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OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
OF
MEASUREX CORPORATION
BY
HONEYWELL ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
HONEYWELL INC.
AT
$35.00 NET PER SHARE
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THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON FRIDAY, FEBRUARY 28, 1997, UNLESS THE
OFFER IS EXTENDED.
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THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE OFFER AND THE
MERGER AND DETERMINED THAT THE TERMS OF THE OFFER AND THE MERGER ARE FAIR TO,
AND IN THE BEST INTERESTS OF, THE COMPANY'S STOCKHOLDERS, AND UNANIMOUSLY
RECOMMENDS THAT STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE HAVING BEEN VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF
SHARES REPRESENTING AT LEAST A MAJORITY OF THE OUTSTANDING SHARES ON A FULLY
DILUTED BASIS. THE OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS CONTAINED
IN THIS OFFER TO PURCHASE. SEE SECTION 14.
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IMPORTANT
Any stockholder who desires to tender all or any portion of his Shares
should either (1) complete and sign the Letter of Transmittal or a facsimile
thereof in accordance with the instructions in the Letter of Transmittal, mail
or deliver it and any other required documents to the Depositary and either
deliver the certificates for such Shares to the Depositary along with the Letter
of Transmittal or tender such Shares pursuant to the procedures for book-entry
transfer set forth in Section 2 or (2) request his broker, dealer, commercial
bank, trust company or other nominee to effect the transaction for him. Any
stockholder whose Shares are registered in the name of a broker, dealer,
commercial bank, trust company or other nominee must contact such broker,
dealer, commercial bank, trust company or other nominee if he desires to tender
such Shares.
Any stockholder who desires to tender Shares and whose certificates
representing such Shares are not immediately available, or who cannot comply
with the procedures for book-entry transfer on a timely basis, may tender such
Shares by following the procedures for guaranteed delivery set forth in Section
2.
Questions and requests for assistance may be directed to the Information
Agent or the Dealer Manager at their respective addresses and telephone numbers
set forth on the back cover of this Offer to Purchase. Requests for additional
copies of this Offer to Purchase, the Letter of Transmittal and the Notice of
Guaranteed Delivery may be directed to the Information Agent, the Dealer
Manager, the Depositary, or to brokers, dealers, commercial banks or trust
companies. A stockholder may also contact brokers, dealers, commercial banks or
trust companies for assistance concerning the Offer.
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The Dealer Manager for the Offer is:
BEAR, XXXXXXX & CO. INC.
January 31, 1997
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TABLE OF CONTENTS
PAGE
----
INTRODUCTION................................................ 1
THE OFFER................................................... 2
1. Terms of the Offer................................. 2
2. Procedure for Tendering Shares..................... 4
3. Withdrawal Rights.................................. 6
4. Acceptance for Payment and Payment................. 7
5. Certain Federal Income Tax Consequences............ 8
6. Price Range of the Shares; Dividends on the
Shares............................................. 8
7. Effect of the Offer on the Market for the Shares;
Stock Listing; Exchange Act Registration; Margin
Regulations........................................ 9
8. Certain Information Concerning the Company......... 10
9. Certain Information Concerning Honeywell and the
Purchaser.......................................... 12
10. Source and Amount of Funds......................... 13
11. Background of the Offer; the Merger Agreement and
Certain Other Agreements........................... 14
12. Purpose of the Offer and the Merger; Plans for the
Company; Other Matters............................. 22
13. Dividends and Distributions........................ 24
14. Conditions of the Offer............................ 24
15. Certain Legal Matters.............................. 26
16. Fees and Expenses.................................. 28
17. Miscellaneous...................................... 29
Schedule I -- Directors and Executive Officers of Honeywell and the Purchaser
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To the Holders of Common Stock of
MEASUREX CORPORATION:
INTRODUCTION
Honeywell Acquisition Corp., a Delaware corporation (the "Purchaser") and a
wholly owned subsidiary of Honeywell Inc., a Delaware corporation ("Honeywell"),
hereby offers to purchase all outstanding shares of Common Stock, par value $.01
per share (the "Common Stock"), including the associated preferred share
purchase rights (the "Rights" and together with the Common Stock, the "Shares"),
issued pursuant to the Rights Agreement (as defined below), of Measurex
Corporation, a Delaware corporation (the "Company"), at $35.00 per Share, net to
the seller in cash, upon the terms and subject to the conditions set forth in
this Offer to Purchase and in the related Letter of Transmittal (which, together
with any amendments or supplements hereto or thereto, collectively constitute
the "Offer"). Tendering stockholders will not be obligated to pay brokerage fees
or commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, transfer taxes on the purchase of Shares pursuant to the Offer. The
Purchaser will pay all fees and expenses incurred in connection with the Offer
of Bear, Xxxxxxx & Co. Inc. ("Bear Xxxxxxx"), which is acting as the Dealer
Manager (the "Dealer Manager"), ChaseMellon Shareholder Services, L.L.C., which
is acting as the Depositary (the "Depositary"), and Xxxxxxxxx & Company Inc.,
which is acting as the Information Agent (the "Information Agent").
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE HAVING BEEN
VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER
OF SHARES REPRESENTING AT LEAST A MAJORITY OF THE OUTSTANDING SHARES ON A FULLY
DILUTED BASIS (THE "MINIMUM CONDITION"). SEE SECTION 14.
The Offer is being made pursuant to an Agreement and Plan of Merger, dated
as of January 26, 1997 (the "Merger Agreement"), by and among Honeywell, the
Purchaser and the Company pursuant to which, as soon as practicable after the
completion of the Offer and satisfaction or waiver, if permissible, of all
conditions to the Merger (as defined below), the Purchaser will be merged with
and into the Company (the "Merger") and the Company will become a wholly owned
subsidiary of Honeywell. At the effective time of the Merger (the "Effective
Time"), each Share then outstanding (other than Shares held by Honeywell, the
Purchaser or any other wholly owned subsidiary of Honeywell and Shares held by
stockholders who perfect their dissenters' rights under Delaware law) will be
converted into the right to receive $35.00 in cash or any higher price per Share
paid in the Offer. The Merger Agreement is more fully described in Section 12.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE OFFER
AND THE MERGER AND DETERMINED THAT THE TERMS OF THE OFFER AND THE MERGER ARE
FAIR TO, AND IN THE BEST INTERESTS OF, THE COMPANY'S STOCKHOLDERS, AND
UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR
SHARES.
The Merger Agreement provides that, except as provided therein, following
satisfaction or waiver, if permissible, of the conditions to the Offer and
subject to the terms and conditions thereof, the Purchaser will accept for
payment, in accordance with the terms of the Offer, all Shares validly tendered
pursuant to the Offer and not withdrawn as soon as it is permitted to do so
pursuant to applicable law. The Offer will not remain open following the time
Shares are accepted for payment.
Under the General Corporation Law of the State of Delaware (the "DGCL"), if
the Purchaser acquires, pursuant to the Offer or otherwise, at least 90% of the
outstanding Shares, the Purchaser will be able to approve the Merger Agreement
and the transactions contemplated thereby without a vote of the stockholders. In
such event, Honeywell, the Purchaser and the Company have agreed in the Merger
Agreement to take, at the request of Honeywell and subject to the satisfaction
of the conditions set forth in the Merger Agreement, all necessary and
appropriate action to cause the Merger to become effective as soon as reasonably
practicable after such acquisition, without a meeting of the stockholders, in
accordance with Section 253 of the DGCL. If, however, the Purchaser does not
acquire at least 90% of the outstanding Shares pursuant to the Offer or
otherwise and a vote of the Stockholders is required under the DGCL, a
significantly longer period of time would be required to effect the Merger. In
the Merger Agreement, Honeywell, Purchaser and the Company have agreed that if
immediately prior to the scheduled Expiration Date (as defined below) the Shares
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tendered pursuant to the Offer are less than 90% of the outstanding Shares,
Purchaser may extend the Offer for a period not to exceed 20 business days.
According to the Company, as of January 26, 1997, there were 16,150,375
Shares issued and outstanding, and there were outstanding options to purchase an
aggregate of 3,592,579 Shares, 1,516,140 of which were then exercisable. The
Merger Agreement provides, among other things, that the Company will not,
without the prior written consent of Honeywell, issue any additional Shares
(except on the exercise of outstanding options or pursuant to the Company's
Employee Stock Purchase Plan (as defined below). Based on the foregoing and
assuming that all outstanding options are exercised, the Minimum Condition will
be satisfied if 9,871,478 Shares are validly tendered and not withdrawn prior to
the expiration of the Offer. If the Purchaser acquires sufficient Shares in the
Offer to meet the Minimum Condition, it would be able to effect the Merger
without the affirmative vote of any other stockholder of the Company.
The Rights. The Company has distributed one Right for each outstanding
Share pursuant to the Rights Agreement, dated as of December 14, 1988, between
the Company and The Bank of New York, as Rights Agent, as amended (the "Rights
Agreement"). Based on the information disclosed by the Company in the Schedule
14D-9 dated January 31, 1997 with respect to the Offer, in connection with and
prior to the Company's entering the Merger Agreement, on January 26, 1997, the
Company amended the Rights Agreement to provide that (x) the execution of the
Merger Agreement and the consummation of the transactions contemplated thereby
will not cause (i) Honeywell and/or the Purchaser to become an Acquiring Person
(as defined in the Rights Agreement) or (ii) a Distribution Date, a Shares
Acquisition Date or a Trigger Event (as such terms are defined in the Rights
Agreement) to occur, irrespective of the number of Shares acquired pursuant to
the Offer, and (y) the Rights will expire upon the acceptance of Shares for
payment pursuant to the Offer.
THE OFFER
1. TERMS OF THE OFFER.
Upon the terms and subject to the conditions of the Offer, the Purchaser
will accept for payment and pay for all Shares validly tendered prior to the
Expiration Date and not theretofore withdrawn in accordance with Section 3 of
this Offer to Purchase. The term "Expiration Date" shall mean 12:00 Midnight,
New York City time, on Friday, February 28, 1997, unless and until the
Purchaser, in accordance with the terms of the Merger Agreement, shall have
extended the period of time for which the Offer is open, in which event the term
"Expiration Date" shall mean the latest time and date at which the Offer, as so
extended by the Purchaser, shall expire.
The Offer is conditioned upon, among other things, the satisfaction of the
Minimum Condition and the expiration or termination of all waiting periods
imposed by the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended,
and the regulations thereunder (the "HSR Act"). See Section 14. If such
conditions are not satisfied prior to the Expiration Date, the Purchaser
reserves the right (but shall not be obligated) to (i) decline to purchase any
of the Shares tendered and terminate the Offer, subject to the terms of the
Merger Agreement, (ii) waive any of the conditions to the Offer, to the extent
permitted by applicable law and the provisions of the Merger Agreement, and,
subject to complying with applicable rules and regulations of the Securities and
Exchange Commission (the "Commission"), purchase all Shares validly tendered or
(iii) extend the Offer and, subject to the right of stockholders to withdraw
Shares until the Expiration Date, retain the Shares which will have been
tendered during the period or periods for which the Offer is extended. The
Merger Agreement provides that if the sole condition to the Offer remaining
unsatisfied as of the initial expiration date of the Offer is the failure of the
waiting period under the HSR Act to have expired or been terminated, then the
Purchaser will extend the Offer from time to time until two business days
following the expiration of such waiting period.
Subject to the terms of the Merger Agreement, the Purchaser expressly
reserves the right, in its sole discretion, at any time or from time to time,
(i) to extend the period of time during which the Offer is open and thereby
delay acceptance for payment of, and the payment for, any Shares, by giving oral
or written notice
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of such extension to the Depositary and (ii) to amend the Offer in any respect
(including, without limitation, by decreasing or increasing the consideration
offered in the Offer (the "Offer Price") to holders of Shares and/or by
decreasing the number of Shares being sought in the Offer), by giving oral or
written notice of such amendment to the Depositary. The rights reserved by the
Purchaser in this paragraph are in addition to the Purchaser's rights to
terminate the Offer as described in Section 14. Any extension, amendment or
termination will be followed as promptly as practicable by public announcement
thereof, the announcement in the case of an extension to be issued no later than
9:00 a.m., New York City time, on the next business day after the previously
scheduled Expiration Date in accordance with the public announcement
requirements of Rule 14d-4(c) under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"). Without limiting the obligation of the Purchaser
under such Rule or the manner in which the Purchaser may choose to make any
public announcement, the Purchaser currently intends to make announcements by
issuing a release to the Dow Xxxxx News Service.
The Merger Agreement provides that, without the written consent of the
Company, the Purchaser will not amend or waive the Minimum Condition, decrease
the price per Share to be paid or the number of Shares sought pursuant to the
Offer, or amend the conditions of the Offer in any manner adverse to the holders
of Shares.
If the Purchaser extends the Offer, or if the Purchaser (whether before or
after its acceptance for payment of Shares) is delayed in its purchase of or
payment for Shares or is unable to pay for Shares pursuant to the Offer for any
reason, then, without prejudice to the Purchaser's rights under the Offer, the
Depositary may retain tendered Shares on behalf of the Purchaser, and such
Shares may not be withdrawn except to the extent tendering stockholders are
entitled to withdrawal rights as described in Section 3. However, the ability of
the Purchaser to delay the payment for Shares which the Purchaser has accepted
for payment is limited by Rule 14e-l(c) under the Exchange Act, which requires
that a bidder pay the consideration offered or return the securities deposited
by or on behalf of holders of securities promptly after the termination or
withdrawal of the Offer.
If the Purchaser makes a material change in the terms of the Offer or the
information concerning the Offer or waives a material condition of the Offer,
the Purchaser will disseminate additional tender offer materials and extend the
Offer to the extent required by Rules 14d-4(c), 14d-6(d) and 14e-1 under the
Exchange Act. The minimum period during which the 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 percentage of securities
sought, will depend upon the facts and circumstances then existing, including
the relative materiality of the changed terms or information. In a public
release, the Commission has stated that in its view an offer must remain open
for a minimum period of time following a material change in the terms of the
Offer and that waiver of a material condition, such as the Minimum Condition, is
a material change in the terms of the Offer. The release states than an offer
should remain open for a minimum of five business days from the date a material
change is first published, sent or given to security holders and that, if
material changes are made with respect to information not materially less
significant than the offer price and the number of shares being sought, a
minimum of ten business days may be required to allow adequate dissemination and
investor response. The requirement to extend the Offer will not apply to the
extent that the number of business days remaining between the occurrence of the
change and the then-scheduled Expiration Date equals or exceeds the minimum
extension period that would be required because of such amendment. As used in
this Offer to Purchase, "business day" has the meaning set forth in Rule 14d-1
under the Exchange Act.
The Company has provided the Purchaser with the Company's stockholder lists
and security position listings for the purpose of disseminating the Offer to
holders of Shares. This Offer to Purchase and the related Letter of Transmittal
will be mailed by the Purchaser to record holders of Shares and will be
furnished by the Purchaser to brokers, dealers, banks and similar persons whose
names, or the names of whose nominees, appear on the stockholder lists or, if
applicable, who are listed as participants in a clearing agency's security
position listing, for subsequent transmittal to beneficial owners of Shares.
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2. PROCEDURE FOR TENDERING SHARES.
Valid Tender. For Shares to be validly tendered pursuant to the Offer,
either (i) a properly completed and duly executed Letter of Transmittal (or
facsimile thereof), together with any required signature guarantees, or in the
case of a book-entry transfer, an Agent's Message (as defined below), and any
other required documents, must be received by the Depositary at one of its
addresses set forth on the back cover of this Offer to Purchase prior to the
Expiration Date and either certificates for tendered Shares must be received by
the Depositary at one of such addresses or such Shares must be delivered
pursuant to the procedures for book-entry transfer set forth below (and a
Book-Entry Confirmation (as defined below) received by the Depositary), in each
case prior to the Expiration Date, or (ii) the tendering stockholder must comply
with the guaranteed delivery procedures set forth below.
The Depositary will establish accounts with respect to the Shares at The
Depository Trust Company and the Philadelphia Depository Trust Company (each, a
"Book-Entry Transfer Facility" and, collectively, the "Book-Entry Transfer
Facilities") for purposes of the Offer within two business days after the date
of this Offer to Purchase. Any financial institution that is a participant in
any of the Book-Entry Transfer Facilities' systems may make book-entry delivery
of Shares by causing a Book-Entry Transfer Facility to transfer such Shares into
the Depositary's account in accordance with that Book-Entry Transfer Facility's
procedure for such transfer. However, although delivery of Shares may be
effected through book-entry transfer into the Depositary's account at a
Book-Entry Transfer Facility, the Letter of Transmittal (or facsimile thereof),
properly completed and duly executed, with any required signature guarantees, or
an Agent's Message, and any other required documents must, in any case, be
transmitted to, and received by, the Depositary at one of its addresses set
forth on the back cover of this Offer to Purchase prior to the Expiration Date,
or the tendering stockholder must comply with the guaranteed delivery procedures
described below. The confirmation of a book-entry transfer of Shares into the
Depositary's account at a Book-Entry Transfer Facility as described above is
referred to herein as a "Book-Entry Confirmation." DELIVERY OF DOCUMENTS TO A
BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH SUCH BOOK-ENTRY TRANSFER
FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
The term "Agent's Message" means a message transmitted by a Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of a
Book-Entry Confirmation, which states that such Book-Entry Transfer Facility has
received an express acknowledgment from the participant in such Book-Entry
Transfer Facility tendering the Shares that such participant has received and
agrees to be bound by the terms of the Letter of Transmittal and that the
Purchaser may enforce such agreement against the participant.
