OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
of
NORAND CORPORATION
by
WAI ACQUISITION CORP.
a wholly owned subsidiary
of
WESTERN ATLAS INC.
at
$33.50 NET PER SHARE
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW
YORK CITY TIME, ON FRIDAY, FEBRUARY 21, 1997, UNLESS THE OFFER IS EXTENDED.
THE BOARD OF DIRECTORS OF NORAND CORPORATION (THE "COMPANY") UNANIMOUSLY HAS
APPROVED THE MERGER AGREEMENT DESCRIBED HEREIN AND DETERMINED THAT THE MERGER
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE
MERGER DESCRIBED HEREIN, ARE FAIR TO AND IN THE BEST INTERESTS OF THE HOLDERS OF
SHARES (AS HEREINAFTER DEFINED) AND RECOMMENDS THAT STOCKHOLDERS ACCEPT THE
OFFER AND TENDER THEIR SHARES PURSUANT TO THE OFFER.
------------------------
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, SHARES REPRESENTING AT LEAST
A MAJORITY OF THE TOTAL NUMBER OF OUTSTANDING SHARES OF COMMON STOCK OF THE
COMPANY ON A FULLY DILUTED BASIS (ASSUMING THE EXERCISE OF ALL OUTSTANDING
OPTIONS AND WARRANTS) BEING VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO THE
EXPIRATION OF THE OFFER.
------------------------
IMPORTANT
Any stockholder desiring to tender all or any portion of such stockholder's
Shares (as hereinafter defined) should either (a) complete and sign the Letter
of Transmittal (or a facsimile thereof) in accordance with the instructions in
the Letter of Transmittal and mail or deliver it together with the
certificate(s) representing tendered Shares and any other required documents to
the Depositary or tender such Shares pursuant to the procedures for book-entry
transfer set forth in Section 3 or (b) request such stockholder's broker,
dealer, commercial bank, trust company or other nominee to effect such
transaction. A 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 such
stockholder desires to tender such Shares.
A 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 3.
Questions and requests for assistance may be directed to the Information
Agent at its address and telephone number set forth on the back cover of this
Offer to Purchase. Additional copies of this Offer to Purchase, the Letter of
Transmittal, the Notice of Guaranteed Delivery and other related materials may
be obtained from the Information Agent or from brokers, dealers, commercial
banks and trust companies.
January 24, 1997
TABLE OF CONTENTS
PAGE
-----
Introduction............................................................................................. 1
1. Terms of the Offer................................................................................... 2
2. Acceptance for Payment and Payment................................................................... 4
3. Procedures for Accepting the Offer and Tendering Shares.............................................. 5
4. Withdrawal Rights.................................................................................... 8
5. Certain Tax Consequences............................................................................. 9
6. Price Range of the Shares; Dividends................................................................. 10
7. Possible Effects of the Offer on the Market for the Shares; Stock Quotation; Exchange Act
Registration; Margin Regulations................................................................... 10
8. Certain Information Concerning the Company........................................................... 12
9. Certain Information Concerning Parent and the Purchaser.............................................. 15
10. Background of the Offer; Contacts with the Company................................................... 17
11. Purpose of the Offer; the Merger Agreement; Statutory Requirements; Appraisal Rights; Plans for the
Company; Other Agreements.......................................................................... 17
12. Source and Amount of Funds........................................................................... 27
13. Dividends and Distributions.......................................................................... 28
14. Certain Conditions of the Offer...................................................................... 29
15. Certain Legal Matters; Required Regulatory Approvals................................................. 30
16. Certain Fees and Expenses............................................................................ 33
17. Miscellaneous........................................................................................ 33
Schedule I--Directors and Executive Officers of Parent and the Purchaser................................... S-1
i
To: All Holders of Shares of Common Stock of Norand Corporation
INTRODUCTION
WAI Acquisition Corp. (the "Purchaser"), a Delaware corporation and a wholly
owned subsidiary of Western Atlas Inc., a Delaware corporation ("Parent"),
hereby offers to purchase all outstanding shares of Common Stock, par value
$0.01 per share (the "Shares"), of Norand Corporation, a Delaware corporation
(the "Company"), at a purchase price of $33.50 per Share, net to the seller in
cash, without interest thereon, upon the terms and subject to the conditions set
forth in this Offer to Purchase and in the related Letter of Transmittal (which
together 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, stock transfer taxes on the purchase of Shares by the Purchaser
pursuant to the Offer. However, any tendering stockholder or other payee who
fails to complete and sign the Substitute Form W-9 that is included in the
Letter of Transmittal may be subject to a required backup federal income tax
withholding of 31% of the gross proceeds payable to such stockholder or other
payee pursuant to the Offer. See Section 3. The Purchaser will pay all charges
and expenses of The Bank of New York, as Depositary (the "Depositary"), and
Xxxxxxxxx & Company Inc., as Information Agent (the "Information Agent"),
incurred in connection with the Offer. SEE SECTION 16.
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY HAS APPROVED THE MERGER
AGREEMENT (AS DEFINED BELOW) AND DETERMINED THAT THE MERGER AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE MERGER, ARE FAIR
TO AND IN THE BEST INTERESTS OF THE HOLDERS OF SHARES, AND RECOMMENDS THAT
STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES.
