty in any material respect) or the occurrence of any event that would cause any representation or warranty contained herein no longer to be true and correct (or, in the case of any representation or warranty that makes no reference to Material Adverse Effect, to no longer be true and correct in any material respect). (b) From and after the date of this Agreement until the Effective Time, except as set forth in SECTION 6.2 of the Company Disclosure Letter, unless Parent has - 26 - consented in writing thereto, the Company shall not, and shall cause each of its Subsidiaries not to: (i) amend its certificate of incorporation or by-laws; (ii) issue, sell or pledge any shares of its capital stock or other ownership interest in the Company (other than issuances of Common Stock in respect of any exercise of stock options outstanding on the date hereof and disclosed in SECTION 4.4 of the Company Disclosure Letter) or its Subsidiaries, or any securities convertible into or exchangeable for any such shares or ownership interest, or any rights, warrants or options to acquire or with respect to any such shares of capital stock, ownership interest, or convertible or exchangeable securities (or derivative instruments in respect of the foregoing); (iii) effect any stock split or otherwise change its capitalization as it exists on the date hereof, or directly or indirectly redeem, purchase or otherwise acquire any shares of its capital stock or capital stock of its Subsidiaries; (iv) (A) grant, confer or award any option, warrant, convertible security or other right to acquire any shares of its capital stock or take any action to cause to be exercisable any otherwise unexercisable option under any Company Stock Plan (except as otherwise required by the terms of such unexercisable options), (B) accelerate or waive any or all of the goals, restrictions or conditions imposed under any Award, or (C) issue, sell, grant or award any shares of capital stock or any right to acquire shares of capital stock under any Company Stock Plan (except as otherwise required by such plan); (v) declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than such payments by the Subsidiaries to the Company); (vii) mortgage or otherwise encumber or subject to any Encumbrance, or sell, lease or otherwise dispose of any of its property or assets (including capital stock of its Subsidiaries), other than Encumbrances that are incurred in the ordinary course of business, consistent with past practice, the sale or disposition of inventory in the ordinary course of business or the sale, lease, encumbrance or other disposition of assets which, individually or in the aggregate, are obsolete or not material to the Company and its Subsidiaries taken as a whole; (viii) (A) acquire by merger, purchase or any other manner, any business or entity or any division thereof for consideration in excess of $1,000,000 in the aggregate; or (B) otherwise acquire any assets which would be material, individually or in the aggregate, to the Company and its Subsidiaries taken as a whole, except for purchases of inventory, supplies or capital equipment in the ordinary course of business consistent - 27 - with past practice and the acquisition of assets for consideration in excess of $1,000,000 in the aggregate; (ix) except for borrowings under existing credit facilities and excepting transactions between the Company and any Subsidiary, incur or assume any long-term or short-term debt or issue any debt securities or assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the debt or other obligations of any other Person, other than obligations (other than debt) of its Subsidiaries incurred in the ordinary course of business; (x) (A) make any loans, advances or capital continuations to, or investments in, any other Person (other than Subsidiaries), except with respect to commitments outstanding as of the date hereof, or (B) forgive any loans, advances or capital continuations to, or investments in, any other Person (other than Subsidiaries), for an aggregate amount in excess of $1,000,000 (as to clauses (A) and (B) collectively); (xi) except as contemplated by this Agreement or in the ordinary course of business consistent with past practices (A) increase the compensation payable or to become payable to its officers or employees, (B) other than in accordance with existing policies and arrangements, grant any severance pay to its officers, directors or employees or (C) establish, adopt, enter into or amend any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any director, officer or employee, except to the extent required by applicable law or the terms or a collective bargaining agreement or a contractual obligation existing on the date hereof; (xii) change any of the accounting principles or practices used by the Company, except as may be required by GAAP; (xiii) pay, discharge or satisfy any material claims, material liabilities or material obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (A) of any such material claims, material liabilities or material obligations in the ordinary course of business and consistent with past practice or (B) of material claims, material liabilities or material obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) contained in the Company Reports; (xiv) agree to the settlement of any claim or litigation, which settlement would have a Material Adverse Effect; (xv) make, change or rescind any material Tax election (other than recurring elections that customarily are made in connection with the filing of any Tax - 28 - Return; provided that any such elections are consistent with the past practices of the Company or its Subsidiaries, as the case may be) or settle or compromise any material Tax liability that is the subject of any audit, claim for delinquent Taxes, examination, action, suit, proceeding or investigation by any Taxing authority; (xv) except to the extent required under existing employee and director benefit plans, agreements or arrangements as in effect on the date of this Agreement or as contemplated by this Agreement, accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits (xix) enter into any agreement, understanding or commitment that restrains, limits or impedes the ability of the Company or any of its Subsidiaries to compete with or conduct any business or line of business, including geographic limitations on the activities of the Company or any of its Subsidiaries; (xx) materially modify, amend or terminate any material contract, or waive, relinquish, release or terminate any right or claim, in each case, except in the ordinary course of business consistent with past practice; (xxi) other than with respect to commitments outstanding as of the date hereof, make any capital expenditures in the aggregate for the Company and its Subsidiaries in excess $1,000,000, in the aggregate; (xxii) take any action to cause the Common Stock to be delisted from the New York Stock Exchange prior to the completion of the offer; and (xxiii) agree in writing or otherwise to take any of the foregoing actions. 6.3. COMPANY STOCKHOLDER APPROVAL; PROXY STATEMENT. (a) If approval or action in respect of the Merger by the stockholders of the Company is required by applicable Law, the Company, acting through the Company Board, shall (i) call a meeting of its stockholders (the "STOCKHOLDERS MEETING") for the purpose of voting upon this Agreement and the transactions contemplated hereby, (ii) hold the Stockholders Meeting as soon as practicable following the purchase of shares of Common Stock pursuant to the Offer, and (iii) unless taking such action would be inconsistent with the fiduciary duties of the directors of the Company or of the Company's directors constituting the Special Committee, as determined by such directors in good faith, and after consultation with independent legal counsel, recommend to its stockholders the approval of this Agreement and the transactions contemplated hereby. In the event a Stockholders Meeting is called, the Company shall use its reasonable best efforts to solicit from the stockholders of the Company proxies in favor of the approval and adoption of this Agreement, and the - 29 - transactions contemplated hereby and to secure the vote or consent of stockholders required by the DGCL to approve and adopt this Agreement, unless otherwise required by the applicable fiduciary duties of the directors of the Company or of the Company's directors constituting the Special Committee, as determined by such directors in good faith, and after consultation with independent legal counsel. This Agreement must be submitted to the stockholders of the Company whether or not the Company Board determines at any time subsequent to declaring its advisability that the Agreement is no longer advisable and recommends that the stockholders reject it. (b) If required by applicable Law, the Company will, as soon as practicable following the expiration of the Offer, prepare and file a preliminary Proxy Statement (such proxy statement, and any amendments or supplements thereto, the "PROXY STATEMENT") or, if applicable, an Information Statement with the SEC with respect to the Stockholders Meeting and will use its best efforts to respond to any comments of the SEC or its staff and to cause the Proxy Statement to be cleared by the SEC. The Company will notify Parent of the receipt of any comments from the SEC or its staff and of any request by the SEC or its staff for amendments or supplements to the Proxy Statement or for additional information and will supply Parent promptly with copies of all correspondence between the Company or any of its representatives, on the one hand, and the SEC, on the other hand. The Company shall give Parent and its counsel the opportunity to review the Proxy Statement prior to it being filed with the SEC and shall give Parent and its counsel the opportunity to review all amendments and supplements to the Proxy Statement and all responses to requests for additional information and replies to comments prior to their being filed with, or sent to, the SEC. Each of the Company and Parent agrees to use its best efforts, after consultation with the other parties hereto, to respond promptly to all such comments of and requests by the SEC. As promptly as practicable after the Proxy Statement has been cleared by the SEC, the Company shall mail the Proxy Statement to the stockholders of the Company. If at any time prior to the approval of this Agreement by the Company's stockholders there shall occur any event which should be set forth in an amendment or supplement to the Proxy Statement, the Company will prepare and mail to its stockholders such an amendment or supplement. (c) The Company represents and warrants that the Proxy Statement will comply in all material respects with the Exchange Act and, at the respective times filed with the SEC and distributed to stockholders of the Company, will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation or warranty as to any information included in the Proxy Statement that was provided by Parent or Purchaser. The Parent represents and warrants that none of the information supplied by Parent or Purchaser for inclusion in the Proxy Statement will, at the respective times filed with the SEC and distributed to stockholders of the Company, - 30 - contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Parent agrees that Parent will promptly inform the Company of the discovery by it or Purchaser of any information that should be set forth in an amendment or supplement to the Proxy Statement. (d) The Company shall use its best efforts to obtain the necessary approvals by its stockholders of the Merger, this Agreement and the transactions contemplated hereby. (e) Parent agrees to cause all shares of Common Stock purchased by Purchaser pursuant to the Offer and all other shares of Common Stock owned by Parent, Purchaser or any other subsidiary or affiliate of Parent to be voted in favor of the approval of the Merger. 6.4. COMPANY BOARD REPRESENTATION; SECTION 14(f). (a) Promptly upon the purchase of shares of Common Stock pursuant to the Offer, Parent shall be entitled to designate such number of directors, rounded up to the next whole number, as will give Parent representation on the Company Board equal to the product of (i) the number of directors on the Company Board and (ii) the percentage that the number of shares of Common Stock owned by Purchaser or Parent bears to the number of shares of Common Stock then outstanding (the "Percentage"), and the Company shall, upon request by Parent, promptly increase the size of the Company Board and/or exercise its best efforts to secure the resignations of such number of directors as is necessary to enable the Parent's designees to be elected to the Company Board and shall cause the Parent's designees to be so elected; provided, however, that until the Effective Time, the Company Board shall have at least one member who is not designated by Parent or Purchaser. At the request of Parent, the Company will use its best efforts to cause such individuals designated by Parent to constitute the same Percentage of (i) each committee of the Company Board, (ii) the board of directors of each Subsidiary and (iii) each committee of each Subsidiary's board of directors. The Company's obligations to appoint designees to the Company Board shall be subject to Section 14(f) of the Exchange Act. The Company shall take, at its expense, all action necessary to effect any such election, and shall include in the Schedule 14D-9 the information required by Section 14(f) of the Exchange Act and Rule 14f-1 promulgated thereunder. Parent will supply to Company in writing, and be solely responsible for, any information with respect to itself and its nominees, directors and affiliates that is required by Section 14(f) and Rule 14f-1. (b) Following the election or appointment of Parent's designees pursuant to this SECTION 6.4 and prior to the Effective Time, the approval of a majority of the directors of the Company then in office who are not designated by Parent shall be required to authorize any permitted termination of this Agreement by the Company, any amendment of this Agreement requiring action by the Company Board, any extension of - 31 - time for the performance of any of the obligations or other acts of Parent or Purchaser, and any waiver of compliance with any of the agreements or conditions contained herein for the benefit of the Company. 6.5. FILINGS; OTHER ACTION. Subject to the terms and conditions herein provided, the Company, Parent, and Purchaser shall: (a) use their reasonable best efforts to cooperate with one another in (i) determining which filings other than under the Exchange Act are required to be made prior to the expiration of the Offer or the Effective Time with, and which consents, approvals, permits or authorizations are required to be obtained prior to the Effective Time from, Governmental Entities or other third parties in connection with the execution and delivery of this Agreement and any other Ancillary Documents and the consummation of the transactions contemplated hereby and thereby and (ii) timely making all filings under the Exchange Act and all such other filings and timely seek all required consents, approvals, permits, authorizations and waivers; and (b) use their reasonable best efforts to take, or cause to be taken, all other action and do, or cause to be done, all other things necessary, proper or appropriate to consummate and make effective the transactions contemplated by this Agreement. If, at any time after the Effective Time, any further action is necessary or desirable to carry out the purpose of this Agreement, the proper officers and directors of Parent and the Surviving Corporation shall take all such necessary action. 6.6. ACCESS TO INFORMATION. (a) From the date of this Agreement until the Closing, the Company shall, and shall cause its Subsidiaries to, (i) give Parent and its authorized representatives reasonable access, upon reasonable notice and during reasonable business hours to all books, records, personnel, offices and other facilities and properties of the Company and its Subsidiaries and their accountants and accountants' work papers, (ii) permit Parent to make such copies and inspections thereof as Parent may reasonably request and (iii) furnish Parent with such financial and operating data and other information with respect to the business and properties of the Company and its Subsidiaries as Parent may from time to time reasonably request; provided that no investigation or information furnished pursuant to this SECTION 6.6 shall affect any representation or warranty made herein by the Company or the conditions to the obligations of Parent to consummate the transactions contemplated by this Agreement. (b) Parent shall hold all information furnished on a confidential basis by or on behalf of the Company or any of the Company's Subsidiaries or representatives pursuant to Section 6.6(a) in confidence. 6.7. PUBLICITY. The initial press release relating to this Agreement shall be issued jointly by the Company and Parent. Thereafter, the Company and Parent shall obtain the prior consent of each other before issuing any press release or otherwise making public statements with respect to the transactions contemplated hereby, except as - 32 - may be required by Law or any listing agreement with any national securities exchange with respect thereto. 6.8. FURTHER ACTION. Each party hereto shall, subject to the fulfillment at or before the Effective Time of each of the conditions of performance set forth herein or the waiver thereof, perform such further acts and execute such documents as may be reasonably required to effect the transactions contemplated hereby, including the Merger. 6.9. INSURANCE; INDEMNITY. (a) Purchaser will (and the Surviving Corporation as successor to the Purchaser as a result of the Merger will) maintain in effect for not less than six years after the Effective Time, the Company's current directors and officers insurance policies, if such insurance is obtainable (or policies of at least the same coverage containing terms and conditions no less advantageous to the current and all former directors and officers of the Company) with respect to acts or failures to act prior to the Effective Time, including acts relating to the transactions contemplated by this Agreement; provided, however, that in order to maintain or procure such coverage, the Surviving Corporation shall not be required to maintain or obtain policies providing such coverage except to the extent such coverage can be provided at an annual cost of no greater than 2 times the most recent annual premium paid by the Company prior to the date hereof (the "Cap"); and provided, further, that if equivalent coverage cannot be obtained, or can be obtained only by paying an annual premium in excess of the Cap, Purchaser or the Surviving Corporation shall only be required to obtain as much coverage as can be obtained by paying an annual premium equal to the Cap. (b) To the extent, if any, not provided by an existing right of indemnification or the agreement or policy, from and after the Effective Time, Purchaser and following the Merger, the Surviving Corporation shall indemnify and hold harmless each Person who is, or has been at any time prior to the date hereof or who becomes prior to the Effective Time, an officer or director of the Company or any of its Subsidiaries (each, an "INDEMNIFIED PARTY"), against all losses, expenses, claims, damages or liabilities or, subject to the last sentence of this paragraph, amounts paid in settlement, arising in connection with any claim, action, suit, proceeding or investigation (an "ACTION") arising out of or pertaining to acts or omissions by such Person in their capacities as an officer or director, as the case may be, of the Company, which acts or omissions occurred prior to the Effective Time, whether asserted or claimed prior to, at or after the Effective Time to the fullest extent permitted by law. In the event of any such Action, the Surviving Corporation shall control the defense of such Action with counsel selected by the Surviving Corporation, which counsel shall be reasonably acceptable to the Indemnified Party; provided, however, that the Indemnified Party shall be permitted to participate in the defense of such Action through counsel selected by the Indemnified Party, which counsel shall be reasonably acceptable to the Surviving Corporation, at the Indemnified Party's expense. Notwithstanding the foregoing, if there is any conflict between the - 33 - Surviving Corporation and any Indemnified Parties or there are additional defenses available to any Indemnified Parties, the Indemnified Parties shall be permitted to participate in the defense of such Action with counsel selected by the Indemnified Parties, which counsel shall be reasonably acceptable to the Surviving Corporation, and Purchaser shall cause the Surviving Corporation to pay the reasonable fees and expenses of such counsel, as accrued and in advance of the final disposition of such Action to the fullest extent permitted by applicable law; provided, however, that the Surviving Corporation shall not be obligated to pay the reasonable fees and expenses of more than one counsel for all Indemnified Parties in any single Action except to the extent that, in the opinion of counsel for the Indemnified Parties, two or more of such Indemnified Parties have conflicting interests in the outcome of such Action. Parent and Purchaser acknowledge that the members of the Special Committee shall be entitled to select their own counsel pursuant to the preceding sentence with respect to any litigation related to the transactions contemplated hereby; provided, however, that such counsel must be reasonably acceptable to Parent. Any Indemnified Party wishing to claim indemnification under this SECTION 6.9, upon learning of any such claim, action, suit, proceeding or investigation eligible for indemnification under this SECTION 6.9, shall notify the Surviving Corporation, but failure to notify the Surviving Corporation shall not relieve it from any liability which it may have under this SECTION 6.9, except to the extent that such failure results in the forfeiture of substantive rights or defenses. The Surviving Corporation shall not be liable for any settlement effected without its written consent, which consent shall not unreasonably be withheld. (c) Purchaser will, and following the Merger, will cause the Surviving Corporation to, keep in effect all provisions in the Surviving Corporation's certificate of incorporation and by-laws that provide for exculpation of director and officer liability and indemnification (and advancement of expenses related thereto) of the past and present officers and directors of the Company at least to the extent they are presently indemnified by the Company and such provisions shall not be amended except as either required by applicable Law or to make changes permitted by Law that would enhance the rights of past or present officers and directors to indemnification or advancement of expenses. (d) If the Surviving Corporation or any of its successors or assigns (i) shall consolidate with or merge into any other corporation or other entity and shall not be the continuing or surviving corporation or entity of the consolidation or merger or (ii) shall transfer all or substantially all of its properties and assets to any individual, corporation or other entity, then and in each such case, proper provisions shall be made so that the successors and assigns of the Surviving Corporation shall assume all of the obligations set forth in this SECTION 6.9. - 34 - (e) The provisions of this SECTION 6.9 are intended to be for the benefit of, and shall be enforceable by, each of the Indemnified Parties, their heirs and their representatives. 6.10. CERTAIN EMPLOYEE AGREEMENTS. Subject to Section 6.11, Parent, Purchaser and the Company and its Subsidiaries shall honor, without modification, all contracts, agreements, collective bargaining agreements and commitments of the parties prior to the date hereof which apply to any current or former employee or current or former director of the Company or its Subsidiaries; provided, however, that this undertaking does not prevent Parent, Purchaser or the Company from enforcing or complying with such contracts, agreements, collective bargaining agreements and commitments in accordance with their terms, including, without limitation, exercising any right to amend, modify, suspend, revoke or terminate any such contract, agreement, collective bargaining agreement or commitment under any such contract, agreement, collective bargaining agreement or commitment or under applicable law. Any workforce reductions carried out following the Effective Time by Parent or the Company and their subsidiaries shall be done in accordance with all applicable collective bargaining agreements, and all laws and regulations governing the employment relationship and termination thereof, including, without limitation, the Worker Adjustment and Retraining Notification Act and regulations promulgated thereunder, and any comparable state or local law. 6.11. EMPLOYEE BENEFIT PLANS. (a) MAINTENANCE OF THE COMPANY BENEFIT PLANS. Each of the Company Employee Benefit Plans (other than Company Stock Plans) in effect at the date hereof shall be maintained in effect with respect to the employees or former employees of the Company and any of its Subsidiaries, who are covered by any such benefit plan immediately prior to the Effective Time (the "AFFILIATED EMPLOYEES") until Parent, Purchaser or the Company otherwise determine after the Effective Time; provided, however, that nothing herein contained shall limit any right contained in any such Company Employee Benefit Plan or under applicable law to amend, modify, suspend, revoke or terminate any such plan; provided further, however, that Parent, Purchaser or the Company or their subsidiaries shall provide benefits to the Affiliated Employees for a period of not less than one year following the Effective Time which are no less favorable in the aggregate than those provided under the Company Employee Benefit Plans (other than Company Stock Plans) (with respect to employees and former employees of the Company and its Subsidiaries). Without limitation of the foregoing, with respect to any benefit plan established to replace any Company Employee Benefit Plan (other than Company Stock Plans); each participant in any such Company Employee Benefit Plan shall receive credit for purposes of eligibility to participate and vesting under any benefit plan of the Company or any of its Subsidiaries or affiliates for service credited for the - 35 - corresponding purpose under such benefit plan; provided, however, that such crediting of service shall not operate to duplicate any benefit to any such participant or the funding for any such benefit or cause any such Company Employee Benefit Plan to fail to comply with the applicable provisions of the Code or ERISA. (b) WELFARE BENEFITS PLANS. With respect to any welfare benefit plan established to replace any Company Employee Benefit Plan which is a welfare benefit plan in which Affiliated Employees may be eligible to participate after the Effective Time, other than limitations, exclusions or waiting periods that are already in effect with respect to such Affiliated Employees and that have not been satisfied as of the Effective Time, such replacement plans shall waive all limitations to pre-existing conditions, exclusions and waiting periods with respect to participation and coverage requirements and provide each Affiliated Employee with credit for other co-payments and deductibles paid prior to the Effective Time in satisfying any applicable deductible or out-of-pocket requirements applicable to the same calendar year under any welfare plans that such Affiliated Employees are eligible to participate in after the Effective Time. ARTICLE 7 7. CONDITIONS. 7.1. CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT THE MERGER. The respective obligation of each party to effect the Merger shall be subject to the satisfaction or waiver, where permissible, prior to the Effective Time, of the following conditions: (a) If approval of this Agreement and the Merger by the holders of Common Stock is required by applicable Law, this Agreement and the Merger shall have been approved by the requisite vote of such holders. (b) Any review or approval required by governmental authorities in countries in which the Company or its Subsidiaries have operations material to the Company and its Subsidiaries, taken as a whole, shall have been completed or obtained. (c) No United States federal or state or Republic of France governmental authority or other agency or commission or court of competent jurisdiction shall have enacted, issued, promulgated, enforced or entered any law, rule, regulation, executive order decree, injunction or other order which is in effect and prohibits or has the effect of prohibiting the consummation of the Merger or makes such consummation illegal. - 36 - ARTICLE 8 8. TERMINATION. 8.1. TERMINATION. This Agreement, notwithstanding approval thereof by the stockholders of the Company, may be terminated at any time prior to the Effective Time: (a) by mutual written consent of the Board of Directors of the Parent and the Special Committee; (b) by the Parent or the Special Committee: (i) if either (i) the purchase of Shares pursuant to the Offer has not been consummated on or before March 15, 2000, or the Effective Time shall not have occurred on or before June 30, 2000 (provided that the right to terminate this Agreement pursuant to this clause (i) shall not be available to any party whose failure to fulfill any obligation under this Agreement has been the cause of or resulted in the failure of the Effective Time to occur on or before such date); or (ii) if there shall be any Law that makes consummation of the Offer or the Merger illegal or prohibited, or if any court of competent jurisdiction in the United States or the Republic of France shall have issued an order, judgment, decree or ruling, or taken any other action restraining, enjoining or otherwise prohibiting the Merger and such order, judgment, decree, ruling or other action shall have become final and non-appealable; (c) by the Special Committee, (i) if there is an Alternative Proposal which the Special Committee in good faith determines is more favorable from a financial point of view to the stockholders of the Company as compared to the Offer and the Merger, and the Special Committee determines in good faith based upon advice of outside counsel, that the failure to take such action would be inconsistent with its fiduciary duties to stockholders imposed by Law; provided, however, that the right to terminate this Agreement pursuant to this SECTION 8.1(C) shall not be available (i) if the Company has breached its obligations under SECTION 6.1, or (ii) if the Alternative Proposal (x) is subject to a financing condition or (y) involves consideration that is not entirely cash or does not permit stockholders to receive the payment of the offered consideration in respect of all shares at the same time, unless the Special Committee has been furnished with a written opinion of the Financial Advisor or other nationally recognized investment banking firm to the effect that (in the case of clause (x)) the Alternative Proposal is readily financeable and (in the case of clause (y)) that such offer provides a higher value per share than the - 37 - consideration per share pursuant to the Offer or the Merger, or (iii) if, prior to or concurrently with any purported termination pursuant to this SECTION 8.1(C), the Company shall not have paid the fees and expenses contemplated by SECTION 8.2, or (iv) if the Company has not provided Parent and Purchaser with five business days prior written notice of its intent to so terminate this Agreement and delivered to the Parent and Purchaser a copy of the written agreement embodying the Alternative Proposal in its then most definitive form; (ii) if Parent or Purchaser shall have breached in any material respect any of their respective representations, warranties or covenants contained in this Agreement; (d) by the Parent, (i) prior to the acceptance of any shares of Common Stock under the Offer, if due to an occurrence or circumstance that would result in the failure of any condition specified in Exhibit A, Parent shall have terminated the Offer without having accepted any Shares for payment thereunder unless such occurrence or circumstance that would result in the failure of any such condition shall have been caused by or resulted from the failure of Parent or Purchaser to perform any obligation of either of them contained in this Agreement; or (ii) prior to the purchase of any Common Stock validly tendered pursuant to the Offer, the Special Committee shall have withdrawn or modified in a manner that is, materially adverse to Parent or Purchaser, its approval or recommendation of this Agreement, the Offer, the Merger or any other transaction contemplated hereby or shall have recommended another merger, consolidation or business combination involving, or acquisition of, the Company or its assets or another tender offer for Common Stock, or shall have resolved to do any of the foregoing. 