THE METHOD OF DELIVERY OF SHARES, THE LETTER OF TRANSMITTAL AND ALL OTHER
REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER FACILITY,
IS AT THE ELECTION AND RISK OF THE TENDERING STOCKHOLDER. SHARES WILL BE DEEMED
DELIVERED ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY (INCLUDING, IN THE CASE
OF A BOOK-ENTRY TRANSFER, BY BOOK-ENTRY CONFIRMATION). IF DELIVERY IS BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
Signature Guarantees. No signature guarantee is required on the Letter of
Transmittal (i) if the Letter of Transmittal is signed by the registered
holder(s) (which term, for purposes of this Section, includes any participant in
any of the Book Entry Transfer Facilities' systems whose name appears on a
security position listing as the owner of the Shares) of Shares tendered
therewith and such registered holder has not completed either the box entitled
"Special Delivery Instructions" or the box entitled "Special Payment
Instructions" on the Letter of Transmittal or (ii) if such Shares are tendered
for the account of a financial institution (including most commercial banks,
savings and loan associations and brokerage houses) that is a participant in the
Security Transfer Agents Medallion Program, the New York Stock Exchange
Medallion Signature Guarantee Program or the Stock Exchange Medallion Program
(each, an "Eligible Institution" and, collectively, "Eligible Institutions"). In
all other cases, all signatures on Letters of Transmittal must be guaranteed by
an Eligible Institution. See Instructions 1 and 5 to the Letter of Transmittal.
If the certificates for Shares are registered in the name of a person other than
the signer of the Letter of Transmittal, or if payment is to be made or
certificates for Shares not tendered or not accepted for payment are to be
returned to
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a person other than the registered holder of the certificates surrendered, then
the tendered certificates for such Shares must be endorsed or accompanied by
appropriate stock powers, in either case signed exactly as the name or names of
the registered holders or owners appear on the certificates, with the signatures
on the certificates or stock powers guaranteed as aforesaid. See Instructions 1
and 5 to the Letter of Transmittal.
Guaranteed Delivery. If a stockholder desires to tender Shares pursuant to
the Offer and such stockholder's certificates for Shares are not immediately
available or the procedures 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, such stockholder's tender may be
effected if all the following conditions are met:
(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 the Purchaser, is received
by the Depositary, as provided below, prior to the Expiration Date; and
(iii) the certificates for all physically tendered Shares, in proper
form for transfer (or a Book-Entry Confirmation with respect to all such
Shares), together with a properly completed and duly executed Letter of
Transmittal (or facsimile thereof), with any required signature guarantees,
or, in the case of a book-entry transfer, an Agent's Message, and any other
required documents are received by the Depositary within three trading days
after the date of execution of such Notice of Guaranteed Delivery. A
"trading day" is any day on which the New York Stock Exchange (the "NYSE")
is open for business.
The Notice of Guaranteed Delivery may be delivered by hand to the
Depositary or transmitted by telegram, facsimile transmission or mail to the
Depositary and must include a guarantee by an Eligible Institution in the form
set forth in such Notice of Guaranteed Delivery.
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 for (or a timely Book-Entry
Confirmation with respect to) such Shares, (ii) a Letter of Transmittal (or
facsimile thereof), properly completed and duly executed, with any required
signature guarantees, or, in the case of a book-entry transfer, an Agent's
Message, and (iii) 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 with respect to
Shares are actually received by the Depositary. UNDER NO CIRCUMSTANCES WILL
INTEREST BE PAID ON THE PURCHASE PRICE TO BE PAID BY THE PURCHASER FOR THE
SHARES, REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN MAKING SUCH
PAYMENT.
The valid tender of Shares pursuant to one of the procedures described
above will constitute a binding agreement between the tendering stockholder and
the Purchaser upon the terms and subject to the conditions of the Offer.
Appointment. By executing the Letter of Transmittal as set forth above, the
tendering stockholder will irrevocably appoint designees of the Purchaser, and
each of them, as such stockholder's attorneys-in-fact and proxies in the manner
set forth in the Letter of Transmittal, each with full power of substitution, to
the full extent of such stockholder's rights with respect to the Shares tendered
by such stockholder and accepted for payment by the Purchaser and with respect
to any and all other Shares or other securities or rights issued or issuable in
respect of such Shares on or after January 31, 1997. All such proxies will be
considered coupled with an interest in the tendered Shares. Such appointment
will be effective when, and only to the extent that, the Purchaser accepts for
payment Shares tendered by such stockholder as provided herein. Upon such
appointment, all prior powers of attorney, proxies and consents given by such
stockholder with respect to such Shares or other securities or rights will,
without further action, be revoked and no subsequent powers of attorney,
proxies, consents or revocations may be given by such stockholder (and, if
given, will not be deemed effective). The designees of the Purchaser will
thereby be empowered to exercise all voting and other rights with respect to
such Shares and other securities or rights, including, without limitation, in
respect of any annual, special or adjourned meeting of the Company's
stockholders, actions by written consent in lieu of any such meeting or
otherwise, as they in their sole discretion deem proper. The Purchaser reserves
the right to require that, in order for Shares to be deemed validly tendered,
immediately upon the Purchaser's acceptance
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for payment of such Shares, the Purchaser must be able to exercise full voting,
consent and other rights with respect to such Shares and other related
securities or rights, including voting at any meeting of stockholders.
Determination of Validity. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance of any tender of Shares
will be determined by the Purchaser in its sole discretion, which determination
will be final and binding. The Purchaser reserves the absolute right to reject
any or all tenders of any Shares determined by it not to be in proper form or
the acceptance for payment of, or payment for which may, in the opinion of the
Purchaser's counsel, be unlawful. The Purchaser also reserves the absolute
right, subject to the provisions of the Merger Agreement, to waive any of the
conditions of the Offer or any defect or irregularity in the tender of any
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 or irregularities
relating thereto have been cured or waived. None of the Purchaser, Honeywell,
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
tenders or incur any liability for failure to give any such notification. The
Purchaser's interpretation of the terms and conditions of the Offer (including
the Letter of Transmittal and the instructions thereto) will be final and
binding.
Backup Withholding. In order to avoid "backup withholding" of U.S. federal
income tax on payments of cash pursuant to the Offer, a stockholder surrendering
Shares in the Offer must, unless an exemption applies, provide the Depositary
with such stockholder's correct taxpayer identification number ("TIN") on a
Substitute Form W-9 and certify under penalties of perjury that such TIN is
correct and that such stockholder is not subject to backup withholding. If a
stockholder does not provide such stockholder's correct TIN or fails to provide
the certifications described above, the Internal Revenue Service (the "IRS") may
impose a penalty on such stockholder and payment of cash to such stockholder
pursuant to the Offer may be subject to backup withholding of 31%. All
stockholders surrendering Shares pursuant to the Offer should complete and sign
the 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 the Purchaser and the Depositary). Certain stockholders
(including, among others, all corporations and certain foreign individuals and
entities) are not subject to backup withholding. Foreign stockholders, if
exempt, 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.
3. WITHDRAWAL RIGHTS.
Except as otherwise provided in this Section 3, tenders of Shares are
irrevocable. Shares tendered pursuant to the Offer may be withdrawn pursuant to
the procedures set forth below at any time prior to the Expiration Date and,
unless theretofore accepted for payment and paid for by the Purchaser pursuant
to the Offer, may also be withdrawn at any time after Monday, March 31, 1997.
For a withdrawal to be effective, a written, telegraphic 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 and
must specify the name of the person having tendered the Shares to be withdrawn,
the number of Shares to be withdrawn and the name of the registered holder of
the Shares to be withdrawn, if different from the name of the person who
tendered the Shares. If certificates for Shares have been delivered or otherwise
identified to the Depositary, then, prior to the physical release of such
certificates, the serial numbers shown on such certificates must be submitted to
the Depositary and, unless such Shares have been tendered by an Eligible
Institution, the signatures on the notice of withdrawal must be guaranteed by an
Eligible Institution. If Shares have been delivered pursuant to the procedures
for book-entry transfer as set forth in Section 2, any notice of withdrawal must
also specify the name and number of the account at the appropriate Book-Entry
Transfer Facility to be credited with the withdrawn Shares and otherwise comply
with such Book-Entry Transfer Facility's procedures. Withdrawals of tenders of
Shares may not be rescinded, and any Shares properly withdrawn will thereafter
be deemed not validly tendered for purposes of the Offer. However, withdrawn
Shares may be retendered by again following one of the procedures described in
Section 2 any time on or prior to the Expiration Date.
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All questions as to the form and validity (including time of receipt) of
notices of withdrawal will be determined by the Purchaser in its sole
discretion, which determination will be final and binding. None of the
Purchaser, Honeywell, 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.
4. ACCEPTANCE FOR PAYMENT AND PAYMENT.
Upon the terms and subject to the conditions of the Offer (including, if
the Offer is extended or amended, the terms and conditions of any such extension
or amendment), the Purchaser will accept for payment and will pay, promptly
after the Expiration Date, for all Shares validly tendered prior to the
Expiration Date and not properly withdrawn in accordance with Section 3. All
determinations concerning the satisfaction of such terms and conditions will be
within the Purchaser's discretion, which determinations will be final and
binding. See Sections 1 and 14. The Purchaser expressly reserves the right, in
its sole discretion, to delay acceptance for payment of or payment for Shares in
order to comply in whole or in part with any applicable law, including, without
limitation, the HSR Act. Any such delays will be effected in compliance with
Rule 14e-l(c) under the Exchange Act (relating to a bidder's obligation to pay
for or return tendered securities promptly after the termination or withdrawal
of such bidder's offer).
In all cases, payment for Shares accepted for payment pursuant to the Offer
will be made only after timely receipt by the Depositary of (i) certificates for
such Shares (or a timely Book-Entry Confirmation with respect thereto), (ii) a
Letter of Transmittal (or facsimile thereof), properly completed and duly
executed, with any required signature guarantees, or, in the case of a
book-entry transfer, an Agent's Message, and (iii) any other documents required
by the Letter of Transmittal. The per Share consideration paid to any
stockholder pursuant to the Offer will be the highest per Share consideration
paid to any other stockholder pursuant to the Offer.
For purposes of the Offer, the Purchaser will be deemed to have accepted
for payment, and thereby purchased, Shares properly tendered to the Purchaser
and not withdrawn as, if and when the Purchaser gives oral or written notice to
the Depositary of the Purchaser's acceptance for payment of such Shares. Payment
for Shares accepted for payment pursuant to the Offer will be made by deposit of
the purchase price therefor with the Depositary, which will act as agent for
tendering stockholders for the purpose of receiving payment from the Purchaser
and transmitting payment to tendering stockholders. UNDER NO CIRCUMSTANCES WILL
INTEREST BE PAID ON THE PURCHASE PRICE TO BE PAID BY THE PURCHASER FOR THE
SHARES, REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN MAKING SUCH
PAYMENT.
If the Purchaser is delayed in its acceptance for payment of, or payment
for, Shares or is unable to accept for payment or pay for Shares pursuant to the
Offer for any reason, then, without prejudice to the Purchaser's rights under
the Offer (including such rights as are set forth in Sections 1 and 14) (but
subject to compliance with Rule 14e-1(c) under the Exchange Act), the Depositary
may, nevertheless, on behalf of the Purchaser, retain tendered Shares, and such
Shares may not be withdrawn except to the extent tendering stockholders are
entitled to exercise, and duly exercise, withdrawal rights as described in
Section 3.
If any tendered Shares are not purchased pursuant to the Offer for any
reason, certificates for any such Shares will be returned, without expense to
the tendering stockholder (or, in the case of Shares delivered by book-entry
transfer of such Shares into the Depositary's account at a Book-Entry Transfer
Facility pursuant to the procedures set forth in Section 2, such Shares will be
credited to an account maintained at the appropriate Book-Entry Transfer
Facility), as promptly as practicable after the expiration or termination of the
Offer.
The Purchaser reserves the right to transfer or assign, in whole or from
time to time in part, to Honeywell, or to one or more direct or indirect wholly
owned subsidiaries of Honeywell, the right to purchase Shares tendered pursuant
to the Offer, but any such transfer or assignment will not relieve the Purchaser
of its obligations under the Offer and will in no way prejudice the rights of
tendering stockholders to receive payment for Shares validly tendered and
accepted for payment pursuant to the Offer.
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5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES.
The receipt of cash for Shares pursuant to the Offer or the Merger will be
a taxable transaction for U.S. federal income tax purposes and also may be a
taxable transaction under state, local or foreign tax laws. Accordingly, a
stockholder who tenders Shares in the Offer or receives cash in exchange for
Shares in the Merger (including as a result of perfecting his dissenters' rights
under the DGCL) will recognize gain or loss for federal income tax purposes
equal to the difference, if any, between the amount of cash received and the
stockholder's tax basis in the Shares sold. Gain or loss will be determined
separately for each block of Shares (i.e., Shares acquired at the same time and
price) exchanged pursuant to the Offer or the Merger. Such gain or loss
generally will be capital gain or loss if the Shares disposed of were held as
capital assets by the stockholder, and will be long-term capital gain or loss if
the Shares disposed of were held for more than one year at the date of sale or
the Expiration Date, as the case may be.
Under present law, the maximum long-term capital gain tax rate for
individuals is 28%. The maximum marginal ordinary income tax rate for
individuals is 39.6%. Individuals may deduct capital losses against capital
gains and against up to $3,000 of ordinary income annually. Unused capital
losses may be carried forward indefinitely. Currently, the maximum long-term
capital gain tax rate for corporations is 35%. For corporations, capital losses
may be deducted only against capital gains. For corporations unused capital
losses may be carried back three years and carried forward for five years.
The foregoing summary constitutes a general description of certain U.S.
federal income tax consequences of the Offer and the Merger without regard to
the particular facts and circumstances of each stockholder of the Company and is
based on the provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), Treasury Department Regulations issued pursuant thereto and published
rulings and court decisions in effect as of the date hereof, all of which are
subject to change, possibly with retroactive effect. Special tax consequences
not described herein may be applicable to certain stockholders subject to
special tax treatment (including insurance companies, tax-exempt organizations,
financial institutions or broker dealers, foreign stockholders and stockholders
who have acquired their Shares pursuant to the exercise of employee stock
options or otherwise as compensation). ALL STOCKHOLDERS SHOULD CONSULT THEIR TAX
ADVISORS WITH RESPECT TO SPECIFIC TAX EFFECTS APPLICABLE TO THEM OF THE OFFER
AND THE MERGER, INCLUDING THE APPLICABILITY AND EFFECT OF THE ALTERNATIVE
MINIMUM TAX AND ANY STATE, LOCAL AND FOREIGN TAX LAWS.
6. PRICE RANGE OF THE SHARES; DIVIDENDS ON THE SHARES.
The Shares are traded on the NYSE and the Pacific Stock Exchange (the
"PSE") under the symbol "MX". The following table sets forth, for each of the
periods indicated, the high and low reported sale price per Share as reported by
the NYSE and the Dow Xxxxx News Retrieval Service.
SALES PRICE
---------------------
FISCAL YEAR HIGH LOW
----------- ---- ---
1995
First Quarter.......................................... $24 1/4 $20 3/8
Second Quarter......................................... 27 3/4 22 3/8
Third Quarter.......................................... 33 1/8 25 1/2
Fourth Quarter......................................... 35 3/4 27 1/8
1996
First Quarter.......................................... $30 3/4 $25 5/8
Second Quarter......................................... 29 5/8 25 3/4
Third Quarter.......................................... 29 3/4 25 7/8
Fourth Quarter......................................... 27 5/8 23 3/8
1997
First Quarter (through January 30)..................... $34 7/8 $23 7/8
On January 24, 1997, the last full trading day prior to the first public
announcement of the intention to commence the Offer, the last reported sale
price of the Shares on the NYSE was $24 1/4 per Share. On
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January 27, 1997, prior to the commencement of trading, Honeywell announced the
intention to commence the Offer. On January 30, 1997, which was the last full
trading day prior to the commencement of the Offer, the last reported sale price
of the Shares on the NYSE was $34 1/2 per Share. STOCKHOLDERS ARE URGED TO
OBTAIN A CURRENT MARKET QUOTATION FOR THE SHARES.
The Company has advised the Purchaser that the Company paid dividends of
$.44 per Share in each of fiscal 1995 and 1996.
7. EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES; STOCK LISTING; EXCHANGE
ACT REGISTRATION; MARGIN REGULATIONS.
Market for the Shares. The purchase of Shares pursuant to the Offer will
reduce the number of holders of Shares and the number of Shares that might
otherwise trade publicly and, depending upon the number of Shares so purchased,
could adversely effect the liquidity and market value of the remaining Shares
held by the public.
Stock Listing. Depending upon the number of Shares purchased pursuant to
the Offer, the Shares may no longer meet the requirements of the NYSE and the
PSE for continued listing. According to the NYSE's published guidelines, the
NYSE could consider delisting the Shares if, among other things, the number of
holders of at least 100 Shares were to fall below 1,200, the number of publicly
held Shares (exclusive of management or other concentrated holdings) were to
fall below 600,000 or the aggregate market value of publicly held Shares were to
not exceed $5.0 million. According to the PSE's published guidelines, the PSE
could consider delisting the Shares if, among other things, there were fewer
than 100,000 publicly held Shares exclusive of management and other concentrated
holdings, there were fewer than 500 record holders, there were fewer than 200
holders of record of at least 100 Shares or the aggregate market value of
publicly held Shares (exclusive of management and other concentrated holdings)
should fall below $500,000 for a six month period. According to the Company's
Annual Report on Form 10-K for the fiscal year ended December 3, 1995 (the
"Company 1995 10-K"), as of December 3, 1995, there were approximately 1,223
holders of record of Shares. As of January 26, 1997, there were 16,150,375
Shares outstanding. If, as a result of the purchase of Shares pursuant to the
Offer or otherwise, the Company does not meet the requirements for continued
listing on the NYSE or on the PSE and the Shares are no longer included on the
NYSE or the PSE, as the case may be, the market for Shares could be adversely
affected.
In the event that the Company at any time does not meet the requirements
for continued listing on the NYSE or the PSE, it is possible that the Shares
would continue to trade in the over-the-counter market and that price quotations
would be reported by other sources. The extent of the public market for the
Shares and the availability of such quotations would, however, depend upon the
number of holders of Shares remaining at such time, the interest in maintaining
a market in Shares on the part of securities firms, the possible termination of
registration of the Shares under the Exchange Act, as described below, and other
factors.
Margin Regulations. The Shares are presently "margin securities" under the
regulations of the Board of Governors of the Federal Reserve System (the
"Federal Reserve Board"), which status has the effect, among other things, of
allowing brokers to extend credit on the collateral of such securities.
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.