The Offer is conditioned upon, among other things, at least a majority of
the total number of outstanding Shares on a fully diluted basis (assuming
exercise of all outstanding stock options and warrants) being validly tendered
and not withdrawn prior to the Expiration Date (as defined in Section 1) (the
"Minimum Condition"). The Purchaser reserves the right (subject to the
applicable rules and regulations of the Securities and Exchange Commission (the
"Commission") and subject to the provision of the Merger Agreement), which it
currently has no intention of exercising, to waive or reduce the Minimum
Condition and to elect to purchase, pursuant to the Offer, a smaller number of
Shares. The Merger Agreement provides that the Purchaser may not waive the
Minimum Condition without the prior consent of the Company if, as a result, the
Purchaser would acquire less than a majority of the Shares actually outstanding.
The Offer is also subject to certain other terms and conditions. SEE SECTIONS 1,
14, AND 15 BELOW.
The Offer is being made pursuant to the Agreement and Plan of Merger, dated
as of January 21, 1997 (the "Merger Agreement"), among the Company, the
Purchaser and Parent pursuant to which, following the consummation of the Offer
and the satisfaction or waiver of certain conditions, the Purchaser will be
merged with and into the Company (the "Merger"), with the Company continuing as
the surviving corporation (the "Surviving Corporation"). In the Merger, each
outstanding Share (other than Shares held by Parent, the Purchaser or any
subsidiary of Parent or the Purchaser or in the treasury of the Company, which
Shares, by virtue of the Merger and without any action on the part of the holder
thereof, shall be cancelled with no payment being made with respect thereto, and
other than Shares, if any, held by stockholders who perfect their appraisal
rights under Delaware law ("Dissenting Shares")) will, by virtue of the Merger
and without any action by the holder thereof, be converted into the right to
receive $33.50 net to its holder in cash, or any higher price paid per Share in
the Offer (the "Merger Consideration"), payable to the holder thereof, without
interest thereon, upon the surrender of the certificate formerly representing
such Share. The Merger Agreement is more fully described in Section 11 below.
Certain federal income tax consequences of the sale of Shares pursuant to the
Offer and the Merger, as the case may be, are described in Section 5 below.
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation ("DLJ"), the Company's
financial advisor, has delivered to the Board of Directors of the Company a
written opinion to the effect that, as of the date of the Merger Agreement, the
consideration to be received by the holders of Shares pursuant to the Merger
Agreement is fair from a financial point of view to such stockholders. A copy of
such opinion is included with the Company's Solicitation/Recommendation
Statement on Schedule 14D-9 (the "Schedule 14D-9"), which is being mailed to
stockholders concurrently herewith, and stockholders are urged to read the
opinion in its entirety for a description of the assumptions made, matters
considered and limitations of the review undertaken by DLJ.
The Company has informed Parent that neither the Offer nor the Merger will
have any effect on the rights of class members under the previously announced
settlement of the stockholder litigation captioned IN RE NORAND SECURITIES
LITIGATION. Accordingly, any stockholder of the Company who is entitled to
participate in such settlement will retain all such rights regardless of whether
the Shares owned by such stockholder are acquired pursuant to the Offer or the
Merger.
The affirmative vote of holders of a majority of the outstanding Shares is
required to approve the Merger. As a result, if the Minimum Condition and the
other conditions to the Offer are satisfied and the Offer is consummated, the
Purchaser will own a sufficient number of Shares to ensure that the Merger will
be approved by the Company's stockholders. SEE SECTION 11.
The Company has advised the Purchaser that, to the knowledge of the Company,
all of its executive officers, directors, affiliates or subsidiaries who are
also stockholders intend either to tender their Shares in the Offer or to vote
in favor of the Merger.
The Company has informed the Purchaser that, as of January 17, 1997, there
were 7,842,905 Shares issued and outstanding, 1,252,347 Shares reserved for
issuance upon the exercise of outstanding stock options and 577,079 Shares
reserved for issuance upon the exercise of outstanding warrants.
THE OFFER IS CONDITIONED UPON THE FULFILLMENT OF CERTAIN CONDITIONS
DESCRIBED IN SECTION 14 BELOW. THE OFFER WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON FRIDAY, FEBRUARY 21, 1997, UNLESS EXTENDED.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE
WITH RESPECT TO THE OFFER.
1. TERMS OF THE OFFER.
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), the Purchaser will accept for payment and thereby purchase all
Shares validly tendered and not withdrawn in accordance with the procedures set
forth in Section 4 on or prior to the Expiration Date. The term "Expiration
Date" means 12:00 midnight, New York City time, on Friday, February 21, 1997,
unless and until the Purchaser, in its sole discretion, shall have extended the
period of time for which the Offer is open, in which event the term "Expiration
Date" shall mean the time and date at which the Offer, as so extended by the
Purchaser, shall expire.
Upon the terms and subject to the conditions of the Offer, the Purchaser
will accept for payment and purchase, as soon as permitted under the terms of
the Offer, all Shares validly tendered and not withdrawn prior to the expiration
of the Offer. If at the Expiration Date, the conditions to the Offer described
in Section 14 hereof shall not have been satisfied or earlier waived but, in the
reasonable belief of Parent, may be satisfied prior to September 30, 1997, then,
subject to the provisions of the Merger Agreement, the Purchaser will extend the
Expiration Date for an additional period or periods of time by giving oral or
written notice of such extension to the Depositary. During any such extension,
all Shares previously tendered and not withdrawn will remain subject to the
Offer and subject to the right of a tendering stockholder to withdraw such
stockholder's Shares. SEE SECTION 4.