8.2. EFFECT OF TERMINATION AND ABANDONMENT. In the event of termination of this Agreement and the abandonment of the Merger pursuant to this ARTICLE 8, all obligations of the parties hereto shall terminate, except the obligations of the parties pursuant to this SECTION 8.2 and SECTIONS 6.6(B), 9.5 and 9.6, and there shall be no liability on the part of the Company, the Parent, Purchaser or their respective officers or directors, except for any breach of a party's obligations under such provisions. If this Agreement shall terminate pursuant to Section 8.1(b)(i) as a result of the failure of the Company to satisfy the condition set forth in paragraphs (f) of EXHIBIT A, or pursuant to 8.1(C) or 8.1(D)(II), the Company shall promptly, but in no event later than two business days after any such termination, reimburse Parent and its affiliates for the out-of-pocket expenses of Parent and its affiliates, incurred in connection with or arising out of the Offer, the Merger or the transactions contemplated hereby or by the Ancillary Documents, including reasonable attorneys' fees. If this Agreement shall terminate pursuant to - 38 - Section 8.1(c)(ii), Parent shall promptly, but in no event later than two business days after any such termination, reimburse the Company its out-of-pocket expenses incurred in connection with or arising out of the Offer, the Merger or the transactions contemplated hereby or by the Ancillary Documents, including reasonable attorneys' fees. The parties agree that such reimbursement of expenses shall be Parent's and Purchaser's exclusive remedy for any loss, liability, damage or claim arising out of or in connection with any such termination of this Agreement. The Company acknowledges that the agreements contained in this SECTION 8.2 are an integral part of the transactions contemplated by this Agreement, and that, without these agreements, Parent and Purchaser would not enter into this Agreement. Notwithstanding the foregoing, no party hereto shall be relieved from liability for any willful, material breach of this Agreement. 8.3. AMENDMENT. To the extent permitted by applicable law, this Agreement may be amended by action taken by or on behalf of the board of directors of each of the parties hereto and, in the case of the Company, with the approval of the Special Committee at any time before or after adoption of this Agreement by the stockholders of the Company (if required); PROVIDED, HOWEVER, that after any such stockholder approval (if required), no amendment shall be made which decreases the Merger Consideration or which adversely affects the rights of, or the income tax consequences to, the Company's stockholders (other than Parent and its Affiliates) hereunder without the approval of such stockholders. This Agreement may not be amended except by an instrument in writing signed on behalf of all of the parties. 8.4. EXTENSION; WAIVER. At any time prior to the Effective Time, any party hereto, by action taken by its board of directors, may, to the extent legally allowed, (a) extend the time for the performance of any of the obligations or other acts of the other parties hereto, (b) waive any inaccuracies in the representations and warranties made to such party contained herein or in any document delivered pursuant hereto and (c) waive compliance with any of the agreements or conditions for the benefit of such party contained herein; PROVIDED, HOWEVER, that, if the Company seeks to make such extension or waiver as provided in (a), (b) or (c) above, it must first obtain the approval of the Special Committee. Any agreement on the part of a party hereto to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party. - 39 - ARTICLE 9 9. GENERAL PROVISIONS. 9.1. NONSURVIVAL OF REPRESENTATIONS AND WARRANTIES. None of the representations and warranties in this Agreement, or in any instrument delivered pursuant to this Agreement, shall survive the Effective Time. 9.2. NOTICES. All notices and other communications given or made pursuant hereto shall be in writing and shall be deemed to have been duly given or made as of the date of receipt and shall be delivered personally or mailed by registered or certified mail (postage prepaid, return receipt requested), sent by overnight courier or sent by facsimile, to the applicable party at the following addresses or facsimile numbers (or at such other address or telecopy number for a party as shall be specified by like notice): If to Parent or Purchaser: Elyo S.A. 235 Avenue Georges Clemenceau BP 4601 92746 Nanterre Cedex France Facsimile: 01 41 20 10 10 Attention: Michel Caillard with a copy to: Fried, Frank, Harris, Shriver & Jacobson One New York Plaza New York, New York 10004 Facsimile: (212) 859-4000 Attention: Jeffrey Bagner, Esq. If to the Company: Trigen Energy Corporation One Water Street White Plains, New York 10601 Facsimile: (914) 948-9157 Attention: Eugene Murphy, Esq. - 40 - With a copy to: Troutman Sanders LLP Bank of America Plaza 600 Peachtree Street, N.E., Suite 5200 Atlanta, Georgia 30308 Facsimile: (404) 885-3900 Attention: W. Brinkley Dickerson, Jr., Esq. 9.3. ASSIGNMENT; BINDING EFFECT. Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the parties hereto (whether by operation of law or otherwise) without the prior written consent of the other parties; provided, however, that either Parent or Purchaser (or both) may assign its rights hereunder (including, without limitation, the right to make the Offer and/or to purchase shares of Common Stock pursuant to the Offer) to a wholly owned subsidiary of Parent; and, further provided that nothing shall relieve the assignor from its obligations hereunder. Subject to the preceding sentence, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns. Notwithstanding anything contained in this Agreement to the contrary, except for the provisions of SECTION 6.9 which may be enforced directly by the beneficiaries thereof, nothing in this Agreement, expressed or implied, is intended to confer on any Person other than the parties hereto or their respective heirs, successors, executors, administrators and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement. 9.4. ENTIRE AGREEMENT. This Agreement, the Company Disclosure Letter, the Exhibits, the Ancillary Documents and any other documents delivered by the parties in connection herewith constitute the entire agreement among the parties with respect to the subject matter hereof and supersede all prior agreements and understandings among the parties with respect thereto. 9.5. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to its rules of conflict of laws. Each of the Company, Parent and Purchaser hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of the United States District Court for the State of Delaware or any court of the State of Delaware (the "DELAWARE COURTS") for any litigation arising out of or relating to this Agreement and the transactions contemplated hereby (and agrees not to commence any litigation relating thereto except in such courts), waives any objection to the laying of venue of any such litigation in the Delaware Courts and agrees not to plead or claim in any Delaware Court that such litigation brought therein has been brought in an inconvenient forum. Parent hereby appoints The Corporation Trust Company as agent for service of process. The - 41 - address of such agent for service of process is Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. 9.6. FEES AND EXPENSES. Except as otherwise provided in SECTION 8.2, whether or not the Merger is consummated, all fees, costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such fees, costs and expenses. 9.7. CERTAIN DEFINITIONS. For purposes of this Agreement, the following terms shall have the following meanings: (i) "AFFILIATE" of a Person means a Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, the first mentioned Person. (ii) "KNOWLEDGE" of any party hereto shall mean the knowledge of any of the executive officers of that party. (iii) "PERSON" means an individual, corporation, partnership, limited liability company, association, trust, unincorporated organization, entity or group (as defined in the Exchange Act). 9.8. HEADINGS. Headings of the Articles and Sections of this Agreement are for the convenience of the parties only, and shall be given no substantive or interpretive effect whatsoever. The table of contents contained in this Agreement is for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. 9.9. INTERPRETATION. In this Agreement, unless the context otherwise requires, words describing the singular number shall include the plural and vice versa, and words denoting any gender shall include all genders and words denoting natural Persons shall include corporations and partnerships and vice versa. Whenever the words "include," "includes" or "including" are used in this Agreement, they shall be understood to be followed by the words "without limitation." 9.10. WAIVERS. No action taken pursuant to this Agreement, including, without limitation, any investigation by or on behalf of any party, shall be deemed to constitute a waiver by the party taking such action of compliance with any representations, warranties, covenants or agreements contained in this Agreement or in any of the Ancillary Documents. The waiver by any party hereto of a breach of any provision hereunder shall not operate or be construed as a waiver of any prior or subsequent breach of the same or any other provision hereunder. - 42 - 9.11. SEVERABILITY. Any term or provision of this Agreement that is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this Agreement or affecting the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction. If any provision of this Agreement is so broad as to be unenforceable, the provision shall be interpreted to be only so broad as is enforceable. 9.12. ENFORCEMENT OF AGREEMENT. The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with its specific terms or was otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any New York Court, this being in addition to any other remedy to which they are entitled at law or in equity. 9.13. COUNTERPARTS. This Agreement may be executed by the parties hereto in separate counterparts, each of which, when so executed and delivered, shall be an original. All such counterparts shall together constitute one and the same instrument. Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto. - 43 - IN WITNESS WHEREOF, the parties have executed this Agreement and caused the same to be duly delivered on their behalf on the day and year first written above. TRIGEN ENERGY CORPORATION By: /s/ Richard E. Kessel --------------------- Name: Richard E. Kessel Title: Executive Vice President ELYO S.A. By: /s/ Olivier Degos --------------------- Name: Oliver Degos Title: Corporate Vice President T ACQUISITION CORP. By: /s/ Olivier Degos --------------------- Name: Oliver Degos Title: Secretary TABLE OF CONTENTS
Page ARTICLE 1.....................................................................................................2 1. The Offer.........................................................................................2 1.1 The Offer...............................................................................2 1.2. Actions by Parent and Purchaser........................................................3 1.3. Actions by the Company.................................................................4 ARTICLE 2.....................................................................................................6 2. The Merger........................................................................................6 2.1. The Merger.............................................................................6 2.2. The Closing............................................................................6 2.3. Effective Time.........................................................................6 2.4 Certificate of Incorporation, Bylaws, Directors and Officers of the Surviving Corporation.......................................... 7 ARTICLE 3.....................................................................................................7 3. Effect of the Merger on Securities of Purchaser and the Company...................................7 3.1. Purchaser Stock........................................................................7 3.2. Company Securities.....................................................................7 3.3. Exchange of Certificates Representing Shares...........................................9 3.4. Adjustment of Merger Consideration.....................................................10 3.5. Dissenting Company Stockholders........................................................11 3.6. Merger Without Meeting of Stockholders.................................................11 ARTICLE 4.....................................................................................................11 4. Representations and Warranties of the Company.....................................................11 4.1. Existence; Good Standing; Corporate Authority..........................................12 4.2. Authorization, Validity and Effect of Agreements.......................................12 4.3. Compliance with Laws...................................................................13 4.4. Capitalization, etc....................................................................13 4.5. No Violation...........................................................................14 4.6. Company Reports; Offer Documents.......................................................15 4.7. Litigation.............................................................................17 4.8. Absence of Certain Changes.............................................................17 4.9. Taxes................................................................................ 18 4.10. Employee Benefit Plans................................................................19 4.11. Labor and Employment Matters..........................................................19 4.12. Brokers...............................................................................20 4.13. Permits...............................................................................20 4.14. Environmental Matters.................................................................20 4.15. Insurance Policies....................................................................22 4.16. Opinion of Financial Advisor..........................................................22
-i- 4.17. State Takeover Statutes...............................................................22 4.18. Required Vote of Company Stockholders.................................................23 4.19. Regulation as a Utility...............................................................23 4.20. Year 2000 Compliance,.................................................................24 ARTICLE 5.....................................................................................................24 5. Representations and Warranties of Parent and Purchaser............................................24 5.1. Existence; Good Standing; Corporate Authority..........................................24 5.2. Authorization, Validity and Effect of Agreements.......................................25 5.3. No Violation...........................................................................25 5.4. Interim Operations of Purchaser........................................................26 5.5. Financing..............................................................................26 5.6. Information Supplied...................................................................26 ARTICLE 6.....................................................................................................27 6. Covenants.........................................................................................27 6.1. Alternative Proposals..................................................................27 6.2. Interim Operations.....................................................................28 6.3. Company Stockholder Approval; Proxy Statement..........................................31 6.4. Company Board Representation; Section 14(f)............................................33 6.5. Filings; Other Action..................................................................34 6.6. Access to Information..................................................................34 6.7. Publicity..............................................................................35 6.8. Further Action.........................................................................35 6.9. Insurance; Indemnity...................................................................35 6.10. Certain Employee Agreements...........................................................37 6.11. Employee Benefit Plans................................................................37 ARTICLE 7.....................................................................................................38 7. Conditions........................................................................................38 7.1. Conditions to Each Party's Obligation to Effect the Merger.............................38 ARTICLE 8.....................................................................................................39 8. Termination.......................................................................................39 8.1. Termination............................................................................39 8.2. Effect of Termination and Abandonment..................................................41 8.3. Amendment..............................................................................41 8.4. Extension; Waiver......................................................................41 ARTICLE 9.....................................................................................................42 9. General Provisions................................................................................42 9.1. Nonsurvival of Representations and Warranties..........................................42 9.2. Notices.42 9.3. Assignment; Binding Effect.............................................................43 9.4. Entire Agreement.......................................................................43 9.5. Governing Law..........................................................................44
-ii- 9.6. Fee and Expenses.......................................................................44 9.7. Certain Definitions....................................................................44 9.8. Headings...............................................................................44 9.9. Interpretation.........................................................................45 9.10. Waivers...............................................................................45 9.11. Severability..........................................................................45 9.12. Enforcement of Agreement..............................................................45 9.13. Counterparts..........................................................................45
-iii- EXHIBIT A CONDITIONS OF THE OFFER Notwithstanding any other term of the Offer or this Agreement, Purchaser shall not be required to accept for payment or to pay for any shares of Common Stock not theretofore accepted for payment or paid for, and may terminate or amend the Offer if at any time on or after the date of this Agreement and before the acceptance of such Shares for payment or the payment therefor, any of the following conditions exist or shall occur and remain in effect: (a) there shall have been instituted, pending or threatened any litigation by the Government of the United States or the Republic of France or by any agency or instrumentality thereof or by any other third Person or nongovernmental entity that would be reasonably likely to (i) restrict the acquisition by Parent or Purchaser (or any of its affiliates) of shares of Common Stock pursuant to the Offer or restrain, prohibit or delay the making or consummation of the Offer or the Merger, (ii) make the purchase of or payment for some or all of the shares of Common Stock pursuant to the Offer or the Merger illegal, (iii) impose limitations on the ability of Parent or Purchaser (or any of their affiliates) effectively to acquire or hold, or to require Parent, Purchaser or the Company or any of their respective affiliates or subsidiaries to dispose of or hold separate, any portion of their assets or the business of any one of them, (iv) impose material limitations on the ability of Parent, Purchaser or their affiliates to exercise full rights of ownership of the shares of Common Stock 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, (v) limit or prohibit any material business activity by Parent, Purchaser or any of their affiliates, including, without limitation, requiring the prior consent of any Person or entity (including the Government of the United States of America and the Republic of France, and any instrumentality thereof) to future transactions by Parent, Purchaser or any of their affiliates (Parent and Purchaser acknowledge that the regulatory nature of some of the Company's assets and businesses may result in the limitation of Parent's and its affiliates in certain utility-related areas) or (vi) make materially more costly (A) the making of the Offer, (B) the acceptance for payment of, or payment for, some or all of the Shares pursuant to the Offer, (C) the purchase of Shares pursuant to the Offer or (D) the consummation of the Merger; or (b) there shall have been a subsequent development in any action or proceeding relating to the Company or any of its Subsidiaries that would (i) be reasonably likely to be materially adverse either to Parent and Purchaser or to -1- Company and its Subsidiaries taken as a whole or (ii) make materially more costly (A) the making of the Offer, (B) the acceptance for payment of, or payment for, some or all of the shares pursuant to the Offer, (C) the purchase of shares pursuant to the Offer or (D) the consummation of the Merger; or (c) there shall have been any action taken, or any Law promulgated, enacted, entered, enforced or deemed applicable to the Offer or the Merger by any Governmental Entity that could directly or indirectly result in any of the consequences referred to in subsection (a) above; or (d) this Agreement shall have been terminated in accordance with its terms; or (e) the Tender and Voting Agreement, dated as of January 19, 2000, among Parent, Purchaser, Charles E. Bayless and George F. Keane, or the Casten Stock Purchase Agreement, shall not be in effect; or (f) (i) any of the representations and warranties made by the Company in this Agreement that are qualified by materiality or Material Adverse Effect shall not have been true and correct in all respects when made, or shall thereafter have ceased to be true and correct in all respects as if made at the scheduled or extended expiration of the Offer (except to the extent that any such representation or warranty refers specifically to another date, in which case such representation or warranty shall be true and correct in all respects as of such other date), or the other representations and warranties made by the Company in this Agreement shall not have been true and correct in all material respects when made, or shall thereafter have ceased to be true and correct in all material respects as if made at the scheduled or extended expiration of the Offer (except to the extent that any such representation or warranty refers specifically to another date, in which case such representation or warranty shall be true and correct in all material respects as of such other date) or (ii) the Company shall have breached or failed to comply in any material respect with any of its obligations under this Agreement; or (g) Parent and the Special Committee shall have agreed that Parent shall terminate the Offer or postpone the acceptance for payment of or payment for Shares thereunder; or (h) there shall have occurred (i) any general suspension of, or limitation on prices for, trading in securities on any national securities exchange or in the over the counter market in the United States, (ii) a declaration of any banking moratorium by federal or state authorities or any suspension of payments in respect of banks or any limitation (whether or not mandatory) imposed by federal or state authorities on the extension of credit by lending institutions in the -2- United States or the Republic of France, (iii) any mandatory limitation by the federal government that has a material adverse effect generally on the extension of credit by banks and other financial institutions generally, (iv) a commencement of a war, armed hostilities or any other international or national calamity directly or indirectly involving the United States or the Republic of France, or (v) in the case of any of the foregoing existing at the time of the commencement of the Offer, in the sole judgment of the Parent, a material acceleration or worsening thereof. The foregoing conditions are for the sole benefit of Parent and Purchaser and may be asserted by Parent or Purchaser regardless of the circumstances giving rise to any such condition and may be waived by Parent or Purchaser, in whole or in part, at any time and from time to time, in the sole discretion of Parent. The failure by Parent or Purchaser 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 of Common Stock not theretofore accepted for payment shall promptly be returned by the depositary to the tendering stockholders. -3- EXHIBIT B AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OF TRIGEN ENERGY CORPORATION ************ FIRST: The name of the Corporation is Trigen Energy Corporation. SECOND: The address of the Corporation's registered office in the State of Delaware is Corporation Trust Center, 1209 Orange Street in the City of Wilmington, County of New Castle, Delaware 19801. The name of its registered agent at such address is The Corporation Trust Company. THIRD: The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of Delaware. FOURTH: The total number of shares which the Corporation shall have authority to issue is 100 shares of Common Stock, par value $.01 per share. FIFTH: The Board of Directors is expressly authorized to adopt, amend, or repeal the by-laws of the Corporation. SIXTH: Elections of directors need not be by written ballot unless the by-laws of the Corporation shall otherwise provide. SEVENTH: A director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director; PROVIDED, HOWEVER, that the foregoing shall not eliminate or limit the liability of a director (i) for any breach of the director's duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the General Corporation Law of Delaware, or (iv) for any transaction from which the director derived -1- an improper personal benefit. If the General Corporation Law of Delaware is hereafter amended to permit further elimination or limitation of the personal liability of directors, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the General Corporation Law of Delaware as so amended. Any repeal or modification of this Article SEVENTH by the stockholders of the Corporation or otherwise shall not adversely affect any right or protection of a director of the Corporation existing at the time of such repeal or modification. EIGHTH: The Corporation reserves the right to amend, alter, change, or repeal any provision contained in this Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation. -2- EX-99.(A)(5)(VI) 10 EXHIBIT 99(A)(5)(VI) Exhibit 99(a)(5)(vi) TRIGEN AND ELYO ANNOUNCE DEFINITIVE AGREEMENT WHITE PLAINS, N.Y. and NANTERRE, France, Jan. 19 /PRNewswire/ -- Trigen Energy Corporation (NYSE: TGN) and ELYO, an energy subsidiary of the Suez Lyonnaise des Eaux Group, jointly announced today that they have entered into a definitive agreement for ELYO to purchase all the outstanding shares of Trigen it does not already own for $23.50 a share in cash. ELYO's subsidiaries currently own approximately 53% of Trigen common stock. The Trigen Board of Directors approved the merger agreement after a Special Committee of independent directors, with the advice of Credit Suisse First Boston and legal counsel, Troutman Sanders, had determined that the transaction was fair to Trigen shareholders. Trigen will retain its name and headquarters in White Plains, N.Y. Trigen also announced that effective today, Richard E. Kessel, currently executive vice president, chief operating officer and a director of Trigen, was elected president and chief executive officer. Mr. Kessel joined Trigen in 1993, when the company acquired United Thermal Corporation (UTC: NASDAQ) where he was CEO. He also serves as chairman of the board's executive committee. He succeeds Thomas R. Casten who has resigned to pursue other interests. Michel Bleitrach, chairman and chief executive officer of ELYO, said, "We appreciate the invaluable contribution that Tom Casten has made to Trigen's success. Tom has built an experienced management team, which will now be led by Rich Kessel. We have every confidence that Rich and his team possess the skills and vision needed to address the energy outsourcing needs of customers in the rapidly evolving energy markets of North America." Tom Casten stated,"It has been an honor to lead Trigen employees in developing energy systems that reduce costs and pollution. In this daunting pursuit, the men and women of Trigen have continually exceeded my own expectations in changing the way the world makes power. Society will benefit from Trigen's continued success. I wish Trigen well as I address new challenges." Christine Morin-Postel has been elected a Trigen director and appointed to the post of non-executive chairman, replacing George Keane, who will remain a director of Trigen. Ms. Morin-Postel co-founded Trigen with Mr. Casten in 1986 and currently serves as chief executive officer of Societe Generale de Belgique, the parent company of ELYO and Tractebel. She also is a member of the executive committee of the Suez Lyonnaise des Eaux Group. Ms. Morin-Postel commented, "I am looking forward to my new role at Trigen, working with Rich and all the employees of Trigen. I would also like to acknowledge Tom Casten's leadership at Trigen for these many years." Trigen is a leading developer, owner and operator of industrial, commercial and institutional district energy and combined heat and power (CHP) systems in North America. The company serves more than 1,500 customers with energy produced at 49 plants in 20 states, Canada and Mexico. EX-99.