Exchange Act Registration. The Shares currently are registered under the
Exchange Act. Registration of the Shares 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 of the Shares 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, such as the short-swing profit recovery
provisions of Section 16(b), the requirement of furnishing a proxy statement
pursuant to Section 14(a) in connection with stockholders' meetings and 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, no longer applicable to the
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Company. Furthermore, the ability of "affiliates" of the Company and persons
holding "restricted securities" of the Company to dispose of such securities
pursuant to Rule 144 or Rule 144A promulgated under the Securities Act of 1933,
as amended (the "Securities Act"), may be impaired or eliminated. If
registration of the Shares under the Exchange Act were terminated, the Shares
would no longer be "margin securities" or be eligible for continued listing on
the NYSE or the PSE. The Purchaser intends to seek to cause the Company to apply
for termination of registration of the Shares under the Exchange Act as soon
after the completion 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.
8. CERTAIN INFORMATION CONCERNING THE COMPANY.
The Company is a Delaware corporation with its principal executive offices
at Xxx Xxxxxxx Xxx, Xxxxxxxxx, Xxxxxxxxxx 00000. The telephone number of the
Company at such offices is (000) 000-0000. According to the Company 1995 10-K,
the Company designs, manufactures and services computer-integrated measurement,
control and information systems.
SELECTED FINANCIAL INFORMATION
Set forth below is certain selected consolidated financial information with
respect to the Company, excerpted or derived from the Company's 1995 Annual
Report to Stockholders and its Quarterly Report on Form 10-Q for the quarter
ended September 1, 1996, both filed with the Commission pursuant to the Exchange
Act.
More comprehensive financial information is included in such reports and in
other documents filed by the Company with the Commission. The following summary
is qualified in its entirety by reference to such reports and other documents
and all of the financial information (including any related notes) contained
therein. Such reports and other documents may be inspected and copies may be
obtained from the Commission in the manner set forth below.
MEASUREX CORPORATION
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
NINE MONTHS ENDED FISCAL YEARS ENDED
---------------------------- -------------------------------------------
SEPTEMBER 1, SEPTEMBER 3, DECEMBER 3, NOVEMBER 27, NOVEMBER 28,
1996 1995 1995 1994 1993
------------ ------------ ----------- ------------ ------------
OPERATING DATA:
Net sales..................... $295,745 $242,065 $335,216 $259,979 $253,997
Operating income.............. 39,483 23,160 36,687 4,800 7,500
Net income.................... 26,727 17,190 26,946 6,107 8,215
Net income per share.......... $ 1.63 $ 1.01 $ 1.60 $ .34 $ .46
BALANCE SHEET DATA (AT END OF
PERIOD):
Working capital............... $ 89,877 $ 82,971 $ 89,303 $123,536 $137,720
Total assets.................. 329,020 295,282 286,705 319,823 318,316
Total liabilities............. 135,409 139,755 120,660 102,640 106,452
Stockholders' equity.......... 193,611 155,527 166,045 217,183 211,864
On December 18, 1996, the Company reported that for the fiscal year ended
December 1, 1996, revenues were $415,975,000, net income was $36,953,000 and net
income per share was $2.25.
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Certain Estimates Prepared by the Company. During the course of the
discussions between Honeywell and the Company that led to the execution of the
Merger Agreement, the Company provided Honeywell with certain information about
the Company which is not publicly available. The information provided included
financial forecasts which contain, among other things, the summary financial
information set forth below.
The Company does not, as a matter of course, publicly disclose
forward-looking information (such as the preliminary unaudited financial results
and financial forecasts referred to above) as to future revenues, earnings or
other financial information. Such forward-looking information was prepared by
the Company solely for internal use and not for publication or with a view to
complying with the published guidelines of the Commission regarding projections
or with the American Institute of Certified Public Accountants Guide for
Prospective Financial Statements and are included in this Offer to Purchase only
because they were furnished to Honeywell. The preliminary unaudited financial
results and financial forecasts necessarily make numerous assumptions with
respect to industry performance, general business and economic conditions,
access to markets and distribution channels, availability and pricing of raw
materials, foreign currency rates and other matters, all of which are inherently
subject to significant uncertainties and contingencies and many of which are
beyond the Company's control. One cannot predict whether the assumptions made in
preparing the preliminary unaudited financial results and financial forecasts
will be accurate, and actual results may be materially higher or lower than
those contained in the preliminary results or forecasts. THE INCLUSION OF THIS
FORWARD-LOOKING INFORMATION SHOULD NOT BE REGARDED AS FACT OR AN INDICATION THAT
HONEYWELL, THE PURCHASER, THE COMPANY OR ANYONE WHO RECEIVED THIS INFORMATION
CONSIDERED IT A RELIABLE PREDICTOR OF FUTURE RESULTS, AND THIS INFORMATION
SHOULD NOT BE RELIED ON AS SUCH. NONE OF HONEYWELL, THE PURCHASER OR THE COMPANY
ASSUMES ANY RESPONSIBILITY FOR THE VALIDITY, REASONABLENESS, ACCURACY OR
COMPLETENESS OF THE FORECASTS AND THE COMPANY HAS MADE NO REPRESENTATION TO
HONEYWELL OR THE PURCHASER REGARDING THE FORECASTS.
MEASUREX CORPORATION
SELECTED ESTIMATED CONSOLIDATED FINANCIAL INFORMATION
(PREPARED BY MEASUREX CORPORATION)
(DOLLARS IN MILLIONS)
FISCAL FISCAL FISCAL
1997 (ESTIMATED) 1998 (ESTIMATED) 1999 (ESTIMATED)
---------------- ---------------- ----------------
Revenues.................................... $450.0 $505.0 $572.0
Operating profit............................ 61.2 80.3 100.6
The Company is subject to the informational filing requirements of the
Exchange Act and, in accordance therewith, is obligated to file reports, proxy
statements and other information with the Commission relating to its business,
financial condition and other matters. Information as of particular dates
concerning the Company's directors and officers, their remuneration, options
granted to them, the principal holders of the Company's securities and any
material interests of such persons in transactions with the Company is required
to be disclosed in proxy statements distributed to the Company's stockholders
and filed with the Commission. Such reports, proxy statements and other
information should be available for inspection at the public reference
facilities of the Commission at 000 Xxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000,
and at the regional offices of the Commission located at Seven World Trade
Center, 13th Floor, New York, NY 10048 and Citicorp Center, 000 Xxxx Xxxxxxx
Xxxxxx (Xxxxx 0000), Xxxxxxx, XX 00000. Copies of such information should be
obtainable by mail, upon payment of the Commission's customary charges, by
writing to the Commission's principal office at 000 Xxxxx Xxxxxx, X.X.,
Xxxxxxxxxx, X.X. 00000. Such material should also be available for inspection at
the offices of the New York Stock Exchange, Inc., 00 Xxxxx Xxxxxx, Xxx Xxxx, XX
00000.
Except as otherwise stated in this Offer to Purchase, the information
concerning the Company contained herein has been taken from or based upon
publicly available documents on file with the Commission and other publicly
available information. Although neither the Purchaser nor Honeywell has any
knowledge that any information acquired from publicly available documents or
directly from the Company is untrue, neither the Purchaser nor Honeywell takes
any responsibility for the accuracy or completeness of such information or for
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any failure by the Company to disclose events that may have occurred and may
affect the significance or accuracy of any such information but which are
unknown to the Purchaser and Honeywell.
9. CERTAIN INFORMATION CONCERNING HONEYWELL AND THE PURCHASER.
The Purchaser, a Delaware corporation, which is a wholly owned subsidiary
of Honeywell, was organized to acquire the Company and has conducted no
activities unrelated to such purpose since its organization. All of the issued
and outstanding shares of capital stock of the Purchaser are beneficially owned
by Honeywell. The principal executive offices of the Purchaser are located at
the principal executive offices of Honeywell. The telephone number of the
Purchaser at such offices is (000) 000-0000.
Honeywell is a Delaware corporation organized in 1927. Honeywell is a
Minneapolis-based international controls corporation that supplies automation
and control systems, components, software, products and services for homes and
buildings, industry, and space and aviation. The purpose of the Company is to
develop and apply advanced-technology products, systems and services to conserve
energy, improve productivity, protect the environment, enhance comfort and
increase safety. Development and modification occur continuously in Honeywell's
business as new or improved products and services are introduced, new markets
are created or entered, distribution methods are revised, and products and
services are discontinued. The principal executive offices of Honeywell are
located at 0000 0xx Xxxxxx Xxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000. Its telephone
number at such address is (000) 000-0000.
Selected Financial Information. Set forth below is certain selected
consolidated financial information with respect to Honeywell for the nine month
periods ended September 29, 1996 and October 1, 1995 and the fiscal years ended
December 31, 1995, 1994, and 1993. Such financial information has been taken
from the periodic reports and other documents filed by Honeywell with the
Commission. More comprehensive information concerning Honeywell is included in
such reports and other documents and the financial information that follows is
qualified in its entirety by reference to such reports and other documents and
all of the financial information and notes contained therein. Such reports and
other documents may be inspected and copies may be obtained from the Commission
in the manner set forth below.
HONEYWELL INC.
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
NINE MONTHS ENDED FISCAL YEARS ENDED DECEMBER 31,
------------------------------------ ---------------------------------
SEPTEMBER 29, 1996 OCTOBER 1, 1995 1995 1994 1993
------------------ --------------- --------- --------- ---------
SUMMARY OF EARNINGS DATA:
Sales........................... $5,194.2 $4,814.6 $6,731.3 $6,057.0 $5,963.0
Income before income taxes...... 378.0 314.9 505.5 369.7 478.5
Net income...................... 249.5 207.8 333.6 278.9 322.2
Earnings per common share....... $ 1.97 $ 1.63 $ 2.62 $ 2.15 $ 2.40
BALANCE SHEET DATA (AT END OF
PERIOD):
Working capital................. $ 751.6 $ 739.1 $ 744.4 $ 577.6 $ 694.1
Total assets.................... 5,389.0 5,014.1 5,060.2 4,885.9 4,598.1
Total liabilities............... 3,304.0 2,997.5 3,020.1 3,031.2 2,825.1
Stockholders' equity............ 2,085.0 2,016.6 2,040.1 1,854.7 1,773.0
On January 16, 1997, Honeywell reported that for the fiscal year ended
December 31, 1996, sales were $7.3 billion, income before income taxes was
$610.2 million and net income was $402.7 million, or $3.18 per common share.
The name, citizenship, business address, present principal occupation or
employment and five-year employment history of each of the directors and
executive officers of the Purchaser and Honeywell are set forth in Schedule I
hereto.
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Except as set forth in this Offer to Purchase, neither the Purchaser nor
any of its affiliates nor, to the best of their knowledge, any of the persons
listed on Schedule 1, nor any associate or majority owned subsidiary of any of
the foregoing, beneficially owns or has a right to acquire any Shares, and
neither the Purchaser nor any of its affiliates nor, to the best of their
knowledge, any of the persons or entities referred to above, nor any of the
respective executive officers, directors or subsidiaries of any of the
foregoing, has effected any transactions in Shares during the past 60 days.
Except as set forth in this Offer to Purchase, neither the Purchaser,
Honeywell, any of their respective affiliates nor, to the best of their
knowledge, any of the persons listed on Schedule 1, has any contract,
arrangement, understanding or relationship with any other person with respect to
any securities of the Company, including, but not limited to, any contract,
arrangement, understanding or relationship concerning the transfer or the voting
of any securities of the Company, joint ventures, loan or option arrangements,
puts or calls, guarantees of loans, guarantees against loss, or the giving or
withholding of proxies. Except as set forth in this Offer to Purchase, neither
the Purchaser, Honeywell, any of their respective affiliates, nor, to the best
of their knowledge, any of the persons listed on Schedule 1, has had, since
November 29, 1993, any business relationships or transactions with the Company
or any of its executive officers, directors or affiliates that would require
reporting under the rules of the Commission. Except as set forth in this Offer
to Purchase, since November 29, 1993, there have been no contacts, negotiations
or transactions between the Purchaser, Honeywell, any of their respective
affiliates or, to the best of their knowledge, any of the persons listed on
Schedule 1, and the Company or its affiliates concerning a merger, consolidation
or acquisition, tender offer or other acquisition of securities, election of
directors or a sale or other transfer of a material amount of assets.
Honeywell is subject to the informational filing requirements of the
Exchange Act and, in accordance therewith, is obligated to file reports, proxy
statements and other information with the Commission relating to its business,
financial condition and other matters. Information as of particular dates
concerning Honeywell's directors and officers, their remuneration, options
granted to them, the principal holders of Honeywell's securities and any
material interests of such persons in transactions with Honeywell is required to
be disclosed in proxy statements distributed to Honeywell's stockholders and
filed with the Commission. Such reports, proxy statements and other information
should be available for inspection from the offices of the Commission in the
same manner as set forth with respect to information concerning the Company in
Section 8. Such material should also be available for inspection at the offices
of the New York Stock Exchange, Inc., 00 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000.
10. SOURCE AND AMOUNT OF FUNDS.
The total amount of funds required to purchase all of the Shares pursuant
to the Offer and to pay related fees and expenses is estimated to be
approximately $625.0 million. The Purchaser will obtain such funds from
Honeywell by means of capital contributions, loans or a combination thereof.
Honeywell will obtain all the funds required in connection with the Offer from
cash and investments on hand, borrowings under its various lines of credit
and/or the private placement of notes.
Honeywell has established lines of credit with The Chase Manhattan Bank and
Xxxxxx Guaranty Trust Company of New York, under which it may borrow up to
$650.0 million in the aggregate to finance the Purchaser's acquisition of the
Shares, or for general corporate purposes. Such borrowings are available to
Honeywell pursuant to a Revolving Credit Agreement (the "Credit Agreement")
between Honeywell and each of the banks (each a "Bank" and collectively the
"Banks"). All capitalized terms which are used in this Section 10 and not
otherwise defined shall have the meanings ascribed to them in the Credit
Agreement.
Loans pursuant to the Credit Agreement bear interest during any particular
interest period, at the election of Honeywell, at either (i) a floating Base
Rate or (ii) such rate as may be mutually agreed upon by the Bank and Honeywell.
The Base Rate on a given day means the higher of (a) the Federal Funds Rate on
such day plus 0.5% or (b) the Prime Rate on such day. The Prime Rate means the
prime rate of interest announced publicly from time to time by the Banks'
principal offices as the "prime commercial lending rate" of such Banks.
Honeywell may also elect to draw Eurocurrency Loans under the Credit Agreements.
The rate of interest for such loans is based on the annual interest rate quoted
by the Banks' offices for offerings in the
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currency of such loan based on deposits with major banks in the London or other
relevant interbank market, plus from 0.145% to 0.3625%, depending upon the
then-current rating (the "Rating") of Honeywell's public debt securities by
Standard & Poor's Rating Services or Xxxxx'x Investors Service, Inc.
Honeywell is required to pay an annual facility fee of 0.04% per annum on
the average daily amount of the Commitment outstanding.
The Credit Agreement incorporates certain provisions of other existing,
substantially similar, Revolving Credit Agreements entered into between
Honeywell and each of the Banks (collectively the "Existing Agreements") and
restricts Honeywell from pledging or creating any mortgage upon certain
Restricted Assets (as defined therein) for the purpose of securing other
creditors, unless provision is made to secure all amounts owed under the Credit
Agreement equally and ratably with such pledge or mortgage.
The foregoing description is qualified in its entirety by reference to the
Credit Agreement and the form of Existing Agreements which are incorporated
herein by reference and copies of which have been filed with the Commission as
an exhibit to the Purchaser's Tender Offer Statement on Schedule 14D-1 (the
"Schedule 14D-1"). The Credit Agreement and the form of Existing Agreements may
be examined and copies may be obtained at the place and in the manner set forth
in Section 9 of this Offer to Purchase.
It is anticipated that borrowings incurred by Honeywell in connection with
the Offer will be repaid from internally generated funds of Honeywell and the
Company and/or refinanced in the private or public markets.
11. BACKGROUND OF THE OFFER; THE MERGER AGREEMENT AND CERTAIN OTHER AGREEMENTS
The following description was prepared by Honeywell and the Company.
Information about the Company was provided by the Company and neither the
Purchaser nor Honeywell takes any responsibility for the accuracy or
completeness of any information regarding meetings or discussions in which
Purchaser, Honeywell or their representatives did not participate.
Background of the Offer
Before and during February 1996, members of the Company's senior
management, including Xxxxx X. Xxxxxx, Chairman of the Board and Chief Executive
Officer, and Xxxxxx XxXxxxx, Xx., Executive Vice President and Chief Financial
Officer, interviewed various investment banking firms with respect to an
engagement to provide financial advice to the Company concerning its long-term
strategic direction and to potentially assist the Company in identifying an
acquiror of all or a portion of the Company's business. One of the objectives in
seeking an affiliation with another Company was to acquire or otherwise gain
access to a next generation Distributed Control System ("DCS"). In February
1996, the Company engaged Xxxxxxx, Xxxxx & Co. ("Xxxxxxx Xxxxx") to serve in
this capacity and Xxxxxxx Xxxxx assisted the Company in the preparation of a
Confidential Memorandum (the "Memorandum") regarding the Company and its
business.
In March 1996, Xxxxxxx Xxxxx, on behalf of the Company, contacted several
companies regarding a potential strategic relationship with the Company,
including Honeywell. In addition, Xx. Xxxxxx contacted one company regarding a
potential strategic relationship with the Company. Based on Honeywell's
expression of interest, Honeywell executed and delivered a Confidential
Nondisclosure Agreement to the Company, and in April 1996 Xxxxxxx Xxxxx provided
a copy of the Memorandum to Honeywell.
In March and April 1996, Xxxxxxx Xxxxx, on behalf of the Company, also
provided a copy of the Memorandum to selected other companies.
On April 22, 1996 Messrs. Xxxxxx and XxXxxxx met with Xxxxxxx Xxxxxxxxxx,
Chairman and Chief Executive Officer, and Xxxxxxxx Xxxxxxxxxxxx, Vice
President-Business Development, of Honeywell in Minneapolis, Minnesota. The
Company representatives made a presentation regarding the Company, its
historical results of operations and current financial condition, its products
and services, the markets it addresses, and the outlook for these markets.