2
Subject to the applicable regulations of the Commission and the terms of the
Merger Agreement, the Purchaser also expressly reserves the right, in its sole
discretion, at any time or from time to time, to (i) delay acceptance for
payment of or, regardless of whether such Shares were theretofore accepted for
payment, payment for any Shares pending receipt of any regulatory or
governmental approvals specified in Section 15; (ii) terminate the Offer
(whether or not any Shares have theretofore been accepted for payment) if any
condition referred to in Section 14 has not been satisfied or upon the
occurrence of any event specified in Section 14; and (iii) except as set forth
in the Merger Agreement, waive any condition or otherwise amend the Offer in any
respect, in each case, by giving oral or written notice of such delay,
termination, waiver or amendment to the Depositary and, other than in the case
of any such waiver, by making a public announcement thereof. The Purchaser
acknowledges (i) that Rule 14e-1(c) under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), requires the Purchaser to pay the consideration
offered or return the Shares tendered promptly after the termination or
withdrawal of the Offer and (ii) that the Purchaser may not delay acceptance for
payment of, or payment for (except as provided in clause (i) of the preceding
sentence), any Shares upon the occurrence of any event specified in Section 14
without extending the period of time during which the Offer is open.
The rights reserved by the Purchaser in the preceding paragraph are in
addition to the Purchaser's rights pursuant to Section 14. Any such extension,
delay, termination or amendment will be followed as promptly as practicable by
public announcement thereof, and such announcement in the case of an extension
will be made no later than 9:00 a.m., New York City time, on the next business
day after the previously scheduled Expiration Date. Without limiting the manner
in which the Purchaser may choose to make any public announcement, subject to
applicable law (including Rules 14d-4(c) and 14d-6(d) under the Exchange Act,
which require that material changes be promptly disseminated to holders of
Shares), the Purchaser shall have no obligation to publish, advertise or
otherwise communicate any such public announcement other than by issuing a
release to the Dow Xxxxx News Service.
If the Purchaser makes a material change in the terms of the Offer, or if it
waives a material condition to the Offer, the Purchaser will extend the Offer
and disseminate additional tender offer materials to the extent required by
Rules 14d-4(c), 14d-6(d) and 14e-1 under the Exchange Act. The minimum period
during which an offer must remain open following material changes in the terms
of the offer, other than a change in price or a change in percentage of
securities sought, will depend upon the facts and circumstances, including the
materiality of the changes. In the Commission's view, an offer should remain
open for a minimum of five business days from the date the material change is
first published, sent or given to stockholders. With respect to a change in
price or the percentage of securities sought, a minimum of ten business days is
generally required to allow for adequate dissemination and investor response.
Accordingly, if prior to the Expiration Date, the Purchaser decreases the number
of Shares being sought, or increases or decreases the consideration offered
pursuant to the Offer, and if the Offer is scheduled to expire at any time
earlier than the period ending on the tenth business day from the date that
notice of such increase or decrease is first published, sent or given to holders
of Shares, the Offer will be extended at least until the expiration of such
period of ten business days. For purposes of the Offer, a "business day" means
any day other than a Saturday, Sunday or a federal holiday and consists of the
time period from 12:01 a.m. through 12:00 midnight, New York City time.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THE SATISFACTION OF THE
MINIMUM CONDITION.
Consummation of the Offer is also conditioned upon 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"), and the
other conditions set forth in Section 14 below. The Purchaser reserves the right
(but shall not be obligated), in accordance with applicable rules and
regulations of the Commission and with the Merger Agreement, to waive any or all
of such conditions. If, by the Expiration Date, any or all of such conditions
have not been satisfied, the Purchaser may, in the exercise of its good faith
judgment, elect to (i) extend the Offer and, subject to applicable withdrawal
rights, retain all tendered
3
Shares until the expiration of the Offer, as extended, subject to the terms of
the Offer and the Merger Agreement; (ii) waive all of the unsatisfied conditions
(other than the Minimum Condition) and, subject to complying with applicable
rules and regulations of the Commission, accept for payment all Shares so
tendered and not extend the Offer; or (iii) terminate the Offer and not accept
for payment any Shares and return all tendered Shares to tendering stockholders.
In the event that the Purchaser waives any condition set forth in Section 14,
the Commission may, if the waiver is deemed to constitute a material change to
the information previously provided to the stockholders, require that the Offer
remain open for an additional period of time and/or that the Purchaser
disseminate information concerning such waiver.
In the Merger Agreement, the Purchaser has agreed that, upon the terms and
subject to the conditions to the Offer, the Purchaser will accept for payment,
all Shares validly tendered and not withdrawn prior to the expiration of the
Offer as soon as it is permitted under the terms of the Offer. However, the
Merger Agreement provides that if the number of Shares that have been validly
tendered and not withdrawn prior to the Expiration Date represent less than 90%
of the Shares on a fully diluted basis, the Purchaser may, in its sole
discretion, extend the Offer for up to a maximum of 10 additional business days,
notwithstanding the prior satisfaction of the conditions set forth in Section
14, so long as the Purchaser waives all conditions to the Offer other than the
Minimum Condition and certain other conditions.
In addition, the Purchaser has agreed that it will not, without the prior
written consent of the Company, (i) decrease the price per Share or change the
form of consideration payable in the Offer, (ii) decrease the number of Shares
sought, (iii) impose additional conditions to the Offer or (iv) amend any other
term of the Offer in any manner adverse to the holders of Shares. The Purchaser
will not waive the Minimum Condition without the prior written consent of the
Company if, as a result, the Purchaser would acquire less than a majority of the
Shares actually outstanding.