(A)(5)(VII) 11 EXHIBIT 99(A)(5)(VII) Exh 99(a)(5)(vii) [Trigen Logo] [Elyo logo] February 28, 2000 Elyo: Acquisition of Trigen Energy Corporation ELYO ANNOUNCES COMMENCEMENT OF TENDER OFFER FOR SHARES OF TRIGEN NANTERRE, France, Feb. 28 -- ELYO, an energy subsidiary of the Suez Lyonnaise des Eaux Group, announced today the commencement of a tender offer by T Acquisition Corp., an indirect, wholly owned subsidiary of ELYO, to purchase any and all the outstanding shares of Trigen Energy Corporation (NYSE Symbol: TGN) that ELYO does not already own for $23.50 a share in cash. ELYO's subsidiaries currently own approximately 53% of Trigen common stock. The tender offer is being made pursuant to the terms of the previously announced merger agreement between Elyo and Trigen. The tender offer is being made pursuant to definitive tender offer materials that are being distributed to Trigen's stockholders and have been filed with the Securities and Exchange Commission. The tender offer is expected to remain open until March 24, 2000, unless extended. It will be followed by a merger under which those shares not tendered will be converted into the right to receive the same $23.50 per share in cash. The closing of the tender offer is subject to certain customary conditions. Trigen is a leading developer, owner and operator of industrial, commercial and institutional district energy and combined heat and power (CHP) systems in North America. The company serves more than 1,500 customers with energy produced at 49 plants in 20 states, Canada and Mexico. CONTACT: Susan Odiseos, Director of Corporate Communications of Trigen Energy Corporation, 914-286-6628; or Gilles Alligner, Director of Communications of ELYO, +1-33-1-41-20-1293; or Jeffrey Zack of Morgen-Walke Associates, Inc., 212-850-5643. EX-99.(C)(I) 12 EXHIBIT 99(C)(I) Exhibit 99(c)(i) ================================================================================ PROJECT TRUST Presentation to the Board of Directors ================================================================================ LAZARD January 19, 2000 PROJECT TRUST Table of Contents - -------------------------------------------------------------------------------- Tab Page - --- ---- I. Overview of Proposed Transaction................................... 1 II. Transaction Rationale.............................................. 2 III. Recent Events and Market Data...................................... 3 IV. Financial Projections.............................................. 12 V. Summary Valuation.................................................. 13 VI. Appendix........................................................... 18 A. Public Market Valuation B. Comparable Transactions Valuation C. Discounted Cash Flow Valuation D. Minority Buy-out Transactions Valuation PROJECT TRUST I. Overview of Proposed Transaction - -------------------------------------------------------------------------------- Overview of Proposed Transaction Price Per Share $23.50 Offer Value $138.6 million(a) $184.4 million(b) Implied Premium 38.2% over current price of $17.00 (1/18/00) 36.2% over price of $17.25 (one month ago) Implied Multiples(c) 2.7x 1999E Revenues ($286.0 million) 11.6x 1999E EBITDA ($66.4 million) 19.1x 1999E EBIT ($40.4 million) 25.5x 1999E EPS ($0.92)(d) Form of Acquisition Cash Tender Offer Followed by a Merger - ---------- (a) Based on 5,899,158 shares held by the public in the United States. (b) Based on 5,899,158 shares held by the public in the United States plus 1,637,274 shares owned by CPCU plus options plus 25% of the value of restricted shares. (c) Based on 12.7 million fully diluted shares. (d) After $4.9 million extraordinary charge, consistent with Street analysts' presentation. -1- PROJECT TRUST II. Transaction Rationale - -------------------------------------------------------------------------------- Transaction Rationale The complete integration of Trigen into ELYO will yield operating benefits, reduce overall cost, and speed decision-making. The completion of this transaction will result in greater simplification of ELYO's corporate structure, further reduce operational and administrative costs, eliminate the expense associated with running a separate publicly traded subsidiary, and enable ELYO to more efficiently fund the capital needs of Trigen. -2- PROJECT TRUST III. Recent Events and Market Data - -------------------------------------------------------------------------------- Trigen One-Year Price and Volume (1/14/99 to 1/14/00) [GRAPHIC OMITTED] [The following table was depicted as a mountain graph in the printed material.] Date Volume Close 1/14/99 500 13.3125 1/15/99 1400 13.1250 1/19/99 3400 12.7500 1/20/99 169400 12.6875 1/21/99 4900 12.6875 1/22/99 300 12.6250 1/25/99 1500 12.8125 1/26/99 29300 12.6875 1/26/99 Begin construction 1/27/99 18400 12.3125 of Georgia power system 1/28/99 5200 11.8125 1/29/99 4200 12.2500 2/01/99 6300 12.2500 2/02/99 1200 12.6250 2/03/99 #N/A 12.5000 2/04/99 2600 12.1875 2/05/99 1100 12.4375 2/08/99 4200 12.9375 2/09/99 8000 13.3750 2/9/99 Reports 1998 Net Income 2/10/99 800 13.2500 2/11/99 #N/A 13.3125 2/12/99 86200 12.8125 2/16/99 #N/A 12.8125 2/17/99 2800 12.8750 2/18/99 28600 12.8750 2/19/99 1200 12.5000 2/22/99 2200 12.8125 2/23/99 2000 13.0000 2/24/99 8300 13.6875 2/25/99 1200 13.9375 2/26/99 #N/A 13.6875 3/01/99 5500 14.0000 3/02/99 8900 13.8750 3/03/99 7500 13.8750 3/04/99 #N/A 13.8750 3/05/99 500 13.8125 3/08/99 2700 14.4375 3/09/99 200 14.3125 3/10/99 1700 14.2500 3/11/99 3000 14.1250 3/12/99 3000 14.1250 3/15/99 600 14.1875 3/16/99 7000 14.6250 3/17/99 500 14.4375 3/18/99 7600 14.8750 3/19/99 5900 15.2500 3/22/99 3500 15.8125 3/23/99 27600 16.3125 3/24/99 12800 16.0000 3/25/99 100 16.0000 3/26/99 300 15.8750 3/29/99 100 15.6875 3/30/99 1300 15.3125 3/31/99 13400 13.6875 4/01/99 2600 13.6875 4/05/99 33300 13.6875 4/06/99 2000 14.1250 4/6/99 PECO settles Gray's Ferry 4/07/99 2500 14.1250 contract lawsuit 4/08/99 2000 14.0000 4/09/99 4600 14.1250 4/12/99 1100 14.0000 4/13/99 6500 13.6875 4/14/99 2300 13.6875 4/15/99 3900 13.6250 4/16/99 34200 14.0000 4/19/99 2100 14.0000 4/20/99 19600 14.0000 4/21/99 34500 14.0000 4/22/99 1600 14.4375 4/23/99 300 14.5625 4/26/99 2800 14.8750 4/27/99 3100 14.9375 4/28/99 8400 14.9375 4/28/99 Reports 1st quarter EPS of 4/29/99 19800 15.6875 $0.51 vs. $0.45 in 1998 4/30/99 5600 15.8750 5/03/99 13500 15.8750 5/04/99 2500 15.8750 5/05/99 9200 15.7500 5/06/99 1200 15.6250 5/07/99 5800 15.5625 5/10/99 3100 15.9375 5/11/99 13300 16.0000 5/12/99 1300 15.6875 5/13/99 1200 15.6875 5/14/99 4400 15.5625 5/17/99 6600 15.5000 5/18/99 1400 15.7500 5/19/99 7000 15.9375 5/20/99 500 15.9375 5/21/99 1200 15.9375 5/24/99 11000 15.8750 5/25/99 1400 16.0000 5/26/99 1600 16.0000 5/27/99 6300 15.9375 5/28/99 1900 16.3125 6/01/99 600 15.9375 6/02/99 21700 14.6250 6/03/99 29500 14.5000 6/3/99 Trigen/Cinergy sign 20 year, 6/04/99 83100 14.1875 $1.0 billion contract with 6/07/99 7500 14.8750 Millenium Chemicals 6/08/99 5500 15.4375 6/09/99 4000 16.0625 6/10/99 11000 16.0000 6/11/99 12300 16.3750 6/14/99 22000 16.5000 6/15/99 19400 16.5625 6/16/99 168500 16.8750 6/17/99 25200 16.7500 6/18/99 2300 16.9375 6/21/99 5800 17.5625 6/22/99 5300 18.0000 6/23/99 14400 17.7500 6/24/99 5600 17.7500 6/25/99 8200 18.1250 6/28/99 10100 18.6250 6/29/99 3400 18.3125 6/30/99 51700 19.0000 7/01/99 7300 19.6250 7/02/99 7900 19.4375 7/06/99 3600 19.1875 7/07/99 3100 19.1250 7/08/99 6200 19.1250 7/09/99 4600 19.8750 7/12/99 5200 19.8750 7/13/99 8800 20.6875 7/14/99 2700 20.7500 7/15/99 4900 20.3750 7/16/99 2300 20.0000 7/19/99 11500 18.8125 7/20/99 6600 18.8125 7/20/99 Commissions St. Louis heat and 7/21/99 1500 18.7500 power plant 7/22/99 6400 19.0000 7/23/99 1400 18.6875 7/26/99 2900 18.5000 7/27/99 2900 18.6875 7/28/99 6900 19.1250 7/28/99 Reports 2nd quarter EPS of $0.78 7/29/99 4200 19.5625 vs. $0.00 in 1998 7/30/99 2700 19.9375 8/02/99 8800 20.5625 8/03/99 5000 20.1250 8/04/99 9200 20.7500 8/05/99 1300 20.4375 8/06/99 1100 20.0000 8/09/99 400 19.9375 8/10/99 2300 19.6250 8/11/99 100 19.7500 8/12/99 2000 19.5000 8/13/99 2000 19.0000 8/16/99 800 19.0000 8/17/99 900 18.9375 8/18/99 1300 18.8125 8/19/99 900 18.6875 8/20/99 2100 18.3750 8/23/99 1800 18.6250 8/24/99 1700 18.6250 8/25/99 6900 18.8125 8/26/99 12700 18.0000 8/27/99 1100 17.9375 8/30/99 1800 17.6875 8/31/99 2200 17.3750 9/01/99 1000 17.3125 9/02/99 1500 17.3750 9/03/99 2400 17.5000 9/07/99 700 17.6875 9/08/99 1600 17.7500 9/09/99 400 18.0000 9/10/99 2200 18.1250 9/13/99 5500 18.2500 9/14/99 1800 18.1250 9/15/99 500 18.2500 9/16/99 2700 18.5000 9/17/99 6800 19.2500 9/20/99 60100 22.1875 9/20/99 Trigen receives buyout offer 9/21/99 41100 22.5000 from Elyo at $22 per share 9/22/99 17400 22.6875 9/23/99 7200 23.5625 9/24/99 25900 23.1875 9/27/99 11200 22.5000 9/28/99 4800 22.3125 9/29/99 5200 22.7500 9/30/99 6600 22.9375 10/01/99 3100 22.4375 10/04/99 12900 22.6250 10/05/99 17000 22.7500 10/06/99 4700 22.7500 10/07/99 36100 22.8125 10/08/99 75200 22.7500 10/11/99 9500 23.7500 10/12/99 1000 23.5000 10/13/99 2300 23.6250 10/14/99 7500 23.4375 10/15/99 2500 23.3125 10/18/99 4200 23.3125 10/19/99 1500 23.0625 10/20/99 15700 22.8125 10/21/99 6400 22.6875 10/22/99 48400 22.5000 10/25/99 19900 22.6875 10/26/99 5700 23.1250 10/26/99 Reports 3rd quarter loss of 10/27/99 84300 23.3125 $0.09 vs. loss of $0.15 in 1998 10/28/99 21900 23.1250 10/29/99 400 23.3125 11/01/99 20600 23.2500 11/02/99 1800 23.0625 11/03/99 27400 23.5625 11/3/99 Trigen/Cinergy sign 20 year, 11/04/99 1400 23.3750 $130 million contract with 11/05/99 4000 23.3125 Sweetheart Cup 11/08/99 16300 23.4375 11/09/99 13200 23.4375 11/10/99 1500 23.3750 11/11/99 14700 23.2500 11/12/99 6000 23.3750 11/15/99 Trigen/Cinergy sign 20 year 11/15/99 19700 23.9375 contract with Eastman Kodak 11/16/99 37100 22.0000 11/17/99 63200 19.9375 11/16/99 Elyo withdraws $22 per share 11/18/99 13900 20.0000 offer to Trigen 11/19/99 8700 19.9375 11/22/99 6200 18.9375 11/23/99 11800 17.5625 11/24/99 21100 17.5000 11/26/99 1000 17.3750 11/29/99 15300 16.8750 11/30/99 48000 16.3125 12/01/99 12800 16.6875 12/02/99 13100 17.0000 12/03/99 7300 17.7500 12/06/99 9100 17.1875 12/07/99 15600 16.9375 12/08/99 7200 17.5625 12/09/99 1200 17.3750 12/10/99 7400 16.9375 12/13/99 30800 17.0000 12/14/99 17000 17.0000 12/15/99 4400 16.7500 12/16/99 11300 16.9375 12/17/99 15100 17.2500 12/20/99 19300 17.8750 12/21/99 22800 18.0000 12/22/99 2100 17.8125 12/23/99 3000 18.0000 12/27/99 8500 17.9375 12/28/99 2000 17.8125 12/29/99 6300 17.1250 12/30/99 20700 16.7500 12/31/99 8400 17.3750 1/03/00 8500 17.0000 1/04/00 1100 17.0000 1/05/00 4000 16.8750 1/06/00 6800 17.0000 1/07/00 8700 17.0000 1/10/00 8400 16.7500 1/11/00 19400 17.0000 1/12/00 23500 16.5000 1/13/00 15900 16.8125 1/14/00 71700 16.8750 -3- PROJECT TRUST III. Recent Events and Market Data - -------------------------------------------------------------------------------- One-Year Comparative Indexed Share Price Performance (1/14/99 to 1/14/00) [GRAPHIC OMITTED] [The following table was depicted as a mountain graph in the printed material.] Date Trigen Composite(a) S&P 500 1/14/99 100.00 100.00 100.00 1/15/99 98.59 102.93 102.56 1/18/99 98.59 102.93 102.56 1/19/99 95.77 102.34 103.28 1/20/99 95.31 98.61 103.67 1/21/99 95.31 101.15 101.89 1/22/99 94.84 101.07 101.07 1/25/99 96.24 98.47 101.80 1/26/99 95.31 97.63 103.31 1/27/99 92.49 94.11 102.56 1/28/99 88.73 92.29 104.39 1/29/99 92.02 95.39 105.56 2/01/99 92.02 94.34 105.02 2/02/99 94.84 98.58 104.11 2/03/99 93.90 99.89 104.94 2/04/99 91.55 97.83 102.99 2/05/99 93.43 101.97 102.24 2/08/99 97.18 101.78 102.61 2/09/99 100.47 100.76 100.33 2/10/99 99.53 96.25 100.94 2/11/99 100.00 98.61 103.45 2/12/99 96.24 102.33 101.48 2/15/99 96.24 102.33 101.48 2/16/99 96.24 103.94 102.45 2/17/99 96.71 102.49 100.98 2/18/99 96.71 103.19 102.07 2/19/99 93.90 105.23 102.23 2/22/99 96.24 107.55 104.95 2/23/99 97.65 106.44 104.87 2/24/99 102.82 105.68 103.40 2/25/99 104.69 102.52 102.71 2/26/99 102.82 101.12 102.16 3/01/99 105.16 98.69 101.98 3/02/99 104.23 98.30 101.10 3/03/99 104.23 100.74 101.28 3/04/99 104.23 103.23 102.84 3/05/99 103.76 104.89 105.22 3/08/99 108.45 103.51 105.82 3/09/99 107.51 100.13 105.58 3/10/99 107.04 98.85 106.16 3/11/99 106.10 99.31 107.05 3/12/99 106.10 102.31 106.80 3/15/99 106.57 106.61 107.84 3/16/99 109.86 105.82 107.77 3/17/99 108.45 106.06 107.06 3/18/99 111.74 108.39 108.61 3/19/99 114.55 106.04 107.19 3/22/99 118.78 104.52 107.00 3/23/99 122.54 104.62 104.12 3/24/99 120.19 104.75 104.65 3/25/99 120.19 109.04 106.42 3/26/99 119.25 106.57 105.82 3/29/99 117.84 101.36 108.08 3/30/99 115.02 102.22 107.31 3/31/99 102.82 102.46 106.12 4/01/99 102.82 103.26 106.73 4/02/99 102.82 103.26 106.73 4/05/99 102.82 105.82 108.99 4/06/99 106.10 106.47 108.72 4/07/99 106.10 105.98 109.46 4/08/99 105.16 110.71 110.87 4/09/99 106.10 116.51 111.23 4/12/99 105.16 123.53 112.08 4/13/99 102.82 121.58 111.35 4/14/99 102.82 126.56 109.59 4/15/99 102.35 126.58 109.13 4/16/99 105.16 133.10 108.81 4/19/99 105.16 135.39 106.38 4/20/99 105.16 134.43 107.75 4/21/99 105.16 129.81 110.22 4/22/99 108.45 127.03 112.10 4/23/99 109.39 127.76 111.93 4/26/99 111.74 131.64 112.20 4/27/99 112.21 135.62 112.42 4/28/99 112.21 133.75 111.44 4/29/99 117.84 135.62 110.78 4/30/99 119.25 133.65 110.15 5/03/99 119.25 135.59 111.75 5/04/99 119.25 134.68 109.88 5/05/99 118.31 136.14 111.15 5/06/99 117.37 137.29 109.89 5/07/99 116.90 135.03 110.96 5/10/99 119.72 137.51 110.57 5/11/99 120.19 138.83 111.83 5/12/99 117.84 139.76 112.52 5/13/99 117.84 141.39 112.82 5/14/99 116.90 137.04 110.36 5/17/99 116.43 137.94 110.50 5/18/99 118.31 139.11 109.99 5/19/99 119.72 143.91 110.89 5/20/99 119.72 146.25 110.45 5/21/99 119.72 145.68 109.74 5/24/99 119.25 145.78 107.79 5/25/99 120.19 143.06 105.96 5/26/99 120.19 144.65 107.64 5/27/99 119.72 139.70 105.71 5/28/99 122.54 138.63 107.40 5/31/99 122.54 138.63 107.40 6/01/99 119.72 139.30 106.77 6/02/99 109.86 138.01 106.82 6/03/99 108.92 136.41 107.21 6/04/99 106.57 138.32 109.53 6/07/99 111.74 138.16 110.09 6/08/99 115.96 139.36 108.67 6/09/99 120.66 142.36 108.78 6/10/99 120.19 139.93 107.48 6/11/99 123.00 140.17 106.72 6/14/99 123.94 140.29 106.75 6/15/99 124.41 140.26 107.34 6/16/99 126.76 143.39 109.75 6/17/99 125.82 146.49 110.54 6/18/99 127.23 149.77 110.78 6/21/99 131.92 150.46 111.29 6/22/99 135.21 151.32 110.20 6/23/99 133.33 157.96 109.97 6/24/99 133.33 157.35 108.55 6/25/99 136.15 154.94 108.51 6/28/99 139.91 156.44 109.83 6/29/99 137.56 158.57 111.49 6/30/99 142.72 157.07 113.24 7/01/99 147.42 155.21 113.92 7/02/99 146.01 154.57 114.77 7/05/99 146.01 154.57 114.77 7/06/99 144.13 158.66 114.51 7/07/99 143.66 161.74 115.15 7/08/99 143.66 161.92 115.03 7/09/99 149.30 163.59 115.76 7/12/99 149.30 162.22 115.42 7/13/99 155.40 157.92 114.96 7/14/99 155.87 161.28 115.34 7/15/99 153.05 158.12 116.29 7/16/99 150.23 160.24 117.04 7/19/99 141.31 161.48 116.12 7/20/99 141.31 160.26 113.60 7/21/99 140.85 157.78 113.78 7/22/99 142.72 154.52 112.27 7/23/99 140.38 160.88 111.94 7/26/99 138.97 160.83 111.18 7/27/99 140.38 165.87 112.43 7/28/99 143.66 171.31 112.64 7/29/99 146.95 170.45 110.63 7/30/99 149.77 169.28 109.61 8/02/99 154.46 169.12 109.56 8/03/99 151.17 167.31 109.07 8/04/99 155.87 164.59 107.68 8/05/99 153.52 158.85 108.37 8/06/99 150.23 158.59 107.27 8/09/99 149.77 156.22 107.06 8/10/99 147.42 156.29 105.71 8/11/99 148.36 158.38 107.40 8/12/99 146.48 159.07 107.09 8/13/99 142.72 158.94 109.53 8/16/99 142.72 156.72 109.78 8/17/99 142.25 159.11 110.89 8/18/99 141.31 164.31 109.95 8/19/99 140.38 178.79 109.19 8/20/99 138.03 177.74 110.26 8/23/99 139.91 182.03 112.21 8/24/99 139.91 180.69 112.48 8/25/99 141.31 179.80 113.99 8/26/99 135.21 176.68 112.36 8/27/99 134.74 176.19 111.23 8/30/99 132.86 175.45 109.23 8/31/99 130.52 175.77 108.93 9/01/99 130.05 176.86 109.81 9/02/99 130.52 172.54 108.82 9/03/99 131.46 178.23 111.97 9/06/99 131.46 178.23 111.97 9/07/99 132.86 185.31 111.41 9/08/99 133.33 185.04 110.89 9/09/99 135.21 185.79 111.18 9/10/99 136.15 189.86 111.51 9/13/99 137.09 187.86 110.88 9/14/99 136.15 186.40 110.24 9/15/99 137.09 184.66 108.73 9/16/99 138.97 185.33 108.77 9/17/99 144.60 186.59 110.17 9/20/99 166.67 183.50 110.17 9/21/99 169.01 184.48 107.87 9/22/99 170.42 184.53 108.11 9/23/99 177.00 182.60 105.63 9/24/99 174.18 179.44 105.38 9/27/99 169.01 178.85 105.87 9/28/99 167.61 172.94 105.78 9/29/99 170.89 172.87 104.63 9/30/99 172.30 170.50 105.82 10/01/99 168.54 168.51 105.83 10/04/99 169.95 171.21 107.62 10/05/99 170.89 169.03 107.36 10/06/99 170.89 169.20 109.34 10/07/99 171.36 167.21 108.70 10/08/99 170.89 164.30 110.22 10/11/99 178.40 164.31 110.15 10/12/99 176.53 165.03 108.32 10/13/99 177.46 163.46 106.05 10/14/99 176.06 162.39 105.88 10/15/99 175.12 157.75 102.91 10/18/99 175.12 156.36 103.46 10/19/99 173.24 158.88 104.05 10/20/99 171.36 163.28 106.37 10/21/99 170.42 164.15 105.89 10/22/99 169.01 165.02 107.38 10/25/99 170.42 163.57 106.72 10/26/99 173.71 160.74 105.75 10/27/99 175.12 163.92 106.97 10/28/99 173.71 168.69 110.75 10/29/99 175.12 174.64 112.44 11/01/99 174.65 173.26 111.71 11/02/99 173.24 176.04 111.18 11/03/99 177.00 173.86 111.78 11/04/99 175.59 174.90 112.41 11/05/99 175.12 181.07 113.04 11/08/99 176.06 178.41 113.60 11/09/99 176.06 178.24 112.63 11/10/99 175.59 180.05 113.30 11/11/99 174.65 181.64 113.96 11/12/99 175.59 182.63 115.17 11/15/99 179.81 185.01 115.03 11/16/99 165.26 188.68 117.15 11/17/99 149.77 186.75 116.38 11/18/99 150.23 189.46 117.55 11/19/99 149.77 188.69 117.31 11/22/99 142.25 185.88 117.22 11/23/99 131.92 180.50 115.88 11/24/99 131.46 174.67 116.90 11/25/99 131.46 174.67 116.90 11/26/99 130.52 174.06 116.86 11/29/99 126.76 173.51 116.14 11/30/99 122.54 178.99 114.58 12/01/99 125.35 181.55 115.31 12/02/99 127.70 182.44 116.24 12/03/99 133.33 183.68 118.24 12/06/99 129.11 183.77 117.42 12/07/99 127.23 188.84 116.25 12/08/99 131.92 190.11 115.81 12/09/99 130.52 193.91 116.16 12/10/99 127.23 186.42 116.90 12/13/99 127.70 184.86 116.75 12/14/99 127.70 184.11 115.75 12/15/99 125.82 187.99 116.59 12/16/99 127.23 183.31 117.04 12/17/99 129.58 191.94 117.23 12/20/99 134.27 199.04 116.99 12/21/99 135.21 207.53 118.25 12/22/99 133.80 203.06 118.47 12/23/99 135.21 202.55 120.31 12/24/99 135.21 202.55 120.31 12/27/99 134.74 209.33 120.20 12/28/99 133.80 209.15 120.25 12/29/99 128.64 208.63 120.73 12/30/99 125.82 212.77 120.81 12/31/99 130.52 220.66 121.21 1/03/00 127.70 217.34 120.05 1/04/00 127.70 211.58 115.45 1/05/00 126.76 214.21 115.67 1/06/00 127.70 216.25 115.78 1/07/00 127.70 222.05 118.91 1/10/00 125.82 234.48 120.25 1/11/00 127.70 232.39 118.67 1/12/00 123.94 236.32 118.15 1/13/00 126.29 243.69 119.59 1/14/00 126.76 254.90 120.87 26.8% 154.9% 20.9% - ---------- (a) Composite includes AES, Calpine and Thermo Ecotek. -4- PROJECT TRUST III. Recent Events and Market Data - -------------------------------------------------------------------------------- Trigen Three-Year Price/Volume Histogram (1/14/97 to 1/14/00) Total Volume Traded: 7,793,800 Shares [GRAPHIC OMITTED] [The following table was depicted as a bar graph in the printed material.] 3 Year
0 11.99 13.99 15.99 17.99 19.99 21.99 23.99 25.99 27.99 11.99 13.99 15.99 17.99 19.99 21.99 23.99 25.99 27.99 50 TOTAL 374,600 1,281,300 917,200 2,010,600 825,200 318,100 1,485,600 519,000 60,400 1,800 7,793,800 Cumulative Percent Traded 4.8% 21.2% 33.0% 58.8% 69.4% 73.5% 92.5% 99.2% 100.0% 100.0%
-5- PROJECT TRUST III. Recent Events and Market Data - -------------------------------------------------------------------------------- Trigen Two-Year Price/Volume Histogram (1/14/98 to 1/14/00) Total Volume Traded: 5,787,700 Shares [GRAPHIC OMITTED] [The following table was depicted as a bar graph in the printed material.] 2 Year
0 11.99 13.99 15.99 17.99 19.99 21.99 23.99 25.99 27.99 11.99 13.99 15.99 17.99 19.99 21.99 23.99 25.99 27.99 50 TOTAL 374,600 1,281,300 917,200 1,998,900 434,300 58,000 723,400 0 0 0 5,787,700 Cumulative Percent Traded 6.5% 28.6% 44.5% 79.0% 86.5% 87.5% 100.0%
-6- PROJECT TRUST III. Recent Events and Market Data - -------------------------------------------------------------------------------- Trigen One-Year Price/Volume Histogram (1/14/99 to 1/14/00) Total Volume Traded: 2,835,800 Shares [GRAPHIC OMITTED] [The following table was depicted as a bar graph in the printed material.] 1 Year
0 11.99 13.99 15.99 17.99 19.99 21.99 23.99 25.99 27.99 11.99 13.99 15.99 17.99 19.99 21.99 23.99 25.99 27.99 50 TOTAL 5,200 468,400 411,200 846,300 323,300 58,000 723,400 0 0 0 2,835,800 Cumulative Percent Traded 0.2% 16.7% 31.2% 61.0% 72.4% 74.5% 100.0%
-7- PROJECT TRUST III. Recent Events and Market Data - -------------------------------------------------------------------------------- Shareholder Profile As Reported ---------------------------- Institutional Holders Shares Held % of Total ----------- ---------- Dimensional Fund Advisors 868,500 7.0% Investment Counselors of Maryland 780,000 6.3 Benson Associates, LLC 411,381 3.3 Denver Investment Advisors 161,900 1.3 Martindale Andres & Co. 136,900 1.1 California Public Employees' Retirement System 134,100 1.1 Loomis Sayles & Co. 121,400 1.0 Accrued Equities 75,000 0.6 Westpeak Investment Advisors, L.P. 71,500 0.6 Barclays Global Investors 61,000 0.5 Other 363,336 2.9 ---------- ----- Total Institutional Ownership 3,185,017 25.7% Suez Lyonnaise des Eaux and Affiliates 6,507,944 52.5% Insiders Thomas R. Casten 1,094,457 8.8% Eugene E. Murphy 243,493 2.0 Other Insiders 397,671 3.2 ---------- ----- Total Insiders 1,735,621 14.0% Retail 978,520 7.9% ---------- ----- Total Shares Outstanding 12,407,102 100.0% ========== ===== - ---------- Source: Trigen 10-Q dated 9/30/99 and Morrow & Co. as of November 1999. -8- PROJECT TRUST III. Recent Events and Market Data - -------------------------------------------------------------------------------- Options and Restricted Stock Information Options
Outstanding Options(a) - ---------------------------------------------------------------------- Diff. Between Average Offer Price and Cost to Range of Average Exercise Offer Avg. Exercise Exercise Exercise Prices Options Life(b) Price Price Price Options(c) - ------------------- ------- ------- -------- ----- --------------- ---------- $11.88 - $19.75 735,210 8.1 $16.40 $23.50 $7.10 $5,219,991 20.00 - 24.00 54,200 7.4 21.55 23.50 1.95 105,690 24.25 - 27.75 19,500 8.4 25.43 23.50 -- -- Total 808,910 8.0 $18.89 $5,325,681
o The cost to exercise the options will be equal to the difference between the offer price and the exercise price multiplied by the number of options (vested and non-vested) or approximately $5.3 million. o Note that if the offer price is less than or equal to the exercise price, those options shall be cancelled. Restricted Stock Restricted Offer Payment Stock Shares Price at Closing(d) - ------------ ----- ------------- 329,220 $23.50 $1,934,168 - ---------- (a) Information of outstanding options based on Trigen 10-K dated 12/31/98. (b) Average contractual remaining life of options in years as of 12/31/98. (c) Includes both vested and non-vested options. (d) At closing, 25% of the restricted stock shares will be paid. The remaining restricted shares shall be cancelled. -9- PROJECT TRUST III. Recent Events and Market Data - -------------------------------------------------------------------------------- Selected Research Analyst Comments After Elyo Offer on September 20, 1999
1999 Target Report Date Research Firm/Analyst EPS Price Rating Selected Quotes ----------- --------------------- --- ----- ------ --------------- December 7, 1999 BancBoston Robertson Stephens $0.75 NA Buy "We are reducing our 4Q earnings estimate for Hugh F. Holman Trigen from $0.49 to $0.25 per share. This reduction is based on two factors. First, we were just flat out too aggressive in setting our target for the quarter, and, to hit it, everything would have had to break right for the company. Second, the weather thus far in 4Q has been great here in the East- which, unfortunately, is bad news for a company that makes money when the weather is cold." "We are maintaining our Buy rating on this stock. Despite our disappointment that Elyo has declined to sweeten its $22/share bid, we think the fundamentals here remain very strong as the deregulation of the power market in the U.S. picks up pace." December 3, 1999 Salomon Smith Barney $0.80 $21.50 Neutral "We are lowering our rating to Neutral from Bonnie Becker Outperform due to: 1) concerns about Trigen's earnings cliff in 2001 caused by the repricing of Grays Ferry contract, 2) the withdrawal by majority shareholder Elyo of its bid for Trigen, and 3) Trigen's premium valuation to both AES Corp and Calpine Corp, which we feel is unwarranted." "We believe that the Elyo offer represented a fair price for Trigen stock. The offer price valued Trigen at 9.6x FV/EBITDA. This compared favorably with the most recent acquisition of an independent power producer (IPP), Calpine's acquisition of CogenAmerica, which valued CogenAmerica at 6.9x EBITDA." November 18, 1999 DLJ Securities $0.80 $22.00- Market "We maintain that the near-term challenge for Ali Agha $23.00 Perf. Trigen is the earnings cliff that the company faces in 2001 arising from the repricing of the Grays Ferry contract. In recent months, management has exhibited increasing success in securing new projects and contracts to bolster earnings going forward. At this time, however, we are maintaining our market performance rating on the stock but will be closely monitoring management's efforts to build out a pipeline of future projects to add to earnings visibility." September 22, 1999 BancBoston Robertson Stephens $0.99 NA Buy "We suspect that Suez Lyonnaise des Eaux will Hugh F. Holman end up sweetening its $22/share offer for Trigen. We base this on several considerations. First, the market seems to be telling us that Suez's bid is low, as the stock immediately traded above $22/share and has held at a premium to the offer. Second, the premium offered relative to Trigen's closing price prior to the offer, 14.3%, is low relative to what Suez has paid in its recent buy-in of United Water Resources (54%) and to what it has offered in two other buy-ins, Tractebel (24.4%) and Sita (20.3%). Third, in a comparable transaction now under way, Calpine's offer to buy 80% of Cogeneration Corporation of America, Calpine has offered Cogen a 48.7% premium to its prior closing price and what appears to us to be a multiple of estimated forward EBITDA of 8.5-9.5x versus Suez's offer of 7.6x Trigen's estimated forward EBITDA.
-10- PROJECT TRUST III. Recent Events and Market Data - -------------------------------------------------------------------------------- Selected Research Analyst Comments Before Elyo Offer on September 20, 1999
1999 Target Report Date Research Firm/Analyst EPS Price Rating Selected Quotes ----------- --------------------- --- ----- ------ --------------- July 29, 1999 Lazard Freres & Co. LLC $0.83 $30.00 Buy "Development and construction activity has James F. McAree been significant and is expected to continue growing. Our impression is that the level of bidding activity continues to increase, outsourcing contracts are being signed and the selling-cycle now seems to be significantly shorter than it was two years ago. We believe that the company can move forward with its many projects since the parent company, ELYO, made a $50 million subordinated loan at favorable terms to TGN and Cinergy has committed $150 million to TGN-Cinergy Solutions projects." "The 2001 earnings profile is becoming clearer. Investors should note that about $0.50 to $0.60 of TGN's 2000 EPS from the Gray's Ferry project is at risk in 2001 due to a change in the pricing of electricity from 4.5 cents per KW to 98% of the PJM Index. We believe that the company has about $0.25 of new EPS from the ramp-up of current projects in 2001 and given the momentum in the business today we are confident that management can at least meet their internal goal of replacing all of the anticipated EPS decline at Gray's Ferry." July 28, 1999 BancBoston Robertson Stephens $0.99 NA Buy "We believe the restructuring of the utility Hugh F. Holman industry will open significant new opportunities to Trigen in the development of new industrial and district heating CHP projects that free customers from the need to rely on local utilities. By `going off the grid', these customers will avoid transition charges and transmission and distribution charges that grid-connected customers will incur. Further, we believe that the environmental benefits of CHP will translate into an increasingly attractive competitive advantage as emissions trading places a monetary value on emissions." "Based on the current strong momentum in Trigen's project development activity, we believe there may yet be an upside to these [earnings] estimates, possibly to $1.00 in 1999." "The company also noted that it believes the selling cycle on new industrial projects is shortening as decision-making on energy projects moves to higher echelons in its client companies-partly as a result of the energy `buzz' created by utility deregulation." "The company indicated that it has at least three very significant project awards pending, and management is anticipating an `active' August (in terms of awards and announcements)." June 3, 1999 Lazard Freres & Co. LLC $0.76 $20.00 Buy "Trigen's bidding activity is robust and James F. McAree contracts are being signed now that uncertainty surrounding electricity deregulation is over." "Trigen and TCS are very well positioned to win outsourcing contracts and the outsourcing trend will continue to grow as companies recognize the potential cost savings now available." June 3, 1999 BancBoston Robertson Stephens $0.78 $22.00- Buy "Trigen has scored a major project win with Hugh F. Holman $29.00 Millenium Chemicals that potentially adds $1 billion in revenues over the next 15-20 years." "We find ourselves reporting news that could drive earnings above our current estimates of $0.78 for 1999 and $1.10 for 2000. We continue to believe that the upside potential to earnings in 2000 could be as much as $0.35 per share."
-11- PROJECT TRUST IV. Financial Projections - -------------------------------------------------------------------------------- Selected Historical and Projected Financial Data(a) ($ in millions, except per share data)
Projected ----------------------------------------------------------- CAGR 1998A 1999E 2000 2001 2002 2003 2004 2005 1999-2005 ----- ----- ---- ---- ---- ---- ---- ---- --------- Selected Income Statement Data Revenues $ 242.4 $ 286.0 $375.5 $403.4 $421.6 $436.9 $446.4 $453.0 7.9% % Growth 18.0% 31.3% 7.4% 4.5% 3.6% 2.2% 1.5% EBITDA 57.0 66.4 99.0 100.0 107.4 111.2 112.6 112.9 9.2 % Margin 23.5% 23.2% 26.4% 24.8% 25.5% 25.4% 25.2% 24.9% EBIT 31.8 40.4 66.3 63.2 67.9 70.8 71.5 71.2 9.9 % Margin 13.1% 14.1% 17.7% 15.7% 16.1% 16.2% 16.0% 15.7% Net Income 6.3(b) 11.7(c) 16.1 11.5 13.5 16.7 18.8 20.0 9.4 % Margin 2.6% 4.1% 4.3% 2.8% 3.2% 3.8% 4.2% 4.4% % Growth 58.2% 37.6 (28.5) 17.9 23.5 12.3 6.5 Earnings per Share (d) $ 0.52(b) $ 0.94(c) $ 1.30 $ 0.93 $ 1.09 $ 1.35 $ 1.52 $ 1.61 9.4% % Growth 80.7% 37.6% (28.5)% 17.9% 23.5% 12.3% 6.5% Selected Cash Flow Data Depreciation and Amortization $ 25.2 $ 26.0 $ 32.7 $ 36.7 $ 39.6 $ 40.4 $ 41.1 $ 41.7 Working Capital Decrease/ (Increase) 0.1 (17.0) 6.4 0.5 (1.9) (2.3) (2.7) (10.2) Capital Expenditures (109.1) (137.1) (93.6) (69.0) (11.5) (10.9) (5.0) (4.1)
- ---------- (a) Source: Trigen Medium Term Plan- Committed Case dated January 8, 2000. (b) Includes extraordinary loss of $0.3 million net of tax. (c) Includes extraordinary loss of $4.9 million net of tax. (d) EPS for 1999 and beyond based on 12.4 million basic shares outstanding as of 10-Q dated 9/30/99. -12- PROJECT TRUST V. Summary Valuation - -------------------------------------------------------------------------------- Valuation Ranges
Premium/(Discount) to Implied Market Value --------------------- Enterprise Value Per Share (a)(b) Current Price (c) -------------------- -------------------- --------------------- Low High Low High Low High ----- ------ ----- ------ ----- ------ -------------------- A. Public Market Valuation $665 -- $730 $15.17 -- $20.28 (10.8%) -- 19.3% B. Comparable Transactions Valuation $695 -- $765 $17.53 -- $23.03 3.1% -- 35.5% C. Discounted Cash Flow Analysis $710 -- $775 $18.71 -- $23.82 10.0% -- 40.1% D. Minority Buy-out Transaction Valuation $715 -- $750 $19.08 -- $21.99 12.3% -- 29.4% -------------------- - ------------------ (a) Based on 12.7 million fully diluted shares. (b) Market value defined as Enterprise Value less net debt of $472 million. Net debt defined as short term and long term debt, plus minority interest, plus preferred stock less cash. (c) Based on a share price of $17.00 as of 1/18/00.
-13- PROJECT TRUST V. Summary Valuation - -------------------------------------------------------------------------------- Valuation Ranges (cont'd) [The following table was depicted as a bar graph in the printed material.]