On May 1, 1996, Messrs. Xxxxxx and XxXxxxx, together with Xxxxx X.
Xxxxxxxx, Executive Vice President and President, Industrial Systems Division,
of the Company and a representative of Xxxxxxx Xxxxx
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met in Phoenix, Arizona with Messrs. Xxxxxxxxxx and Xxxxxxxxxxxx, as well as
Xxxxxx X. Xxxxxxxxxx, President of Honeywell's Industrial Automation and Control
division, Xxxxx Xxxxxx, Vice President-Business Development for the Industrial
Automation and Control division of Honeywell, and Xxxxxxx X. Xxxxxx, Vice
President and Chief Financial Officer of Honeywell. The parties discussed the
possibility of combining the companies and developed a plan for investigating
the feasibility of such a transaction, conducting due diligence reviews of the
Company and, if appropriate, negotiating the terms of an agreement between the
parties.
From May 15, 1996 through May 22, 1996, several representatives of
Honeywell conducted a due diligence review of the Company in Cupertino,
California. These representatives included, among others, Xx. Xxxxxxxxxxxx and
Xx. Xxxxxx, as well as several other representatives of Honeywell, and, for a
portion of the meetings, Xxxxxx X. Xxxxxxx, Managing Director of Bear, Xxxxxxx &
Co. Inc. ("Bear Xxxxxxx"), an investment banking firm engaged by Honeywell.
These representatives received a tour of the Company's headquarters facility and
manufacturing plant in Cupertino, California and met at length with Xx. XxXxxxx
and, to a lesser extent, with Messrs. Xxxxxx and Xxxxxxxx concerning the
Company's historical and projected financial data. Certain of these meetings
also included a representative of Xxxxxxx, Xxxxx. They also reviewed numerous
documents concerning the Company's business, financial results and financial
outlook, as well as the Company's standard operating policies and procedures,
worldwide organizational information, and related data.
On May 23, 1996, Honeywell's representatives visited the Company's offices
and manufacturing facility in Vancouver, British Columbia and met with Xx.
XxXxxxx and Xxxxxx Xxxxxx, then the Vice President and General Manager of the
Company's Measurex Xxxxxx subsidiary. They reviewed the nature and financial
performance of the Measurex Xxxxxx business.
The purposes of the meetings in May 1996 were to provide Honeywell with an
understanding of the Company's historical and projected financial results of
operations, develop an analysis of the profit and loss position of each of the
businesses operated by the Company, and provide Honeywell with the information
necessary for Honeywell to determine how the companies could most appropriately
be combined and what operating synergies would result from such a combination.
On June 19, 1996, Messrs. XxXxxxx and Xxxxxxxx, together with Xxxx X.
Xxxxxxxxx, President and Chief Operating Officer of the Company, met in Phoenix,
Arizona with, among others, Xx. Xxxxxx, Xx. Xxxxxxxxxx, Xxxxxx Xxxx, Vice
President and General Manager of Honeywell's Worldwide Pulp and Paper business,
and other Honeywell employees. At this meeting, Honeywell delivered a
presentation concerning their organization and the possible structure of a
combination of the Company with the relevant portions of Honeywell's business.
The participants engaged in a detailed discussion of the marketing, sales and
other technical issues surrounding such a combination and exchanged ideas
concerning the operational issues involved in effecting a successful
transaction.
In late June, Xx. Xxxxxxxxxx contacted Xx. Xxxxxx and indicated that on the
basis of developments to date Honeywell would like to move forward and he also
indicated a preliminary range of values placed on the Company by Honeywell. Xx.
Xxxxxx said this range was below his expectations, but the parties agreed to
meet again in July.
On July 10, 1996, Messrs. Xxxxxxxxxxxx and Xxxxxxxxxx, together with a Bear
Xxxxxxx representative, met with Messrs. Xxxxxx and XxXxxxx, together with a
representative of Xxxxxxx Xxxxx, to present Honeywell's current views concerning
a possible acquisition of the Company. Honeywell presented its reasons for its
preliminary valuation of the Company at that time, as discussed by Xx.
Xxxxxxxxxx and Xx. Xxxxxx in late June.
During this period the Company met with representatives of another party
that had expressed an interest in conducting a review of the Company's business.
The meetings with the other party and information provided to that party were
generally similar to the meetings with Honeywell and the information provided to
Honeywell, as described above.
Following the foregoing meetings, the Company's senior executive officers
met to review the status of the discussions with and preliminary valuation
ranges from Honeywell and the other party with which the
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Company had held discussions and concluded that, given the Company's prospects
at that time and the outlook for its financial performance as an independent
entity, the Company should not pursue further discussions with either Honeywell
or the other party at that time.
As indicated above, for a number of years management of the Company had
attempted to acquire a next generation DCS product line through either a product
or corporate acquisition. Over the balance of fiscal 1996 and specifically in
management meetings conducted in October and November 1996, the Company's senior
executive officers reviewed the Company's long-term prospects and business
strategies. Senior management considered the importance to the Company's
long-term prospects of having a next generation DCS product and the difficulties
encountered in identifying and acquiring such a product, and the outlook for the
Company's financial performance over the next several years. The Company
management also discussed the importance of having a DCS product with its Board
of Directors at a meeting in October 1996. Senior management and the Board
concluded that the foregoing issues represented significant challenges to be
addressed.
On December 6, 1996, Xx. Xxxxxxxxxx contacted Xx. Xxxxxx to propose that
the companies reconsider a possible combination. They discussed a possible
meeting in January 1997.
On January 6, 1997, an officer of the other party with which the Company
had prior discussions called Xx. XxXxxxx to ask about circumstances regarding
the Company. Xx. XxXxxxx indicated that another company had expressed interest
in the Company and that the Company was pursuing discussions with such company.
The officer of the other party indicated an interest in pursuing additional
discussions with the Company.
On January 7, 1997, Messrs. Xxxxxxxxxx, Xxxxxxxxxxxx, Tambakeras and Xxxxxx
met with Messrs. Xxxxxx, Gingerich, Xxxxxxxx and XxXxxxx to update each other on
their respective businesses since they last met. Messrs. Xxxxxx and Xxxxxxxxxx
also met privately. At their meeting, Xx. Xxxxxxxxxx suggested that the parties
consider a transaction valuing the Company Common Stock at a range of up to
$35.00 per Share, subject to the completion of due diligence by Honeywell, which
he believed might be structured as a stock-for-stock, pooling-of-interests
transaction. Xx. Xxxxxx indicated that he would call Xx. Xxxxxxxxxx later in the
week.
On January 10, 1997, Xx. Xxxxxx telephoned Xx. Xxxxxxxxxx and advised him
that, if Honeywell was prepared to make a firm offer at $35.00 per Share, Xx.
Xxxxxx would discuss such an offer with the Company's Board of Directors.
From January 14, 1997 through January 17, 1997, several representatives of
Honeywell, together with Xx. Xxxxxxx of Bear Xxxxxxx and representatives of
Deloitte & Touche, Honeywell's independent public accounting firm, met with
representatives of the Company's senior management to obtain an update on due
diligence matters, recent financial results and updated financial projections.
They also discussed possible business integration plans.
On January 17, Xx. Xxxxxxxxxx called Xx. Xxxxxx and said he was considering
the idea of structuring a potential transaction as a cash tender offer at a
range of up to $35.00 per Share.
During the period from January 13 through January 18, 1997, representatives
of the party conducting the discussions with the Company met with officers of
the Company and visited Company facilities for the purpose of updating such
party's previous investigations of the Company.
On January 15, 1997, Xx. XxXxxxx spoke to a representative of the other
party who indicated possible interest at a price per Share slightly lower than
the high end of the range proposed by Honeywell. Thereafter, a representative of
Xxxxxxx Xxxxx spoke to a representative of the party who confirmed that the
party would not consider increasing the price previously issued with Xx.
XxXxxxx.
On January 20, 1997, the Board of Directors of the Company held a telephone
meeting. The directors reviewed the history of the discussions to date with
Honeywell and other parties and discussed in detail preliminary value
indications for the Company, including the indication received from Xx.
Xxxxxxxxxx. The
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Company's Board of Directors authorized management to continue discussions with
Honeywell, subject to the further approval of the Board of Directors.
On January 21, 1997, Xx. Xxxxxxxxxx called Xx. Xxxxxx and indicated that
Honeywell's Board had met earlier in the day and was interested in moving
forward on an all cash transaction at $35.00 per Share. Xx. Xxxxxxxxxx suggested
that representatives of the parties meet to negotiate terms of a definitive
agreement, indicated that he had scheduled a Honeywell Board of Directors
meeting for January 26, 1997 and proposed that Xx. Xxxxxx schedule a Board of
Directors meeting for the same day.
Later in the day on January 21, 1997, counsel for Honeywell delivered to
counsel for the Company a draft of the Merger Agreement and on January 22, 1997
and January 23, 1997 counsel for Honeywell, together with Xx. Xxxxxxx of Bear
Xxxxxxx, met with counsel for the Company to negotiate the terms of the Merger
Agreement and such negotiations continued through January 26, 1997.
On January 23, 1997, the Company's Board of Directors held a telephonic
meeting to discuss the status of negotiations with Honeywell and issues related
to the terms of a definitive agreement. In addition, representatives of Xxxxxxx
Xxxxx made a preliminary presentation to the directors regarding their analysis
of the proposed transaction.
On January 26, 1997, the Company's Board of Directors held a meeting at the
Company's headquarters in Cupertino, California to consider and approve the
Merger Agreement and the related transactions.
Also, on January 26, 1997, the Board of Directors of Honeywell held a
telephonic meeting to consider the proposed terms of the definitive agreement,
including the Offer and the Merger. At the meeting, the Board of Directors of
Honeywell approved the Merger Agreement and the transactions contemplated
thereby. Following the approval of the respective Boards of Directors,
Honeywell, the Purchaser and the Company executed the Merger Agreement.
MERGER AGREEMENT
The following is a summary of certain provisions 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 filed
with the Commission as an exhibit to the Schedule 14D-1. The Merger Agreement
may be examined and copies may be obtained at the places and in the manner set
forth in Section 9 of this Offer to Purchase.
The Offer. The Merger Agreement provides that the Purchaser will commence
the Offer and that, upon the terms and subject to prior satisfaction or waiver
of the conditions of the Offer, the Purchaser will purchase all Shares validly
tendered pursuant to the Offer. The Merger Agreement provides that, without the
written consent of the Company, the Purchaser will not decrease the Offer Price,
decrease the number of Shares sought in the Offer, amend or waive the Minimum
Condition, or amend any condition of the Offer in a manner adverse to the
holders of Shares, except that if on the initial scheduled expiration date of
the Offer, the sole condition remaining unsatisfied is the failure of the
waiting period under the HSR Act to have expired or been terminated, the
Purchaser shall extend the termination date from time to time until two business
days after the expiration of the waiting period under the HSR Act. The Merger
Agreement provides that if, immediately prior to the expiration date of the
Offer, as it may be extended, the Shares tendered and not withdrawn pursuant to
the Offer equal less than 90% of the Shares outstanding, the Purchaser may
extend the Offer for a period not to exceed 20 business days.
The Merger. Following the consummation of the Offer, the Merger Agreement
provides that, subject to the terms and conditions thereof, and in accordance
with Delaware law, at the Effective Time, the Purchaser will be merged with and
into the Company. As a result of the Merger, the separate corporate existence of
the Purchaser will cease and the Company will continue as the surviving
corporation (the "Surviving Corporation").
The respective obligations of Honeywell and the Purchaser, on the one hand,
and the Company, on the other hand, to effect the Merger are subject to the
satisfaction on or prior to the Closing Date (as defined in
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the Merger Agreement) of each of the following conditions, any and all of which
may be waived in whole or in part, to the extent permitted by applicable law:
(i) the Merger Agreement shall have been approved and adopted by the requisite
vote of the holders of Shares, if required by applicable law, in order to
consummate the Merger; (ii) no law, statute, rule, order, decree or regulation
shall have been enacted or promulgated by any government or any governmental
agency or authority of competent jurisdiction which declares the Merger
Agreement invalid or unenforceable in any material respect or which prohibits
the consummation of the Merger, and all governmental consents, orders and
approvals required for the consummation of the Merger and the transactions
contemplated by the Merger Agreement shall have been obtained and shall be in
effect at the Effective Time; (iii) Honeywell, the Purchaser or their affiliates
shall have purchased Shares pursuant to the Offer, unless such failure to
purchase is as a result of a breach of Honeywell's and the Purchaser's
obligations under the Merger Agreement; and (iv) the applicable waiting period
under the HSR Act shall have expired or been terminated.
At the Effective Time of the Merger (i) each issued and outstanding Share
(other than Shares that are owned by the Company as treasury stock, any Shares
owned by Honeywell, the Purchaser or any other wholly owned subsidiary of
Honeywell, or any Shares which are held by stockholders exercising appraisal
rights under Delaware law) will be converted into the right to receive the price
per share paid pursuant to the Offer (the "Merger Consideration") and (ii) each
issued and outstanding share of the Purchaser will be converted into one share
of common stock of the Surviving Corporation.
The Company's Board of Directors. The Merger Agreement provides that
promptly after the purchase by Honeywell of at least a majority of the
outstanding Shares (on a fully diluted basis), Honeywell will be entitled to
designate such number of directors, rounded up to the next whole number, on the
Company's Board as is equal to the product of the total number of directors on
the Company Board multiplied by the percentage that the number of Shares so
accepted for payment bears to the total number of Shares then outstanding. The
Company will, upon request of the Purchaser, use its best reasonable efforts
promptly to either increase the size of the Company's Board or secure the
resignations of such number of its incumbent directors, or both, as is necessary
to enable Honeywell's designees to be elected to the Company's Board. In the
event that Honeywell's designees are elected to the Company's Board, until the
Effective Time, the Company's Board will have at least two directors who are
directors on the date of the Merger Agreement and who would constitute
Continuing Directors for purposes of Article Twelfth of the Company's
Certificate of Incorporation. The Company's obligation to appoint the
Purchaser's designees to the Board of Directors is subject to compliance with
Section 14(f) of the Exchange Act and Rule 14f-1 promulgated thereunder.
Stockholders Meeting. Pursuant to the Merger Agreement, the Company will,
if required by applicable law in order to consummate the Merger, duly call, give
notice of, convene and hold a special meeting of its stockholders (the "Special
Meeting") as promptly as practicable following the acceptance for payment and
purchase of Shares by the Purchaser pursuant to the Offer for the purpose of
considering and taking action upon the Merger and the adoption of the Merger
Agreement. The Merger Agreement provides that the Company will, if required by
applicable law in order to consummate the Merger, prepare and file with the
Commission a preliminary proxy or information statement (the "Proxy Statement")
relating to the Merger and the Merger Agreement and use its best efforts (i) to
obtain and furnish the information required to be included by the Commission in
the Proxy Statement and, after consultation with Honeywell, to respond promptly
to any comments made by the Commission with respect to the preliminary Proxy
Statement and cause a definitive Proxy Statement to be mailed to its
stockholders, provided that no amendment or supplement to the Proxy Statement
will be made by the Company without consultation with Honeywell and its counsel
and (ii) to obtain the necessary approvals of the Merger and the Merger
Agreement by its stockholders. If the Purchaser acquires at least a majority of
the outstanding Shares, the Purchaser will have sufficient voting power to
approve the Merger, even if no other stockholder votes in favor of the Merger.
The Company has agreed to include in the Proxy Statement the recommendation of
the Company Board that stockholders of the Company vote in favor of the approval
of the Merger and the adoption of the Merger Agreement. Honeywell has agreed
that it will vote, or cause to be voted, all of the Shares then owned by it, the
Purchaser or any of its other subsidiaries and affiliates in favor of the
approval of the Merger and the adoption of the Merger Agreement.
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The Merger Agreement provides that in the event that Honeywell, the
Purchaser or any other subsidiary of Honeywell acquires at least 90% of the
outstanding Shares, pursuant to the Offer or otherwise, Honeywell, the Purchaser
and the Company will, at the request of Honeywell and subject to the terms of
the Merger Agreement, take all necessary and appropriate action to cause the
Merger to become effective as soon as practicable after such acquisition,
without a meeting of stockholders of the Company, in accordance with Delaware
law.
Options. Pursuant to the Merger Agreement, immediately prior to the
Effective Time, each holder of then outstanding options to purchase Shares
granted by the Company (the "Options") will be entitled to receive from the
Company, and will receive, in settlement of each Option a cash amount (the "Cash
Amount") with respect to the number of Shares for which the Option is
exercisable immediately prior to the Effective Time (the "Vested Portion"), and
Honeywell will assume the balance of the Option, if any (the "Unvested
Portion"). The Vested Portion of each Option will terminate as of the Effective
Time. The Cash Amount payable for the Vested Portion of each Option will equal
the product of (i) the Merger Consideration minus the exercise price per Share
of the Vested Portion of such Options and (ii) the number of Shares covered by
the Vested Portion of such Option. With respect to any Option held by
individuals who are parties to severance agreements and Options held by
directors of the Company, the entire Option will be treated as the Vested
Portion of the Option. In addition, with respect to any portion of the Option
(other than Options held by the individuals referred to in the preceding
sentence) if any, other than the Vested Portion (the "Unvested Portion"),
Honeywell will assume, as of the Effective Time such Unvested Portion of an
Option. Upon such assumption, the Unvested Portion of the Option will be
converted into an option (a "Honeywell Option") to purchase shares of Honeywell
Common Stock. With respect to any such Honeywell Option (i) the number of shares
of Honeywell Common Stock subject to such Honeywell Option will be determined by
multiplying the number of Shares subject to the Unvested Portion of the Option
by the Option Exchange Ratio (as hereinafter defined), rounding any fractional
share up to the nearest whole share, and (ii) the exercise price per share of
such Honeywell Option will be determined by dividing the exercise price per
share under the Unvested Portion of the Option by the Option Exchange Ratio, and
rounding the exercise price thus determined up to the nearest whole cent. Except
as provided above, the assumed Options will be subject to the same terms and
conditions (including, without limitation, expiration date, vesting and exercise
provisions) as were applicable to the Unvested Portion of the Option immediately
prior to the Effective Time. Honeywell has agreed to take all actions which may
be necessary so that, in the event that an optionee's employment by the Company
is terminated at any time during the eighteen-month period immediately following
the Effective Time, the Unvested Options held by such optionee shall vest as of
the date of termination and not expire until three months following the date of
termination. The "Option Exchange Ratio" will be (x) the Offer Price divided by
(y) the average of the closing prices of Honeywell Common Stock on the NYSE
during the ten trading days preceding the fifth trading day prior to the Closing
Date. If and to the extent required by the terms of the plans governing Options
or pursuant to the terms of any Option granted thereunder, each of Honeywell and
the Company shall use its best efforts to obtain the consent of each holder of
outstanding Options to the foregoing treatment of such Options. Each share of
Honeywell Common Stock underlying the Honeywell Options will be covered by an
effective registration statement under the Securities Act. Except as may be
otherwise agreed to by Honeywell or the Purchaser and the Company, the Option
Plan shall terminate as of the Effective Time and the provisions in any other
plan, program or arrangement providing for the issuance or grant of any other
interest in respect of the capital stock of the Company or any of its
subsidiaries shall be deleted as of the Effective Time. According to the Merger
Agreement, the Company has taken all actions so that following the Effective
Time no holder of employee stock options will have any rights to receive Shares
upon exercise of an employee stock option.