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, the related Letter of Transmittal and
other relevant materials will be mailed by the Purchaser to record holders of
Shares and will be furnished by the Purchaser to brokers, dealers, commercial
banks, trust companies and similar persons whose names, or the names of whose
nominees, appear on the securityholder 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.
2. ACCEPTANCE FOR PAYMENT AND PAYMENT.
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of the Offer as so
extended or amended) and subject to the applicable rules of the Commission
(including Rule 14e-1(c)), the Purchaser will purchase, by accepting for
payment, and will pay for, all Shares validly tendered and not withdrawn (as
permitted by Section 4) prior to the Expiration Date promptly after the later to
occur of (i) the Expiration Date and (ii) the satisfaction or waiver of the
conditions to the Offer set forth in Section 14. SEE SECTION 14. In addition,
subject to applicable rules of the Commission, the Purchaser expressly reserves
the right to delay acceptance for payment of, or payment for, Shares pending
receipt of any regulatory or governmental approvals specified in Section 15.
For information with respect to approvals required to be obtained prior to
the consummation of the Offer, including under the HSR Act and other laws and
regulations see Section 15.
In all cases, payment for Shares purchased pursuant to the Offer will be
made only after timely receipt by the Depositary of (i) certificates
representing such Shares ("Share Certificates") or timely confirmation (a
"Book-Entry Confirmation") of the book-entry transfer of such Shares into the
Depositary's account at The Depository Trust Company or Philadelphia Depository
Trust Company (collectively, the "Book-Entry Transfer Facilities") pursuant to
the procedures set forth in Section 3; (ii) the appropriate Letter of
4
Transmittal (or a facsimile thereof), properly completed and duly executed, with
any required signature guarantees or an Agent's Message (as defined below) in
connection with a book-entry transfer; and (iii) any other documents required by
the Letter of Transmittal.
The term "Agent's Message" means a message transmitted by a Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of a
Book-Entry Confirmation, which states that such Book-Entry Transfer Facility has
received an express acknowledgment from the participant in such Book-Entry
Transfer Facility tendering the Shares which are the subject of such Book-Entry
Confirmation that such participant has received and agrees to be bound by the
terms of the Letter of Transmittal and that the Purchaser may enforce such
agreement against such participant.
For purposes of the Offer, the Purchaser will be deemed to have accepted for
payment, and thereby purchased, Shares validly tendered and not withdrawn as, if
and when the Purchaser gives oral or written notice to the Depositary of the
Purchaser's acceptance of such Shares for payment pursuant to the Offer. In all
cases, upon the terms and subject to the conditions of the Offer, payment for
Shares purchased pursuant to the Offer will be made by deposit of the purchase
price therefor with the Depositary, which will act as agent for tendering
stockholders for the purpose of receiving payment from the Purchaser and
transmitting payment to validly tendering stockholders.
UNDER NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE FOR SHARES BE
PAID BY THE PURCHASER.
If any tendered Shares are not purchased pursuant to the Offer for any
reason, or if Share Certificates are submitted representing more Shares than are
tendered, Share Certificates representing unpurchased or untendered Shares will
be returned, without expense to the tendering stockholder (or, in the case of
Shares delivered by book-entry transfer into the Depositary's account at a
Book-Entry Transfer Facility pursuant to the procedures set forth in Section 3,
such Shares will be credited to an account maintained within such Book-Entry
Transfer Facility), as promptly as practicable following the expiration,
termination or withdrawal of the Offer.
IF, PRIOR TO THE EXPIRATION DATE, THE PURCHASER SHALL INCREASE THE
CONSIDERATION OFFERED TO HOLDERS OF SHARES PURSUANT TO THE OFFER, SUCH INCREASED
CONSIDERATION SHALL BE PAID TO ALL HOLDERS OF SHARES THAT ARE PURCHASED PURSUANT
TO THE OFFER, WHETHER OR NOT SUCH SHARES WERE TENDERED PRIOR TO SUCH INCREASE IN
CONSIDERATION.
The Purchaser reserves the right, subject to the provisions of the Merger
Agreement, to transfer or assign at any time, in whole or from time to time in
part, to one or more of the Purchaser's subsidiaries or affiliates the right to
purchase all or any portion of the Shares tendered pursuant to the Offer, but
any such transfer or assignment will not relieve the Purchaser of its
obligations under the Offer or prejudice the rights of tendering stockholders to
receive payment for Shares validly tendered and accepted for payment pursuant to
the Offer.
3. PROCEDURES FOR ACCEPTING THE OFFER AND TENDERING SHARES.
VALID TENDER OF SHARES. Except as set forth below, in order for Shares to
be validly tendered pursuant to the Offer, the Letter of Transmittal (or a
facsimile thereof), properly completed and duly executed, together with any
required signature guarantees or an Agent's Message in connection with a
book-entry delivery of Shares and any other documents required by the Letter of
Transmittal must be received by the Depositary at one of its addresses set forth
on the back cover of this Offer to Purchase on or prior to the Expiration Date
and either (i) Share Certificates representing tendered Shares must be received
by the Depositary or tendered pursuant to the procedure for book-entry transfer
set forth below and Book-Entry Confirmation must be received by the Depositary,
in each case on or prior to the Expiration Date, or (ii) the guaranteed delivery
procedures set forth below must be complied with.