Public Market Comparable Transactions Discounted Cash Minority Buy-Out Current Price(a) Valuation Valuation Flow Analysis Transaction Valuation $17.00 $15.17 $17.53 $18.71 $19.08 $20.28 $23.03 $23.82 $21.99
- ---------- (a) As of 1/18/00. -14- PROJECT TRUST V. Summary Valuation - -------------------------------------------------------------------------------- Analysis at Various Prices ($ in millions, except per share data)
Premium to Market Value ------------------------------------------------------------------------- 0% 10% 20% 30% 40% ------------------------------------------------------------------------- Stock Price $ 17.00 (g) $ 18.70 $ 20.40 $ 22.10 $ 23.80 Primary Shares Outstanding (a) 12.4 12.4 12.4 12.4 12.4 Options (b)(c) 0.7 0.7 0.7 0.8 0.8 Restricted Stock (f) 0.1 0.1 0.1 0.1 0.1 Fully Diluted Gross Shares 13.2 13.2 13.2 13.3 13.3 Options Proceeds (c) $ 12.1 $ 12.1 12.1 13.2 13.2 Market Value $ 212.8 $ 235.2 $ 257.7 $ 280.2 $ 302.8 Net Debt (d) 472.1 472.1 472.1 472.1 472.1 ------- ------- ------- ------- ------- Enterprise Value $ 684.8 $ 707.3 $ 729.8 $ 752.3 $ 774.9 ======= ======= ======= ======= ======= Enterprise Value as a Multiple of Revenues (e) 1999 $ 286.0 2.4 x 2.5 x 2.6 x 2.6 x 2.7 x 2000 $ 375.5 1.8 1.9 1.9 2.0 2.1 EBITDA (e) 1999 $ 66.4 10.3 x 10.7 x 11.0 x 11.3 x 11.7 x 2000 $ 99.0 6.9 7.1 7.4 7.6 7.8 EBIT (e) 1999 $ 40.4 16.9 x 17.5 x 18.1 x 18.6 x 19.2 x 2000 $ 66.3 10.3 10.7 11.0 11.3 11.7 Market Value as a Multiple of Net Income (e) 1999 $ 11.7 18.2 x 20.1 x 22.1 x 24.0 x 25.9 x 2000 $ 16.1 13.2 14.6 16.0 17.4 18.8 Book Value (e) 1999 $ 164.6 1.3 x 1.4 x 1.6 x 1.7 x 1.8 x 2000 $ 180.5 1.2 1.3 1.4 1.6 1.7
- ---------- (a) Based on Trigen 10-Q dated September 30, 1999. (b) Options based on outstanding "in-the-money" options as of Trigen's 10-K dated 12/31/98. (c) Outstanding options and their respective strike prices as of 12/31/98 10-K are as follows: 735,210 at $16.40, 54,200 at $21.55, and 19,500 at $25.43. (d) Net debt defined as short term and long term debt, plus minority interest, plus preferred stock, less cash, based on Trigen Medium Term Plan- Committed Case dated January 8, 2000. Net Debt comprised of $49.8 million of current debt, $417.8 million of long term debt, $19.4 million minority interest, less $15.0 million of cash as of December 1999. (e) Source: Trigen Medium Term Plan- Committed Case dated January 8, 2000. (f) Represents 25% of the 329,200 total shares of restricted stock. (g) Closing price on 1/18/00. -15- PROJECT TRUST V. Summary Valuation - -------------------------------------------------------------------------------- Historical Share Price Information - -------------------------------------------------------------------------------- Trigen Energy Corp. ================================================================================ Current Price (1/18/00) $17.00 1999 High (11/15/99) $23.94 1999 Low (1/4/99) $11.38 52 Week High (11/15/99) $23.94 52 Week Low (1/28/99) $11.81 Average for December 1999 $17.32 Average for November 1999 $21.13 Average for October 1999 $23.03 3 Month Average* $19.38 - ---------- * Based on average closing price from 10/18/99 to 1/18/00 -16- PROJECT TRUST V. Summary Valuation - -------------------------------------------------------------------------------- Summary of Premiums Paid in Minority Buyout Transactions (all numbers reflect medians)
Premium of Initial Bid to: Premium of Final Bid to: --------------------------------------- --------------------------------------- One Day Prior One Month Prior One Day Prior One Month Prior Stake Purchased # of Deals to Annnouncement to Annnouncement to Annnouncement to Annnouncement - --------------- ---------- ---------------- ---------------- ---------------- ---------------- Less than 5% 1 6.3% 7.7% 14.8% 16.3% 5.0% to 9.9% 3 (5.9%) 5.5% 12.3% 91.6% 10.0% to 14.9% 5 15.5% 15.0% 25.0% 26.7% 15.0% to 19.9% 15 10.2% 23.8% 20.4% 30.9% 20.0% to 49.9% 37 14.3% 19.0% 18.2% 26.2% ---- - ------------------------------------------------------------------------------------------------------------------------------------ Overall 61 11.4% 19.0% 19.3% 29.2% - ------------------------------------------------------------------------------------------------------------------------------------
-17- PROJECT TRUST VI. Appendix A - -------------------------------------------------------------------------------- Public Market Valuation ($ in millions) Low High ------- ------- ---------------------- Rounded Enterprise Value Range (a) $665 - $730 ---------------------- Enterprise Value Range $664 - $730 Less: Net Debt (b) (472) - (472) ------- ------- Market Value (c) $193 - $258 Price Per Share (d) $15.17 $20.28
Public Market Multiple Benchmarks ----------------------------------------------- MidAmerican Thermo Group Enterprise Value as a Multiple of Energy (f) Calpine Ecotek Median (g) ----------- ------- ------ ---------- EBITDA (e) ----------------------- 1999 $66.4 10.0 x - 11.0 x 8.1 x 26.9 x 4.5 x 13.7 x ----------------------- 2000 $99.0 6.7 - 7.4 7.2 17.6 4.1 9.6 EBIT (e) 1999 $40.4 16.4 x - 18.1 x 13.5 x 36.4 x 8.4 x 18.2 x 2000 $66.3 10.0 - 11.0 12.0 23.5 7.3 13.3 Market Value as a Multiple of Net Income (e) 1999 $11.7 16.5 x - 22.1 x 12.7 x 53.1 x 12.9 x 12.9 x 2000 $16.1 12.0 - 16.0 10.9 42.5 11.3 11.3 Book Value (e) 1999 $164.6 1.2 x - 1.6 x 1.8 x 9.6 x 1.0 x 6.9 x 2000 $180.5 1.1 - 1.4
- ---------- (a) Enterprise Value defined as Market Value of Common Equity plus short term and long term debt, plus minority interest, plus preferred stock, less cash. (b) Net debt defined as short term and long term debt, plus minority interest, plus preferred stock, less cash, based on Trigen Medium Term Plan- Committed Case dated January 8, 2000. Net Debt comprised of $49.8 million of current debt, $417.8 million of long term debt, $19.4 million minority interest, less $15.0 million of cash as of December 1999. (c) Market Value defined as Enterprise Value less net debt. (d) Based on 12.7 million fully diluted shares. (e) Source: Trigen Medium Term Plan- Committed Case dated January 8, 2000. (f) Based on the price per share on 10/22/99, which was one day before the company announced it would be acquired. (g) Group median based on a larger set of companies on the following page. -18- PROJECT TRUST VI. Appendix A - -------------------------------------------------------------------------------- Public Market Valuation (cont'd) ($ in millions)
Trigen Group Group MidAmerican Energy Mean Median AES Energy Calpine ------ ---- ------ --- ------ ------- LTM Ended Sep-99 Sep-99 Sep-99 Sep-99 Fiscal Year Ended Dec-98 Dec-98 Dec-98 Dec-98 Current Market Information ------ ------- Ticker TGN AES MEC CPN Price as of 01/18/2000 $17.00 $77.94 $27.25 (e) $85.00 52 Wk High 24.19 83.38 35.75 86.63 52 Wk Low 11.50 32.81 26.44 14.41 Current Price as a % of 52 Week High 70.3% 76.9% 76.2% 93.5% 76.2% 98.1% Shares Outstanding 12.7 (f) 206.4 61.2 62.9 Indicated Dividend $0.14 $0.00 $0.00 $0.00 Payout Ratio 10.1% 0.0% 0.0% 0.0% Dividend Yield 0.8% 0.0% 0.0% 0.0% Market Value (a) $215 $16,085 $1,667 $5,346 Market Capitalization (b) 687 24,702 8,596 6,863 - ------------------------------------------------------------------------------------------------------------------------------------ Market Capitalization as a Multiple of: LTM Net Sales 2.6 x 5.3 4.3 8.9 x 2.4 x 9.4 x 1999E 2.4 5.5 5.1 8.2 2.1 10.4 2000E 1.8 3.8 3.1 4.3 1.8 7.8 LTM EBITDA 10.2 x 14.3 x 9.9 x 22.4 x 9.4 x 24.3 x 1999E 10.4 14.7 13.7 19.4 8.1 26.9 2000E 6.9 10.2 9.6 12.0 7.2 17.6 LTM EBIT 16.8 x 20.9 x 16.2 x 28.2 x 16.2 x 34.0 x 1999E 17.0 20.3 18.2 23.0 13.5 36.4 2000E 10.4 14.3 13.3 14.5 12.0 23.5 - ------------------------------------------------------------------------------------------------------------------------------------ Price as a Multiple of: MGMT. I/B/E/S LTM EPS 12.2 x 29.9 x 15.7 x 67.5 x 9.0 x 51.4 x 1999E (I/B/E/S) 18.1 (a) 21.3 x 26.1 12.9 41.0 12.7 53.1 2000E (I/B/E/S) 13.1 (a) 14.2 20.1 11.3 26.4 10.9 42.5 Book Value per Share 1.3 x 6.0 x 6.9 x 10.7 x 1.8 x 9.6 x - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ Leverage Ratios: ST + LT Debt/Total Book Cap 71.8% 70.7% 74.1% 72.1% 79.7% 74.1% Net Debt/Market Cap 65.8% 44.4% 28.8% 28.8% 72.5% 21.8% Total Debt/LTM EBITDA 7.0 x 5.8 x 7.0 x 7.1 x 7.0 x 5.9 x - ------------------------------------------------------------------------------------------------------------------------------------ Summary Capitalization 12/31/1999 (g) 09/30/1999 09/30/1999 09/30/1999 -------------- ---------- ---------- ---------- Cash & Investments $ 15 $702 $167 $174 Short-Term Debt 50 8% 7% 8% 968 9% 100 1% 0 0% Long-Term Debt 418 64% 53% 64% 6,837 63% 6,298 78% 1,667 74% Minority Interest 19 3% 4% 4% 964 9% 0 0% 24 1% Preferred Equity 0 0% 2% 0% 550 5% 699 9% 0 0% Common Equity 165 25% 34% 25% 1,502 14% 933 12% 558 25% ----- ------- ------ ------ Capitalization $652 100% $10,821 100% $8,030 100% $2,249 100% ===== ------ ------- ======= ====== ====== Cogeneration Thermo Corp of Amer. Ecotek ------------- ------ LTM Ended Sep-99 Oct-99 Fiscal Year Ended Dec-98 Oct-99 Current Market Information Ticker CGCA TCK Price as of 01/18/2000 $16.81 (b) $5.44 52 Wk High 25.13 10.88 52 Wk Low 7.94 5.00 Current Price as a % of 52 Week High 66.9% 50.0% Shares Outstanding 6.9 36.0 Indicated Dividend $0.00 $0.00 Payout Ratio 0.0% 0.0% Dividend Yield 0.0% 0.0% Market Value (a) $115 $196 Market Capitalization (b) 411 285 - ------------------------------------------------------------------------- Market Capitalization as a Multiple of: LTM Net Sales 4.3 x 1.4 x 1999E NA 1.3 2000E NA 1.2 LTM EBITDA 9.9 x 5.6 x 1999E NA 4.5 2000E NA 4.1 LTM EBIT 14.1 x 11.9 x 1999E NA 8.4 2000E NA 7.3 - ------------------------------------------------------------------------- Price as a Multiple of: LTM EPS 15.7 x 6.0 x 1999E (I/B/E/S) 10.8 12.9 2000E (I/B/E/S) 9.6 11.3 Book Value per Share 6.9 x 1.0 x - ------------------------------------------------------------------------- - ------------------------------------------------------------------------- Leverage Ratios: ST + LT Debt/Total Book Cap 94.8% 32.8% Net Debt/Market Cap 72.0% 27.0% Total Debt/LTM EBITDA 7.2 x 1.9 x - ------------------------------------------------------------------------- Summary Capitalization 09/30/1999 10/02/1999 ---------- ---------- Cash & Investments $5 $22 Short-Term Debt 29 9% 38 12% Long-Term Debt 272 86% 61 20% Minority Interest 0 0% 13 4% Preferred Equity 0 0% 0 0% Common Equity 17 5% 191 63% ---- ---- Capitalization $318 100% $302 100% ==== ====
-19- PROJECT TRUST VI. Appendix A - -------------------------------------------------------------------------------- Public Market Valuation (cont'd) ($ in millions)
Trigen MidAmerican Cogeneration Thermo Energy AES Energy Calpine Corp of Amer. Ecotek ------ --- ------ ------- ------------- ------ Net Sales 2000E 375.5(a) 5,700.3 (a) 4,816.7 (a) 875.5 (a) NA 230.0 (a) 1999E 286.0(a) 3,006.9 (a) 4,136.1 (a)(b) 657.0 (a) NA 226.4 (a) LTM 266.8 2,771.0 3,617.0 729.3 94.8 205.5 1998 242.4 2,398.0 2,566.2 (d) 528.1 74.0 209.0 1997 240.7 1,411.0 2,210.3 (d) 247.5 64.8 180.2 1996 243.6 835.0 NA 205.9 96.5 150.1 EBITDA 2000E 99.0(a) 2,057.9 (a) 1,191.5 (a) 390.5 (a) NA 69.1 1999E 66.4(a) 1,274.2 (a) 1,063.0 (a)(b) 255.5 (a) NA 63.6 LTM 67.1 1,101.5 (b) 911.7 (c) 282.0 41.6 50.8 (b) 1998 57.0 1,161.0 836.3 (d) 221.0 36.8 73.2 1997 44.8 608.0 756.6 (d) 144.0 24.3 68.7 1996 42.4(b) 392.0 NA 103.4 21.5 56.4 Depreciation & Amortization 2000E 32.7(a) 358.8 (a) 473.9 (a) 99.0 (a) NA 30.1 (c) 1999E 26.0(a) 198.2 (a) 426.4 (a) 67.0 (a) NA 29.6 (c) LTM 26.1 226.5 (b) 382.0 80.0 12.5 26.9 (b) 1998 25.2 196.0 333.4 (d) 74.3 9.8 23.9 1997 16.0 114.0 276.0 (d) 46.8 7.8 21.6 1996 7.6 65.0 NA 36.6 9.4 20.4
-20- PROJECT TRUST VI. Appendix A - -------------------------------------------------------------------------------- Public Market Valuation (cont'd) ($ in millions)
Trigen MidAmerican Cogeneration Thermo Energy AES Energy Calpine Corp of Amer. Ecotek ------ --- ----------- ------- ------------- ------ EBIT (c) 2000E 66.3 (a) 1,699.1 (a) 717.5 (a) 291.5 (a) NA 39.0 (a) 1999E 40.4 (a) 1,076.0 (a) 636.6 (a)(b) 188.5 (a) NA 34.0 (a) LTM 41.0 875.0 529.7 (c) 201.9 29.1 23.9 (b) 1998 31.8 965.0 502.8 (d) 146.7 27.0 49.3 1997 28.7 494.0 480.6 (d) 97.2 16.5 47.1 1996 34.8 (b) 327.0 NA 66.8 12.1 35.9 Net Income (d) 2000E 16.1 (a) 666.7 (a) 183.7 (a) 103.1 (a) NA 19.8 (a) 1999E 11.7 (a)(e) 379.1 (a) 138.5 (a)(b) 67.1 (a) NA 26.0 (a) LTM 17.2 (c)(d) 208.0 180.7 (c) 79.0 (b) 7.3 (a) 13.9 (b)(d) 1998 6.3 (d) 307.0 (c) 137.5 (d) 46.3 (b) 8.0 35.3 (d) 1997 5.0 188.0 (c) 138.9 (d) 34.7 23.4 22.5 1996 8.7 (b) 125.0 NA 18.7 (17.7) 17.8 EPS (e) MGMT. I/B/E/S ----- ------- 2000E (I/B/E/S) 1.30 (a) 1.20 2.95 2.49 2.00 1.76 0.48 1999E (I/B/E/S) 0.94 (a)(e) 0.80 1.90 2.15 1.60 1.55 0.42 LTM 1.39 (c)(d) 1.16 3.03 1.65 (b) 1.07 0.90 (b)(d) 1998 0.52 (d) 1.73 2.29 1.15 (b) 1.17 0.90 (d) 1997 0.41 1.13 2.06 0.87 3.59 0.58 1996 0.74 (b) 0.82 NA 0.72 (4.24) 0.49
-21- PROJECT TRUST VI. Appendix A - -------------------------------------------------------------------------------- Public Market Valuation (cont'd) ($ in millions)
Trigen Group Group MidAmerican Cogeneration Thermo Energy Mean Median AES Energy Calpine Corp of Amer. Ecotek ------ ---- ------ --- ------ ------- ------------- ------ ----- ----- I/B/E/S Est.5 Year Growth Rate (e) 12.0% 18.8% 19.5% 27.0% 12.0% 30.0% NA NA Net Sales Growth 2000E 31.3% 28.6% 16.5% 89.6% 16.5% 33.3% NA 1.6% 1999E 7.2% 5.1% 8.5% 8.5% 14.4% (9.9%) NA 10.2% LTM 10.1% 20.4% 21.8% 15.6% 40.9% 38.1% 28.1% (1.7%) 1998 0.7% 38.8% 16.0% 70.0% 16.1% 113.4% 14.2% 16.0% 1997 (1.2%) 15.9% 20.1% 69.0% NA 20.2% (32.9%) 20.1% EBITDA Margin 2000E 26.4% 33.7% 33.0% 36.1% 24.7% 44.6% NA 30.0% 1999E 23.2% 33.4% 31.8% 42.4% 25.7% 38.9% NA 28.1% LTM 25.2% 34.5% 36.7% 39.8% 25.2% 38.7% 43.9% 24.7% 1998 23.5% 40.4% 38.4% 48.4% 32.6% 41.8% 49.7% 35.0% 1997 18.6% 40.8% 37.8% 43.1% 34.2% 58.2% 37.5% 38.2% 1996 17.4% 38.4% 37.6% 46.9% NA 50.2% 22.3% 37.6% EBIT Margin 2000E 17.7% 22.6% 18.1% 29.8% 14.9% 33.3% NA 17.0% 1999E 14.1% 22.4% 17.2% 35.8% 15.4% 28.7% NA 15.0% LTM 15.4% 22.6% 23.6% 31.6% 14.6% 27.7% 30.7% 11.6% 1998 13.1% 27.9% 25.7% 40.2% 19.6% 27.8% 36.5% 23.6% 1997 11.9% 27.7% 25.8% 35.0% 21.7% 39.3% 25.4% 26.2% 1996 14.3% 25.7% 24.0% 39.2% NA 32.4% 12.5% 24.0% Net Income Margin 2000E 4.3% 9.4% 11.3% 11.7% 3.8% 11.8% NA 8.6% 1999E 4.1% 9.6% 10.2% 12.6% 3.3% 10.2% NA 11.5% LTM 6.4% 7.9% 7.6% 7.5% 5.0% 10.8% 7.7% 6.8% 1998 2.6% 10.7% 10.3% 12.8% 5.4% 8.8% 10.8% 16.9% 1997 2.1% 15.2% 12.9% 13.3% 6.3% 14.0% 36.0% 12.5% 1996 3.6% 11.4% 10.9% 15.0% NA 9.1% NM 11.8% EPS Growth LTM 167.2% 25.4% 32.6% NM 32.6% 43.8% NM 0.0% LFY 25.8% 31.5% 32.3% 54.1% 10.8% 32.3% NM 54.9% LFY-1 NM 25.3% 20.1% 36.9% NA 20.1% NM 18.8% ----- -----
-22- PROJECT TRUST VI. Appendix A - -------------------------------------------------------------------------------- Public Market Valuation (cont'd) ($ in millions) Footnotes: General: (a) Market Value defined as shares outstanding multipled by current stock price. (b) Market Capitalization defined as Market Value of Common Equity plus debt, plus minority interest, plus preferred, less cash. (c) EBIT defined as Earnings Before Interest and Taxes excluding nonrecurring income and including each company's share of equity in earnings of unconsolidated affiliates. (d) Net Income defined as net income from continuing operations available to common shareholders. (e) All EPS etimates are based on I/B/E/S median estimates as of January 18, 2000. Trigen Energy (a) Source: Trigen Medium Term Plan- Committed Case dated January 8, 2000. (b) Excludes $6.4 million from a condemnation award and a $1.9 project financing fee, tax effected at 35% when applicable. (c) Excludes pre- tax gains of $14.5 million from the settlement of Grey's Ferry litigation, tax-affected at 40%. (d) Includes extraordinary loss of $0.3 million from extinguishment of debt, net of tax. (e) Includes cumulative effect of change in accounting principle of $4.9 million, net of tax. (f) Represents fully diluted shares. (g) Trigen capitalization based on estimated December 1999 figures as per management. AES (a) Source: BancBoston Robertson Stephens research report dated October 20, 1999. (b) D&A estimated as a percentage of historical sales * LFP and LFP-4 actual sales. (c) Excludes loss/gain on extinguishment of debt, net of taxes. MidAmerican Energy (a) Source: Credit Suisse First Boston research report dated September 16, 1999. (b) Excludes non-recurring gain on sale of assets, net of taxes when appropriate. (c) Excludes gain on sale of qualified facilities of $20.173 million and gain on sale of McLeod of $78.223 million, tax affected at 35%. (d) Proforma historical data from Credit Suisse First Boston research dated July 30, 1999. Historical numbers reflect the recent sale of assets (1999). However, these historical numbers do not correspond to MidAmerican Energy's actual financial statements. (e) Represents the price per share on 10/22/99, which was one day before the company announced it would be acquired. Calpine (a) Source: Donaldson, Lufkin & Jenrette research report dated August 30, 1999. (b) Excludes charge for retirement of debt, net of tax. Cogeneration Corp. of America (a) Excludes gain from settlement of litigation of $14.5 million, tax affected at 35%. (b) Represents the price per share on 8/26/99, which was one day before the company announced it would be acquired. Thermo Ecotek (a) Source: Barrington Research Associates, Inc. research report dated May 10, 1999. Calendarized to 12/31 yearend, assuming I/B/E/S growth rate in 2001E. (b) Excludes restructuring and reorganization charges, tax effected at 35% where appropriate. (c) Calculated as a percentage of historical sales * 1999E & 2000E sales projected by Barrington Research Associates. (see footnote (a)). (d) Excludes gain on issuance of stock by subsidiary, tax effected where appropriate. -23- PROJECT TRUST VI. Appendix B - -------------------------------------------------------------------------------- Comparable Transactions Valuation(a) ($ in millions) Low High ------ ------ ------ ------ Rounded Enterprise Value Range (b) $ 695 - $ 765 ------ ------ Enterprise Value Range $ 697 - $ 763 Less: Net Debt (c) (472) - (472) Market Value (d) $ 223 - $ 293 ------ ------ Price Per Share (e) $17.53 $23.03
Comparable Transaction Benchmarks ------------------------------------------------------ Marubeni/ NGC-AES/ Calpine/ Industry Enterprise Value as a Multiple of Sithe Destec (g) Cogen (g)(i) Median (h) --------- ---------- ------------ ---------- EBITDA (f) ------------------------------ 1999 $ 66.4 10.5 x - 11.5 x 9.1 x 19.0 x 11.1 x 11.1 x ------------------------------ 2000 $ 99.0 7.0 - 7.7 EBIT (f) 1999 $ 40.4 17.2 x - 18.9 x 12.0 x 24.2 x 15.6 15.6 x 2000 $ 66.3 10.5 - 11.5 Market Value as a Multiple of Net Income (f) 1999 $ 11.7 19.1 x - 25.1 x 25.8 x 33.9 x 23.2 25.8 x 2000 $ 16.1 13.9 - 18.2 Book Value (f) 1999 $164.6 1.4 x - 1.8 x 3.8 x 1.5 x 10.8 2.4 x 2000 $180.5 1.2 - 1.6
- ---------- (a) It should be noted that none of the comparable transactions utilized as a comparison is identical to the transaction contemplated. (b) Enterprise Value defined as Market Value of Common Equity plus short term and long term debt, plus minorty interest, plus preferred stock, less cash. (c) Net debt defined as short term and long term debt, plus minority interest, plus preferred stock, less cash, based on Trigen Medium Term Plan- Committed Case dated January 8, 2000. Net Debt comprised of $49.8 million of current debt, $417.8 million of long term debt, $19.4 million minority interest, less $15.0 million of cash as of December 1999. (d) Market Value defined as Enterprise Value less net debt. (e) Based on 12.7 million fully diluted shares. (f) Source: Trigen Medium Term Plan- Committed Case dated January 8, 2000. (g) Prices established in auctions. (h) Industry median based on a larger set of transactions on the following page. (i) Salomon Smith Barney research dated 12/3/99 values this deal at 6.9x EBITDA, and BancBoston Robertson Stephens research dated 9/22/99 values this deal at 8.5 - 9.5x forward EBITDA. Data is not immediately available to reconcile these figures. -24- PROJECT TRUST VI. Appendix B - -------------------------------------------------------------------------------- Comparable Transactions Valuation(a) ($ in millions)
Announcement Equity Value/ Price/ Price/ Agg Value/ Date Buyer/Target Agg. Value LTM Earnings Book LTM EBIT - ------------ ------------ ------------- ------------ ------ ---------- 8/27/1999 Calpine (b) $ 144 / 23.2 x 10.8 x 15.6 x Cogeneration Corp. of America 380 2/18/1997 NGC-AES/ $1,229 / 33.9 x 1.5 x 24.2 x Destec Energy 1,168 2/29/1996 Marubeni/ $ 831 / 25.8 x 3.8 x 12.0 x Sithe Energies 2,017 5/17/1995 American Tractebel/ $ 191 / 41.9 x 2.3 x 15.7 x CRSS 218 9/19/1994 CalEnergy/ $ 939 / 15.7 x 2.4 x 11.4 x Magma Power 1,054 Mean: 28.1 x 4.2 x 15.8 x Median: 25.8 x 2.4 x 15.6 x High: 41.9 x 10.8 x 24.2 x Low: 15.7 x 1.5 x 11.4 x Premium Premium Announcement Agg Value/ Agg Value/ One Month One Day Date Buyer/Target LTM EBITDA LTM Revenues Prior Prior 8/27/1999 Calpine (b) 11.1 x (c) 5.0 x 41.8 % 48.7 % Cogeneration Corp. of America 2/18/1997 NGC-AES/ 19.0 x 2.0 x 34.3 % 11.0 % Destec Energy 2/29/1996 Marubeni/ 9.1 x 2.9 x 122.2 % 155.3 % Sithe Energies 5/17/1995 American Tractebel/ 12.7 x 7.7 x 52.6 % 45.0 % CRSS 9/19/1994 CalEnergy/ 9.1 x 5.7 x 38.4 % 37.2 % Magma Power Mean: 12.2 x 4.7 x 57.9 % 59.4 % Median: 11.1 x 5.0 x 41.8 % 45.0 % High: 19.0 x 7.7 x 122.2 % 155.3 % Low: 9.1 x 2.0 x 34.3 % 11.0 %
- ---------- (a) It should be noted that none of the comparable transactions utilized as a comparison is identical to the transaction contemplated. (b) Equity value and aggregate value represent the 80% of Cogeneration Corp. of America which Calpine agreed to acquire. (c) Salomon Smith Barney research dated 12/3/99 values this deal at 6.9x EBITDA, and BancBoston Robertson Stephens research dated 9/22/99 values this deal at 8.5 - 9.5x forward EBITDA. Data is not immediately available to reconcile these figures. -25- PROJECT TRUST VI. Appendix C - -------------------------------------------------------------------------------- Discounted Cash Flow Valuation(a) ($ in millions) Low High ------ ------ ---------------------- Rounded Enterprise Value Range (b) $ 710 - $ 775 ---------------------- Enterprise Value Range $ 708 $ 773 Less: Net Debt (c) (472) - (472) ------ ------ Market Value (d) $ 238 $ 303 Price Per Share (e) $18.71 $23.82
Projections ----------------------------------------------------------------------------- 2000 2001 2002 2003 2004 2005 ---- ---- ---- ---- ---- ---- Revenues $ 375.5 $ 403.4 $ 421.6 $ 436.9 $ 446.4 $ 453.0 EBITDA 99.0 100.0 107.4 111.2 112.6 112.9 EBIT 66.3 63.2 67.9 70.8 71.5 71.2 Taxes at 41.4% (27.5) (26.2) (28.1) (29.3) (29.6) (29.5) Net Income (Unlevered) 38.9 37.1 39.8 41.5 41.9 41.7 D&A 32.7 36.7 39.6 40.4 41.1 41.7 Capital Expenditures (93.6) (69.0) (11.5) (10.9) (5.0) (4.1) Working Capital Decrease/(Increase) 6.4 0.5 (1.9) (2.3) (2.7) (10.2) ----------------------------------------------------------------------------- Free Cash Flow ($ 15.6) $ 5.2 $ 66.0 $ 68.7 $ 75.2 $ 69.1 -----------------------------------------------------------------------------
NPV of Terminal Value NPV of Enterprise Value NPV to Perpetuity Growth Rate Perpetuity Growth Rate Discount 12/31/99 of ------------------------------------------ ----------------------------------------- Rate Cash Flows 0.30% 0.80% 1.30% 1.80% 0.30% 0.80% 1.30% 1.80% - -------- ---------- ----- ----- ----- ----- ----- ----- ----- ----- 8.00% $187.6 $566.2 $605.5 $650.7 $703.3 $753.8 $793.2 $838.4 $890.9 8.25% 185.6 (+) $540.8 $577.1 $618.7 $666.7 726.4 762.8 804.3 852.3 ------------------ 8.50% 183.7 $517.1 $550.7 $589.0 $632.9 (=) 700.8 734.4 772.6 816.6 8.75% 181.7 $494.9 $526.0 $561.4 $601.8 676.6 707.8 743.1 783.5 ------------------ 9.00% 179.8 $474.1 $503.0 $535.7 $572.9 653.9 682.8 715.5 752.7
- ---------- (a) Source: Trigen Medium Term Plan- Committed Case dated January 8, 2000. (b) Enterprise Value defined as Market Value of Common Equity plus short term and long term debt, plus minorty interest, plus preferred stock, less cash. (c) Net debt defined as short term and long term debt, plus minority interest, plus preferred stock, less cash, based on Trigen Medium Term Plan- Committed Case dated January 8, 2000. Net Debt comprised of $49.8 million of current debt, $417.8 million of long term debt, $19.4 million minority interest, less $15.0 million of cash as of December 1999. (d) Market Value defined as Enterprise Value less net debt. (e) Based on 12.7 million fully diluted shares. -26- PROJECT TRUST VI. Appendix C - -------------------------------------------------------------------------------- Weighted Average Cost of Capital ($ in millions)
Levered Unlevered Debt / Mkt. Cap. Net Market Equity Ticker Company Beta(a) Beta(b) Ratio Debt(c) Value - ------ ------- ------- --------- ---------------- --- ------------- TGN Trigen Energy 0.54 0.24 68.7% $472 $215 AES AES 0.70 0.54 34.9% 8,617 16,085 CPN Calpine 0.71 0.61 22.1% 1,517 5,346 TCK Thermo Ecotek 0.21 0.17 31.5% 90 196 CGCA Cogeneration of America 0.59 0.29 63.4% 296 171 ---- ---- ---- ----- ----- Median 0.64 0.41 33.2% 907 2,771
Assumptions - ----------------------------------------------- Marginal Tax Rate 41.4% Risk Free Rate of Return (d) 6.74% Equity Risk Premium (e) 8.00% Pre-Tax/After-Tax Cost of Debt - -------------------------------------------------------------------------- 8.00% 8.50% 9.00% 9.50% 10.00% 10.50% 11.00% 4.69% 4.98% 5.27% 5.57% 5.86% 6.15% 6.45%
Median Debt/ Debt/ Unlevered Levering Levered Cost of ---------------------------------------------------------------- Cap. Equity Beta Factor(f) Beta Equity(g) Weighted Average Cost of Capital(h) - ---- ------ ---- --------- ---- --------- ---------------------------------------------------------------- 10.0% 11.1% 0.41 1.07 0.44 10.3% 9.7% 9.7% 9.8% 9.8% 9.8% 9.8% 9.9% 20.0% 25.0% 0.41 1.15 0.47 10.5% 9.4% 9.4% 9.5% 9.5% 9.6% 9.6% 9.7% 30.0% 42.9% 0.41 1.25 0.52 10.9% 9.0% 9.1% 9.2% 9.3% 9.4% 9.5% 9.5% 40.0% 66.7% 0.41 1.39 0.57 11.3% 8.7% 8.8% 8.9% 9.0% 9.1% 9.3% 9.4% 50.0% 100.0% 0.41 1.59 0.65 12.0% 8.3% 8.5% 8.6% 8.8% 8.9% 9.1% 9.2% 60.0% 150.0% 0.41 1.88 0.78 12.9% 8.0% 8.2% 8.3% 8.5% 8.7% 8.9% 9.0% 70.0% 233.3% 0.41 2.37 0.98 14.6% 7.6% 7.9% 8.1% 8.3% 8.5% 8.7% 8.9% 80.0% 400.0% 0.41 3.34 1.38 17.8% 7.3% 7.5% 7.8% 8.0% 8.2% 8.5% 8.7% ----------------------------------------------------------------
- ---------- (a) BARRA Predicted Beta as of December 1999. Cogeneration of America beta as of October 1999 because it was acquired in December 1999. (b) Unlevered Beta = Levered Beta/[1+(1-Tax Rate)(Debt/Equity)] (c) Net debt includes Short-Term Debt, Long-Term Debt, Preferred Stock, and Minority Interest, less Cash and Marketable Securities. (d) Risk Free Rate is 30-Year Treasury Bond Yield as of January 18, 2000. (e) Represents the long-horizon expected equity risk premium based on simple differences of historical arithmetic mean returns from 1926-1998 (Ibbotson Associates' 1999 Yearbook). (f) Levering Factor = [1 + (1-Tax Rate)(Debt/Equity)] (g) Cost of Equity = (Risk Free Rate of Return)+(Levered Beta)(Equity Risk Premium) (h) Weighted Average Cost of Capital = (After-Tax Cost of Debt)(Debt/Cap.)+(Cost of Equity)(Equity/Cap.) -27- PROJECT TRUST VI. Appendix D - -------------------------------------------------------------------------------- Minority Buy-out Transactions Valuation ($ in millions, except per share data) Low High ---- ---- ----------------- Rounded Enterprise Value Range $715 - $750 -----------------