In addition, outstanding purchase rights under the Company's Employee Stock
Purchase Plan (the "Company ESPP") will be exercised upon the earlier of (i) the
next scheduled purchase date under the Company ESPP or (ii) immediately prior to
the Effective Time, and each participant in the Company ESPP shall accordingly
be issued Shares at the time which will be cancelled at the Effective Time and
converted into the right to the receive the Merger Consideration for those
Shares. The Company ESPP will terminate with such exercise date, and no purchase
rights shall be subsequently granted or exercised under the Company ESPP.
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Interim Operations. Pursuant to the Merger Agreement, the Company has
agreed that, except as expressly contemplated or provided by the Merger
Agreement or agreed to in writing by Honeywell, prior to the time the directors
of the Purchaser constitute a majority of the Company Board (the "Board
Appointment Date"), the business of the Company and its subsidiaries will be
conducted only in the ordinary and usual course and to the extent consistent
therewith, each of the Company and its subsidiaries will use its best reasonable
efforts to preserve its business organization intact and maintain its existing
relations with customers, suppliers, employees, creditors and business partners,
and (a) the Company will not, directly or indirectly, (i) issue, sell, transfer
or pledge or agree to sell, transfer or pledge any treasury stock of the Company
or any capital stock of any of its subsidiaries beneficially owned by it, except
upon the exercise of employee stock options or other rights to purchase shares
of Common Stock pursuant to the ESPP outstanding on January 26, 1997; (ii) amend
its certificate of incorporation or by-laws or similar organizational documents;
or (iii) split, combine or reclassify the outstanding Shares or Preferred Stock
or any outstanding capital stock of any of the subsidiaries of the Company; and
(b) neither the Company nor any of its subsidiaries shall (i) declare, set aside
or pay any dividend or other distribution payable in cash, stock or property
with respect to its capital stock other than dividends paid by subsidiaries of
the Company to the Company or any of its subsidiaries in the ordinary course of
business; (ii) issue, sell, pledge, dispose of or encumber any additional shares
of, or securities convertible into or exchangeable for, or options, warrants,
calls, commitments or rights of any kind to acquire, any shares of capital stock
of any class of the Company or its subsidiaries, other than shares reserved for
issuance on January 26, 1997 pursuant to the exercise of Company Options
outstanding on January 26, 1997; (iii) transfer, lease, license, sell, mortgage,
pledge, dispose of, or encumber any assets other than in the ordinary and usual
course of business and consistent with past practice, or incur or modify any
indebtedness or other liability, other than in the ordinary and usual course of
business and consistent with past practice; (iv) redeem, purchase or otherwise
acquire directly or indirectly any of its capital stock; (v) grant any increase
in the compensation payable or to become payable by the Company or any of its
subsidiaries to any of its executive officers or adopt any new or amend or
otherwise increase or accelerate the payment or vesting of the amounts payable
or to become payable under any existing bonus, incentive compensation, deferred
compensation, severance, profit sharing, stock option, stock purchase,
insurance, pension, retirement or other employee benefit plan, agreement or
arrangement; (vi) enter into any employment or severance agreement with or,
except in accordance with the existing written policies of the Company, grant
any severance or termination pay to any officer, director or employee of the
Company or any of its subsidiaries; (vii) permit any insurance policy naming it
as a beneficiary or a loss payable payee to be cancelled or terminated without
notice to Honeywell, except in the ordinary course of business and consistent
with past practice; (viii) enter into any contract or transaction relating to
the purchase of assets other than in the ordinary course of business consistent
with prior practices; (ix) change any of the accounting methods used by it
unless required by generally accepted accounting principles ("GAAP"), neither
the Company nor any of its subsidiaries shall make any material tax election
except in the ordinary course of business consistent with past practice, change
any material tax election already made, adopt any material tax accounting method
except in the ordinary course of business consistent with past practice, change
any material tax accounting method unless required by GAAP, enter into any
closing agreement, settle any tax claim or assessment or consent to any tax
claim or assessment or any waiver of the statute of limitations for any such
claim or assessment; or (x) take any action with the intent of causing any of
the conditions to the Offer set forth in Annex A to the Merger Agreement to not
be satisfied.
No Solicitation. Pursuant to the Merger Agreement, the Company has agreed
that neither the Company nor any of its subsidiaries will (and the Company will
use its best efforts to cause its officers, directors, employees,
representatives and agents, including, but not limited to, investment bankers,
attorneys and accountants, not to), directly or indirectly, encourage, solicit,
participate in or initiate discussions or negotiations with, or provide any
information to, any corporation, partnership, person or other entity or group
(other than Honeywell, any of its affiliates or representatives) concerning any
proposal or offer to acquire all or a substantial part of the business and
properties of the Company or any of its subsidiaries or any capital stock of the
Company or any of its subsidiaries, whether by merger, tender offer, exchange
offer, sale of assets or similar transactions involving the Company or any
subsidiary, division or operating or principal business unit of the Company (an
"Acquisition Proposal"), except that the Company and the Company Board are not
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prohibited from (i) taking and disclosing to the Company's stockholders a
position with respect to a tender or exchange offer by a third party pursuant to
Rules 14d-9 and 14e-2 promulgated under the Exchange Act, or (ii) making such
disclosure to the Company's stockholders as, in the good faith judgment of the
Board, after receiving advice from outside counsel, is required under applicable
law, provided that the Company may not, except as described below, withdraw or
modify, or propose to withdraw or modify, its position with respect to the Offer
or the Merger or approve or recommend, or propose to approve or recommend, any
Acquisition Proposal, or enter into any agreement with respect to any
Acquisition Proposal. The Company also agreed to immediately cease any existing
activities, discussions or negotiations with any parties conducted prior to the
date of the Merger Agreement with respect to any of the foregoing. The Merger
Agreement provides that the Company, prior to the acceptance of Shares pursuant
to the Offer, may furnish information concerning the Company and its
subsidiaries to any corporation, partnership, person or other entity or group
pursuant to appropriate confidentiality agreements, and may negotiate and
participate in discussions and negotiations with such entity or group concerning
an Acquisition Proposal if (i) such entity or group has on an unsolicited basis
submitted a bona fide written proposal to the Company relating to any such
transaction which the Company Board determines in good faith, after consulting
with a nationally recognized investment banking firm, represents a superior
transaction to the Offer and the Merger and (ii) in the opinion of the Company
Board, only after receipt of advice from outside legal counsel, the failure to
provide such information or access or to engage in such discussions or
negotiations could reasonably be expected to cause the Company Board to violate
its fiduciary duties to the Company's stockholders under applicable law (an
Acquisition Proposal which satisfies clauses (i) and (ii) is referred to in the
Merger Agreement as a "Superior Proposal"). The Company will within two business
days following receipt of a Superior Proposal notify Honeywell of the receipt of
the same. The Company will promptly provide to Honeywell any material non-public
information regarding the Company provided to any other party which was not
previously provided to Honeywell. At any time after two business days following
notification to Honeywell of its intent to do so (which notification shall
include the identity of the bidder and the material terms and conditions of the
proposal) and if permitted to do so pursuant to the terms of the Merger
Agreement, the Company Board may withdraw or modify its approval or
recommendation of the Offer and may enter into an agreement with respect to a
Superior Proposal, provided it shall concurrently with entering into such
agreement pay or cause to be paid to Honeywell the Termination Fee (as defined
below) plus any amount payable at the time for reimbursement of expenses
pursuant to the Merger Agreement. If the Company has notified Honeywell of its
intent to enter into an agreement with respect to a Superior Proposal in
compliance with the preceding sentence and has otherwise complied with such
sentence, the Company may enter into an agreement with respect to such Superior
Proposal (with the bidder and on terms no less favorable than those specified in
such notification) after the expiration of the initial two business day period
without any further notification.
Indemnification and Insurance. Pursuant to the Merger Agreement, for six
years after the Effective Time, the Surviving Corporation (or any successor to
the Surviving Corporation) shall indemnify, defend and hold harmless the present
and former officers and directors of the Company and its subsidiaries and
persons who become any of the forgoing prior to the Effective Time with respect
to matters occurring at or prior to the Effective Time to the full extent
required under Delaware law, the terms of the Company's Certificate of
Incorporation or the By-laws, as in effect as of January 26, 1997 and, the terms
of any indemnification agreement entered into with the Company prior to January
26, 1997. The Merger Agreement also provides that Honeywell or the Surviving
Corporation will maintain the Company's existing officers' and directors'
liability insurance ("D&O Insurance") for a period of not less than six years
after the Effective Time, provided, that Honeywell may substitute therefor
policies of substantially equivalent coverage and amounts containing terms no
less favorable to such former directors or officers. Xxxxxxxxx has also agreed
that if the existing D&O Insurance expires, is terminated or cancelled during
such period, Honeywell or the Surviving Corporation will use all reasonable
efforts to obtain substantially similar D&O Insurance, but in no event will it
be required to pay aggregate premiums for such insurance in excess of 150% of
the aggregate premiums paid in 1996 on an annualized basis for such purpose (the
"1996 Premium"). If Honeywell or the Surviving Corporation is unable to obtain
the amount of D&O Insurance required for such aggregate premium, Honeywell or
the Surviving Corporation has agreed to obtain as much insurance as can be
obtained for an annual premium not in excess of 150% of the 1996 Premium.
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Representations and Warranties. Pursuant to the Merger Agreement, the
Company has made customary representations and warranties to Honeywell and the
Purchaser with respect to, among other things, its organization, capitalization,
financial statements, public filings, conduct of business, employee benefit
plans, intellectual property, employment matters, compliance with laws, tax
matters, litigation, environmental matters, vote required to approve the Merger
Agreement, undisclosed liabilities, its rights plan, information in the Proxy
Statement and the absence of any material adverse effect on the Company since
September 1, 1996.
Termination; Fees. The Merger Agreement may be terminated and the Merger
abandoned at any time prior to the Effective Time, whether before or after
approval of the stockholders of the Company, (a) by mutual consent of Honeywell
and the Company, (b) by either the Company or Honeywell (i) if (x) the Offer
shall have expired without any Shares being purchased therein or (y) the
Purchaser shall not have accepted for payment all Shares tendered pursuant to
the Offer by April 30, 1997, provided, that such right to terminate will not be
available to any party whose failure to fulfill any obligation under the Merger
Agreement was the cause of, or resulted in, the failure of Honeywell or the
Purchaser to purchase the Shares on or before such date or after Purchaser has
purchased Shares pursuant to the Offer; or (ii) if any governmental entity shall
have issued an order, decree or ruling or taken any other action (which order,
decree, ruling or other action the parties will use their best efforts to lift),
in each case permanently restraining, enjoining or otherwise prohibiting the
acceptance for payment of, or payment for, Shares pursuant to the Offer or the
Merger and such order, decree, ruling or other action shall have become final
and non-appealable, (c) by the Company (i) if Honeywell, the Purchaser or any of
their affiliates shall have failed to commence the Offer on or prior to five
business days following the date of the initial public announcement of the
Offer; provided, that the Company may not terminate the Merger Agreement
pursuant to this clause (i) if the Company is at such time in breach of its
obligations under the Merger Agreement such as to cause a material adverse
effect on the Company and its subsidiaries, taken as a whole; (ii) in connection
with entering into a definitive agreement with respect to an Acquisition
Proposal; provided it has complied with all of the provisions, including the
notice provisions described above under "No Solicitation," and that it makes
simultaneous payment of the Termination Fee, plus any amounts then due as a
reimbursement of expenses; or (iii) if Honeywell or the Purchaser shall have
breached in any material respect any of their respective representations,
warranties, covenants or other agreements contained in the Merger Agreement,
which breach cannot be or has not been cured, in all material respects, within
30 days after the giving of written notice to Honeywell or the Purchaser, as
applicable, (d) by Honeywell (i) if, due to an occurrence, not involving a
breach by Honeywell or the Purchaser of their obligations under the Merger
Agreement, which makes it impossible to satisfy any of the conditions to the
Offer, Honeywell, the Purchaser, or any of their affiliates shall have failed to
commence the Offer on or prior to five business days following the date of the
initial public announcement of the Offer; (ii) if prior to the purchase of
Shares pursuant to the Offer, the Company has breached any representation,
warranty, covenant or other agreement contained in the Merger Agreement which
(x) would give rise to the failure of a condition described in paragraph (f) or
(g) under Annex A to the Merger Agreement (which are set forth in clauses (f)
and (g) of Section 14) and (y) cannot be or has not been cured, in all material
respects, within 30 days after the giving of written notice to the Company; or
(iii) if either Honeywell or the Purchaser is entitled to terminate the Offer as
a result of the occurrence of any event set forth in paragraph (e) under Annex A
to the Merger Agreement (which is set forth in clause (e) of Section 14).
In accordance with the Merger Agreement, if (x) the Company terminates the
Merger Agreement pursuant to clause (c)(ii) of the immediately preceding
paragraph, (y) Honeywell terminates the Merger Agreement pursuant to clause
(d)(iii) of the immediately preceding paragraph, or (z) either the Company or
Honeywell terminates the Merger Agreement pursuant to paragraph (b)(i) above and
(u) prior thereto there shall have been publicly announced another Acquisition
Proposal or an event set forth in paragraph (h) of Annex A to the Merger
Agreement (which is set forth in clause (h) of Section 14) shall have occurred
and (v) an Acquisition Proposal shall be consummated on or prior to December 31,
1997, the Company has agreed to pay to Honeywell an amount equal to $20.0
million (the "Termination Fee") plus an amount, not to exceed $3.0 million,
equal to Xxxxxxxxx's actual and reasonably documented out-of-pocket fees and
expenses incurred by Honeywell and Purchaser in connection with the Offer, the
Merger, the Merger Agreement and the consummation of the Transactions; provided
that no Termination Fee will be payable if the Purchaser or
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Honeywell was in material breach of its representations, warranties or
obligations under the Merger Agreement at the time of its termination.
EMPLOYMENT AGREEMENTS
The following is a summary of certain provisions of employment agreements
entered into by the Purchaser with Xxxxx X. Xxxxxx, Chairman of the Board and
Chief Executive Officer of the Company (the "Xxxxxx Agreement"), and Xxxx
Xxxxxxxxx, President and Chief Operating Officer of the Company (the "Xxxxxxxxx
Agreement" and, together with the Xxxxxx Agreement, the "Employment
Agreements"), which agreements will become effective at the Effective Time. The
summary is qualified in its entirety by reference to the Employment Agreements
which are incorporated herein by reference and copies of which have been filed
as exhibits to the Schedule 14D-1. The Employment Agreements may be examined and
copies may be obtained at the places and in the manner set forth in Section 9 of
the Offer to Purchase.
Pursuant to the Employment Agreements, Xx. Xxxxxx and Xx. Xxxxxxxxx (each,
an "Executive" and collectively, the "Executives") will be employed by the
Surviving Corporation until December 31, 2000 and December 31, 1998,
respectively, unless earlier terminated pursuant to the terms of the Employment
Agreements. The respective Employment Agreements provide that as long as such
Executive remains an employee of the Surviving Corporation and such Executive's
respective Employment Agreement remains in effect, Xx. Xxxxxx'x base salary for
1997 will be $475,000 and his base salary for each of 1998, 1999 and 2000 will
be $300,000 and Xx. Xxxxxxxxx will be compensated in accordance with the terms
of Honeywell's Executive Compensation Program as a Level J executive with an
initial annual base salary of $250,000.
Xx. Xxxxxx will be entitled to $395,000 as additional incentive
compensation upon continuation of his employment through the end of 1997 and
will receive a cash payment of approximately $3.1 million on or about the
Effective Time (representing the amount due under his Measurex Severance
Agreement if he were Involuntarily Terminated (as defined therein) within
eighteen months of the Effective Time). According to the Xxxxxxxxx Agreement,
although Xx. Xxxxxxxxx will receive the same 40% of base salary "on-plan"
incentive compensation specified for Level J executives, the plan upon which his
incentive compensation will be determined during the first calendar year of his
employment, even if Xx. Xxxxxxxxx'x employment with Xxxxxxxxx commences after
the start of the calendar year, will be based upon the results reflected in the
1997 Measurex operating plan previously delivered to Honeywell and in the pulp
and paper segment of the 1997 Honeywell operating plan, with the objectives of
operating profit and economic value added weighted 60% and 40%, respectively; if
Xx. Xxxxxxxxx'x employment does commence after the start of the calendar year,
his incentive compensation for such first calendar year of employment will be
prorated. In addition, objectives and weightings for the subsequent calendar
years of Xx. Xxxxxxxxx'x employment, if his employment continues pursuant to the
Xxxxxxxxx Agreement, will be determined by the President of Honeywell Industrial
Automation and Control, during the fourth quarter of the year preceding each
such subsequent year. If an Executive's Employment Agreement terminates before
the end of a calendar year, any incentive compensation due such Executive for
that calendar year will be determined on a prorated basis.