5
THE METHOD OF DELIVERY OF SHARE CERTIFICATES, THE LETTER OF TRANSMITTAL AND
ALL OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING
STOCKHOLDER, AND DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
DEPOSITARY. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME
SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
BOOK-ENTRY TRANSFER. The Depositary will make a request to establish
accounts with respect to the Shares at each of the Book-Entry Transfer
Facilities for purposes of the Offer within two business days after the date of
this Offer to Purchase. Any financial institution that is a participant in the
system of any Book-Entry Transfer Facility may make book-entry delivery of
Shares by causing such Book-Entry Transfer Facility to transfer such Shares into
the Depositary's account at such Book-Entry Transfer Facility in accordance with
such Book-Entry Transfer Facility's procedures for such transfer. However,
although delivery of Shares may be effected through book-entry transfer into the
Depositary's account at a Book-Entry Transfer Facility, the Letter of
Transmittal (or facsimile thereof), properly completed and duly executed, with
any required signature guarantees, or an Agent's Message in connection with a
book-entry transfer, and any other required documents must, in any case, be
transmitted to and received by the Depositary at one of its addresses set forth
on the back cover of this Offer to Purchase on or prior to the Expiration Date,
or the guaranteed delivery procedure set forth below must be complied with.
DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH
SUCH BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO
THE DEPOSITARY.
SIGNATURE GUARANTEES. Signatures on all Letters of Transmittal must be
guaranteed by a firm that is a bank, broker, dealer, credit union, savings
association or other entity which is a member in good standing of the Securities
Transfer Agents Medallion Program (an "Eligible Institution"), unless the Shares
tendered thereby are tendered (i) by a registered holder of Shares who has not
completed either the box labeled "Special Payment Instructions" or the box
labeled "Special Delivery Instructions" on the Letter of Transmittal or (ii) for
the account of an Eligible Institution. SEE INSTRUCTION 1 OF THE LETTER OF
TRANSMITTAL.
If the Share Certificates are registered in the name of a person other than
the signer of the Letter of Transmittal, or if payment is to be made to, or
Share Certificates for unpurchased Shares are to be issued or returned to, a
person other than the registered holder, then the tendered certificates must be
endorsed or accompanied by appropriate stock powers, signed exactly as the name
or names of the registered holder or holders appear on the certificates, with
the signatures on the certificates or stock powers guaranteed by an Eligible
Institution as provided in the Letter of Transmittal. SEE INSTRUCTIONS 1 AND 5
OF THE LETTER OF TRANSMITTAL.
If the Share Certificates are forwarded separately to the Depositary, a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof) must accompany each such delivery.
GUARANTEED DELIVERY. If a stockholder desires to tender Shares pursuant to
the Offer and such stockholder's Share Certificates are not immediately
available or time will not permit all required documents to reach the Depositary
on or prior to the Expiration Date or the procedures for book-entry transfer
cannot be completed on a timely basis, such Shares may nevertheless be tendered
if all of the following guaranteed delivery procedures are duly complied with:
(i) such tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form made available by the Purchaser, is
received by the Depositary, as provided below, on or prior to the Expiration
Date; and
6
(iii) the Share Certificates (or a Book-Entry Confirmation) representing
all tendered Shares, in proper form for transfer together with a properly
completed and duly executed Letter of Transmittal (or facsimile thereof),
with any required signature guarantees (or, in the case of a book-entry
transfer, an Agent's Message) and any other documents required by the Letter
of Transmittal are received by the Depositary within three National
Association of Securities Dealers Automatic Quotation System ("NASDAQ")
trading days after the date of execution of such Notice of Guaranteed
Delivery.
The Notice of Guaranteed Delivery may be delivered by hand or mail or
transmitted by facsimile transmission to the Depositary and must include a
guarantee by an Eligible Institution in the form set forth in such Notice of
Guaranteed Delivery and a representation that the stockholder on whose behalf
the tender is being made is deemed to own the Shares being tendered within the
meaning of Rule 14e-4 under the Exchange Act.
Notwithstanding any other provision hereof, payment for Shares accepted for
payment pursuant to the Offer will in all cases be made only after timely
receipt by the Depositary of Share Certificates for, or, of Book-Entry
Confirmation with respect to, such Shares, a properly completed and duly
executed Letter of Transmittal (or facsimile thereof), together with any
required signature guarantees (or, in the case of a book-entry transfer, an
Agent's Message) and any other documents required by the appropriate Letter of
Transmittal. Accordingly, payment might not be made to all tendering
stockholders at the same time, and will depend upon when Share Certificates are
received by the Depositary or Book-Entry Confirmations of such Shares are
received into the Depositary's account at a Book-Entry Transfer Facility.
BACKUP FEDERAL INCOME TAX WITHHOLDING. Under the backup federal income tax
withholding laws applicable to certain stockholders (other than certain exempt
stockholders, including, among others, all corporations and certain foreign
individuals), the Depositary may be required to withhold 31% of the amount of
any payments made to such stockholders pursuant to the Offer or the Merger. To
prevent backup federal income tax withholding, each such stockholder must
provide the Depositary with such stockholder's correct taxpayer identification
number and certify that such stockholder is not subject to backup federal income
tax withholding by completing the Substitute Form W-9 included in the Letter of
Transmittal. SEE INSTRUCTION 9 OF THE LETTER OF TRANSMITTAL.