Premium of Initial Bid to: Premium of Final Bid to: ------------------------------------ ------------------------------------ One Day Prior One Month Prior One Day Prior One Month Prior to Announcement to Announcement to Announcement to Announcement --------------- --------------- --------------- --------------- Base Price (a) $17.00 $17.25 $17.00 $17.25 Median Premium 20.0% to 49.9% 14.3% 19.0% 18.2% 26.2% Overall 11.4 19.0 19.3 29.2 Selected 12.3% 20.0% 20.0% 27.5% - ------------------------------------------------------------------------------------------------------------------------------------ Price Per Share $19.08 $20.70 $20.40 $21.99 - ------------------------------------------------------------------------------------------------------------------------------------ Fully Diluted Shares Outstanding 12.7 12.7 12.7 12.7 ------ ------ ------ ------ Market Value (e) $242.7 $263.3 $259.5 $279.8 Net Debt (d) 472.1 472.1 472.1 472.1 ------ ------ ------ ------ Enterprise Value (c) $714.8 $735.4 $731.5 $751.8 ====== ====== ====== ====== Enterprise Value as a Multiple of EBITDA (b) 1999 x $ 66.4 10.8 11.1 x 11.0 x 11.3 x 2000 $ 99.0 7.2 7.4 7.4 7.6 EBIT (b) 1999 x $ 40.4 17.7 18.2 x 18.1 x 18.6 x 2000 $ 66.3 10.8 11.1 11.0 11.3 Market Value as a Multiple of Net Income (b) 1999 x $ 11.7 20.8 22.5 x 22.2 x 24.0 x 2000 $ 16.1 15.1 16.4 16.1 17.4 Book Value (b) 1999 x $164.6 1.5 1.6 x 1.6 x 1.7 x 2000 $180.5 1.3 1.5 1.4 1.6
- ---------- (a) Represents Trigen's stock price on January 18, 2000 and December 17, 1999 respectively. (b) Source: Trigen Medium Term Plan- Committed Case dated January 8, 2000. (c) Enterprise Value defined as Market Value of Common Equity plus net debt. (d) Net debt defined as short term and long term debt, plus minority interest, plus preferred stock, less cash, based on Trigen Medium Term Plan- Committed Case dated January 8, 2000. Net Debt comprised of $49.8 million of current debt, $417.8 million of long term debt, $19.4 million minority interest, less $15.0 million of cash as of December 1999. (e) Market Value defined as fully diluted shares outstanding multipled by the price per share. -28- PROJECT TRUST VI. Appendix D - -------------------------------------------------------------------------------- Minority Buy-out Transactions Valuation - Cash and Stock Offers ($ in millions, except per share data)
Initital Date of Stock Price Stock Price 52 Week Premium Clos- Acquiring Company/Acquired One Month One Day High Prior to Over 52 Week ing Offer Company Prior to Ann. Prior to Ann. Date of Ann. Ann. High - ------- ----- -------------------------- ------------- ------------- ------------ ------------- ------------ Cash Boise Cascade/ $ 10.13 $ 14.69 12/02/1999 $ 15.38 (13.8%) Boise Cascase Office Pr. Cash Cordant Technologies/ $ 12.31 $ 14.06 11/12/1999 $ 20.31 (16.3%) Howmet Intl. Cash Citigroup/ $ 44.63 $ 40.38 10/21/1999 $ 49.06 (8.3%) Student Loan Corp. 11/99 Cash Warburg, Pincus Ventures/ $ 19.13 $ 15.25 03/24/1999 $ 40.46 (38.2%) Knoll (Warburg, Pincus) 8/99 Cash Vivendi/ $ 1.44 $ 2.25 04/01/1999 $ 3.31 (39.6%) Aqua Alliance 7/99 Cash McDermott Intl./ $ 29.88 $ 30.50 05/07/1999 $ 47.00 (24.2%) J Ray McDermott SA 7/99 Cash Viacom/ $ 6.31 $ 9.00 03/21/1999 $ 9.50 (5.3%) Spelling Entertainment 5/99 Cash Global TeleSystems $208.87 $198.84 04/14/1999 $208.87 0.9% Omnicom 4/99 Stock Fairchild $ 7.88 $ 8.75 12/03/1998 $ 13.00 (25.0%) Banner Aerospace 2/99 Stock Inland Steel $ 19.44 $ 12.50 09/23/1998 $ 22.44 (51.9%) Ryerson Tull 2/99 Cash Orion N.Z. $ 1.83 $ 2.38 10/29/1998 $ 4.06 (27.1%) Qest N.Z. 2/99 Cash Affiliated Comp Svcs $ 16.94 $ 16.22 10/16/1998 $ 21.25 (10.6%) BRC Holdings 2/99 Stock Anglo American $ 12.20 $ 15.33 10/15/1998 $ 38.18 (53.4%) Anglo American Industrial 12/98 Cash Allmerica Financial/ $ 27.50 $ 27.56 10/27/1998 $ 34.63 (16.2%) Citizens Corp (Hanover Ins) 12/98 Cash Usinor SA/ $ 5.06 $ 3.02 09/23/1998 $ 14.19 (59.5%) J&L Specialty Steel 12/98 Cash Billington/Anglo American $ 4.98 $ 6.72 10/14/1998 $ 7.87 0.9% Samancor 12/98 Cash Disco/Ahold/ $ 4.00 $ 5.22 11/13/1998 $ 15.20 (53.9%) Disco 12/98 Stock Anglo American $ 48.33 $ 53.30 10/15/1998 $ 62.93 (10.0%) Anglo American Coal 12/98 Cash Billington/Anglo American $ 0.41 $ 0.40 09/07/1998 $ 1.25 (57.7%) QNI 11/98 Cash Dow AgroSciences/ $ 18.38 $ 19.75 04/30/1998 $ 25.00 (18.0%) Mycogen Corp 11/98 Cash Dexter Corporation/ $ 32.81 $ 31.00 07/07/1998 $ 38.50 (3.9%) Life Technologies 11/98 Stock Reno Dei Medici/ $ 4.55 $ 4.28 02/27/1998 $ 5.02 (20.1%) Sarrio 10/98 Cash Fiat/Norsk Hydro/ $ 5.52 $ 5.39 05/29/1998 $ 6.17 22.6% Meridian Technology 10/98 Stock Newmont Mining/ $ 15.69 $ 26.75 09/29/1998 $ 47.00 (48.3%) Newmont Gold 9/98 Cash/Stock Buhrman/ $ 7.50 $ 10.38 01/20/1998 $ 12.31 (14.7%) BT Office Products 9/98 Stock Liberty Media/ $ 16.56 $ 21.88 07/13/1998 $ 22.00 9.6% Tele-Communications International 9/98 Cash Cable Michigan Inc./ $ 10.50 $ 11.00 04/30/1998 $ 11.00 0.0% Mercom 7/98 Cash Texas Industries/ $ 12.00 $ 12.88 05/22/1997 $ 14.88 (4.2%) Chaparral Steel 6/98 Cash Waste Management/ 242.0 247.5 06/29/1998 279.0 23.7% Waste Mangagement Int'l Aggregate Initial Premium Date of Inside Ownership Consideration For Over One Month Clos- Acquiring Company/Acquired Before the Amount Acquired Initial Bid Per Prior Market ing Offer Company Transaction (000's) Share Price - ------- ----- -------------------------- ---------------- ----------------- --------------- ---------------- Cash Boise Cascade/ 81.2% $163,900 $ 13.25 30.9% Boise Cascase Office Pr. Cash Cordant Technologies/ 84.6% $261,400 $ 17.00 38.1% Howmet Intl. Cash Citigroup/ 80.0% $180,000 $ 45.00 0.8% Student Loan Corp. 11/99 Cash Warburg, Pincus Ventures/ 58.2% $490,800 $ 25.00 30.7% Knoll (Warburg, Pincus) 8/99 Cash Vivendi/ 77.8% $117,100 $ 2.00 39.1% Aqua Alliance 7/99 Cash McDermott Intl./ 63.0% $514,500 $ 35.62 19.2% J Ray McDermott SA 7/99 Cash Viacom/ 80.9% $191,600 $ 9.00 42.6% Spelling Entertainment 5/99 Cash Global TeleSystems 52.5% $189,800 $210.82 0.9% Omnicom 4/99 Stock Fairchild 85.0% $ 82,400 $ 9.75 23.8% Banner Aerospace 2/99 Stock Inland Steel 86.4% $ 52,200 $ 10.80 (44.4%) Ryerson Tull 2/99 Cash Orion N.Z. 69.0% $ 81,400 $ 2.96 61.4% Qest N.Z. 2/99 Cash Affiliated Comp Svcs 51.0% $131,900 $ 19.00 12.2% BRC Holdings 2/99 Stock Anglo American 52.3% $580,000 $ 17.80 45.9% Anglo American Industrial 12/98 Cash Allmerica Financial/ 81.8% $212,400 $ 29.00 5.5% Citizens Corp (Hanover Ins) 12/98 Cash Usinor SA/ 53.0% $104,075 $ 5.75 13.6% J&L Specialty Steel 12/98 Cash Billington/Anglo American 86.6% $203,600 $ 7.94 59.4% Samancor 12/98 Cash Disco/Ahold/ 52.0% $159,400 $ 7.00 75.0% Disco 12/98 Stock Anglo American 57.0% $751,700 $ 56.64 17.2% Anglo American Coal 12/98 Cash Billington/Anglo American 52.4% $268,100 $ 0.53 30.7% QNI 11/98 Cash Dow AgroSciences/ 62.2% $379,300 $ 20.50 11.6% Mycogen Corp 11/98 Cash Dexter Corporation/ 52.0% $419,491 $ 37.00 12.8% Life Technologies 11/98 Stock Reno Dei Medici/ 63.0% $ 89,600 $ 4.01 (11.9%) Sarrio 10/98 Cash Fiat/Norsk Hydro/ 55.7% $117,600 $ 7.57 37.2% Meridian Technology 10/98 Stock Newmont Mining/ 93.8% $313,500 $ 24.28 54.8% Newmont Gold 9/98 Cash/Stock Buhrman/ 70.0% $138,100 $ 10.50 40.0% BT Office Products 9/98 Stock Liberty Media/ 83.0% $387,617 $ 24.11 45.5% Tele-Communications International 9/98 Cash Cable Michigan Inc./ 62.0% $ 55,636 $ 11.00 4.8% Mercom 7/98 Cash Texas Industries/ 81.3% $ 72,800 $ 14.25 18.8% Chaparral Steel 6/98 Cash Waste Management/ 80.0% $258,888 345.0 42.6% Waste Mangagement Int'l Initial Final Premium Final Premium Date of Premium Over Over One Over One Day Percent Clos- Acquiring Company/Acquired One Day Prior Final Bid Per Month Prior Prior Marker Increase in ing Offer Company Market Price Share Price Price Offer - ------ ----- -------------------------- ------------- ------------- ----------- ------------ ----------- Cash Boise Cascade/ (9.8%) $ 13.25 30.9% (9.8%) 0.0% Boise Cascase Office Pr. Cash Cordant Technologies/ 20.9% $ 17.00 38.1% 20.9% 0.0% Howmet Intl. Cash Citigroup/ 11.5% $ 45.00 0.8% 11.5% 0.0% Student Loan Corp. 11/99 Cash Warburg, Pincus Ventures/ 63.9% $ 28.00 46.4% 83.6% 12.0% Knoll (Warburg, Pincus) 8/99 Cash Vivendi/ (11.1%) $ 2.90 101.7% 28.9% 45.0% Aqua Alliance 7/99 Cash McDermott Intl./ 16.8% $ 35.62 19.2% 16.8% 0.0% J Ray McDermott SA 7/99 Cash Viacom/ 0.0% $ 9.75 54.5% 8.3% 8.3% Spelling Entertainment 5/99 Cash Global TeleSystems 6.0% $210.82 0.9% 6.0% 0.0% Omnicom 4/99 Stock Fairchild 11.4% $ 11.00 39.7% 25.7% 12.8% Banner Aerospace 2/99 Stock Inland Steel (13.6%) $ 9.76 (49.8%) (21.9%) (9.6%) Ryerson Tull 2/99 Cash Orion N.Z. 24.4% $ 3.13 70.9% 31.7% 5.9% Qest N.Z. 2/99 Cash Affiliated Comp Svcs 17.1% $ 19.00 12.2% 17.1% 0.0% BRC Holdings 2/99 Stock Anglo American 16.1% $ 15.34 25.7% 0.0% (13.9%) Anglo American Industrial 12/98 Cash Allmerica Financial/ 5.2% $ 33.25 20.9% 20.6% 14.7% Citizens Corp (Hanover Ins) 12/98 Cash Usinor SA/ 90.5% $ 6.38 25.9% 111.2% 10.9% J&L Specialty Steel 12/98 Cash Billington/Anglo American 18.0% NA NA NA NA Samancor 12/98 Cash Disco/Ahold/ 34.1% $ 7.00 75.0% 34.1% 0.0% Disco 12/98 Stock Anglo American 6.3% $ 48.80 1.0% (8.4%) (13.9%) Anglo American Coal 12/98 Cash Billington/Anglo American 32.9% $ 0.66 63.8% 66.5% 25.3% QNI 11/98 Cash Dow AgroSciences/ 3.8% $ 28.00 52.4% 41.8% 36.6% Mycogen Corp 11/98 Cash Dexter Corporation/ 19.4% $ 39.25 19.6% 26.6% 6.1% Life Technologies 11/98 Stock Reno Dei Medici/ (6.4%) $ 4.56 0.4% 6.6% 13.9% Sarrio 10/98 Cash Fiat/Norsk Hydro/ 40.4% $ 7.11 28.9% 31.9% (6.0%) Meridian Technology 10/98 Stock Newmont Mining/ (9.2%) $ 30.05 91.6% 12.3% 23.8% Newmont Gold 9/98 Cash/Stock Buhrman/ 1.2% $ 13.75 83.3% 32.5% 31.0% BT Office Products 9/98 Stock Liberty Media/ 10.2% $ 22.00 32.8% 0.6% (8.7%) Tele-Communications International 9/98 Cash Cable Michigan Inc./ 0.0% $ 12.00 14.3% 9.1% 9.1% Mercom 7/98 Cash Texas Industries/ 10.7% $ 15.50 29.2% 20.4% 8.8% Chaparral Steel 6/98 Cash Waste Management/ 39.4% 345.0 42.6% 39.4% 0.0% Waste Mangagement Int'l
-29- PROJECT TRUST VI. Appendix D - -------------------------------------------------------------------------------- Minority Buy-out Transactions Valuation - Cash and Stock Offers (cont'd) ($ in millions, except per share data)
Initital Date of Stock Price Stock Price 52 Week Premium Clos- Acquiring Company/Acquired One Month One Day High Prior to Over 52 Week ing Offer Company Prior to Ann. Prior to Ann. Date of Ann. Ann. High - ------- ----- -------------------------- ------------- ------------- ------------ ------------- ------------ 5/98 Cash Xerox Corp / $ 16.38 $ 17.25 03/05/1998 $ 22.50 (11.1%) XL Connect 12/97 Cash/Stock Orion Capital/ $ 28.44 $ 32.50 09/18/1997 $ 34.56 (1.6%) Guaranty National Corporation 12/97 Cash Waste Management Inc./ $ 12.63 $ 13.00 06/20/1997 $ 17.25 (13.0%) Wheelabrator Technologies, Inc. 11/97 Stock Enron Corp/ $ 28.25 $ 30.25 05/14/1997 $ 32.38 (1.2%) Enron Global Power & Pipe 9/97 Cash FH Faulding & Co $ 9.25 $ 10.75 06/30/1997 $ 12.19 (1.5%) Faulding Inc. 8/97 Cash Texas Industries $ 12.00 $ 12.88 05/22/1997 $ 14.75 (3.4%) Chaparral 6/97 Cash Anthem/ $ 31.63 $ 35.50 06/02/1997 $ 36.25 10.3% Accordia 5/97 Cash Monsanto/ $ 5.06 $ 5.50 01/28/1997 $ 6.88 5.5% Calgene 3/97 Cash/Stock Tembec Inc./ 6.25 7.00 01/23/1997 NA NA Spruce Falls 2/97 Cash Hoechst AG/ 206.92 266.22 12/10/1996 273.78 NA Roussel-Uclaf 9/96 Cash Chemed Corp./ 34.13 36.50 06/10/1996 41.50 NA Roto-Rooter Inc. (Chemed Corp) 1/96 Cash Berkshire Hathaway Inc./ 55.63 55.75 08/25/1995 68.63 NA GEICO Corp. (Berkshire Hathaway) 12/95 Cash COBE Laboratories/ 14.75 15.75 07/14/1995 19.38 (7.1%) REN-Corp-USA (COBE Labs) 12/95 Cash BIC SA/ 31.13 35.75 05/19/1995 38.88 (6.1%) Bic Corp (BIC SA) 10/95 Cash McCaw Cellular/ 128.25 109.88 04/07/1995 140.50 (9.3%) LIN Bdcstg (McCaw Cellular) 9/95 Cash Pacific Corp/ 24.75 24.25 11/02/1994 29.50 (5.1%) Pacific Telecom (Pacific Corp) 8/95 Cash Societe BIC/ 31.13 35.75 05/19/1995 37.50 (2.7%) BIC Corp 6/95 Cash Club Mediterranee SA/ 22.25 22.63 04/05/1995 26.00 1.9% Club Med 5/95 Cash GTE Corp/ 18.25 17.75 09/08/1994 21.25 5.9% Contel Cellular Inc. 3/95 Cash Proventus AB/ 3.52 3.70 12/15/1994 4.30 NA Aritmos AB 3/95 Cash Dole Food Co. Inc./ 10.50 11.63 08/24/1994 15.38 (9.0%) Castle & Cooke Homes, Inc. 1/95 Conv. Note WMX Technologies Inc./ 8.63 8.00 07/28/1994 10.88 (27.7%) Chemical Waste Management 1/95 Cash/Stock Adia SA/ 24.00 26.50 03/23/1994 33.25 5.3% Adia Services Inc. 12/94 Stock Ogden Corp./ 15.25 17.38 06/06/1994 24.25 (29.2%) Ogden Services 10/94 Stock National Intergroup Inc./ 13.00 13.50 03/01/1994 13.75 7.3% FoxMeyer 9/94 Stock EW Scripps Co./ 75.00 78.50 02/17/1994 86.00 NA Scripps Howard Broadcasting 6/94 Cash Colonia Konzern AG/ $1,133.16 $1,309.00 02/28/1994 $1,335.00 28.3% Norsdtern Allgemeine 4/94 Stock Triarc Cos/ 15.50 15.50 04/26/1993 16.50 NA Southeastern Public Services Co. 4/94 Cash Medco Containment Services/ 29.75 25.75 10/13/1993 36.50 (25.3%) Medical Marketing Group Aggregate Initial Premium Date of Inside Ownership Consideration For Over One Month Clos- Acquiring Company/Acquired Before the Amount Acquired Initial Bid Per Prior Market ing Offer Company Transaction (000's) Share Price - ------- ----- -------------------------- ---------------- ----------------- --------------- ---------------- 5/98 Cash Xerox Corp / 80.0% $ 88,000 $ 20.00 22.1% XL Connect 12/97 Cash/Stock Orion Capital/ 80.5% $ 106,926 $ 34.00 19.6% Guaranty National Corporation 12/97 Cash Waste Management Inc./ 67.0% $ 874,500 $ 15.00 18.8% Wheelabrator Technologies, Inc. 11/97 Stock Enron Corp/ 50.6% $ 428,000 $ 32.00 13.3% Enron Global Power & Pipe 9/97 Cash FH Faulding & Co 62.0% $ 77,220 $ 12.00 29.7% Faulding Inc. 8/97 Cash Texas Industries 84.6% $ 72,816 $ 14.25 18.8% Chaparral 6/97 Cash Anthem/ 66.8% $ 193,155 $ 40.00 26.5% Accordia 5/97 Cash Monsanto/ 54.5% $ 242,600 $ 7.25 43.2% Calgene 3/97 Cash/Stock Tembec Inc./ 51.0% 175,000 10.00 60.0% Spruce Falls 2/97 Cash Hoechst AG/ 56.5% 3,500,000 NA NA Roussel-Uclaf 9/96 Cash Chemed Corp./ 58.1% 88,250 NA NA Roto-Rooter Inc. (Chemed Corp) 1/96 Cash Berkshire Hathaway Inc./ 52.4% 2,347,000 NA NA GEICO Corp. (Berkshire Hathaway) 12/95 Cash COBE Laboratories/ 53.0% 177,700 18.00 22.0% REN-Corp-USA (COBE Labs) 12/95 Cash BIC SA/ 78.0% 212,600 36.50 17.3% Bic Corp (BIC SA) 10/95 Cash McCaw Cellular/ 52.0% 3,323,400 127.50 (0.6%) LIN Bdcstg (McCaw Cellular) 9/95 Cash Pacific Corp/ 86.6% 159,000 28.00 13.1% Pacific Telecom (Pacific Corp) 8/95 Cash Societe BIC/ 78.0% 219,000 36.50 17.3% BIC Corp 6/95 Cash Club Mediterranee SA/ 70.8% 135,600 26.50 19.1% Club Med 5/95 Cash GTE Corp/ 90.0% 254,300 22.50 23.3% Contel Cellular Inc. 3/95 Cash Proventus AB/ 78.2% 141,300 NA NA Aritmos AB 3/95 Cash Dole Food Co. Inc./ 82.8% 81,500 14.00 33.3% Castle & Cooke Homes, Inc. 1/95 Conv. Note WMX Technologies Inc./ 78.5% 397,400 7.86 (8.9%) Chemical Waste Management 1/95 Cash/Stock Adia SA/ 81.0% 86,639 35.02 45.9% Adia Services Inc. 12/94 Stock Ogden Corp./ 83.2% 119,000 17.16 12.5% Ogden Services 10/94 Stock National Intergroup Inc./ 80.5% 84,028 14.75 13.5% FoxMeyer 9/94 Stock EW Scripps Co./ 86.0% 125,386 3 shares 15.0% Scripps Howard Broadcasting 6/94 Cash Colonia Konzern AG/ 57.9% $ 520,969 $1,713.00 51.2% Norsdtern Allgemeine 4/94 Stock Triarc Cos/ 71.0% 86,140 .55 shares 9.2% Southeastern Public Services Co. and $6 note 4/94 Cash Medco Containment Services/ 54.2% 122,510 27.25 (8.4%) Medical Marketing Group Initial Final Premium Final Premium Date of Premium Over Over One Over One Day Percent Clos- Acquiring Company/Acquired One Day Prior Final Bid Per Month Prior Prior Marker Increase in ing Offer Company Market Price Share Price Price Offer - ------ ----- -------------------------- ------------- ------------- ----------- ------------ ----------- 5/98 Cash Xerox Corp / (11.1%) $ 20.00 22.1% 15.9% 0.0% XL Connect 12/97 Cash/Stock Orion Capital/ 4.6% $ 36.00 26.6% 10.8% 5.9% Guaranty National Corporation 12/97 Cash Waste Management Inc./ 15.4% $ 16.50 30.7% 26.9% 10.0% Wheelabrator Technologies, Inc. 11/97 Stock Enron Corp/ 5.8% $ 33.83 19.8% 11.8% 5.7% Enron Global Power & Pipe 9/97 Cash FH Faulding & Co 11.6% $ 13.50 45.9% 25.6% 12.5% Faulding Inc. 8/97 Cash Texas Industries 10.7% $ 15.50 29.2% 20.4% 8.8% Chaparral 6/97 Cash Anthem/ 12.7% $ 40.00 26.5% 12.7% 0.0% Accordia 5/97 Cash Monsanto/ 31.8% $ 8.00 58.0% 45.5% 10.3% Calgene 3/97 Cash/Stock Tembec Inc./ 42.9% 10.00 60.0% 42.9% 0.0% Spruce Falls 2/97 Cash Hoechst AG/ NA 294.52 42.3% 10.6% NA Roussel-Uclaf 9/96 Cash Chemed Corp./ NA 41.00 20.1% 12.3% NA Roto-Rooter Inc. (Chemed Corp) 1/96 Cash Berkshire Hathaway Inc./ NA 70.00 25.8% 25.6% NA GEICO Corp. (Berkshire Hathaway) 12/95 Cash COBE Laboratories/ 14.3% 20.00 35.6% 27.0% 11.1% REN-Corp-USA (COBE Labs) 12/95 Cash BIC SA/ 2.1% 40.50 30.1% 13.3% 11.0% Bic Corp (BIC SA) 10/95 Cash McCaw Cellular/ 16.0% 129.91 1.3% 18.2% 1.9% LIN Bdcstg (McCaw Cellular) 9/95 Cash Pacific Corp/ 15.5% 30.00 21.2% 23.7% 7.1% Pacific Telecom (Pacific Corp) 8/95 Cash Societe BIC/ 2.1% 40.50 30.1% 13.3% 11.0% BIC Corp 6/95 Cash Club Mediterranee SA/ 17.1% 32.00 43.8% 41.4% 20.8% Club Med 5/95 Cash GTE Corp/ 26.8% 25.50 39.7% 43.7% 13.3% Contel Cellular Inc. 3/95 Cash Proventus AB/ NA 4.38 24.4% 18.1% NA Aritmos AB 3/95 Cash Dole Food Co. Inc./ 20.4% 15.75 50.0% 35.5% 12.5% Castle & Cooke Homes, Inc. 1/95 Conv. Note WMX Technologies Inc./ (1.8%) 8.86 2.7% 10.7% 12.7% Chemical Waste Management 1/95 Cash/Stock Adia SA/ 32.2% NA NA NA NA Adia Services Inc. 12/94 Stock Ogden Corp./ (1.2%) 18.48 21.2% 6.4% 7.7% Ogden Services 10/94 Stock National Intergroup Inc./ 9.3% .90 shares NA 13.0% (3.4%) FoxMeyer 9/94 Stock EW Scripps Co./ 9.9% 3.45 shares 32.3% 26.4% 15.0% Scripps Howard Broadcasting 6/94 Cash Colonia Konzern AG/ 30.9% $1,713.00 51.2% 30.9% 0.0% Norsdtern Allgemeine 4/94 Stock Triarc Cos/ 9.2% .80 shares 2.6% 2.6% (6.1%) Southeastern Public Services Co. 4/94 Cash Medco Containment Services/ 5.8% 27.75 (6.7%) 7.8% 1.8% Medical Marketing Group
-30- PROJECT TRUST VI. Appendix D - -------------------------------------------------------------------------------- Minority Buy-out Transactions Valuation - Cash and Stock Offers (cont'd) ($ in millions, except per share data)
Initital Date of Stock Price Stock Price 52 Week Premium Clos- Acquiring Company/Acquired One Month One Day High Prior to Over 52 Week ing Offer Company Prior to Ann. Prior to Ann. Date of Ann. Ann. High - ------- ----- -------------------------- ------------- ------------- ------------ ------------- ------------ 2/94 Cash Holderbank Financiere Glaros/ 7.25 6.75 01/07/1993 7.75 (1.3%) Holnam Inc. 12/93 Cash Valley Fashions Corp./ 48.63 48.88 09/20/1993 51.13 (10.0%) West Point-Perpperell Inc. 10/93 Cash Torchmark/ 27.38 26.88 02/22/1993 30.25 0.8% United Investors Management 5/93 Cash/Stock Rust International Inc./ NA 7.88 11/13/1992 23.88 (25.1%) Brand Cos Inc. 7/92 Cash W.R. Grace & Company 11.88 15.25 03/02/1992 19.00 (13.2%) Grace Energy Company 5/92 Stock Unocal Corp./ 9.75 9.88 02/24/1992 12.00 NA Unocal Exploration Corp. 1/92 Stock Arkla Inc./ NA 14.25 09/18/1991 20.88 NA Arkla Exploration Co. 12/91 Cash Siemens AG/ 131.77 120.63 10/21/1991 209.36 (29.5%) Siemens Nixdorf Information Systems - ------------------------------------------------------------------------------------------------------------------------------------ Average Median - ------------------------------------------------------------------------------------------------------------------------------------ Aggregate Initial Premium Date of Inside Ownership Consideration For Over One Month Clos- Acquiring Company/Acquired Before the Amount Acquired Initial Bid Per Prior Market ing Offer Company Transaction (000's) Share Price - ------- ----- -------------------------- ---------------- ----------------- --------------- ---------------- 2/94 Cash Holderbank Financiere Glaros/ 95.0% 51,700 7.65 5.5% Holnam Inc. 12/93 Cash Valley Fashions Corp./ 95.0% 66,300 46.00 (5.4%) West Point-Perpperell Inc. 10/93 Cash Torchmark/ 83.0% 216,591 30.50 11.4% United Investors Management 5/93 Cash/Stock Rust International Inc./ 56.0% 185,000 17.88 NA Brand Cos Inc. 7/92 Cash W.R. Grace & Company 83.4% 77,501 16.50 38.9% Grace Energy Company 5/92 Stock Unocal Corp./ 95.3% 120,418 0.50 shares 7.7% Unocal Exploration Corp. 1/92 Stock Arkla Inc./ 82.0% 92,640 0.90 shares NA Arkla Exploration Co. 12/91 Cash Siemens AG/ 78.0% 1,302,423 147.52 12.0% Siemens Nixdorf Information Systems - ------------------------------------------------------------------------------------------------------------------------------------ Average 22.6% Median 19.0% - ------------------------------------------------------------------------------------------------------------------------------------ Initial Final Premium Final Premium Date of Premium Over Over One Over One Day Percent Clos- Acquiring Company/Acquired One Day Prior Final Bid Per Month Prior Prior Marker Increase in ing Offer Company Market Price Share Price Price Offer - ------ ----- -------------------------- ------------- ------------- ----------- ------------ ----------- 2/94 Cash Holderbank Financiere Glaros/ 13.3% NA NA NA NA Holnam Inc. 12/93 Cash Valley Fashions Corp./ (5.9%) NA NA NA NA West Point-Perpperell Inc. 10/93 Cash Torchmark/ 13.5% 31.25 14.2% 16.3% 2.5% United Investors Management 5/93 Cash/Stock Rust International Inc./ 0.0% 18.75 NA 4.9% 4.9% Brand Cos Inc. 7/92 Cash W.R. Grace & Company 8.2% 19.00 60.0% 24.6% 15.2% Grace Energy Company 5/92 Stock Unocal Corp./ 6.3% 0.54 shares 16.3% 14.8% 8.0% Unocal Exploration Corp. 1/92 Stock Arkla Inc./ NA 0.95 shares NA 35.6% 5.6% Arkla Exploration Co. 12/91 Cash Siemens AG/ 22.3% 147.52 12.0% 22.3% (0.0%) Siemens Nixdorf Information Systems - ------------------------------------------------------------------------------------------------------------------------------------ Average 13.8% 31.6% 22.2% 7.2% Median 11.4% 29.2% 19.3% 6.6% - ------------------------------------------------------------------------------------------------------------------------------------
-31- PROJECT TRUST VI. Appendix D - -------------------------------------------------------------------------------- Minority Buy-out Transactions Valuation - Stock Offers Only ($ in millions, except per share data)
Stock Price Initital Date of Stock Price One Day 52 Week Premium Clos- Acquiring Company/Acquired One Month Prior to High Prior to Over 52 Week ing Company Prior to Ann. Ann. Date of Ann. Ann. High - ------- -------------------------- ------------- ----------- ------------ ------------- ------------ 4/99 Fairchild $ 7.88 $ 8.75 12/03/1998 $13.00 (25.0%) Banner Aerospace 2/99 Inland Steel $19.44 $12.50 09/23/1998 $22.44 (51.9%) Ryerson Tull 2/99 Anglo American $12.20 $15.33 10/15/1998 $38.18 (53.4%) Anglo American Industrial 12/98 Anglo American $48.33 $53.30 10/15/1998 $62.93 (10.0%) Anglo American Coal 11/98 Reno Dei Medici/ $ 4.55 $ 4.28 02/27/1998 $ 5.02 (20.1%) Sarrio 10/98 Newmont Mining/ $15.69 $26.75 09/29/1998 $47.00 (48.3%) Newmont Gold 9/98 Liberty Media/ $16.56 $21.88 07/13/1998 $22.00 9.6% International 11/97 Enron Corp/ $28.25 $30.25 05/14/1997 $32.38 (1.2%) Enron Global Power & Pipe 12/94 Ogden Corp./ $15.25 $17.38 06/06/1994 $24.25 (29.2%) Ogden Services 10/94 National Intergroup Inc./ $13.00 $13.50 03/01/1994 $13.75 7.3% FoxMeyer 9/94 EW Scripps Co./ $75.00 $78.50 02/17/1994 $86.00 NA Scripps Howard Broadcasting 4/94 Triarc Cos/ $15.50 $15.50 04/26/1993 $16.50 NA Southeastern Public Services Co. 5/92 Unocal Corp./ $ 9.75 $ 9.88 02/24/1992 $12.00 NA Unocal Exploration Corp. 1/92 Arkla Inc./ NA $14.25 09/18/1991 $20.88 NA Arkla Exploration Co. - -------------------------------------------------------------------------------------------------------------------- Average Median - -------------------------------------------------------------------------------------------------------------------- Aggregate Initial Premium Initial Date of Inside Ownership Consideration For Over One Month Premium Over Clos- Acquiring Company/Acquired Before the Amount Acquired Initial Bid Prior Market One Day Prior ing Company Transaction (000's) Per Share Price Market Price - ------- -------------------------- ---------------- ----------------- ----------- --------------- ------------- 4/99 Fairchild 85.0% $ 82,400 $ 9.75 23.8% 11.4% Banner Aerospace 2/99 Inland Steel 86.4% $ 52,200 $ 10.80 (44.4%) (13.6%) Ryerson Tull 2/99 Anglo American 52.3% $580,000 $ 17.80 45.9% 16.1% Anglo American Industrial 12/98 Anglo American 57.0% $751,700 $ 56.64 17.2% 6.3% Anglo American Coal 11/98 Reno Dei Medici/ 63.0% $ 89,600 $ 4.01 (11.9%) (6.4%) Sarrio 10/98 Newmont Mining/ 93.8% $313,500 $ 24.28 54.8% (9.2%) Newmont Gold 9/98 Liberty Media/ 83.0% $387,617 $ 24.11 45.5% 10.2% International 11/97 Enron Corp/ 50.6% $428,000 $ 32.00 13.3% 5.8% Enron Global Power & Pipe 12/94 Ogden Corp./ 83.2% $119,000 17.16 12.5% (1.2%) Ogden Services 10/94 National Intergroup Inc./ 80.5% $ 84,028 14.75 13.5% 9.3% FoxMeyer 9/94 EW Scripps Co./ 86.0% $125,386 3 shares 15.0% 9.9% Scripps Howard Broadcasting 4/94 Triarc Cos/ 71.0% $ 86,140 .55 shares 9.2% 9.2% Southeastern Public Services Co. and $6 note 5/92 Unocal Corp./ 95.3% $120,418 0.50 shares 7.7% 6.3% Unocal Exploration Corp. 1/92 Arkla Inc./ 82.0% $ 92,640 0.90 shares NA NA Arkla Exploration Co. - ------------------------------------------------------------------------------------------------------------------------------ Average 15.5% 4.2% Median 13.5% 6.3% - ------------------------------------------------------------------------------------------------------------------------------ Final Premium Final Premium Date of Over One Over One Day Percent Clos- Acquiring Company/Acquired Final Bid Per Month Prior Prior Marker Increase in ing Company Share Price Price Offer - ------- -------------------------- ------------- ------------- ------------- ----------- 4/99 Fairchild $ 11.00 39.7% 25.7% 12.8% Banner Aerospace 2/99 Inland Steel $ 9.76 (49.8%) (21.9%) (9.6%) Ryerson Tull 2/99 Anglo American $ 15.34 25.7% 0.0% (13.9%) Anglo American Industrial 12/98 Anglo American $ 48.80 1.0% (8.4%) (13.9%) Anglo American Coal 11/98 Reno Dei Medici/ $ 4.56 0.4% 6.6% 13.9% Sarrio 10/98 Newmont Mining/ $ 30.05 91.6% 12.3% 23.8% Newmont Gold 9/98 Liberty Media/ $ 22.00 32.8% 0.6% (8.7%) International 11/97 Enron Corp/ $ 33.83 19.8% 11.8% 5.7% Enron Global Power & Pipe 12/94 Ogden Corp./ 18.48 21.2% 6.4% 7.7% Ogden Services 10/94 National Intergroup Inc./ .90 shares NA 13.0% (3.4%) FoxMeyer 9/94 EW Scripps Co./ 3.45 shares 32.3% 26.4% 15.0% Scripps Howard Broadcasting 4/94 Triarc Cos/ .80 shares 2.6% 2.6% (6.1%) Southeastern Public Services Co. 5/92 Unocal Corp./ 0.54 shares 16.3% 14.8% 8.0% Unocal Exploration Corp. 1/92 Arkla Inc./ 0.95 shares NA 35.6% 5.6% Arkla Exploration Co. - ------------------------------------------------------------------------------------------------- Average 19.4% 9.0% 2.6% Median 20.5% 9.2% 5.7% - -------------------------------------------------------------------------------------------------