If Xx. Xxxxxxxxx is continuously employed by the Surviving Corporation
through the scheduled issue date for the Honeywell Stock Option program in
February 1998, the Xxxxxxxxx Agreement provides for Xx. Xxxxxxxxx to receive
7,500 nonqualified stock options to purchase shares of Honeywell's common stock
with a ten-year term (provided that if Xx. Xxxxxxxxx'x employment with Honeywell
is terminated, the exercisability of such options after the date of termination
will be subject to the terms of Honeywell's Stock Option Program (the "Option
Plan") at an exercise price determined in accordance with the Option Plan. In
addition, the Xxxxxxxxx Agreement provides that Xx. Xxxxxxxxx will receive (i)
25,000 shares of non-qualified stock options with a ten-year term (with the same
post-termination exercisability provisions) at an exercise price equal to the
closing price of Honeywell common stock on the NYSE on the Effective Time,
vesting on December 31, 1998 (a) with respect to 10,000 shares contingent on the
attainment by the Surviving Corporation of 1997 financial performance goals to
be determined by the Surviving Corporation and Xx. Xxxxxxxxx and (b) with
respect to 15,000 shares contingent on the attainment by the Surviving
Corporation of 1998 financial performance goals to be determined by the
Surviving Corporation and Xx. Xxxxxxxxx, (ii) the number of shares of
performance restricted stock of Honeywell issued pursuant to the
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terms of the Honeywell Performance Stock Program equal to up to the product of
4,333 multiplied by a fraction, the numerator of which is the number of calendar
months (including the month during which the Effective Time occurs) from the
Effective Time through December 31, 1997 and the denominator of which is 24,
(iii) 3,000 shares of restricted Honeywell stock vesting on December 31, 1998,
(iv) 5,000 shares of restricted Honeywell stock vesting on December 31, 1999,
contingent on the attainment by the Surviving Corporation of 1997 and 1998
financial performance goals to be determined by the Surviving Corporation and
Xx. Xxxxxxxxx, (v) an aggregate cash payment of $100,000 payable in equal
installments on or about the first day of each calendar month during 1997
following the Effective Time and (vi) an aggregate cash payment of approximately
$2.0 million payable in six equal installments the first of which will be made
on the Effective Time and the remaining five of which will be made at the end of
each four-month period following the Effective Time if Xx. Xxxxxxxxx has
remained continually employed by the Surviving Corporation through the end of
such period, provided that (a) if he is terminated by the Surviving Corporation
other than for Cause (as defined) prior to such date, Xx. Xxxxxxxxx is entitled
to the full amount of the unpaid portion of such payment which shall be payable
in a lump sum upon termination and (b) if he voluntarily terminates his
employment he is entitled to only a pro rata portion of such payment to the date
of termination unless he resigns as a result of a material breach of the
Xxxxxxxxx Agreement by the Surviving Corporation, in which case he is entitled
to the full amount of such payment which shall be payable in a lump sum upon
termination.
If an Executive's employment is terminated voluntarily by such Executive or
due to death, disability or for Cause, the Executive will receive his base
salary at the rate then in effect through the date of his termination or death,
as the case may be, and will be entitled to receive any incentive compensation
payable with respect to the year in which the termination or death occurred on a
prorated basis.
The Xxxxxxxxx Agreement provides for a severance payment in the event of
termination of employment by the Surviving Corporation other than for Cause,
disability or death in an amount equal to 12 months' base salary, together with
incentive compensation, if any, with respect to the fiscal year of the Surviving
Corporation during which such termination occurred on a prorated basis. In
exchange for such severance payment, Xx. Xxxxxxxxx will execute and deliver to
the Surviving Corporation a legally effective release and waiver of all claims,
complaints, and causes of action (other than claims or rights to compensation or
severance payments), whether known or unknown, which he has or may have against
the Surviving Corporation.
The Employment Agreements also contain non-competition provisions
prohibiting the Executive, for a period which ends either two years after his
separation from employment with the Surviving Corporation or three years after
the Effective Time, whichever is later, from (A) directly or indirectly entering
into the employ of, or rendering or engaging in any services to, any person,
firm, corporation or organization which is a competitor of Honeywell or the
Surviving Corporation with respect to (i) products which the lines of business
of Honeywell or the Surviving Corporation in which such Executive was actively
involved during the term of his employment with the Surviving Corporation (the
"Relevant Lines of Business") are producing, or services which the Relevant
Lines of Business are providing at that time, (ii) products or services which
such Executive has reason to know the Relevant Lines of Business has plans to
produce or provide within eighteen months of that time or (iii) products which
Honeywell or the Surviving Corporation has produced or services which Honeywell
or the Surviving Corporation has provided at any time subsequent to the
Effective Time (competitors with respect to (i) through (iii) above each being
hereinafter referred to as a "Competitor") where such Executive would be
performing services for the Competitor within the United States of America,
Asia, Europe, or any other country in which the Relevant Lines of Business do
business on the date of such Executive's separation from employment with the
Surviving Corporation; or (B) directly or indirectly serving as a partner,
shareholder, creditor, director, officer, principal, agent, employee, trustee,
consultant or advisor for or on behalf of any such Competitor (other than owning
5% or less of any class of outstanding securities of any corporation whose
shares are traded on a U.S. national securities exchange or quoted on The Nasdaq
Stock Market, even though such corporation may be a Competitor). The Employment
Agreements also prohibit each Executive, for a period which ends either two
years after his separation from employment with the Surviving Corporation or
three years after the Effective Time, whichever is later, from directly or
indirectly soliciting to employ any employee of Honeywell or the Surviving
Corporation or employing any
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employee of Honeywell or the Surviving Corporation, provided, that the foregoing
restriction will not preclude such Executive from employing, either in response
to any general solicitation for employment or other similar method, any
individual whose total annual compensation, including salary and incentive
compensation, is less than $70,000, or where, notwithstanding such Executive's
reasonable inquiry, he is unaware of such individual's employment with Honeywell
or the Surviving Corporation.
12. PURPOSE OF THE OFFER AND THE MERGER; PLANS FOR THE COMPANY; OTHER MATTERS
PURPOSE OF THE OFFER AND THE MERGER
The purpose of the Offer, the Merger and the Merger Agreement is for
Honeywell to acquire control of, and the entire equity interest in, the Company.
Upon consummation of the Merger, the Company will become a subsidiary of
Honeywell. The Offer is intended to increase the likelihood that the Merger will
be effected.
PLANS FOR THE COMPANY
Honeywell is conducting a detailed review of the Company and its assets,
corporate structure, dividend policy, capitalization, operations, properties,
policies, management and personnel and will consider, subject to the terms of
the Merger Agreement, what, if any, changes would be desirable in light of the
circumstances which exist upon completion of the Offer. Such changes could
include changes in the Company's business, corporate structure, charter,
by-laws, capitalization, Board of Directors, management or dividend policy,
although, except as noted in this Offer to Purchase, Honeywell has no current
plans with respect to any of such matters.
Except as noted in this Offer to Purchase, neither Honeywell nor the
Purchaser has any present plans or proposals that would result in an
extraordinary corporate transaction, such as a merger, reorganization,
liquidation, relocation of operations, or sale or transfer of assets, involving
the Company or any of its subsidiaries, or any material changes in the Company's
corporate structure, business or composition of its management or personnel.
OTHER MATTERS
Stockholder Approval. Under the DGCL and the Company's Certificate of
Incorporation, the approval of the Board of Directors of the Company, and the
affirmative vote of the holders of a majority of the outstanding Shares are
required to approve and adopt the Merger Agreement and the transactions
contemplated thereby, including the Merger. Section 203 of the DGCL prevents
certain "business combinations" with an "interested stockholder" (generally, any
person who owns or has the right to acquire 15% or more of a corporation's
outstanding voting stock) for a period of three years following the time such
person became an interested stockholder unless, among other things, prior to the
time the interested stockholder became such the board of directors of the
corporation approved either the business combination or the transaction in which
the interested stockholder became such.
The Board of Directors of the Company has unanimously approved the Offer,
the Merger and the Merger Agreement and the transactions contemplated thereby
for the purposes of Section 203 of the DGCL. Unless the Merger is consummated
pursuant to the short-form merger provisions under the DGCL described below (in
which case no further corporate action by the stockholders of the Company will
be required to complete the Merger), the only remaining required corporate
action of the Company will be the approval and adoption of the Merger Agreement
and the transactions contemplated thereby by the affirmative vote of the holders
of a majority of the Shares.
Under Article Twelfth of the Company's Certificate of Incorporation, a
business combination transaction involving a beneficial owner of 10% or more of
the outstanding shares could require the affirmative vote of holders of 90% of
the outstanding Shares, unless the transaction was approved by two-thirds of the
Continuing Directors (as such term is defined in the Company's Certificate of
Incorporation). The Company has represented in the Merger Agreement that such
approval was obtained and that, accordingly, the provisions of Article Twelfth
shall not be applicable to the Merger.
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Short Form Merger. Under the DGCL, if the Purchaser acquires at least 90%
of the outstanding Shares, the Purchaser will be able to approve the Merger
without a vote of the Company's stockholders. In such event, the Purchaser
anticipates that it will take all necessary and appropriate action to cause the
Merger to become effective as soon as reasonably practicable after such
acquisition without a meeting of the Company's stockholders. If the Purchaser
does not otherwise acquire at least 90% of the outstanding Shares pursuant to
the Offer or otherwise, a significantly longer period of time may be required to
effect the Merger, because a vote or the consent of the Company's stockholders
would be required under the DGCL. Pursuant to the Merger Agreement, the Company
has agreed to take all action necessary under the DGCL and its Certificate of
Incorporation and Bylaws to convene a meeting of its stockholders promptly
following consummation of the Offer to consider and vote on the Merger, if a
stockholders' vote is required. If the Purchaser owns a majority of the
outstanding Shares, approval of the Merger can be obtained without the
affirmative vote of any other stockholder of the Company.
Appraisal Rights. No appraisal rights are available in connection with the
Offer. However, if the Merger is consummated, stockholders of the Company at the
time of the Merger will have certain rights under the DGCL to dissent and demand
appraisal of, and to receive payment in cash of the fair value of, their Shares.
Such rights to dissent, if the statutory procedures are complied with, could
lead to a judicial determination of the fair value of the Shares (excluding any
element of value arising from the accomplishment or expectation of the Merger),
required to be paid in cash to such dissenting holders for their Shares. In
addition, such dissenting stockholders would be entitled to receive payment of a
fair rate of interest from the date of consummation of the Merger on the amount
determined to be the fair value of their Shares. In determining the fair value
of the Shares, a Delaware court would be required to take into account all
relevant factors. Accordingly, such determination could be based upon
considerations other than, or in addition to, the market value of the Shares,
including, among other things, asset values and earning capacity of the Company.
In Xxxxxxxxxx v. UOP, Inc., the Delaware Supreme Court stated, among other
things, that "proof of value by any techniques or methods which are generally
considered acceptable in the financial community and otherwise admissible in
court" should be considered in an appraisal proceeding. Therefore, the value so
determined in any appraisal proceeding could be different from the price being
paid in the Offer. The Delaware Supreme Court stated in Xxxxxxxxxx and Xxxxxx v.
Xxxxxx X. Xxxx Chemical Corp. that although the remedy ordinarily available to
minority stockholders in a cash-out merger is the right to appraisal described
above, a damages remedy or injunctive relief may be available if a merger is
found to be the product of procedural unfairness, including fraud,
misrepresentation or other misconduct.
Rule 13e-3. The Merger would have to comply with any applicable Federal
law operative at the time, Rule 13e-3 under the Exchange Act is applicable to
certain "going private" transactions. The Purchaser does not believe that Rule
13e-3 will be applicable to the Merger. Rule 13e-3 requires, among other things,
that certain financial information concerning the Company, and certain
information relating to the fairness of the proposed transaction and the
consideration offered to minority stockholders in such a transaction, be filed
with the Commission and disclosed to minority stockholders prior to consummation
of the transaction.
13. DIVIDENDS AND DISTRIBUTIONS.
As described above, the Merger Agreement provides that, prior to the Board
Appointment Date, without the prior written consent of Honeywell, the Company
will not (i) declare or pay any dividend on its capital stock, (ii) except as
explicitly permitted by the Merger Agreement, issue, sell or pledge (or
authorize or propose the issuance, sale or pledge of) any additional shares of
its capital stock or securities convertible into or exercisable or exchangeable
for shares of its capital stock or (iii) purchase or otherwise acquire, or
propose to purchase or otherwise acquire, any outstanding Shares.
14. CONDITIONS OF THE OFFER.
Notwithstanding any other provisions of the Offer, and in addition to (and
not in limitation of) the Purchaser's rights to extend and amend the Offer at
any time in its sole discretion (subject to the terms of the Merger Agreement),
the Purchaser will not be required to accept for payment or, subject to any
applicable rules and regulations of the Commission, including Rule 14e-l(c)
under the Exchange Act (relating to the
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Purchaser's obligation to pay for or return tendered Shares promptly after
termination or withdrawal of the Offer), pay for, and may delay the acceptance
for payment of or, subject to the restriction referred to above, the payment
for, any tendered Shares, and may terminate or amend the Offer as to any Shares
not then paid for, if (i) any applicable waiting period under the HSR Act shall
not have expired or been terminated, (ii) the Minimum Condition shall not have
been satisfied, or (iii) at any time on or after January 26, 1996 and prior to
the acceptance for payment of Shares any of the following events have occurred:
(a) there shall be threatened or pending any suit, action or proceeding by
any Governmental Entity (as defined in the Merger Agreement) against the
Purchaser, Honeywell, the Company or any Subsidiary of the Company (i) seeking
to prohibit or impose any material limitations on Honeywell's or the Purchaser's
ownership or operation (or that of any of their respective Subsidiaries or
affiliates) of all or a material portion of their or the Company's businesses or
assets, or to compel Honeywell or the Purchaser or their respective Subsidiaries
and affiliates to dispose of or hold separate any material portion of the
business or assets of the Company or Honeywell and their respective
Subsidiaries, in each case taken as a whole, (ii) challenging the acquisition by
Honeywell or the Purchaser of any Shares under the Offer, seeking to restrain or
prohibit the making or consummation of the Offer or the Merger or the
performance of any of the other transactions contemplated by the Merger
Agreement, or seeking to obtain from the Company, Honeywell or the Purchaser any
damages that are material in relation to the Company and its Subsidiaries taken
as a whole, (iii) seeking to impose material limitations on the ability of the
Purchaser, or render the Purchaser unable, to accept for payment, pay for or
purchase some or all of the Shares pursuant to the Offer and the Merger, (iv)
seeking to impose material limitations on the ability of Purchaser or Honeywell
effectively to exercise full rights of ownership of the Shares, including,
without limitation, the right to vote the Shares purchased by it on all matters
properly presented to the Company's stockholders, or (v) which otherwise is
reasonably likely to have a Company Material Adverse Effect (as defined in the
Merger Agreement);
(b) there shall be any statute, rule, regulation, judgment, order or
injunction enacted, entered, enforced, promulgated, or deemed applicable,
pursuant to an authoritative interpretation by or on behalf of a Government
Entity, to the Offer or the Merger, or any other action shall be taken by an
Governmental Entity, other than the application to the Offer or the Merger of
applicable waiting periods under HSR Act, that is reasonably likely to result,
directly or indirectly, in any of the consequences referred to in clauses (i)
through (v) of paragraph (a) above;
(c) there shall have occurred (i) any general suspension of trading in, or
limitation on prices for, securities on the NYSE for a period in excess of 24
hours (excluding suspensions or limitations resulting solely from physical
damage or interference with such exchanges not related to market conditions),
(ii) a declaration of a banking moratorium or any suspension of payments in
respect of banks in the United States (whether or not mandatory), (iii) a
commencement of a war, armed hostilities or other international or national
calamity directly or indirectly involving the United States, (iv) any limitation
(whether or not mandatory) by any United States governmental authority on the
extension of credit generally by banks or other financial institutions, or (v) a
change in general financial, bank or capital market conditions which materially
and adversely affects the ability of financial institutions in the United States
to extend credit or syndicate loans or (vi) in the case of any of the foregoing
existing at the time of the commencement of the Offer, a material acceleration
or worsening thereof;
(d) there shall have occurred any events after the date of the Merger
Agreement which, either individually or in the aggregate, would have a Company
Material Adverse Effect; provided, however, that no event, change or effect that
materially results from the transactions contemplated by the Merger Agreement
(the "Transactions") or the announcement thereof shall be deemed to cause,
either individually or in the aggregate, a Company Material Adverse Effect;
(e)(i) the Board of Directors of the Company or any committee thereof shall
have withdrawn or modified in a manner adverse to Honeywell or the Purchaser its
approval or recommendation of the Offer, the Merger or the Merger Agreement, or
approved or recommended any Acquisition Proposal or (ii) the Company shall have
entered into any agreement with respect to any Superior Proposal in accordance
with the Merger Agreement;
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(f) the representations and warranties of the Company set forth in the
Merger Agreement shall not be true and correct, in each case (i) as of the date
referred to in any representation or warranty which addresses matters as of a
particular date, or (ii) as to all other representations and warranties, as of
the date of the Merger Agreement and as of the scheduled expiration of the
Offer, unless the inaccuracies (without giving effect to any materiality or
material adverse effect qualifications or materiality exceptions contained
therein) under such representations and warranties, taking all the inaccuracies
under all such representations and warranties together in their entirety, do
not, individually or in the aggregate, result in a Company Material Adverse
Effect;
(g) the Company shall have failed to perform any obligation or to comply
with any agreement or covenant to be performed or complied with by it under the
Merger Agreement other than any failure which would not have, either
individually or in the aggregate, a Company Material Adverse Effect;
(h) any person acquires beneficial ownership (as defined in Rule 13d-3
promulgated under the Exchange Act), of at least 20% of the outstanding Common
Stock of the Company (other than any person not required to file a Schedule 13D
under the rules promulgated under the Exchange Act);
(i) the Merger Agreement shall have been terminated in accordance with its
terms; or
(j) the diminution in the value of the Company and its subsidiaries to
Honeywell and the Purchaser as a result of breaches, if any, of the
representations and warranties set forth in Section 3.15 of the Merger Agreement
relating to environmental matters (without giving effect to any materiality or
material adverse effect qualifications or materiality exceptions contained
therein) in excess of environmental liabilities and costs which would reasonably
be expected to exist based on the reports and information regarding
environmental matters provided to Honeywell as listed on the disclosure schedule
provided to Honeywell by the Company pursuant to the Merger Agreement (the
"Company Disclosure Schedule") (assuming there has been no non-compliance with
Environmental Laws, Environmental Claims, releases of Hazardous Materials (as
such terms are defined in the Merger Agreement), contamination or other
environmental conditions described in Section 3.15 of the Merger Agreement other
than as specifically identified in such reports) as estimated by an
environmental consultant or consultants reasonably satisfactory to Honeywell and
the Company exceeds $16.0 million.