APPOINTMENT AS PROXY. By executing the Letter of Transmittal, a tendering
stockholder irrevocably appoints designees of the Purchaser, and each of them,
as such stockholder's agents, attorneys-in-fact and proxies, with full power of
substitution, in the manner set forth in the Letter of Transmittal, to the full
extent of such stockholder's rights with respect to the Shares tendered by such
stockholder and accepted for payment by the Purchaser and with respect to any
and all other Shares and other securities or rights issued or issuable in
respect of such Shares on or after the date of this Offer to Purchase. All such
powers of attorney and proxies shall be considered irrevocable and coupled with
an interest in the tendered Shares. Such appointment will be effective upon the
acceptance for payment of such Shares by the Purchaser in accordance with the
terms of the Offer. Upon such acceptance for payment, all other powers of
attorney and proxies given by such stockholder with respect to such Shares and
such other securities or rights prior to such payment will be revoked, without
further action, and no subsequent powers of attorney and proxies may be given by
such stockholder (and, if given, will not be deemed effective). The designees of
the Purchaser will, with respect to the Shares and such other securities and
rights for which such appointment is effective, be empowered to exercise all
voting and other rights of such stockholder as they in their sole discretion may
deem proper at any annual or special meeting of the Company's stockholders, or
any adjournment or postponement thereof, or by consent in lieu of any such
meeting or otherwise. In order for Shares to be deemed validly tendered,
immediately upon the acceptance for payment of such Shares, the Purchaser or its
designee must be able to exercise full voting rights with respect to such Shares
and other securities, including voting at any meeting of stockholders.
DETERMINATION OF VALIDITY. All questions as to the form of documents and
the validity, eligibility (including time of receipt) and acceptance for payment
of any tender of Shares will be determined by the
7
Purchaser, in its sole discretion, whose determination shall be final and
binding on all parties. The Purchaser reserves the absolute right to reject any
or all tenders determined by it not to be in proper form or the acceptance of or
payment for which may, in the opinion of the Purchaser's counsel, be unlawful.
The Purchaser also reserves the absolute right to waive any of the conditions of
the Offer or any defect or irregularity in any tender of Shares of any
particular stockholder whether or not similar defects or irregularities are
waived in the case of other stockholders.
The Purchaser's interpretation of the terms and conditions of the Offer will
be final and binding. No tender of Shares will be deemed to have been validly
made until all defects and irregularities with respect to such tender have been
cured or waived by the Purchaser. None of Parent, the Purchaser or any of their
respective affiliates or assigns, the Depositary, the Information Agent or any
other person or entity will be under any duty to give any notification of any
defects or irregularities in tenders or incur any liability for failure to give
any such notification.
The Purchaser's acceptance for payment of Shares tendered pursuant to any of
the procedures described above will constitute a binding agreement between the
tendering stockholder and the Purchaser upon the terms and subject to the
conditions of the Offer.
4. WITHDRAWAL RIGHTS.
Except as otherwise provided in this Section 4, tenders of Shares made
pursuant to the Offer are irrevocable. Shares tendered pursuant to the Offer may
be withdrawn at any time on or prior to the Expiration Date and, unless
theretofore accepted for payment as provided herein, may also be withdrawn at
any time after March 24, 1997 (or such later date as may apply in case the Offer
is extended).
If, for any reason whatsoever, acceptance for payment of any Shares tendered
pursuant to the Offer is delayed, or the Purchaser is unable to accept for
payment or pay for Shares tendered pursuant to the Offer, then, without
prejudice to the Purchaser's rights set forth herein, the Depositary may,
nevertheless, on behalf of the Purchaser, retain tendered Shares and such Shares
may not be withdrawn except to the extent that the tendering stockholder is
entitled to and duly exercises withdrawal rights as described in this Section 4.
Any such delay will be by an extension of the Offer to the extent required by
law.
In order for a withdrawal to be effective, a written or facsimile
transmission notice of withdrawal must be timely received by the Depositary at
one of its addresses set forth on the back cover of this Offer to Purchase. Any
such notice of withdrawal must specify the name of the person who tendered the
Shares to be withdrawn, the number of Shares to be withdrawn, and (if Share
Certificates have been tendered) the name of the registered holder of the Shares
as set forth in the Share Certificate, if different from that of the person who
tendered such Shares. If Share Certificates have been delivered or otherwise
identified to the Depositary, then prior to the physical release of such
certificates, the tendering stockholder must submit the serial numbers shown on
the particular certificates evidencing the Shares to be withdrawn and the
signature on the notice of withdrawal must be guaranteed by an Eligible
Institution, except in the case of Shares tendered for the account of an
Eligible Institution. If Shares have been tendered pursuant to the procedures
for book-entry transfer set forth in Section 3, the notice of withdrawal must
specify the name and number of the account at the appropriate Book-Entry
Transfer Facility to be credited with the withdrawn Shares, in which case a
notice of withdrawal will be effective if delivered to the Depositary by any
method of delivery described in the first sentence of this paragraph.
Withdrawals of Shares may not be rescinded. Any Shares properly withdrawn will
be deemed not validly tendered for purposes of the Offer, but may be tendered at
any subsequent time prior to the Expiration Date by following any of the
procedures described in Section 3.
All questions as to the form and validity (including time of receipt) of
notices of withdrawal will be determined by the Purchaser, in its sole
discretion, whose determination shall be final and binding. None of Parent, the
Purchaser or any of their respective affiliates or assigns, the Depositary, the
Information
8
Agent or any other person or entity will be under any duty to give any
notification of any defects or irregularities in any notice of withdrawal or
incur any liability for failure to give any such notification.