-32- PROJECT TRUST VI. Appendix D - -------------------------------------------------------------------------------- Minority Buy-out Transactions Valuation - Cash Offers Only ($ in millions, except per share data)
Stock Price Initital Inside Date of Stock Price One Day 52 Week Premium Ownership Clos- Acquiring Company/Acquired One Month Prior to High Prior Over 52 Before the ing Company Prior to Ann. Ann. Date of Ann. to Ann. Week High Transaction - ------- -------------------------- ------------- ----------- ------------ ---------- --------- ----------- Boise Cascade/ $ 10.13 $ 14.69 12/02/1999 $ 15.38 (13.8%) 81.2% Boise Cascase Office Pr. Cordant Technologies/ $ 12.31 $ 14.06 11/12/1999 $ 20.31 (16.3%) 84.6% Howmet Intl. Citigroup/ $ 44.63 $ 40.38 10/21/1999 $ 49.06 (8.3%) 80.0% Student Loan Corp. 11/99 Warburg, Pincus Ventures/ $ 19.13 $ 15.25 03/24/1999 $ 40.46 (38.2%) 58.2% Knoll (Warburg, Pincus) 8/99 Vivendi/ $ 1.44 $ 2.25 04/01/1999 $ 3.31 (39.6%) 77.8% Aqua Alliance 7/99 McDermott Intl./ $ 29.88 $ 30.50 05/07/1999 $ 47.00 (24.2%) 63.0% J Ray McDermott SA 7/99 Viacom/ $ 6.31 $ 9.00 03/21/1999 $ 9.50 (5.3%) 80.9% Spelling Entertainment 5/99 Global TeleSystems/ $208.87 $198.84 04/14/1999 $208.87 0.9% 52.5% Omnicom 2/99 Orion N.Z./ $ 1.83 $ 2.38 10/29/1998 $ 4.06 (27.1%) 69.0% Qest N.Z 2/99 Affiliated Comp Svcs/ $ 16.94 $ 16.22 10/16/1998 $ 21.25 (10.6%) 51.0% BRC Holdings 12/98 Allmerica Financial/ $ 27.50 $ 27.56 10/27/1998 $ 34.63 (16.2%) 81.8% Citizens Corp (Hanover Ins) 12/98 Usinor SA/ $ 5.06 $ 3.02 09/23/1998 $ 14.19 (59.5%) 53.0% J&L Specialty Steel 12/98 Billington/Anglo American $ 4.98 $ 6.72 10/14/1998 $ 7.87 0.9% 86.6% Samancor 12/98 Disco/Ahold/ $ 4.00 $ 5.22 11/13/1998 $ 15.20 (53.9%) 52.0% Disco 12/98 Billington/Anglo American $ 0.41 $ 0.40 09/07/1998 $ 1.25 (57.7%) 52.4% QNI 11/98 Dow AgroSciences/ $ 18.38 $ 19.75 04/30/1998 $ 25.00 (18.0%) 62.2% Mycogen Corp 11/98 Dexter Corporation/ $ 32.81 $ 31.00 07/07/1998 $ 38.50 (3.9%) 52.0% Life Technologies 10/98 Fiat/Norsk Hydro/ $ 5.52 $ 5.39 05/29/1998 $ 6.17 22.6% 55.7% Meridian Technology 9/98 Cable Michigan Inc./ $ 10.50 $ 11.00 04/30/1998 $ 11.00 0.0% 62.0% Mercom 7/98 Texas Industries/ $ 12.00 $ 12.88 05/22/1997 $ 14.88 (4.2%) 81.3% Chaparral Steel 6/98 Waste Management/ 242.0 247.5 06/29/1998 279.0 23.7% 80.0% Waste Mangagement Int'l 5/98 Xerox Corp / $ 16.38 $ 17.25 03/05/1998 $ 22.50 (11.1%) 80.0% XL Connect 12/97 Orion Capital/ $ 28.19 $ 32.50 09/18/1997 $ 34.56 (11.1%) 77.3% Guaranty National Corp 12/97 Waste Management Inc./ $ 12.63 $ 13.00 06/20/1997 $ 17.25 (13.0%) 67.0% Wheelabrator Technologies, Inc. 9/97 FH Faulding & Co $ 9.25 $ 10.75 06/30/1997 $ 12.19 (1.5%) 62.0% Faulding Inc. 8/97 Texas Industries $ 12.00 $ 12.88 05/22/1997 $ 14.75 (3.4%) 84.6% Chaparral Initial Initial Premium Final Aggregate Premium Over One Premium Date of Consideration Over One Day Prior Over One Clos- Acquiring Company/Acquired For Amount Initial Bid Per Month Prior Market Final Bid Month Prior ing Company Acquired (000's) Share Market Price Price Per Share Price - ------- -------------------------- ---------------- --------------- ------------ --------- --------- ----------- Boise Cascade/ $ 163,900 $ 13.25 30.9% (9.8%) $ 13.25 30.9% Boise Cascase Office Pr. Cordant Technologies/ $ 261,400 $ 17.00 38.1% 20.9% $ 17.00 38.1% Howmet Intl. Citigroup/ $ 180,000 $ 45.00 0.8% 11.5% $ 45.00 0.8% Student Loan Corp. 11/99 Warburg, Pincus Ventures/ $ 490,800 $ 25.00 30.7% 63.9% $ 28.00 46.4% Knoll (Warburg, Pincus) 8/99 Vivendi/ $ 117,100 $ 2.00 39.1% (11.1%) $ 2.90 101.7% Aqua Alliance 7/99 McDermott Intl./ $ 514,500 $ 35.62 19.2% 16.8% $ 35.62 19.2% J Ray McDermott SA 7/99 Viacom/ $ 191,600 $ 9.00 42.6% 0.0% $ 9.75 54.5% Spelling Entertainment 5/99 Global TeleSystems/ $ 189,800 $210.82 0.9% 6.0% $210.82 0.9% Omnicom 2/99 Orion N.Z./ $ 81,400 $ 2.96 61.4% 24.4% $ 3.13 70.9% Qest N.Z 2/99 Affiliated Comp Svcs/ $ 131,900 $ 19.00 12.2% 17.1% $ 19.00 12.2% BRC Holdings 12/98 Allmerica Financial/ $ 212,400 $ 29.00 5.5% 5.2% $ 33.25 20.9% Citizens Corp (Hanover Ins) 12/98 Usinor SA/ $ 104,075 $ 5.75 13.6% 90.5% $ 6.38 25.9% J&L Specialty Steel 12/98 Billington/Anglo American $ 203,600 $ 7.94 59.4% 18.0% NA NA Samancor 12/98 Disco/Ahold/ $ 159,400 $ 7.00 75.0% 34.1% $ 7.00 75.0% Disco 12/98 Billington/Anglo American $ 268,100 $ 0.53 30.7% 32.9% $ 6.38 1472.2% QNI 11/98 Dow AgroSciences/ $ 379,300 $ 20.50 11.6% 3.8% $ 28.00 52.4% Mycogen Corp 11/98 Dexter Corporation/ $ 419,491 $ 37.00 12.8% 19.4% $ 39.25 19.6% Life Technologies 10/98 Fiat/Norsk Hydro/ $ 117,600 $ 7.57 37.2% 40.4% $ 7.11 28.9% Meridian Technology 9/98 Cable Michigan Inc./ $ 55,636 $ 11.00 4.8% 0.0% $ 12.00 14.3% Mercom 7/98 Texas Industries/ $ 72,800 $ 14.25 18.8% 10.7% $ 15.50 29.2% Chaparral Steel 6/98 Waste Management/ $ 258,888 345.0 42.6% 39.4% 345.0 42.6% Waste Mangagement Int'l 5/98 Xerox Corp / $ 88,000 $ 20.00 22.1% (11.1%) $ 20.00 22.1% XL Connect 12/97 Orion Capital/ $ 117,200 $ 34.00 22.1% (11.1%) $ 36.50 22.1% Guaranty National Corp 12/97 Waste Management Inc./ $ 874,500 $ 15.00 18.8% 15.4% $ 16.50 30.7% Wheelabrator Technologies, Inc. 9/97 FH Faulding & Co $ 77,220 $ 12.00 29.7% 11.6% $ 13.50 45.9% Faulding Inc. 8/97 Texas Industries $ 72,816 $ 14.25 18.8% 10.7% $ 15.50 29.2% Chapparral Final Premium Date of Over One Percent Clos- Acquiring Company/Acquired Day Prior Increase in ing Company Marker Price Offer - ------- -------------------------- ------------ ----------- Boise Cascade/ (9.8%) 0.0% Boise Cascase Office Pr. Cordant Technologies/ 20.9% 0.0% Howmet Intl. Citigroup/ 11.5% 0.0% Student Loan Corp. 11/99 Warburg, Pincus Ventures/ 83.6% 12.0% Knoll (Warburg, Pincus) 8/99 Vivendi/ 28.9% 45.0% Aqua Alliance 7/99 McDermott Intl./ 16.8% 0.0% J Ray McDermott SA 7/99 Viacom/ 8.3% 8.3% Spelling Entertainment 5/99 Global TeleSystems/ 6.0% 0.0% Omnicom 2/99 Orion N.Z./ 31.7% 5.9% Qest N.Z 2/99 Affiliated Comp Svcs/ 17.1% 0.0% BRC Holdings 12/98 Allmerica Financial/ 20.6% 14.7% Citizens Corp (Hanover Ins) 12/98 Usinor SA/ 111.2% 10.9% J&L Specialty Steel 12/98 Billington/Anglo American NA NA Samancor 12/98 Disco/Ahold/ 34.1% 0.0% Disco 12/98 Billington/Anglo American 1498.5% 1102.8% QNI 11/98 Dow AgroSciences/ 41.8% 36.6% Mycogen Corp 11/98 Dexter Corporation/ 26.6% 6.1% Life Technologies 10/98 Fiat/Norsk Hydro/ 31.9% (6.0%) Meridian Technology 9/98 Cable Michigan Inc./ 9.1% 9.1% Mercom 7/98 Texas Industries/ 20.4% 8.8% Chaparral Steel 6/98 Waste Management/ 39.4% 0.0% Waste Mangagement Int'l 5/98 Xerox Corp / 15.9% 0.0% XL Connect 12/97 Orion Capital/ 12.3% 0.0% Guaranty National Corp 12/97 Waste Management Inc./ 26.9% 10.0% Wheelabrator Technologies, Inc. 9/97 FH Faulding & Co 25.6% 12.5% Faulding Inc. 8/97 Texas Industries 20.4% 8.8% Chapparral
-33- PROJECT TRUST VI. Appendix D - -------------------------------------------------------------------------------- Minority Buy-out Transactions Valuation - Cash Offers Only (cont'd) ($ in millions, except per share data)
Stock Price Initital Inside Date of Stock Price One Day 52 Week Premium Ownership Clos- Acquiring Company/Acquired One Month Prior to High Prior Over 52 Before the ing Company Prior to Ann. Ann. Date of Ann. to Ann. Week High Transaction - ------- -------------------------- ------------- ----------- ------------ ---------- --------- ----------- 6/97 Anthem/ $ 31.63 $ 35.50 06/02/1997 $ 36.25 10.3% 66.8% Accordia 5/97 Monsanto/ $ 5.06 $ 5.50 01/28/1997 $ 6.88 5.5% 54.5% Calgene 2/97 Hoechst AG/ $ 206.92 $ 266.22 12/10/1996 $ 273.78 NA 56.5% Roussel-Uclaf 9/96 Chemed Corp./ $ 34.13 $ 36.50 06/10/1996 $ 41.50 NA 58.1% Corp) 1/96 Berkshire Hathaway Inc./ $ 55.63 $ 55.75 08/25/1995 $ 68.63 NA 52.4% Hathaway) 12/95 COBE Laboratories/ $ 14.75 $ 15.75 07/14/1995 $ 19.38 (7.1%) 53.0% REN-Corp-USA (COBE Labs) 12/95 BIC SA/ $ 31.13 $ 35.75 05/19/1995 $ 38.88 (6.1%) 78.0% Bic Corp (BIC SA) 10/95 McCaw Cellular/ $ 128.25 $ 109.88 04/07/1995 $ 140.50 (9.3%) 52.0% LIN Bdcstg (McCaw Cellular) 9/95 Pacific Corp/ $ 24.75 $ 24.25 11/02/1994 $ 29.50 (5.1%) 86.6% Pacific Telecom (Pacific Corp) 8/95 Societe BIC/ $ 31.13 $ 35.75 05/19/1995 $ 37.50 (2.7%) 78.0% BIC Corp 6/95 Club Mediterranee SA/ $ 22.25 $ 22.63 04/05/1995 $ 26.00 1.9% 70.8% Club Med 5/95 GTE Corp/ $ 18.25 $ 17.75 09/08/1994 $ 21.25 5.9% 90.0% Contel Cellular Inc. 3/95 Proventus AB/ $ 3.52 $ 3.70 12/15/1994 $ 4.30 NA 78.2% Aritmos AB 3/95 Dole Food Co. Inc./ $ 10.50 $ 11.63 08/24/1994 $ 15.38 (9.0%) 82.8% Castle & Cooke Homes, Inc. 6/94 Colonia Konzern AG/ $1,133.16 $1,309.00 02/28/1994 $1,335.00 28.3% 57.9% Norsdtern Allgemeine 4/94 Medco Containment Services/ $ 29.75 $ 25.75 10/13/1993 $ 36.50 (25.3%) 54.2% Medical Marketing Group 2/94 Holderbank Financiere Glaros/ $ 7.25 $ 6.75 01/07/1993 $ 7.75 (1.3%) 95.0% Holnam Inc. 12/93 Valley Fashions Corp./ $ 48.63 $ 48.88 09/20/1993 $ 51.13 (10.0%) 95.0% West Point-Perpperell Inc. 10/93 Torchmark/ $ 27.38 $ 26.88 02/22/1993 $ 30.25 0.8% 83.0% United Investors Management 7/92 W.R. Grace & Company $ 11.88 $ 15.25 03/02/1992 $ 19.00 (13.2%) 83.4% Grace Energy Company 12/91 Siemens AG/ $ 131.77 $ 120.63 10/21/1991 $ 209.36 (29.5%) 78.0% Systems - ---------------------------------------------------------------------------------------------------------------------------------- Average Median - ---------------------------------------------------------------------------------------------------------------------------------- Initial Initial Premium Aggregate Premium Over One Date of Consideration Over One Day Prior Clos- Acquiring Company/Acquired For Amount Initial Bid Per Month Prior Market Final Bid ing Company Acquired (000's) Share Market Price Price Per Share - ------- -------------------------- ---------------- --------------- ------------ --------- ---------- 6/97 Anthem/ $ 193,155 $ 40.00 26.5% 12.7% $ 40.00 Accordia 5/97 Monsanto/ $ 242,600 $ 7.25 43.2% 31.8% $ 8.00 Calgene 2/97 Hoechst AG/ $3,500,000 NA NA NA $ 294.52 Roussel-Uclaf 9/96 Chemed Corp./ $ 88,250 NA NA NA $ 41.00 Corp) 1/96 Berkshire Hathaway Inc./ $2,347,000 NA NA NA $ 70.00 Hathaway) 12/95 COBE Laboratories/ $ 177,700 $ 18.00 22.0% 14.3% $ 20.00 REN-Corp-USA (COBE Labs) 12/95 BIC SA/ $ 212,600 $ 36.50 17.3% 2.1% $ 40.50 Bic Corp (BIC SA) 10/95 McCaw Cellular/ $3,323,400 $ 127.50 (0.6%) 16.0% $ 129.91 LIN Bdcstg (McCaw Cellular) 9/95 Pacific Corp/ $ 159,000 $ 28.00 13.1% 15.5% $ 30.00 Pacific Telecom (Pacific Corp) 8/95 Societe BIC/ $ 219,000 $ 36.50 17.3% 2.1% $ 40.50 BIC Corp 6/95 Club Mediterranee SA/ $ 135,600 $ 26.50 19.1% 17.1% $ 32.00 Club Med 5/95 GTE Corp/ $ 254,300 $ 22.50 23.3% 26.8% $ 25.50 Contel Cellular Inc. 3/95 Proventus AB/ $ 141,300 NA NA NA $ 4.38 Aritmos AB 3/95 Dole Food Co. Inc./ $ 81,500 $ 14.00 33.3% 20.4% $ 15.75 Castle & Cooke Homes, Inc. 6/94 Colonia Konzern AG/ $ 520,969 $1,713.00 51.2% 30.9% $1,713.00 Norsdtern Allgemeine 4/94 Medco Containment Services/ $ 122,510 $ 27.25 (8.4%) 5.8% $ 27.75 Medical Marketing Group 2/94 Holderbank Financiere Glaros/ $ 51,700 $ 7.65 5.5% 13.3% NA Holnam Inc. 12/93 Valley Fashions Corp./ $ 66,300 $ 46.00 (5.4%) (5.9%) NA West Point-Perpperell Inc. 10/93 Torchmark/ $ 216,591 $ 30.50 11.4% 13.5% $ 31.25 United Investors Management 7/92 W.R. Grace & Company $ 77,501 $ 16.50 38.9% 8.2% $ 19.00 Grace Energy Company 12/91 Siemens AG/ $1,302,423 $ 147.52 12.0% 22.3% $ 147.52 Systems - ------------------------------------------------------------------------------------------------------------------------------- Average 23.7% 16.2% Median 19.2% 14.3% - ------------------------------------------------------------------------------------------------------------------------------- Final Final Premium Premium Date of Over One Over One Percent Clos- Acquiring Company/Acquired Month Prior Day Prior Increase in ing Company Price Marker Price Offer - ------- -------------------------- ----------- ------------ ----------- 6/97 Anthem/ 26.5% 12.7% 0.0% Accordia 5/97 Monsanto/ 58.0% 45.5% 10.3% Calgene 2/97 Hoechst AG/ 42.3% 10.6% NA Roussel-Uclaf 9/96 Chemed Corp./ 20.1% 12.3% NA Corp) 1/96 Berkshire Hathaway Inc./ 25.8% 25.6% NA Hathaway) 12/95 COBE Laboratories/ 35.6% 27.0% 11.1% REN-Corp-USA (COBE Labs) 12/95 BIC SA/ 30.1% 13.3% 11.0% Bic Corp (BIC SA) 10/95 McCaw Cellular/ 1.3% 18.2% 1.9% LIN Bdcstg (McCaw Cellular) 9/95 Pacific Corp/ 21.2% 23.7% 7.1% Pacific Telecom (Pacific Corp) 8/95 Societe BIC/ 30.1% 13.3% 11.0% BIC Corp 6/95 Club Mediterranee SA/ 43.8% 41.4% 20.8% Club Med 5/95 GTE Corp/ 39.7% 43.7% 13.3% Contel Cellular Inc. 3/95 Proventus AB/ 24.4% 18.1% NA Aritmos AB 3/95 Dole Food Co. Inc./ 50.0% 35.5% 12.5% Castle & Cooke Homes, Inc. 6/94 Colonia Konzern AG/ 51.2% 30.9% 0.0% Norsdtern Allgemeine 4/94 Medco Containment Services/ (6.7%) 7.8% 1.8% Medical Marketing Group 2/94 Holderbank Financiere Glaros/ NA NA NA Holnam Inc. 12/93 Valley Fashions Corp./ NA NA NA West Point-Perpperell Inc. 10/93 Torchmark/ 14.2% 16.3% 2.5% United Investors Management 7/92 W.R. Grace & Company 60.0% 24.6% 15.2% Grace Energy Company 12/91 Siemens AG/ 12.0% 22.3% (0.0%) Systems - --------------------------------------------------------------------------------------- Average 65.6% 58.9% 35.1% Median 29.6% 21.6% 7.7% - ---------------------------------------------------------------------------------------
-34- EX-99.(C)(II) 13 EXHIBIT 99(C)(II) Exhibit 99(c)(ii) JANUARY 19, 2000 CONFIDENTIAL MATERIALS PREPARED FOR DISCUSSION PROJECT TRUST HIGHLY CONFIDENTIAL 1 - -------------------------------------------------------------------------------- PROJECT TRUST APPROACH TO THE ASSIGNMENT - -------------------------------------------------------------------------------- METHODOLOGY KEY ISSUES - ------------------------------- ------------------------------------------ Discounted Cash Flow Analysis o Financial projections/sensitivities o Discount rate o Terminal value - ------------------------------- ------------------------------------------ - ------------------------------- ------------------------------------------ Comparable Acquisition Analysis o Appropriate comparables o Undisclosed information (eg: contract terms) o Historical perspective - ------------------------------- ------------------------------------------ - ------------------------------- ------------------------------------------ Comparable Company Analysis o Trust equity market valuation o Appropriate comparables: o Size and market position o Projected financial performance o Geographic location o Liquidity and capital structure o Business profile - ------------------------------- ------------------------------------------ CREDIT | FIRST SUISSE | BOSTON --------------------------------------------------------------- HIGHLY CONFIDENTIAL 2 - -------------------------------------------------------------------------------- PROJECT TRUST TRANSACTION STATISTICS - -------------------------------------------------------------------------------- (US$ IN MILLIONS, EXCEPT PER SHARE ITEMS) -------------------------------------------------------------------- OFFER PRICE $23.50 -------------------------------------------------------------------- Transaction Premiums: As of 01/18/00 $17.00 38.2% Average 11/17/99 - 1/14/00 17.42 34.9% Prior to Offer on 09/20/99: One Day $19.25 22.1% One Month 18.14 29.5% Six Months 17.05 37.8% One Year 15.17 54.9% Company Equity Value $310 Company Enterprise Value $763 -------------------------------------------------------------------- CREDIT | FIRST SUISSE | BOSTON --------------------------------------------------------------- HIGHLY CONFIDENTIAL 3 - -------------------------------------------------------------------------------- PROJECT TRUST FORECAST OVERVIEW - -------------------------------------------------------------------------------- THREE CASES WERE ANALYZED: ------------------------------------------------------------------------ I. ADJUSTED CASE: Management's projection of cash flows for the signed development projects with revised probability weights assigned to the portfolio of unsigned contracts. Also includes potential cash flows from the limited merchant electric power plant development at existing Trigen facilities. II. MANAGEMENT CASE: Management's projection of current operational contracts and signed development contracts. No unsigned contracts are included. III. LIMITED DEVELOPMENT CASE: Management's projection of current operational contracts under a limited probability case for cash flows of signed backlogs. ------------------------------------------------------------------------ NOTE: All cases based on Trigen management forecasts. CREDIT | FIRST SUISSE | BOSTON --------------------------------------------------------------- HIGHLY CONFIDENTIAL 4 - -------------------------------------------------------------------------------- PROJECT TRUST DCF ANALYSIS - --------------------------------------------------------------------------------
(US$ IN MILLIONS) - ----------------------------------------------------------------------------------------- VALUATION METHODOLOGY ENTERPRISE AMV/1999E VALUE -------------------- AMV/2000E REFERENCE RANGE EBITDA EBIT EBITDA - ----------------------------------------------------------------------------------------- ENTERPRISE VALUE REFERENCE RANGE Adjusted Case $742 - $843 11.3x - 12.9x 18.6x - 21.2x 7.1x - 8.1x Management $716 - $798 10.8x - 12.0x 17.7x - 19.7x 7.2x - 8.1x Limited Development $630 - $703 9.5x - 10.6x 15.6x - 17.4x 6.0x - 6.6x -----------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------- NOTE: All cases based on Trigen management forecasts. Multiples relative to Adjusted Case financial projections based on discount rates of 8.5% - 9.0% and terminal value EBITDA multiples of 8.0x - 9.0x. Adjusted Case includes Merchant Power project with applied equity discount rates of 14.0% - 15.0% and terminal value EBITDA multiples of 6.5x - 7.0x. CREDIT | FIRST SUISSE | BOSTON --------------------------------------------------------------- HIGHLY CONFIDENTIAL 5 - -------------------------------------------------------------------------------- PROJECT TRUST COMPARABLE ACQUISITIONS ANALYSIS - --------------------------------------------------------------------------------
(US$ IN MILLIONS) ----------------------------------------------------------------------------------------------------- ENTERPRISE VALUE AS A MULTIPLE OF EBITDA EV VALUE CAPACITY ---------------- DATE TARGET ACQUIROR % BOUGHT (US$MM) (MW) LTM FORWARD ----------------------------------------------------------------------------------------------------- 8/27/99 Cogen Corp. of America Calpine 80% $383 463 13.0x 8.3x 2/23/99 CE Generation Electric El Paso Natural Gas 50% 861 410 4.7 6.8 10/30/98 Cogen Technologies Enron 100% 1,450 1,020 12.0 - 3/18/98 Bechtel/US Gen Cogentrix 15% 190 365 7.9 7.7 2/18/97 Destec Energy NGC Corp./AES 100% 1,207 2,970 16.5 12.2 7/8/96 Falcon Seaboard CalEnergy 88% 226 456 10.8 8.1 -----------------------------------------------------------------------------------------------------
CREDIT | FIRST SUISSE | BOSTON --------------------------------------------------------------- HIGHLY CONFIDENTIAL 6 - -------------------------------------------------------------------------------- PROJECT TRUST COMPARABLE ACQUISITIONS ENTERPRISE VALUE REFERENCE RANGE - --------------------------------------------------------------------------------
(US$ IN MILLIONS, EXCEPT PER SHARE ITEMS) - ------------------------------------------------------------------------------------------- MULTIPLE RANGE IMPLIED ENTERPRISE VALUE - ------------------------------------------------------------------------------------------- LTM EBITDA $65.6 10.0x - 12.0x $656 - $787 2000 FORWARD EBITDA 105.4 7.0x - 9.0x 738 - 949 - ------------------------------------------------------------------------------------------- ENTERPRISE VALUE REFERENCE RANGE $650 - $780 - -------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------- NOTE: All cases based on Trigen management forecasts. Based on Adjusted Case. LTM as of September 30, 1999. CREDIT | FIRST SUISSE | BOSTON --------------------------------------------------------------- HIGHLY CONFIDENTIAL 7 - -------------------------------------------------------------------------------- PROJECT TRUST COMPARABLE COMPANIES TRADING ANALYSIS
- ---------------------------------------------------------------------------------------------------------------------------- ENTERPRISE VALUE AS A MULTIPLE OF --------------------------------------------------- SHARE LTM 1999E 2000E PRICE/EPS LT EPS ENTERPRISE -------------- -------------- -------------- -------------- GROWTH COMPANY VALUE EBITDA EBIT EBITDA EBIT EBITDA EBIT 1999E 2000E RATE (E) - ---------------------------------------------------------------------------------------------------------------------------- TRIGEN $ 629 9.6X 15.3 8.4X 12.9 8.4X 12.4 21.4 14.4X 13.0% Cogen Corp. of America(1) 415 11.3 17.1 7.2 9.5 6.5 8.2 10.8 7.4 NM AES Corp. 18,686 24.4 31.5 20.5 24.6 13.2 16.3 28.2 23.2 26.0% Calpine Corp. 5,816 26.3 36.9 27.4 35.8 20.5 26.7 53.5 42.3 27.1% - ----------------------------------------------------------------------------------------------------------------------------
Note: As of January 14, 2000. All cases based on Trigen management forecasts. Trigen estimates per the Adjusted Case. Other estimates from First Call and selected equity analyst reports. LTM as of September 30, 1999. (1) Cogen Corp. of America was acquired by Calpine Corp. on August 27, 1999; trading statistics as of August 26, 1999. CREDIT | FIRST SUISSE | BOSTON --------------------------------------------------------------- HIGHLY CONFIDENTIAL 8 - -------------------------------------------------------------------------------- PROJECT TRUST COMPARABLE COMPANIES TRADING ENTERPRISE VALUE REFERENCE RANGE - -------------------------------------------------------------------------------- (US$ IN MILLIONS, EXCEPT PER SHARE ITEMS) - ----------------------------------------------------------------------- AMV/EV MULTIPLE IMPLIED ENTERPRISE RANGE VALUE - ----------------------------------------------------------------------- EBITDA 1999E 66.4 10.0 -12.0 663 - 796 2000E 105.4 8.0 -10.0 843 -1,054 EBIT 1999E 40.4 16.0 -18.0 646 - 727 2000E 71.7 11.0 -12.0 788 - 860 NET INCOME 1999E 11.7 21.0 -24.0 699 - 734 2000E 17.0 17.0 -20.0 742 - 793 - ----------------------------------------------------------------------- ENTERPRISE VALUE REFERENCE RANGE $670 -$770 - ----------------------------------------------------------------------- - -------------------------------------------------------------------------------- Note: All cases based on Trigen management forecasts. Based on Adjusted Case. LTM as of September 30,1999. CREDIT | FIRST SUISSE | BOSTON --------------------------------------------------------------- HIGHLY CONFIDENTIAL 9 - -------------------------------------------------------------------------------- PROJECT TRUST VALUATION SUMMARY
(US$ in Millions) ------------------------------------------------------------------------------------- VALUATION METHODOLOGY ENTERPRISE AMV/1999E VALUE ------------------------- AMV/2000E REFERENCE RANGE EBITDA EBIT EBITDA ------------------------------------------------------------------------------------- DCF Analysis(1) Adjusted Case $742 -$843 11.3x-12.9x 18.6x-21.2x 7.1x- 8.1x Management Case $716 -$798 10.8x-12.0x 17.7x-19.7x 7.2x- 8.1x Limited Development $630 -$703 9.5x-10.6x 15.6x-17.4x 6.0x- 6.6x Comparable Acquisitions $650 -$780 9.8x-11.7x 16.0x-19.3x 6.1x- 7.4x Comparable Companies $670 -$770 10.1x-11.6x 16.5x-19.0x 6.3x- 7.3x ------------------------------------------------------------------------------------- PROPOSED PURCHASE PRICE $763 11.5X 18.9X 7.2X AT $23.50 PER SHARE ------------------------------------------------------------------------------------- (1) All cases based on Trigen management forecasts.