The foregoing conditions are for the sole benefit of Honeywell and the
Purchaser, may be asserted by Honeywell or the Purchaser regardless of the
circumstances giving rise to such condition (including any action or inaction by
Honeywell or the Purchaser not in violation of the Merger Agreement) or may be
waived by Honeywell or the Purchaser in whole or in part at any time and from
time to time in the sole discretion of Honeywell or the Purchaser, subject in
each case to the terms of the Merger Agreement. The failure by Honeywell or the
Purchaser at any time to exercise any of the foregoing rights shall not be
deemed a waiver of any such right and each such right shall be deemed an ongoing
right and may be asserted at any time and from time to time.
15. CERTAIN LEGAL MATTERS.
Except as described in this Section 15, based on information provided by
the Company, none of the Company, Purchaser or Honeywell is aware of 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
Purchaser's acquisition of Shares (and the indirect acquisition of the stock of
the Company's subsidiaries) as contemplated herein or of any approval or other
action by a domestic or foreign governmental, administrative or regulatory
agency or authority that would be required or desirable for the acquisition and
ownership of the Shares (and the indirect acquisition of the stock of the
Company's subsidiaries) by the Purchaser as contemplated herein. Should any such
approval or other action be required or desirable, the Purchaser and Honeywell
presently contemplate that such approval or other action will be sought, except
as described below under "State Takeover Laws." While, except as otherwise
described in this Offer to Purchase, the Purchaser does not presently intend to
delay the acceptance for payment of or payment for Shares tendered pursuant to
the Offer pending the outcome of any such matter, there can be no assurance that
any such approval or other action, if needed, would be obtained or would be
obtained without substantial conditions or that failure to
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obtain any such approval or other action might not result in consequences
adverse to the Company's business or that certain parts of the Company's
business might not have to be disposed of or other substantial conditions
complied with in the event that such approvals were not obtained or such other
actions were not taken or in order to obtain any such approval or other action.
If certain types of adverse action are taken with respect to the matters
discussed below, the Purchaser could decline to accept for payment or pay for
any Shares tendered. See Section 14 for certain conditions to the Offer,
including conditions with respect to governmental actions.
(a) 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" (e.g. a person who owns or has the right to acquire 15% or more of
a corporation's outstanding voting stock) 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 time such person
became an interested stockholder unless, among other things, the corporation's
board of directors approves such business combination or the transaction in
which the interested stockholder becomes such prior to the time the interested
stockholder becomes such. The Board of Directors of the Company has approved the
Offer, the Merger, the Merger Agreement and the Stockholder Agreement for the
purposes of Section 203 of the DGCL. 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 Xxxxx x. MITE
Corp., the Supreme Court of the United States invalidated on constitutional
grounds the Illinois Business Takeover statute, which, as a matter of state
securities law, made takeovers of corporations meeting certain requirements more
difficult. However in 1987, in CTS Corp. v. Dynamics Corp. of America, the
Supreme Court held that the State of Indiana may, as a matter of corporate law
and, in particular, with respect to those aspects of corporate law concerning
corporate governance, constitutionally disqualify a potential acquiror from
voting on the affairs of a target corporation without the prior approval of the
remaining presenting stockholders. The state law before the Supreme Court was by
its terms applicable only to corporations that had a substantial number of
stockholders in the state and were incorporated there.
Except as described above with respect to Section 203 of the DGCL, the
Purchaser has not attempted to comply with the takeover laws of any other state.
Should any person seek to apply any state takeover law, the Purchaser will take
such action as then appears desirable, which may include challenging the
validity or applicability of any such statute in appropriate court proceedings.
In the event it is asserted that one or more state takeover laws is applicable
to the Offer or the Merger, and an appropriate court does not determine that it
is inapplicable or invalid as applied to the Offer, the Purchaser might be
required to file certain information with, or receive approvals from, the
relevant state authorities. In addition, if enjoined, the Purchaser might be
unable to accept for payment any Shares tendered pursuant to the Offer, or be
delayed in continuing or consummating the Offer and the Merger. In such case,
the Purchaser may not be obligated to accept for payment any Shares tendered.
See Section 14.
The Company and certain of its subsidiaries conduct business in a number of
other states throughout the United States, some of which have enacted takeover
laws and regulations. Neither Honeywell nor the Purchaser knows whether any or
all of these takeover laws and regulations will by their terms apply to the
Offer, and, except as set forth above, neither Honeywell nor the Purchaser has
currently complied with any other state takeover statute or regulation. The
Purchaser reserves the right to challenge the applicability or validity of any
state law purportedly applicable to the Offer and nothing in this Offer to
Purchase or any action taken in connection with the Offer is intended as a
waiver of such right. If it is asserted that any state takeover statute is
applicable to the Offer and an appropriate court does not determine that it is
inapplicable or invalid as applied to the Offer, the Purchaser might be required
to file certain information with, or to receive approvals from, the relevant
state authorities, and the Purchaser might be unable to accept for payment or
pay for Shares tendered pursuant to the Offer, or may be delayed in consummating
the Offer. In such case, the Purchaser may not be obligated to accept for
payment or pay for any Shares tendered pursuant to the Offer. See Section 14.
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(b) Antitrust. The Offer and the Merger are subject to the HSR Act, which
provides that certain acquisition transactions may not be consummated unless
certain information has been furnished to the Antitrust Division of the
Department of Justice (the "Antitrust Division") and the Federal Trade
Commission (the "FTC") and certain waiting period requirements have been
satisfied.
Honeywell and the Company expect to file soon their Notification and Report
Forms with respect to the Offer under the HSR Act. The waiting period under the
HSR Act with respect to the Offer will expire at 11:59 p.m., New York City time,
on the 15th day after the date Honeywell's form is filed unless early
termination of the waiting period is granted. However, the Antitrust Division or
the FTC may extend the waiting period by requesting additional information or
documentary material from Honeywell or the Company. If such a request is made,
such waiting period will expire at 11:59 p.m., New York City time, on the tenth
day after substantial compliance by Honeywell with such request. Only one
extension of the waiting period pursuant to a request for additional information
is authorized by the HSR Act. Thereafter, such waiting period may be extended
only by court order or with the consent of Honeywell. In practice, complying
with a request for additional information or material can take a significant
amount of time. In addition, if the Antitrust Division or the FTC raises
substantive issues in connection with a proposed transaction, the parties
frequently engage in negotiations with the relevant governmental agency
concerning possible means of addressing those issues and may agree to delay
consummation of the transaction while such negotiations continue. The Purchaser
will not accept for payment Shares tendered pursuant to the Offer unless and
until the waiting period requirements imposed by the HSR Act with respect to the
Offer have been satisfied. See Section 14.
As discussed below, the HSR Act requirements with respect to the Merger
will not apply if certain conditions are met. In particular, the Merger may not
be consummated until 30 calendar days after receipt by the Antitrust Division
and the FTC of the Notification and Report Forms of both Honeywell and the
Company unless the Purchaser acquires 50% or more of the outstanding Shares
pursuant to the Offer (which would be the case if the Minimum Condition were
satisfied) or the 30-day period is earlier terminated by the Antitrust Division
and the FTC. Within such 30 day period, the Antitrust Division or the FTC may
request additional information or documentary materials from Honeywell and/or
the Company. The Merger may not be consummated until 20 days after such requests
are substantially complied with by both Honeywell and the Company. Thereafter,
the waiting periods may be extended only by court order or with the consent of
Honeywell and the Company.
The FTC and the Antitrust Division frequently scrutinize the legality under
the antitrust laws of transactions such as the Purchaser's acquisition of Shares
pursuant to the Offer and the Merger. At any time before or after the
Purchaser's acquisition of Shares, the Antitrust Division or the FTC could take
such action under the antitrust laws as it deems necessary or desirable in the
public interest, including seeking to enjoin the acquisition of Shares pursuant
to the Offer or otherwise or seeking divestiture of Shares acquired by the
Purchaser or divestiture of substantial assets of Honeywell or its subsidiaries.
Private parties, as well as state governments, may also bring legal action under
the antitrust laws under certain circumstances. Based upon an examination of
publicly available information relating to the businesses in which Honeywell and
the Company are engaged, Honeywell and the Purchaser believe that the
acquisition of Shares by the Purchaser will not violate the antitrust laws.
Nevertheless, there can be no assurance that a challenge to the Offer or other
acquisition of Shares by the Purchaser on antitrust grounds will not be made or,
if such a challenge is made, of the result. See Section 14 for certain
conditions to the Offer, including conditions with respect to litigation and
certain governmental actions.
(c) Federal Reserve Board Regulations. Regulations G, U and X (the "Margin
Regulations") of the Federal Reserve Board restrict the extension or maintenance
of credit for the purpose of buying or carrying margin stock, including the
Shares, if the credit is secured directly or indirectly by margin stock. Such
secured credit may not be extended or maintained in an amount that exceeds the
maximum loan value of all the direct and indirect collateral securing the
credit, including margin stock and other collateral.
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33
As described in Section 10 of this Offer to Purchase, the financing of the
Offer will not be directly or indirectly secured by the Shares or other
securities which constitute margin stock. Accordingly, all financing for the
Offer will be in full compliance with the Margin Regulations.
(d) Foreign Laws. According to publicly available information, the Company
owns property and conducts business in a number of other foreign countries and
jurisdictions, including, without limitation, Canada, Ireland, Austria, Sweden
and the Federal Republic of Germany. In connection with the acquisition of the
Shares pursuant to the Offer or the Merger, the laws of certain of those foreign
countries and jurisdictions may require the filing of information with, or the
obtaining of the approval or consent of, governmental authorities in such
countries and jurisdictions. The governments in such countries and jurisdictions
might attempt to impose additional conditions on the Company's operations
conducted in such countries and jurisdictions as a result of the acquisition of
the Shares pursuant to the Offer or the Merger. If such approvals or consents
are found to be required the parties intend to make the appropriate filings and
applications. In the event such a filing or application is made for the
requisite foreign approvals or consents, there can be no assurance that such
approvals or consents will be granted and, if such approvals or consents are
received, there can be no assurance as to the date of such approvals or
consents. In addition, there can be no assurance that the Purchaser will be able
to cause the Company or its subsidiaries to satisfy or comply with such laws or
that compliance or noncompliance will not have adverse consequences for the
Company or any subsidiary after purchase of the Shares pursuant to the Offer or
the Merger. See Section 14.
16. FEES AND EXPENSES.
Honeywell has engaged Xxxx Xxxxxxx to act as financial advisor to Honeywell
in connection with the proposed acquisition of the Company and as Dealer Manager
in connection with the Offer. Honeywell has agreed to pay Bear Xxxxxxx a
retainer advisory fee of $100,000 and an additional fee of $1,500,000 for the
fairness opinion rendered to Honeywell in connection with the transactions
contemplated by the Merger Agreement. Furthermore, if Honeywell acquires,
through the Offer or otherwise, control of, or a material interest in, the
stock, business or assets of the Company as contemplated herein, Honeywell has
agreed to pay to Bear Xxxxxxx an additional transaction fee of $2,650,000.
Honeywell has also agreed to reimburse Bear Xxxxxxx for all reasonable
out-of-pocket expenses, including reasonable fees and expenses of accountants
and legal counsel, if any, and to indemnify Bear, Xxxxxxx & Co. Inc. and certain
related persons against certain liabilities and expenses in connection with the
Offer, including certain liabilities under the Federal securities laws.
The Purchaser has retained Xxxxxxxxx & Company Inc. to act as the
Information Agent and ChaseMellon Shareholder Services, L.L.C. to act as the
Depositary in connection with the Offer. Such firms each will receive reasonable
and customary compensation for their services. The Purchaser has also agreed to
reimburse each such firm for certain reasonable out-of-pocket expenses and to
indemnify each such firm against certain liabilities and expenses in connection
with their services, including certain liabilities under the federal securities
laws.
The Purchaser will not pay any fees or commissions to any broker or dealer
or other person (other than the Dealer Manager and the Information Agent) for
soliciting tenders of Shares pursuant to the Offer. Brokers, dealers, banks and
trust companies will be reimbursed by the Purchaser for customary mailing and
handling expenses incurred by them in forwarding material to their customers.
17. MISCELLANEOUS.
The Offer is being made to all holders of Shares other than the Company.
The Purchaser is not aware of any jurisdiction in which the making of the Offer
or the tender of Shares in connection therewith would not be in compliance with
the laws of such jurisdiction. If the Purchaser becomes aware of any
jurisdiction in which the making of the Offer would not be in compliance with
applicable law, the Purchaser will make a good faith effort to comply with any
such law. If, after such good faith effort, the Purchaser cannot comply with any
such law, the Offer will not be made to (nor will tenders be accepted from or on
behalf of) the holders of Shares residing in such jurisdiction. In any
jurisdiction where the securities, blue sky or other laws require the Offer to
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34
be made by a licensed broker or dealer, the Offer shall be deemed to be made on
behalf of the Purchaser by the Dealer Manager or one or more registered brokers
or dealers licensed under the laws of such jurisdiction.
No person has been authorized to give any information or to make any
representation on behalf of Honeywell or the Purchaser not contained herein or
in the Letter of Transmittal and, if given or made, such information or
representation must not be relied upon as having been authorized.
The Purchaser and Honeywell have filed with the Commission the Schedule
14D-1 pursuant to Rule 14d-3 under the Exchange Act furnishing certain
additional information with respect to the Offer. The Schedule 14D-1 and any
amendments thereto, including exhibits, may be examined and copies may be
obtained from the offices of the Commission and the NYSE in the manner set forth
in Section 9 of this Offer to Purchase (except that they will not be available
at the regional offices of the Commission).
HONEYWELL ACQUISITION CORP.
January 31, 1997
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SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS
OF HONEYWELL AND THE PURCHASER
I. DIRECTORS AND EXECUTIVE OFFICERS OF HONEYWELL. The following table sets
forth the name, business address and present principal occupation or employment,
and material occupations, positions, offices or employments for the past five
years of each director and executive officer of Honeywell. Unless otherwise
indicated, each such person is a citizen of the United States of America and the
business address of each such person is c/o Honeywell Inc., Honeywell Plaza,
P.O. Box 524, Minneapolis, Minnesota 55440-0524. Unless otherwise indicated,
each occupation set forth opposite an individual's name refers to employment
with Honeywell. Unless otherwise indicated, each such person has held his or her
present occupation as set forth below, or has been an executive officer at
Honeywell, or the organization indicated, for the past five years.
NAME AND PRESENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
BUSINESS ADDRESS MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
---------------- --------------------------------------------------
1. DIRECTORS OF XXXXXXXXX
Xxxxxx X. Xxxxxxxx, Xx. Vice Admiral Xxxxxxxx retired from the U.S. Navy in 1987
The Xxxxxxxx Group, Inc. after 34 years of distinguished service, principally
000 Xxxx Xxxxxx within the submarine force and directing the Department
Mt. Pleasant, SC 29464 of the Navy research and technology development
enterprise. Upon retirement from the Navy, Admiral
Xxxxxxxx formed The Xxxxxxxx Group, Inc., a technical
and management consulting practice providing services to
industry, primarily in areas of strategic planning,
technology investment and application, and business
planning and development. Admiral Xxxxxxxx is a director
of Golder Federal Services, Inc. He serves with several
boards and committees of government and academe. He is a
member of the Army Science Board and the Naval Studies
Board of the National Research Council. In addition, he
is a director of Oak Ridge Associated Universities and
the Foundation for Research Development, Medical
University of South Carolina, a member of the Board of
Trustees of the South Carolina Research Authority and a
member of the Board of Visitors to the Software
Engineering Institute, Carnegie Mellon University.
Xxxxxxxxx X. Xxxxxx Xx. Xxxxxx joined Bell Laboratories in 1960, where she
The University of Pennsylvania held various supervisory positions until 1977. From 1973
The Xxxxxxx School until 1977, she was also adjunct professor of economics
Department of Public at New York University. In 1977, she was appointed a
Policy and Management commissioner of the Civil Aeronautics Board and was vice
3100 Xxxxxxxxx Xxxx-Xxxxxxxx Xxxx chairman of the Civil Aeronautics Board from 1981 to
Philadelphia, PA 1983. From 1983 to 1990, she served as xxxx of the
19104-6372 Graduate School of Industrial Administration of Carnegie
Mellon University. From 1990 to 1991, she was a visiting
scholar at Yale University, on leave from Carnegie
Mellon. Currently, Xx. Xxxxxx is Xxxx X. Xxxxx Professor
of Public Policy and Management at The Xxxxxxx School.
Xx. Xxxxxx is also a director of Xxxxxx Xxxxxx Companies
Inc., CSX Corporation, Xxxxxxxx, Inc. and the College
Retirement Equities Fund. She is a past member of the
board of trustees of Princeton University, and she
serves on the board of the Brookings Institution and the
National Bureau of Economics Research.
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NAME AND PRESENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
BUSINESS ADDRESS MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
---------------- --------------------------------------------------
Xxxxxxx X. Xxxxxxxxxx Xx. Xxxxxxxxxx began his business career at Honeywell in
1969. He has held various marketing and operations
management positions and was named the Company's vice
president for Marine Systems in 1981. In 1983, Xx.
Xxxxxxxxxx was appointed president for Honeywell Europe,
headquartered in Brussels, Belgium. In 1987, Xx.
Xxxxxxxxxx returned to Minneapolis as the Company's
executive vice president, International, and was elected
president of this business in May 1987. In 1990, Xx.