5. CERTAIN TAX CONSEQUENCES.
The receipt of cash for Shares pursuant to the Offer or the Merger will be a
taxable transaction for federal income tax purposes and may also be a taxable
transaction under applicable state, local, foreign and other tax laws. For
United States federal income tax purposes, each selling or exchanging
stockholder would generally recognize gain or loss equal to the difference
between the amount of cash received and such stockholder's tax basis for the
sold or exchanged Shares. Such gain or loss will be capital gain or loss
(assuming the Shares are held as a capital asset) and any such capital gain or
loss will be long term if, as of the date of sale or exchange, the Shares were
held for more than one year or will be short term if, as of such date, the
Shares were held for one year or less.
The foregoing discussion may not be applicable to certain types of
stockholders, including stockholders who acquired Shares pursuant to the
exercise of employee stock options or otherwise as compensation, individuals who
are not citizens or residents of the United States and foreign corporations or
entities that are otherwise subject to special tax treatment under the Internal
Revenue Code of 1986, as amended (such as insurance companies, tax-exempt
entities and regulated investment companies).
THE FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL
INFORMATION ONLY. STOCKHOLDERS ARE URGED TO CONSULT THEIR TAX ADVISORS WITH
RESPECT TO THE SPECIFIC TAX CONSEQUENCES TO THEM OF THE OFFER AND MERGER,
INCLUDING FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES.
9
6. PRICE RANGE OF THE SHARES; DIVIDENDS.
According to the Company's Annual Report on Form 10-K for the fiscal year
ended August 31, 1996 (the "Form 10-K"), the Shares are traded in the
over-the-counter market and quoted on the NASDAQ National Market System (the
"NMS") under the symbol "NRND." The following table sets forth, for the periods
indicated, the reported high and low sale prices for the Shares on the NMS, as
reported in the Form 10-K with respect to periods occurring in fiscal 1995 and
1996, and as reported thereafter by published financial sources, with respect to
periods occurring in fiscal 1997.
NORAND CORPORATION
HIGH LOW
--------- ---------
FISCAL 1995
First Quarter............................................................. $ 40.75 $ 32.75
Second Quarter............................................................ 41.00 33.00
Third Quarter............................................................. 42.75 27.00
Fourth Quarter............................................................ 48.25 32.25
FISCAL 1996
First Quarter............................................................. 43.25 13.25
Second Quarter............................................................ 19.00 11.13
Third Quarter............................................................. 21.00 15.50
Fourth Quarter............................................................ 23.00 15.75
FISCAL 1997
First Quarter............................................................. 20.50 15.00
Second Quarter (through January 23, 1997)................................. 33.25 16.00
To date, the Company has paid no cash dividends on the Shares.
On January 21, 1997, the last full day of trading prior to the announcement
of the execution of the Merger Agreement, according to published sources, the
reported closing price on the NMS for the Shares was $19.38 per Share. On
January 23, 1997, the last full day of trading prior to the commencement of the
Offer, according to published sources, the reported closing price on the NMS for
the Shares was $32.88 per Share.
STOCKHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS FOR THE SHARES.
7. POSSIBLE EFFECTS OF THE OFFER ON THE MARKET FOR THE SHARES; STOCK QUOTATION;
EXCHANGE ACT REGISTRATION; MARGIN REGULATIONS.
POSSIBLE EFFECTS OF THE OFFER ON THE MARKET FOR THE SHARES. The purchase of
Shares pursuant to the Offer will reduce the number of Shares that might
otherwise trade publicly and could adversely affect the liquidity and market
value of the remaining Shares held by the public. The purchase of Shares
pursuant to the Offer can also be expected to reduce the number of holders of
Shares. The Purchaser cannot predict whether the reduction in the number of
Shares that might otherwise trade publicly would have an adverse or beneficial
effect on the market price for or marketability of the Shares or whether it
would cause future market prices to be greater or less than the Offer price
therefor.
STOCK QUOTATION. Depending upon the number of Shares purchased pursuant to
the Offer, the Shares may no longer meet the requirements of the National
Association of Securities Dealers (the "NASD") for continued inclusion in the
NMS, which require that an issuer have at least 200,000 publicly held shares,
held by at least 400 stockholders or 300 stockholders of round lots, with a
market value of at least
10
$1,000,000, and have net tangible assets of at least $1,000,000, $2,000,000 or
$4,000,000, depending on profitability levels during the issuer's four most
recent fiscal years. If these standards are not met, the Shares might
nevertheless continue to be included in the NASD's NASDAQ Stock Market (the
"NASDAQ Stock Market") with quotations published in the NASDAQ "additional list"
or in one of the "local lists", but if the number of holders of the Shares were
to fall below 300, or if the number of publicly held Shares were to fall below
100,000 or there were not at least two registered and active market makers for
the Shares, the NASD's rules provide that the Shares would no longer be
"qualified" for NASDAQ Stock Market reporting and the NASDAQ Stock Market would
cease to provide any quotations. Shares held directly or indirectly by
directors, officers or beneficial owners of more than 10% of the Shares are not
considered as being publicly held for this purpose. According to the Form 10-K,
as of November 8, 1996, there were approximately 8,000 holders of Shares and
there were 7,664,621 Shares outstanding. If, as a result of the purchase of
Shares pursuant to the Offer or otherwise, the Shares no longer meet the
requirements of the NASD for continued inclusion in the NASDAQ National Market
or in any other tier of the NASDAQ Stock Market and the Shares are no longer
included in the NASDAQ National Market or in any other tier of the NASDAQ Stock
Market, as the case may be, the market for Shares could be adversely affected.