CREDIT | FIRST SUISSE | BOSTON --------------------------------------------------------------- EX-99.(D)(I) 14 EXHIBIT 99(D)(I) Exhibit 99(d)(i) TENDER AND VOTING AGREEMENT TENDER AND VOTING AGREEMENT, dated as of January 19, 2000 (this "AGREEMENT"), between Elyo S.A., a societe anonyme organized under the laws of France ("PARENT"), T Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Parent ("PURCHASER") and each of the persons listed on Schedule A hereto (each a "STOCKHOLDER" and, collectively, the "STOCKHOLDERS"). RECITALS WHEREAS, Parent, Purchaser and Trigen Energy Corporation, a Delaware corporation (the "Company") propose to enter into an Agreement and Plan of Merger dated as of the date hereof (as the same may be amended or supplemented, the "MERGER AGREEMENT") providing for, among other things, the making of the Offer by Purchaser for all of the issued and outstanding shares of common stock, par value $0.01 per share, of the Company (referred to herein as either the "SHARES" or "COMMON STOCK") and the merger of Purchaser with and into the Company on the terms and conditions set forth in the Merger Agreement (the "Merger"); WHEREAS, each Stockholder is the beneficial owner of the Shares and Options set forth opposite such Stockholder's name on Schedule A hereto (collectively referred to herein as the "Shares" of such Stockholder); such Shares, as such Shares may be adjusted by stock dividend, stock split, recapitalization, combination or exchange of shares, merger, consolidation, reorganization or other change or transaction of or by the Company, together with Shares issuable upon the exercise of Options; and WHEREAS, as a condition to their willingness to enter into the Merger Agreement, Parent and Purchaser have requested that the Stockholders enter into this Agreement; NOW, THEREFORE, to induce Parent and Purchaser to enter into, and in consideration of their entering into, the Merger Agreement, and in consideration of the premises and the representations, warranties and agreements contained herein, the parties agree as follows: Section 1. CERTAIN DEFINITIONS. Capitalized terms used but not otherwise defined herein have the meanings ascribed to such terms in the Merger Agreement. Section 2. REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS. Each Stockholder, severally and not jointly, represents and warrants to Parent and Purchaser, as of the date hereof, as follows: (a) The Shares (including the Options) constitute all of the securities (as defined in Section 3(a)(10) of the Exchange Act), of the Company beneficially owned, directly or indirectly, by the Stockholder. (b) Except for the Shares (including the Options), such Stockholder does not, directly or indirectly, beneficially own or have any option, warrant or other right to acquire any securities of the Company that are or may by their terms become entitled to vote or any securities that are convertible or exchangeable into or exercisable for any securities of the Company that are or may by their terms become entitled to vote, nor is such Stockholder subject to any contract, commitment, arrangement, understanding, restriction or relationship (whether or not legally enforceable), other than this Agreement, that provides for such Stockholder to vote or acquire any securities of the Company. Such Stockholder holds exclusive power to vote the Shares and has not granted a proxy to any other Person to vote the Shares (including those issuable upon exercise of the Options), subject to the limitations set forth in this Agreement. (c) This Agreement has been duly executed and delivered by such Stockholder and, assuming due authorization, execution and delivery of this Agreement by Parent and Purchaser, is a valid and binding obligation of the Stockholder enforceable against such Stockholder in accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally; and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). (d) No investment banker, broker, finder or other intermediary is, or will be, entitled to a fee or commission from Purchaser, Parent or the Company in respect of this Agreement based on any arrangement or agreement made by or on behalf of such Stockholder in his or her capacity as a stockholder of the Company. (e) Such Stockholder understands and acknowledges that Parent is entering into, and causing Purchaser to enter into, the Merger Agreement in reliance upon such Stockholder's execution and delivery of this Agreement. Section 3. REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASER. Parent and Purchaser represent and warrant to the Stockholders as of the date hereof: (a) Each of Parent and Purchaser is a company duly organized, validly existing and in good standing under the laws of their respective jurisdictions of incorporation, has the requisite company power and authority to execute and deliver this Agreement and to consummate the transactions 2 contemplated hereby, and has taken all necessary company action to authorize the execution, delivery and performance of this Agreement. (b) This Agreement has been duly executed and delivered by Parent and Purchaser and, assuming the due authorization, execution and delivery of this Agreement by the Company and the Stockholders, is a valid and binding obligation of each of Parent and Purchaser, enforceable against each of them in accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally; and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). Section 4. TRANSFER OF THE SHARES. During the term of this Agreement, except as otherwise expressly provided herein, each Stockholder agrees that such Stockholder will not (a) tender into any tender or exchange offer or otherwise sell, transfer, pledge, assign, hypothecate or otherwise dispose of, or encumber with any Lien, any of the Shares, (b) acquire any shares of Common Stock or other securities of the Company (otherwise than in connection with a transaction of the type described in Section 5 or by exercising any of the Options), (c) deposit the Shares into a voting trust, enter into a voting agreement or arrangement with respect to the Shares or grant any proxy or power of attorney with respect to the Shares, (d) enter into any contract, option or other arrangement (including any profit sharing arrangement) or undertaking with respect to the direct or indirect acquisition or sale, transfer, pledge, assignment, hypothecation or other disposition of any interest in or the voting of any Shares or any other securities of the Company, (e) exercise any rights (including, without limitation, under Section 262 of the Delaware General Corporation Law) to demand appraisal of any Shares which may arise with respect to the Merger, or (f) take any other action that would in any way restrict, limit or interfere with the performance of such Stockholder's obligations hereunder or the transactions contemplated hereby or which would otherwise diminish the benefits of this Agreement to Parent or Purchaser. Section 5. ADJUSTMENTS. (a) In the event (i) of any stock dividend, stock split, recapitalization, reclassification, combination or exchange of shares of capital stock or other securities of the Company on, of or affecting the Shares or the like or any other action that would have the effect of changing a Stockholder's ownership of the Company's capital stock or other securities or (ii) a Stockholder becomes the beneficial owner of any additional Shares of or other securities of the Company, then the terms of this Agreement will apply to the shares of capital stock held by such Stockholder immediately following the effectiveness of the events described in clause (i) or such Stockholder becoming the beneficial owner 3 thereof, as described in clause (ii), as though they were Shares hereunder. (b) Each Stockholder hereby agrees, while this Agreement is in effect, to promptly notify Parent and Purchaser of the number of any new Shares acquired by such Stockholder, if any, after the date hereof. Section 6. TENDER OF SHARES. Each Stockholder hereby agrees that such Stockholder will validly tender (or cause the record owner of such shares to validly tender) and sell (and not withdraw) pursuant to and in accordance with the terms of the Offer not later than the fifth business day after commencement of the Offer (or if the Stockholder acquires Shares after the date hereof, the earlier of the expiration date of the Offer and the fifth business day after such Shares are acquired by such Stockholder), or, if the Stockholder has not received the Offer Documents by such time, within two business days following receipt of such documents, all of the then outstanding shares of Common Stock beneficially owned by such Stockholder (including the shares of Common Stock outstanding as of the date hereof and shares issued upon exercise (if any) of the Options, in each case as set forth on Schedule A hereto opposite such Stockholder's name). Upon the purchase by Parent of all of such then outstanding shares of Common Stock beneficially owned by such Stockholder pursuant to the Offer in accordance with this Section 6, this Agreement will terminate as it relates to such Stockholder. In the event, notwithstanding the provisions of the first sentence of this Section 6, any Shares beneficially owned by a Stockholder are for any reason withdrawn from the Offer or are not purchased pursuant to the Offer, such Shares will remain subject to the terms of this Agreement. Each Stockholder acknowledges that Parent's obligation to accept for payment and pay for the shares of Common Stock tendered in the Offer is subject to all the terms and conditions of the Offer. Section 7. VOTING AGREEMENT. Each Stockholder, by this Agreement, does hereby (a) agree to appear (or not appear, if requested by Parent or Purchaser) at any annual, special, postponed or adjourned meeting of the stockholders of the Company or otherwise cause the Shares such Stockholder beneficially owns to be counted as present (or absent, if requested by Parent or Purchaser) thereat for purposes of establishing a quorum and to vote or consent, and (b) constitute and appoint Parent and Purchaser, or any nominee thereof, with full power of substitution, during and for the term of this Agreement, as his true and lawful attorney and proxy for and in his name, place and stead, to vote all the Shares such Stockholder beneficially owns at the time of such vote, at any annual, special, postponed or adjourned meeting of the stockholders of the Company (and this appointment will include the right to sign his or its name (as stockholder) to any consent, certificate or other document relating to the Company that laws of the State of Delaware may require or permit), in the case of both (a) and (b) above, (x) 4 in favor of approval and adoption of the Merger Agreement and approval and adoption of the Merger and the other transactions contemplated thereby. This proxy and power of attorney is a proxy and power coupled with an interest, and each Stockholder declares that it is irrevocable until this Agreement shall terminate in accordance with its terms. Each Stockholder hereby revokes all and any other proxies with respect to the Shares that such Stockholder may have heretofore made or granted. For Shares as to which a Stockholder is the beneficial but not the record owner, such Stockholder shall use his or its best efforts to cause any record owner of such Shares to grant to Parent a proxy to the same effect as that contained herein. Each Stockholder hereby agrees to permit Parent and Purchaser to publish and disclose in the Offer Documents and the Proxy Statement and related filings under the securities laws such Stockholder's identity and ownership of Shares and the nature of his or its commitments, arrangements and understandings under this Agreement. Section 8. TERMINATION. This Agreement will terminate (a) as to any Stockholder upon the purchase of all the Shares beneficially owned by such Stockholder pursuant to the Offer in accordance with Section 6, or (b) on the earlier to occur of (i) the Effective Time or (ii) the date the Merger Agreement is terminated in accordance with its terms. Section 9. FEES AND EXPENSES. Except as otherwise expressly provided herein or in the Merger Agreement, whether of not the Merger is consummated, all costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses. Section 10. FURTHER ASSURANCES. Each party hereto will execute and deliver all such further documents and instruments and take all such further action as may be reasonably necessary in order to consummate the transactions contemplated hereby. Section 11. PUBLICITY. A Stockholder shall not issue any press release or otherwise make any public statements with respect to this Agreement or the Merger Agreement or the other transactions contemplated hereby or thereby without the consent of Parent and Purchaser, except as may be required by Law or applicable stock exchange rules. Section 12. STOCKHOLDER CAPACITY. No person executing this Agreement makes any agreement or understanding herein in such Stockholder's capacity as a director or officer of the Company or any subsidiary of the Company. Each Stockholder signs solely in such Stockholder's capacity as the beneficial owner of such Stockholder's Shares and nothing herein shall limit or affect any actions taken 5 by a Stockholder in such Stockholder's capacity as an officer or director of the Company or any subsidiary of the Company to the extent specifically permitted by the Merger Agreement. Section 13. ENFORCEMENT. The parties hereto agree that irreparable damage may occur in the event that any of the provisions of this Agreement were not performed in accordance with its specific terms or was otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any New York Court, this being in addition to any other remedy to which they are entitled at law or in equity for damages or otherwise. Section 14. MISCELLANEOUS. (a) All representations and warranties contained herein will survive for twelve months after the termination hereof. The covenants and agreements made herein will survive in accordance with their respective terms. (b) Any provision of this Agreement may be waived at any time by the party that is entitled to the benefits thereof. No such waiver, amendment or supplement will be effective unless in writing and signed by the party or parties sought to be bound thereby. Any waiver by any party of a breach of any provision of this Agreement will not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Agreement. The failure of a party to insist upon strict adherence to any term of this Agreement or one or more sections hereof will not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Agreement. (c) This Agreement constitutes the entire agreement among the parties hereto with respect to the subject matter hereof, and supersedes all prior agreements among the parties with respect to such matters. This Agreement may not be amended, changed, supplemented, waived or otherwise modified, except upon the delivery of a written agreement executed by the parties hereto. (d) This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to its rules of conflict of laws. Each of the Stockholders, Parent and Purchaser hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of the United States District Court for the State of Delaware or any court of the State of Delaware (the "DELAWARE COURTS") for any litigation arising out of or relating to this Agreement and the transactions contemplated hereby (and agrees not to commence any litigation relating thereto except in such courts), waives any 6 objection to the laying of venue of any such litigation in the Delaware Courts and agrees not to plead or claim in any Delaware Court that such litigation brought therein has been brought in an inconvenient forum. Parent hereby appoints The Corporation Trust Company as agent for service of process. The address of such agent for service of process is Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. (e) The descriptive headings contained herein are for convenience and reference only and will not affect in any way the meaning or interpretation of this Agreement. In this Agreement, unless the context otherwise requires, words describing the singular number shall include the plural and vice versa, and words denoting any gender shall include all genders and words denoting natural persons shall include corporations and partnerships and vice versa. Whenever the words "include," "includes" or "including" are used in this Agreement, they shall be understood to be followed by the words "without limitation." (f) All notices and other communications hereunder will be in writing and will be given (and will be deemed to have been duly given upon receipt) by delivery in person, by telecopy, or by registered or certified mail, postage prepaid, return receipt requested, addressed as follows: If to Parent or Purchaser to: Elyo S.A. 235 Avenue Georges Clemenceau BP 4601 92746 Nanterre Cedex France Attention: Michel Caillard Fax: (01 41 20 10 10) with copies to: Fried, Frank, Harris, Shriver & Jacobson One New York Plaza New York, New York 10004 Attention: Jeffrey Bagner, Esq. Telecopy: (212) 859-4000 If to a Stockholder, at the address set forth on Schedule A hereto or to such other address as any party may have furnished to the other parties in writing in accordance herewith. (g) This Agreement may be executed by the parties hereto in separate 7 counterparts, each of which, when so executed and delivered, shall be an original. All such counterparts shall together constitute one and the same instrument. Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto. (h) This Agreement is binding upon and is solely for the benefit of the parties hereto and their respective successors, legal representatives and assigns. Neither this Agreement nor any of the rights, interests or obligations under this Agreement will be assigned by any of the parties hereto without the prior written consent of the other parties, except that Parent and Purchaser will have the right to assign to any direct or indirect wholly owned subsidiary of Parent or Purchaser any and all rights and obligations of Parent or Parent under this Agreement, provided that any such assignment will not relieve either Parent or Purchaser from any of its obligations hereunder. (i) Any term or provision of this Agreement that is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this Agreement or affecting the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction. If any provision of this Agreement is so broad as to be unenforceable, the provision shall be interpreted to be only so broad as is enforceable. (j) All rights, powers and remedies provided under this Agreement or otherwise available in respect hereof at law or in equity will be cumulative and not alternative, and the exercise of any thereof by either party will not preclude the simultaneous or later exercise of any other such right, power or remedy by such party. 8 IN WITNESS WHEREOF, each of the Parent and Purchaser has caused this Agreement to be signed by its officer or director thereunto duly authorized and each Stockholder has signed this Agreement, all as of the date first written above. ELYO S.A. By: /s/ Olivier Degos ------------------------------- Name: Olivier Degos Title: Corporate Vice President T ACQUISITION CORP. By: /s/ Olivier Degos ------------------------------- Name: Olivier Degos Title: Secretary STOCKHOLDERS: /s/ George F. Keane ----------------------------------- GEORGE F. KEANE /s/ Charles E. Bayless ----------------------------------- CHARLES E. BAYLESS /s/ Charles E. Bayless, Trustee ----------------------------------- BAYLESS FAMILY TRUST 9
SCHEDULE A Number Number Stockholder Address of Shares of Options - ----------- ------- --------- ---------- George F. Keane 237 Mayfield 27,200 30,000 Trumbull, CT 06611 Charles E. Bayless 7300 North Sunset 2,348.346* 10,000 Canyon Drive Tucson, AR 85718 Bayless Family Trust 7300 North Sunset 9,149 Canyon Drive Tucson, AR 85718 With copies to: W. Brinkley Dickerson, Jr. Troutman Sanders LLP 600 Peachtree Street N.E. Suite 5200 Atlanta, GE 30308
- ---------- * Through October 13, 1999, plus additional deferred shares and reinvestments granted to date. EX-99.(D)(II) 15 EXHIBIT 99(D)(II) Exh 99(d)(ii) ELYO 235 AVENUE GEORGES CLEMENCEAU BP 4601 92746 NANTERRE CEDEX January 19, 2000 Thomas R. Casten c/o Trigen Energy Corporation One Water Street White Plains, NY 10601 Dear Mr. Casten: We hereby agree to purchase (or cause an affiliate to purchase) from you, and you hereby agree to sell to us, 1,012,402 shares (the "Subject Shares") of common stock, par value $.01 per share (the "Shares"), of Trigen Energy Corporation (the "Company") at a purchase price of $23.50 per Share in cash. The purchase and sale shall be consummated on the 31st calendar day (the "Closing Date") following the filing of the Schedule TO (which will include a Schedule 13E-3, pursuant to Rule 13e-3 under the Securities Exchange Act of 1934, as amended), by Elyo S.A. and certain of its affiliates in connection with the offer by T Acquisition Corp., a Delaware corporation and an indirect, wholly owned subsidiary of Elyo S.A., to purchase any and all of the outstanding Shares (the "Offer" to be made pursuant to the terms of the Agreement and Plan of Merger, dated as of January 19, 2000 between Elyo S.A., T Acquisition Corp. and the Company). If Parent is legally barred from purchasing the Subject Shares by reason of a court order or otherwise, Parent will buy the Subject Shares on the date two business days following the date that such legal prohibition ceases. On the Closing Date, you shall deliver to us at the principal offices of the Company the certificate(s) representing the Subject Shares and we shall deliver to you at the principal offices of the Company a check in an amount equal to the number of Subject Shares times $23.50 (or, at your option specified in writing at least 3 business days prior to the Closing Date, a wire transfer to an account designated by you in such notice). You hereby represent that you beneficially own 1,012,402 Subject Shares, and that the Subject Shares constitute all of the Shares beneficially owned, directly or indirectly, by you (other than Shares ("Plan Shares") that may be acquired upon the exercise of options or shares of restricted stock, in each case issued or issuable under the Trigen Energy Corporation 1994 Stock Incentive Plan, and Shares held by you under the Company's Section 401(k) plan). The Plan Shares are not Subject Shares and are not subject to the terms and conditions of this Agreement. In consideration of our agreement to purchase the Subject Shares, you hereby agree not to tender the Subject Shares pursuant to the Offer. Please indicate your agreement with the foregoing, effective as of the date first above mentioned, by signing below. This letter may be signed in any number of counterparts, each of which shall be deemed an original, but all of which, when taken together, shall constitute one instrument. Sincerely, ELYO S.A. By: /s/ Olivier Degos -------------------------------- Name: Olivier Degos Title: Corporate Vice President AGREED AND ACCEPTED THOMAS R. CASTEN /s/ Thomas R. Casten - ----------------------- Thomas R. Casten - 2 - EX-99.(D)(III) 16 EXHIBIT 99(D)(III) Exhibit 99(d)(iii) SEPARATION AGREEMENT AND RELEASE This Separation Agreement and Release (this "Agreement") is made and entered into this 19th day of January, 2000, by Trigen Energy Corporation, a Delaware corporation (the "Company"), and Thomas R. Casten (the "Employee"). WITNESSETH: WHEREAS, the Employee and the Company are parties to an Employment Agreement dated as of August 10, 1994 (the "Employment Agreement"); WHEREAS, the Employee desires to resign his employment with the Company and the Company is willing to accept the Employee's resignation, subject to the terms and conditions of this Agreement set forth below; and WHEREAS, the Company has made certain awards to the Employee of shares of restricted common stock (the "Common Stock") of the Company, par value $.01 per share (the "Restricted Stock"), and options (the "Options") to acquire the Common Stock, in each case, pursuant to the Trigen Energy Corporation 1994 Stock Incentive Plan (the "Plan") (the number of vested and unvested Options and the number of shares of Restricted Stock are set forth on Exhibit A hereto). NOW THEREFORE, the Company and Employee, in consideration of the covenants and agreements herein expressed, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, agree as follows: 1. RESIGNATION. The Employee hereby resigns from all of his positions as a director and officer of the Company and all of its subsidiaries and affiliates effective as of the date hereof (the "Termination Date"). Notwithstanding the foregoing, the Employee shall be entitled to remain a general partner of the Trenton District Energy Company ("TDEC") in accordance with the terms of the governing instruments of TDEC; PROVIDED, HOWEVER, that the Employee shall in no way interfere with or participate in the management or day-to-day operations of TDEC. From and after the Termination Date, the Employee shall not be authorized to incur or commit to any expenses, obligations or liabilities on behalf of the Company, its subsidiaries or affiliates. 2. SEVERANCE PAYMENTS. For and in consideration of all of the Employee's acknowledgments, releases and covenants set forth in this Agreement, the Employee shall be entitled to the following compensation and benefits (collectively, the "Severance Payments"): a) INITIAL SALARY CONTINUATION. In accordance with the terms of the Employment Agreement, the Company shall continue to pay the Employee 1/12 of his annual base salary at the rate in effect on the Termination Date for each completed month of service until August 10, 2000. Such payments shall be made in accordance with the normal payroll procedures of the Company and be pro-rated for any partial payroll period. b) SUPPLEMENTARY SEVERANCE AND BENEFITS. (i) ADDITIONAL SALARY CONTINUATION. The Company shall continue to pay the Employee 1/12 of his annual base salary at the rate in effect on the Termination Date for each completed month of service from August 11, 2000 until the expiration of the Severance Period (as defined below). Such payments shall be made in accordance with the normal payroll procedures of the Company and be pro-rated for any partial payroll period. "Severance Period" shall mean the period ending on the earlier of (A) the second anniversary of the Termination Date, (B) the date the Employee breaches any of his obligations under this Agreement or (C) the date the Employee becomes a participant in a proxy contest or solicits proxies to challenge actions recommended by the Company's Board of Directors. (ii) RESTRICTED STOCK. Subject to Section 2(f) below, the shares of the Restricted Stock which are not vested as of the Termination Date shall remain outstanding and become vested upon the earlier of (A) the attainment by the Company of cumulative diluted earnings of $2.08 per share on the Company's Common Stock in any four consecutive fiscal quarters, (B) the second anniversary of the Termination Date or (C) such earlier time as vesting occurs under the Plan. Notwithstanding the foregoing, immediately before the "Effective Time" (as such term is defined in the Agreement and Plan of Merger, dated as of January 19, 2000, among Elyo S.A., T Acquisition Corp. and the Company (the "Merger Agreement")), 100% of the shares of Restricted Stock shall be canceled and the Company shall, subject to Section 2(f) below, make a cash payment to the Employee on the "Closing Date" (as such term is defined in the Merger Agreement) equal to the product obtained by multiplying 9,550 by the "Merger Consideration" (as such term is defined in the Merger Agreement), and on the second anniversary of the Closing Date, the Company shall, subject to Section 2(f) below, make a cash payment to the Employee equal to product obtained by multiplying 28,649 by the Merger Consideration. (iii) OPTIONS. Subject to Section 2(f) below, all Options which are not vested as of the Termination Date shall remain outstanding and continue to vest and become exercisable in accordance with the vesting schedule in effect immediately prior to the Termination Date as if the Employee had remained continuously employed by the Company following the Termination Date, provided, however, that all Options to the extent not vested on the second anniversary of the Termination Date shall become vested on such anniversary. All Options shall remain exercisable for a period of thirty (30) days following the second anniversary of the Termination Date, after which all such Options shall be canceled. Notwithstanding the foregoing, all Options that remain outstanding -2- immediately before the Effective Time, if any, shall be treated in accordance with the terms of the Merger Agreement. (iv) BENEFITS CONTINUATION. Subject to Section 2(f) below, for a period of two years following the Termination Date or, if earlier, until the Employee obtains new employment, the Company shall permit the Employee to continue to participate in the insurance plans (including life, disability, health and medical) provided by the Company to its employees from time to time in accordance with the terms of such plans as if the Employee continued to be employed by the Company for such period. Subject to Section 2(f) below, for a period of two years following the Termination Date or, if earlier, until the Employee obtains new employment, the Company will provide the Employee such administrative support that he may reasonably request, including reasonable access to the Company's information technology department for technical support for his personal computer and the reasonable assistance of Mrs. Linda Prime or, if at no additional cost to the Company, a different senior administrative assistant if Mrs. Prime is no longer employed by the Company. Subject to Section 2(f), the Employee shall be entitled to retain the office furniture, laptop computer and personal computer which the Company made available to the Employee immediately prior to the Termination Date. c) ACCRUED VACATION. Within ten (10) days of the date hereof, the Company shall pay the Employee a lump sum cash payment of $31,976.92 in respect of the Employee's accrued vacation through the Termination Date. d) OUTPLACEMENT/FINANCIAL ADVISOR SERVICES. For a period of one (1) year following the Termination Date, the Company shall provide the Employee outplacement and financial advisor services at a cost not to exceed $25,000 on a pre-tax basis, through the outplacement service firm and financial advisor selected by the Employee. e) 1999 BONUS. The Employee shall be entitled to receive an annual cash bonus in respect of the Company's 1999 fiscal year in accordance with the terms of the Company's annual incentive plan in effect as of December 31, 1999. The Company shall disclose the bonus calculation to the Employee. If as of the date hereof, the Employee had a good faith belief that certain "extraordinary items" or "asset impairment" write-offs that are taken into account in such calculation should not have been so accounted for and the Employee can demonstrate that the treatment of such item or write-off was inconsistent with the Company's past practices, the Company shall recalculate the Employee's bonus; PROVIDED, HOWEVER, that the Employee acknowledges that the Company included a reserve of $3 million in its latest 1999 forecast for the write-off of certain assets located in London, Canada and agrees that, if such write-down is taken into account in the Company's 1999 financial statements and is used to compute the 1999 bonuses of the other incentive plan participants, it shall be taken into account in -3- computing the Employee's bonus. Such bonus shall be paid to the Employee at the time the Company pays bonuses in respect of fiscal 1999 to all annual incentive plan participants. f) FORFEITURE OF THE SEVERANCE PAYMENTS. If the Severance Period expires prior to the Second Anniversary of the Termination Date, the Company's obligations to make any payments or to provide any benefits under Section 2(b) shall immediately cease and all of the unexercised Options shall be canceled and all of the shares of the Restricted Stock shall be immediately forfeited. g) NO MITIGATION. The Employee shall not be required to mitigate the amount of any payment or benefit contemplated by this Section 2. h) OTHER PLAN. The Company shall satisfy its obligations to the Employee under the Omnibus Deferral Program in accordance with the terms thereof. 