Xxxxxxxxxx was elected executive vice president and
chief operating officer for International and Home and
Building Control, and a director of the Company. In
April 1993, Xx. Xxxxxxxxxx was elected chairman of the
board and chief executive officer. Xx. Xxxxxxxxxx is
also a director of Xxxxxxx, Inc., Xxxxxxxxx Company,
Inc. and The St. Xxxx Companies, Inc. He serves as a
member on various advisory boards and committees
including: the U.S.-China Business Council, Investment
and Services Policy Advisory Committee (INSPAC),
U.S.-Russia Trade and Economic Council and the Alliance
to Save Energy Board.
Xxxxxxx Xxxxxx Xxxxx, Xx. In 1947, Xx. Xxxxx joined Xxxxx International
The Friendship Group Corporation (now known as Xxxxx Xxxxxx Incorporated
West Tower following the merger in 1987 of Xxxxx International and
Suite 3000 Xxxxxx Tool Co.), a provider of products and services to
0000 Xxxxx Xxxxxx the petroleum and mining industries. He became chief
Newport Beach, CA 92660-2140 research engineer in 1957 and vice president and
assistant general manager in 1958. Xx. Xxxxx was elected
president in 1962, chief executive officer in 1965, and
chairman of the board in 1969. In January 1989, Xx.
Xxxxx retired from Xxxxx Xxxxxx Inc. and assumed the
post of chairman of the board and chief executive
officer of the Friendship Group, an investment
partnership. Xx. Xxxxx is also a director of Xxxxxxx
Instruments, Inc., Xxxx XxXxx Corporation, Regenesis
Inc., and the American Mutual Fund, Inc. He is past
chairman and a current member of the board of the YMCA
of the United States of America, and is a trustee of
Xxxxxx Xxxx College, Claremont, California.
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NAME AND PRESENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
BUSINESS ADDRESS MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
---------------- --------------------------------------------------
Xxxxxxx X. Xxxxxxxxx In 1959, Xx. Xxxxxxxxx co-founded Xxxxxxxxx, Xxxxxx &
Xxxxxxxxx Enterprises, Inc. Xxxxxxxx, Inc., an investment banking firm, and in 1961,
000 Xxxx Xxx., Xxxxx 0000 Alliance Capital Management Corporation, an investment
New York, NY 10152 management firm, and served as chairman and chief
executive officer until 1973. Xx. Xxxxxxxxx was
Undersecretary of State from 1973 to 1974. In 1975, he
served as special consultant and advisor to the Vice
President of the United States. During that year he
became founding xxxx of the Yale Graduate School of
Management and was named Xxxxxxx X. Xxxxxxxx Professor
of Management Studies, serving until 1980. Xx. Xxxxxxxxx
then founded Xxxxxxxxx Enterprises, Inc., a private
investing firm, and served as its chairman and chief
executive officer until year-end 1990. From 1991 until
June 1995, Xx. Xxxxxxxxx served as chairman of the board
and chief executive officer of The New York Stock
Exchange, Inc. In June 1995, Xx. Xxxxxxxxx rejoined
Donaldson Enterprises, Inc., as its chairman and chief
executive officer. In September 1995, he was also
elected senior advisor to Xxxxxxxxx, Xxxxxx & Xxxxxxxx,
Inc., the firm he co-founded in 1959. Xx. Xxxxxxxxx is
also a director of Aetna Life & Casualty Company and
Xxxxxx Xxxxxx Companies Inc. He serves as a trustee and
director of a number of philanthropic and educational
institutions.
X. Xxxxxx Xxxxxxxxx In 1953, Xx. Xxxxxxxxx joined the Canadian Bank of
Canadian Imperial Bank of Commerce (now CIBC), a Canadian financial services
Commerce institution based in Toronto. In 1968, he was appointed
Commerce Court West deputy chief general manager. In 1971, Xx. Xxxxxxxxx
Suite 3620 (36th Floor) became senior vice president and in 1973, he was
Toronto, Ontario promoted to executive vice president and chief general
Canada M5L IA2 manager. Xx. Xxxxxxxxx was elected to CIBC's Board of
Directors in 1974 and elected president and chief
operating officer in 1976. In 1984, he was elected chief
executive officer, and in 1985, he was named chairman.
In June 1992, Xx. Xxxxxxxxx retired as chairman and
chief executive officer of CIBC, and now holds the
position of chairman of its Executive Committee. Xx.
Xxxxxxxxx is also a director of CIBC, Amoco Canada
Petroleum Co. Ltd., Ontario Hydro, Westcoast Energy
Inc., Xxxxxx Xxxxxx Ltd., Coca-Cola Beverages Ltd.,
Xxxxxxxxx Inc., Asia Satellite Telecommunications
Company Limited, Orange plc, and a member of the
advisory board, IBM Canada Ltd and other cultural and
medical entities. Xx. Xxxxxxxxx is a citizen of Canada.
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NAME AND PRESENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
BUSINESS ADDRESS MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
---------------- --------------------------------------------------
Xxxxx X. Xxxxxx Xx. Xxxxxx was president and chief operating officer of
Northern States Power Company Ameritech, the Chicago-based parent of the Bell
000 Xxxxxxxx Xxxx, 0xx Floor companies serving Illinois, Indiana, Michigan, Ohio and
Minneapolis, MN 55401-1993 Wisconsin, prior to joining Northern States Power
Company, an electric and gas utility company, as its
president and chief executive officer in 1987. Xx.
Xxxxxx has served as its chairman of the board and chief
executive officer since 1988, and in 1994 was also named
president. Xx. Xxxxxx is also a director of Walgreen
Company, Ecolab Inc., ReliaStar Financial and the
Federal Reserve Bank of Minneapolis. He also serves on
the board of overseers for the Xxxxxxx School of
Management, University of Minnesota, the Board of
Trustees for the University of St. Xxxxxx, in St. Xxxx,
Minnesota, and the Board of Visitors for the University
of Pittsburgh, Xxxxxx X. Xxxx School of Business. Xx.
Xxxxxx serves as chairman of the Nuclear Energy
Institute, located in Washington, D.C. and is former
chairman and a current member of the board of the Edison
Electric Institute. Xx. Xxxxxx serves the community as a
board member and is past chairman of (1994-1995) of the
United Way of Minneapolis Area; the Minnesota Business
Partnership the Xxxxxxxx Program, the Greater
Minneapolis Convention & Visitors Association, Capitol
City Partnership, the Minneapolis Center for Corporate
Responsibility and the Xxxxx Xxxxxxxx Memorial Leukemia
Foundation.
Xxxxx Xxxxxx In 1972, Xx. Xxxxxx joined the predecessor of Xxxxxxx
Xxxxxxx and Broad Home Corp. and Broad Home Corporation, the largest home builder in
00000 Xxxxxxxx Xxxxxxxxx xxx xxxxxxx Xxxxxx Xxxxxx and one of the largest
Los Angeles, CA 90024 residential builders in Paris, France, where he held a
number of corporate positions prior to being named
president of Xxxxxxx and Broad-France in 1976. After
returning to the United States, in 1980, he was elected
president of all housing operations. In 1986, he was
elected president and chief executive officer of Xxxxxxx
and Broad Home Corporation, and in 1993, was named
chairman of the board. Xx. Xxxxxx also is a director of
Xxxxx'x Food & Drug Centers, Inc., and National Golf
Properties, Inc. Among his civic and cultural
activities, Xx. Xxxxxx is a trustee of the RAND
Corporation, co-chairman of the Mayor's Alliance for a
Safer L.A., and a member of the Board of the National
Park Foundation, University of Southern California Law
CenterBoard of Councilors, and a member of the Council
on Foreign Relations. In 1992, he was inducted into the
California Building Industry Hall of Fame.
I-4
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NAME AND PRESENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
BUSINESS ADDRESS MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
---------------- --------------------------------------------------
X. Xxxxx Xxxxx Xx. Xxxxx joined Sperry Corporation in 1962 where he
advanced with assignments in information systems,
operations and marketing. In 1978, he was named vice
president of the Sperry Avionics Division, and in 1985
he was chosen to lead Xxxxxx'x commercial aviation
business as vice president and general manager of
Commercial Flight Systems. Xx. Xxxxx joined Honeywell in
December 1986, when the Sperry Aerospace Group was
acquired by Honeywell. In June 1987, Xx. Xxxxx was
appointed vice president of Honeywell's Commercial
Flight Systems Group, and in April 1989 he was elected
president, Space and Aviation. In 1990, Xx. Xxxxx was
elected executive vice president and chief operating
officer for Space and Aviation, and Industrial, and a
director of the Company. In April 1993, Xx. Xxxxx was
elected president and chief operating officer. Xx. Xxxxx
is also a director of Xxxx Inc., Xxxxxxxx Metals Company
and Geon Company. He is also a member of the board of
the Aerospace Industries Association (AIA) and the
National Association of Manufacturers (NAM).
X. Xxxxx Xxxx Xx. Xxxx joined Xerox Corporation, a document processing
Xerox Corporation office equipment company, in 1968. In May 1985, he was
000 Xxxx Xxxxx Xxxx elected a corporate officer and in 1987 he was elected
P.O. Box 1600 president of Xerox's United States Marketing Group. In
Stamford, CT 06904-1600 February 1992, Xx. Xxxx was promoted to executive vice
president and is responsible for world-wide operations.
Xx. Xxxx is also a director of Xxxxxx Laboratories and
Ameritech Corporation. He serves on the board of
overseers of the Rochester Philharmonic Orchestra and is
a member of the Stanford University Graduate School of
Business advisory council. In 1993, Xx. Xxxx was
inducted into the National Sales Hall of Fame.
Xxxxxx X. Xxxxxxxxx In March 1993, Xx. Xxxxxxxxx formed Great Northern
Great Northern Capital Capital, a private asset management firm, and serves as
000 Xxxxxxxxx Xxxxxx its chairman of the board and chief executive officer.
Suite W-1099 Prior to March 1993, Xx. Xxxxxxxxx served as president
St. Xxxx, MN 55101 at IAI Capital Group, a venture capital and merchant
banking firm. From 1973 to November 1989, he held
various senior positions at Northwest Airlines, Inc.,
and from 1986 to 1989, he served as chairman of the
board and chief executive officer of NWA Inc. and
Northwest Airlines, Inc. Xx. Xxxxxxxxx is also a
director of Precision Castparts Corp., Department 56,
Inc., X.X. Xxxxxx Holdings, Inc., and the Argonne
National Laboratory University of Chicago Development
Corporation (ARCH). He also serves as chairman of the
St. Xxxxx Foundation in St. Xxxx, Minnesota, and of
Catholic Views Broadcast, Inc. Channel 53 Television in
Minnesota. Xx. Xxxxxxxxx is a member of the Council on
the Graduate School of Business, University of Chicago,
a trustee of the University of Chicago, a director of
the American Council on Germany, a director of the
Center of the American Experiment, an advisor to the
Metropolitan Economic Development Association, and
former vice chairman of the U.S.-China Business Council.
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NAME AND PRESENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
BUSINESS ADDRESS MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
---------------- --------------------------------------------------
Xxxxxxx X. Xxxxxx Xx. Xxxxxx was a member of the law firm of Xxxxxx and
SUPERVALU INC. Xxxxxxx from 1963 to 1977. In 1977, he joined SUPERVALU
00000 Xxxxxx Xxxx Xxxx INC., a food distributor and retailer, as senior vice
P.O. Box 990 president of administration and as a member of the board
Minneapolis, MN 55440 of directors. He was elected president and chief
operating officer in 1978, chief executive officer in
1981, and chairman of the board in 1982. Xx. Xxxxxx is
also a director of Xxxxxxx, Inc., Musicland Stores
Corporation, Norwest Corporation and ShopKo Stores, Inc.
He is also a member of the board of directors of the
Food Marketing Institute, Food Distributors
International and the International Center for Companies
of the Food and Trade Industry (CIES).
2. EXECUTIVE OFFICERS OF XXXXXXXXX
Xxxxxxx X. Xxxxxxxxxx Chairman and chief executive officer. (For further
information see paragraph I.1 above.)
Xxxxxx X. Xxxxx President, Home and Building Control since January 1997.
From January 1996 to December 1996, Xx. Xxxxx was vice
president and general manager of Honeywell's worldwide
Home and Building Control strategic business unit. From
October 1994 to November 1996, he was vice president and
general manager of Home and Building Control. From May
1992 to September 1994, he was vice president and
general manager of Industrial Automation and Control.
From November 1990 to April 1992 he was president of
U.S. Process Automation Business for ASEA Brown Boveri.
Xxxxxx X. Xxxxxxx Vice president and general counsel since joining the
Company in April 1992. Prior to April 1992, Xx. Xxxxxxx
served as senior vice president, general counsel and
clerk and corporate officer of Wang Laboratories Inc.
Xx. Xxxxxxx is director of Passport Corporation and
Organizational Dynamics, Inc. and a member of the
advisory board of Bay Banks, Inc.
Xxxxxxx X. Xxxxxx President, Honeywell Europe, effective February 1, 1997.
Xx. Xxxxxx has been vice president and chief financial
officer since October 1994. From February 1992 to
October 1994, he was vice president and controller of
Honeywell. From July 1990 to February 1992, he was vice
president and treasurer of Honeywell.
Xxxxx X. XxXxxxxx Senior vice president since January 1997. From April
1994 to December 1996, Xx. XxXxxxxx was president, Home
and Building Control Business. From December 1991 to
April 1994, he was vice president, field operations for
Home and Building Control. Xx. XxXxxxxx is a citizen of
Canada.
X. Xxxxx Xxxxx President and chief operating officer. (For further
information see paragraph I. 1 above.)
Xxxxxx X. Xxxxxxxxx Vice president and controller since October 1994. From
May 1993 to October 1994, Xx. Xxxxxxxxx was vice
president, finance for Home and Building Control. From
March 1992 to April 1993, he was vice president and
assistant controller of operations for Honeywell. From
January 1990 to February 1992, he was vice president for
financial planning and reporting for Honeywell.
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41
NAME AND PRESENT PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
BUSINESS ADDRESS MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
---------------- --------------------------------------------------
Xxxxx X. Xxxxxx Corporate vice president, human resources, since May
1993. From January 1992 to April 1993 he was director,
human resources, Home and Building Control.
Xxxxxx X. Xxxxxxx President, Space and Aviation Control since January
1997. From September 1993 to December 1996 Xx. Xxxxxxx
was vice president and general manager of Air Transport
Systems. From March 1992 to August 1993, he was vice
president of marketing for Air Transport Systems. From
February 1991 to February 1992 he was vice president of
marketing for Business and Commuter Aviation Systems.
Xxxxxxxx X. Xxxxxxxxxxxx Vice president and chief financial officer, effective
February 1, 1997. Xx. Xxxxxxxxxxxx has been vice
president, business development since March 1996. From
July 1993 to February 1996, he was vice president for
finance for Industrial Automation and Control. From
April 1992 to June 1993 he was director, corporate
financial planning and business analysis.
Xxxxxx X. Xxxxxxxxxx President, Industrial Control, effective February 1,
1997. Xx. Xxxxxxxxxx has been president, Industrial
Automation and Control since March 1995. From January
1992 to February 1995, Xx. Xxxxxxxxxx was president of
Honeywell Asia Pacific.
II. DIRECTORS AND EXECUTIVE OFFICERS OF THE PURCHASER. The following table
sets forth the name, business address and present principal occupation or
employment, and material occupations, positions, offices or employments for the
past five years of each director and executive officer of the Purchaser. Unless
otherwise indicated, each such person is a citizen of the United States of
America and the business address of each such person is c/o Honeywell Inc.,
Honeywell Plaza, P.O. Box 524, Minneapolis, Minnesota 55440-0524. Unless
otherwise indicated, each occupation set forth opposite an individual's name
refers to employment with the Purchaser.
NAME PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
---- -------------------------------------------
X. Xxxxx Xxxxx Chairman and president of the Purchaser since January
1997. (For further information see paragraph I.1 above.)
Xxxxxxx X. Xxxxxx Vice president and treasurer of the Purchaser since
January 1997. (For further information see paragraph I.2
above.)
Xxxxxxxx X. Xxxxxxxxxxxx Director and vice president of the Purchaser since
January 1997. (For further information see paragraph I.1
above.)
Xxxxxx X. Xxxxxxxxxx Vice president of the Purchaser since January 1997. (For
further information see paragraph I.1 above.)
Xxxxxx Xxxxxx Director and vice president and secretary of the
Purchaser since January 1997. Xx. Xxxxxx is also vice
president and secretary of Honeywell, a position he has
held since 1983.
Xxxxxx Xxx Xxxx Vice president and assistant secretary of the Purchaser
since January 1997. Xx. Xxx Xxxx joined Honeywell as
assistant general counsel in December 1996. For more
than five years prior thereto he was employed as an
attorney for the law firm of Xxxxxx & Xxxxxxx.
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42
Facsimile copies of the Letter of Transmittal, properly completed and duly
signed, 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 one of the addresses set forth below:
The Depositary for the Offer is:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
By Mail: By Hand/Overnight Delivery:
ChaseMellon Shareholder Services, L.L.C. ChaseMellon Shareholder Services, L.L.C.
Reorganization Department Reorganization Department
PO Box 000 000 Xxxxxxxx
Xxxxxxx Xxxxxxx 00xx Xxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
By Facsimile Transmission:
(000) 000-0000
Confirm Receipt of Facsimile by Telephone:
(000) 000-0000
or
(000) 000-0000
Questions or requests for assistance or additional copies of this Offer to
Purchase, the Letter of Transmittal and the Notice of Guaranteed Delivery may be
directed to the Information Agent or the Dealer Manager at their respective
locations and telephone numbers set forth below. Stockholders may also contact
their broker, dealer, commercial bank or trust company for assistance concerning
the Offer.
The Information Agent for the Offer is:
(GEORGESON & COMPANY LOGO)
Wall Street Plaza
New York, New York 10005
Banks and Brokers Call Collect: (000) 000-0000
CALL TOLL FREE: (000) 000-0000
The Dealer Manager for the Offer is:
BEAR, XXXXXXX & CO. INC.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Call Toll Free: (000) 000-0000
I-8