3. WITHHOLDING. The Company shall have the right to deduct from any amounts payable under this Agreement or otherwise any taxes or other amounts required by law to be withheld. 4. EMPLOYEE RELEASE. In consideration of this Agreement, the Employee agrees to release and forever discharge the Company, its stockholders, subsidiaries, directors, officers and employees, and any affiliates, agents, representatives, successors, and assigns of any of the foregoing, including Elyo S.A., Suez Lyonnais des Eaux, Tractebel S.A./N.V., and Societe Generale de Belgique, and their respective affiliates, stockholders, officers and directors (collectively referred to as the "Releasees"), from and against any and all obligations, liabilities, damages, costs, claims, complaints, charges, or causes of actions in law or equity (collectively "Claims") that the Employee or his heirs, administrators, successors, or assigns may now have or may ever have against any Releasee, whether accrued, absolute, contingent, unliquidated or otherwise, and whether known or unknown on the date hereof, and which have or may have arisen out of any act or omission occurring, or state of facts existing, prior to the date of execution of this Agreement, in any way related to the Employee's employment with, and services as a director of, the Company and its affiliates and the termination thereof, or in connection with the Employee's ownership of any securities of the Company or any of its affiliates, including, without limitation, (i) Claims arising under the Employment Agreement or any arrangement, plan, program, or policy for employee benefits, with the exception of any tax qualified plans under which the Employee has a vested accrued interest, (ii) any other Claims related to the Employee's employment with the Company or the termination of that employment and (iii) Claims based on federal, state, or local law or regulation or the common law, including but not limited to, Claims in any way related to Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Equal Pay Act, the Fair Labor Standards Act, the Americans with Disabilities Act, the Employee -4- Retirement Income Security Act of 1974, as amended, the New York Human Rights Law, and all other applicable state and local labor and employment laws (including all laws concerning unlawful and unfair labor and employment practices), breach of contract, wrongful discharge, defamation or intentional infliction of emotional distress. If and to the extent a court of competent jurisdiction shall determine any part or portion of the foregoing release to be invalid or unenforceable, the same shall not affect the remainder of the release which shall be given full effect without regard to the invalid part or portion of the release. 5. EMPLOYEE ACKNOWLEDGMENT. Employee acknowledges that he: (i) has been given the opportunity to consider the terms of this Agreement for more than twenty-one (21) days and has determined that it is in his best interest to execute this Agreement on the date hereof; (ii) is waiving claims under the Age Discrimination in Employment Act; (iii) has been advised to consult with legal counsel of his own choosing prior to the execution of this Agreement; (iv) fully understands the terms and conditions contained herein; (v) has entered into this Agreement of his own free will and was not under any undue pressure or duress; (vi) is not waiving rights or claims that may arise after the date this Agreement is executed; (vii) has received as consideration for the waivers contained herein money and other benefits in addition to that which he is already entitled; (viii) understands that for a period of seven (7) days following the execution of this Agreement that he may revoke his waiver and release of any claims under the Age Discrimination in Employment Act. In the event the Employee so revokes his waiver and release of claims under the Age Discrimination in Employment Act, the Employee shall not be entitled to any of the payments or benefits provided in Section 2(b) hereof and in all other respects this Agreement shall remain in full force and effect. 6. ADDITIONAL COVENANTS. a) NON DISPARAGEMENT. The Employee shall not make or publish any negative or disparaging statements, comments or remarks (whether written or oral) regarding (i) the Company, its subsidiaries, or their directors or officers, Elyo S.A., Suez Lyonnais des Eaux, Tractebel S.A./N.V., or Societe Generale de Belgique, and (ii), any person that the Employee knows to be a director, officer, employee or affiliate of any of the persons or entities named in clause (i). Except in furtherance of the Employee's employment after the date hereof, which employment does not violate Section 6(c) hereof, the Employee further agrees that he shall not discourage, or attempt to discourage, any person, firm, corporation or business entity from doing business with, or utilizing the services of, any of (iii) the Company, its subsidiaries, or their directors, officers or employees, Elyo S.A., Suez Lyonnais des Eaux, Tractebel S.A./N.V., or Societe Generale de Belgique and (iv) any person that the Employee knows to be a director, officer, employee or affiliate of any of the persons or entities named in clause (iii). The Company, its subsidiaries, their officers and directors and Elyo S.A., Suez Lyonnais des -5- Eaux, Tractebel S.A./N.V., and Societe Generale de Belgique and their officers and directors shall not make or publish any negative or disparaging statements, comments or remarks (whether written or oral) regarding the Employee. b) UNAUTHORIZED DISCLOSURE. The Employee agrees and understands that in the Employee's position with the Company, the Employee has been exposed to and has received information relating to the confidential affairs of the Company, its subsidiaries and affiliates, including but not limited to technical information, intellectual property, business and marketing plans, strategies, customer information, other information concerning the products, promotions, development, financing, expansion plans, business policies and practices of the Company, its subsidiaries and affiliates, and other forms of information considered by the Company to be confidential and/or in the nature of trade secrets ("Confidential Information"). The term Confidential Information shall not include any information which is known, or becomes known, to the general public through no wrongful act on the part of the Employee. The Employee agrees that from and after the date of this Agreement, the Employee will not disclose such Confidential Information, either directly or indirectly, to any third person or entity without the prior written consent of the Company. In the event that the Employee becomes legally required to disclose any Confidential Information, he will provide the Company with prompt notice thereof so that the Company may seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Section 6(b) to permit a particular disclosure. In the event that such protective order or other remedy is not obtained, or that the Company waives compliance with the provisions of this Section 6(b) to permit a particular disclosure, the Employee will furnish only that portion of the Confidential Information which he is legally required to disclose and, at the Company's expense, will cooperate with the efforts of the Company to obtain a protective order or other reliable assurance that confidential treatment will be accorded the Confidential Information. This confidentiality covenant has no temporal, geographical or territorial restriction. The Employee will promptly supply to the Company all property, keys, notes, memoranda, writings, lists, files, reports, customer lists, correspondence, tapes, disks, cards, surveys, maps, logs, machines, technical data or any other tangible product or document which has been produced by, received by or otherwise submitted to the Employee during the Employee's employment with the Company. c) NON-COMPETITION. By and in consideration of the Company's entering into this Agreement and the payments to be made and benefits to be provided by the Company hereunder, the Employee agrees that he will not for a period of two years following the Termination Date, directly or indirectly, own, manage, operate, join, control, be employed or retained as a consultant by, or participate in the ownership, management, operation or control of, or be connected in any manner with, including but not limited to holding any position as a shareholder, director, officer, consultant, independent contractor, employee, partner, or investor in (other than in TDEC in a -6- manner not prohibited by Section 1 hereof), any "Restricted Enterprise" (as defined below) doing or proposing to do business in any of the territories in which, as of the Termination Date, the Company or its subsidiaries have or are developing operations; PROVIDED, that in no event shall the passive ownership as an inactive investor of less than 5% of the outstanding equity securities of any issuer (other than the Company, except for shares owned or subject to Options held on the date hereof) whose securities are registered under the Securities Exchange Act of 1934, as amended, standing alone, be prohibited by this Section 6(c). For purposes of this Section 6(c), the term "Restricted Enterprise" shall mean any person, corporation, partnership or other entity that engages, directly or indirectly, in the development, ownership or operation of commercial or industrial energy systems, including, but not limited to, district heating or cooling, cogeneration relating to industrial and district heating and cooling, or the provision of building management services with respect to heating, ventilating or air conditioning. d) NON-SOLICITATION. The Employee shall not, and shall not cause or encourage any other person to, interfere with or harm, or attempt to interfere with or harm, the relationship of the Company or any of its subsidiaries or affiliates with, or endeavor to entice away from the Company or any of its subsidiaries or affiliates, or hire or retain as a consultant or advisor, any person who was an employee of the Company, or any of its subsidiaries or affiliates on or within six month prior to the Termination Date, other than an individual who has not been employed by the Company, or any of its subsidiaries or affiliates for more than one year following such individual's termination. e) COOPERATION. The Employee agrees to reasonably cooperate with the Company, its subsidiaries and affiliates and to be reasonably available to the Company, its subsidiaries and affiliates with respect to past, continuing and/or future matters arising out of the Employee's employment or any other relationship with the Company, its subsidiaries and affiliates, whether such matters are business-related, legal (including litigation) or otherwise; provided such cooperation does not materially interfere with his new full time employment. The Company shall reimburse the Employee for all reasonable out-of-pocket expenses incurred in connection with such cooperation. f) NO EXISTING LITIGATION. The Employee represents that with respect to any act or omission occurring, or state of facts existing, on or prior to the date of execution of this Agreement, he has not filed any complaints, charges or lawsuits against any Releasee with any government agency or any court or other tribunal. g) REMEDIES. The Employee agrees that any breach of the terms of Section 6(a), (b), (c) or (d) would result in irreparable injury and damage to the Company, its subsidiaries and/or affiliates for which the Company, its subsidiaries and/or affiliates would have no adequate remedy at law; the Employee therefore also agrees that in the event of said breach or any threat of breach, the Company, its subsidiaries and/or -7- affiliates, as applicable, shall, in addition to the remedies provided in Section 2(f) above, be entitled to an immediate injunction and restraining order to prevent such breach and/or threatened breach and/or continued breach by the Employee and/or any and all persons and/or entities acting for and/or with the Employee, without having to prove damages, in addition to any other remedies to which the Company, its subsidiaries and/or affiliates may be entitled at law or in equity. The terms of this Section 6(g) shall not prevent the Company, its subsidiaries and/or affiliates from pursuing any other available remedies for any breach or threatened breach hereof, including but not limited to the recovery of damages from the Employee and enforcing the provisions of Section 2(f) of this Agreement. The Employee and the Company further agree that the provisions of the covenants contained in Section 6(a), (b), (c) and (d) are reasonable and necessary to protect the businesses of the Company, its subsidiaries and affiliates because of the Employee's access to Confidential Information and his material participation in the operation of such businesses. The Employee acknowledges that the Company would not have entered into this Agreement absent the inclusion of Section 6(a), (b), (c) and (d). Should a court or arbitrator determine, however, that any provision of the covenants contained in this Section 6 are not reasonable or valid, either in period of time, geographical area, or otherwise, the parties hereto agree that such covenants should be interpreted and enforced to the maximum extent which such court or arbitrator deems reasonable or valid. The Company agrees that any breach of this Agreement by the Company or its affiliates shall result in the immediate acceleration of all amounts due the Employee. The terms of this Section 6(g) shall not prevent the Employee from pursuing any other available remedies for any breach or threatened breach hereof, including but not limited to the recovery of damages and enforcing the provisions of Section 6(a) hereof. The existence of any claim or cause of action by the Employee against the Company, its subsidiaries and/or affiliates, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company of the covenants contained in this Section 6. h) TDEC. In the event TDEC refinances or restructures its debt obligations, the Company shall use its good faith efforts to allocate sufficient debt basis to the Employee so that the Employee does not recognize income as a result of such refinancing or restructuring or offer the Employee the opportunity to guaranty sufficient debt to avoid income recognition on such refinancing or restructuring, but only if, in the sole discretion of the Company, such efforts (i) could not adversely impact the Company or its affiliates or TDEC, (ii) are consistent with the Company's and TDEC's obligations to their securityholders, (iii) are permitted by all applicable laws and regulations and (iv) are commercially reasonable; it being understood that the foregoing shall in no way impose any obligations upon the Company or TDEC to engage in or to refrain from -8- engaging in any transaction, including, but not limited to, those impacting TDEC's capital structure. 7. NO ADMISSIONS. Nothing in this Agreement shall be construed as an admission by any Releasee of any liability on its part under any federal, state, or local law or regulation or the common law. The Employee also acknowledges that he has had the opportunity to consult with an attorney prior to signing this Agreement, and that he has read and understood all of the provisions of this Agreement. 8. ENTIRE AGREEMENT. This Agreement, the agreements governing the Options and Restricted Stock as amended by this Agreement and the letter agreement dated the date hereof between Elyo S.A. and the Employee, constitute the entire agreement between the parties with respect of the subject matter hereof and supersedes any and all other agreements either oral or in writing between the parties hereto with respect to the subject matter hereof, including, but not limited to, the Employment Agreement, and contain all of the covenants and agreements between the parties with respect to said matters. Each party to this Agreement acknowledges that no representations, inducements, promises, or agreements, orally or otherwise, have been made by any Releasee, or anyone acting on behalf of any Releasee, which are not embodied herein, and that no other agreement, statement or promise not contained in this Agreement shall be valid or binding. 9. BINDING EFFECT. This Agreement shall be binding upon any and all successors and assigns of the Employee and the Company. 10. GOVERNING LAW. Except for issues or matters as to which federal law is applicable, this Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York without giving effect to the conflicts of law principles thereof. 11. SEVERABILITY. If and to the extent that any court of competent jurisdiction holds any provision or part of this Agreement to be invalid or unenforceable, such holding shall in no way affect the validity of the remainder of this Agreement. 12. HEADINGS. The headings contained herein are solely for the purpose of reference, are not part of this Agreement and shall not in any way affect the meaning or interpretation of this Agreement. 13. COUNTERPARTS. This Agreement may be executed in two counterparts. 14. PRESS RELEASE; CONFIDENTIALITY. Subject to applicable law, the Parties shall mutually agree on the form of any press release relating to the Employee's resignation from the Company. Other than with respect to information provided in any -9- such press release or required to be disclosed by court order, the Employee agrees not to disclose the terms of this Agreement to any person or entity, other than the Employee's immediate family and financial or legal advisors who agree to be bound by this confidentiality provision. 15. ARBITRATION. Except as qualified below, any dispute arising under, out of or in connection with this Agreement shall be submitted to binding arbitration in the City of New York by and in accordance with the rules and procedures of the American Arbitration Association. The decision of the arbitrator(s) shall be final and binding on all parties and judgment may be entered thereon in any court. The Employee acknowledges that the Company's remedy at law for any breach or threatened breach by the Employee of Sections 6(a), (b), (c) or (d) will be inadequate. Therefore, the Company shall be entitled to injunctive and other equitable relief from a court of law or other tribunal restraining the Employee from violating those covenants until such time as a final and binding determination is made by the arbitrator(s). IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and date indicated below. THOMAS R. CASTEN /S/ THOMAS R. CASTEN ------------------------------- Dated: JANUARY 19, 2000 ------------------------ TRIGEN ENERGY CORPORATION By: /S/ RICHARD E. KESSEL --------------------------- Title: EXECUTIVE VICE PRESIDENT ------------------------ Dated: JANUARY 19, 2000 ------------------------ -10- Exhibit A Separation Agreement and Release Shares of Restricted Stock 38,199 Shares Underlying Vested and Unvested Options 75,900
EX-99.(I) 17 EXHIBIT 99(I) Exhibit 99(i) SUEZ LYONNAISE DES EAUX LETTERHEAD DELEGATION DE POUVOIR Je soussigne, Gerard MESTRALLET, President du Directoire, agissant en vertu des decisions du Directoire en date du 30 juin 1997 et du 19 octobre 1998, Delegue, avec faculte de sub-delegation, a : Monsieur Philippe de MARGERIL, Secraetire General, tous pouvoirs a l'effet de : - signer la correspondance courante de la Societe, - contracter toutes assurances de quelque nature que ce soit, payer les primes, accepter et recevoir toutes indemnisations, - representer la Societe dans toutes Assemblees des Societes, Associations, Groupements ou Syndicats dont elle fait partie, - deposer et enregistrer toutes marques, brevets et autres droits de propriete intellectuelle, accepter et consentir tous accords de cession ou de licence, avec faculte de subdelegation aux Avocats et Conseils pour l'accomplissement des formalites, - faire toutes acquisitions de biens meubles utiles a l'objet social, - accepter et consentir tous baux et locations, faire toutes resiliations, - souscrire, acquerir, ceder toutes actions, parts sociales, obligations, bons, et autres valeurs mobilieres de toute nature, - faire ouvrir et fonctionner au nom de la Societe tous comptes courants de depots ou d'avance aupres de l'Administration de Cheques Postaux, de la Banque de France et tout autre etablissement prive ou public, - operer tous depots, retraits, transferts de fonds, rentes, creances ou autres valeurs appartenant a la Societe, - emettre, endosser, acquitter et signer, a quelque titre que ce soit, tous billets, cheques et effets de commerce, - etablir et signer tous memoires de sommes qui peuvent ou pourront etre dues a la Societe pour quelque cause que ce soit par toutes administrations publiques, communales departementales et de l'Etat ou par toutes personnes, - recevoir de toutes administrations publiques et de l'Etat, des departements, villes et communes et, en general, de toutes collectivites publiques ou privees et de toutes personnes, les sommes qui peuvent etre dues a la Societe, a quelque titre et pour quelque cause que ce soit, en donner quittances, - payer toutes sommes dues par la Societe a quelque titre et pour quelque cause que ce soit et en retirer quittances, - en cas de difficultes quelconques et specialement a defaut de paiement, engager toutes poursuites, faire tous commandements et sommations, - en cas de redressement judiclaire de quelque debiteur, declarer toutes creances, faire toutes affirmations, repondre a toutes consultations, accorder tous delais et remises, 6 - representer la Societe en justice, tant en demandant qu'en defendant, elire domicile; engager toutes instances et actions et y defendre devant toutes jurisdictions competentes; signer et deposer toutes requetes et tous memoires; proposer et accepter toutes transactions ou tous compromis; se desister de toutes instances et actions, acquiescer a tous jugements, arrets et ordonnances; interjeter tous appels et former tous pourvois, - faire toutes declarations aupres de toutes administrations fiscales, presenter toutes demandes de degrevement et restitution d'impots, contributions, taxes et droits generalement quelconques, signer et deposer toutes requetes et tous memoires, engager toutes instances et y defendre devant toutes juridictions competentes, proposer et accepter toutes transactions, se desister de toutes instances et actions, acquiescer a tous arrets et jugements, et former tous pourvois, - remplir toutes formalites necessaires pour soumettre la Societe aux lois, arretes et reglements de tous pays ou elle pourrait etre amenee a faire des operations, - formuler toutes demandes d'autorisation ou d'agrement et generalement contracter tous engagements lies auxdites demandes, - representer la Societe a l'egard de toutes administrations tant en France qu'a l'etranger. Aux effets ci-dessus, passer et signer tous actes et pieces, fournir toutes justifications, elire domicile et generalement, faire le necessaire. La presente delegation annule et remplace celle consentie en pareille matiere en date du 1(er) Juillet 1997. Fait a Nanterre, le 27 octobre 1998 /s/ Gerard Nestrallet Gerard NESTRALLET 7 SUEZ LYONNAISE DES EAUX LETTERHEAD DELEGATION DE POUVOIR Je soussigne, Philippe de MARGERIE, Secretaire General, agissant en vertu d'une delegation consentie en date du 27 Octobre 1998 par Monsieur Gerard MESTRALLET, President du Directoire. DELEGUE A: Monsieur Patrice HERBET, Directeur Juridique France et International, tous pouvoirs a l'effet de: - signer la correspondance courante de la Societe, - deposer et enregistrer toutes marques, brevets et autres droits de propriete intellectuelle, accepter et consentir tous accords de cession ou de licence, avec faculte de subdelegation aux Avocats et Conseils pour l'accomplissement des formalites, - etablir et signer tous memoires de sommes qui peuvent ou pourront etre dues a la Societe pour quelque cause que ce soit par toutes admistrations publiques, communales, departementales et de l'Etat ou par toutes personnes, - en cas de difficultes quelconques et specialement a defaut de paiement, engager toutes poursuites, faire tous commandements et sommations, - en cas de redressement judiciaire de quelque debitieur, declarer toutes creances, - representer la Societe en justice, tant en demandant qu'en defendant, elire domicile; engager toutes instances et actions et y defendre devant toutes juridictions competentes; signer et deposer toutes requetes et tous memoires; proposer et accepter toutes transactions ou tous compromis; se desister de toutes instances et actions, acquiescer a tous jugements, arrets et ordonnances; interjeter tous appels et former tous pourvois, - remplir toutes formalites necessaires pour soumettre la Societe aux lois, arretes et reglements de tous pays ou elle pourrait etre amenee a faire des operations, - formuler routes demandes d'autorisation ou d'agrement contracter tous engagements lies auxdites demandes, - repesenter la Societe a l'egard de toutes adminstrations tant en France qu'a l'etranger. Aux effets ci-dessus, passer et signer tous actes et pieces, fournir toutes justifications, elire domicile et generalement, faire le necessaire. Fait a Nanterre, le 27 octobre 1998 /s/ Philippe de Margerie Philippe de MARGERIE 8 -----END PRIVACY-ENHANCED MESSAGE-----