In the event that the Shares no longer meet the requirements of the NASD for
continued inclusion in any tier of the NASDAQ Stock Market, 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 interests 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.
EXCHANGE ACT REGISTRATION. The Shares are currently registered under the
Exchange Act. The purchase of the Shares pursuant to the Offer may result in the
Shares becoming eligible for deregistration under the Exchange Act. Registration
of the Shares may be terminated upon application by the Company to the
Commission if the Shares are not listed on a "national securities exchange" and
there are fewer than 300 record holders of Shares. Termination of registration
of the Shares under the Exchange Act would substantially reduce the information
required to be furnished by the Company to its stockholders and the Commission
and would make certain provisions of the Exchange Act, such as the short-swing
profit recovery provisions of Section 16(b) and the requirements of furnishing a
proxy statement in connection with stockholders' meetings pursuant to Section
14(a) or 14(c) and the related requirement of an annual report, no longer
applicable to the Company. If the Shares are no longer registered under the
Exchange Act, the requirements of Rule 13e-3 under the Exchange Act with respect
to "going private" transactions would no longer be applicable to the Company.
Furthermore, the ability of "affiliates" of the Company and persons holding
"restricted securities" of the Company to dispose of such securities pursuant to
Rule 144 promulgated under the Securities Act of 1933, as amended, may be
impaired or, with respect to certain persons, eliminated. If registration of the
Shares under the Exchange Act were terminated, the Shares would no longer be
"margin securities" or eligible for stock exchange listing or NASDAQ reporting.
The Purchaser believes that the purchase of the Shares pursuant to the Offer may
result in the Shares becoming eligible for deregistration under the Exchange
Act, and it would be the intention of the Purchaser to cause the Company to make
an application for termination of registration of the Shares as soon as possible
after successful completion of the Offer if the Shares are then eligible for
such termination.
If registration of the Shares is not terminated prior to the Merger, then
the registration of the Shares under the Exchange Act and the quotation of the
Shares on the NMS will be terminated following the consummation of the Merger.
MARGIN REGULATIONS. The Shares are currently "margin securities" under the
regulations of the Board of Governors of the Federal Reserve System (the
"Federal Reserve Board"), which have the effect, among
11
other things, of allowing brokers to extend credit on the collateral of such
Shares for the purpose of buying, carrying or trading in securities ("Purpose
Loans"). Depending upon factors such as the number of record holders of the
Shares and the number and market value of publicly held Shares, following the
purchase of Shares pursuant to the Offer, the Shares might no longer constitute
"margin securities" for purposes of the Federal Reserve Board's margin
regulations and, therefore, could no longer be used as collateral for Purpose
Loans made by brokers. In addition, if registration of the Shares under the
Exchange Act were terminated, the Shares would no longer constitute "margin
securities."
8. CERTAIN INFORMATION CONCERNING THE COMPANY.
The following description of the Company and its business has been taken
from the Form 10-K and is qualified in its entirety by reference to the Form
10-K:
Norand Corporation, a Delaware corporation, was organized in 1988 as the
successor to a business established in 1968. In February 1993 Xxxxxx
completed an initial public offering of 4,025,000 shares of its common
stock. Xxxxxx's principal executive office is located at 000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxx, Xxxx 00000. Xxxxxx's telephone number is (319)
369-3100. . . .
Norand designs, develops, manufactures, markets and services mobile
computing systems and wireless data communication networks using radio
frequency technology. These systems automate the collection, processing and
communication of information related to product sales and distribution,
inventory control and warehouse data management. Norand systems include
hand-held computers and radio frequency terminals as well as a variety of
other hardware devices; application-specific software; communication
networks; systems integration and support services; and related peripheral
items including portable printers and bar code scanning devices.
Xxxxxx has continued to invest in a variety of enabling technologies
(such as application software and network communications systems) that
support its systems solution approach. Xxxxxx has spent over $120 million on
product development and engineering expenses since October 1988 to transform
the Company from a hardware product-oriented company to an integrated
systems solutions provider.
12
The selected financial information of the Company and its consolidated
subsidiaries set forth below has been excerpted and derived from the Form 10-K
and from the Company's Quarterly Report on Form 10-Q for the three-month period
ended November 30, 1996. More comprehensive financial and other information is
included in such reports (including management's discussion and analysis of
financial condition and results of operations) and in other reports and
documents filed by the Company with the Commission. The financial information
set forth below is qualified in its entirety by reference to such reports and
documents filed with the Commission and the financial statements and related
notes contained therein. These reports and other documents may be examined and
copies thereof may be obtained in the manner set forth below. As described in
such reports, certain information set forth below is a restatement of
information originally reported.
NORAND CORPORATION
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
THREE MONTHS ENDED
------------------------- FISCAL YEAR ENDED AUGUST 31
NOVEMBER 30, DECEMBER 2, ----------------------------------
1996 1995 1996 1995 1994
------------ ----------- ---------- ---------- ----------
STATEMENT OF OPERATIONS DATA:
Revenues:
Product sales revenue.......................... $ 44,836 $ 39,231 $ 193,249 $ 179,266 $ 153,653
Customer service revenue....................... 10,600 10,575 42,251 38,648 33,816
------------ ----------- ---------- ---------- ----------
Total revenues............................... 55,436 49,806 235,500 217,914 187,469
Cost of products and services.................... 31,692 30,966 141,744 127,816 96,139
------------ ----------- ---------- ---------- ----------
Gross profit................................. 23,744 18,840 93,756 90,098 91,330
Operating Expenses:
Product developement and engineering
expenses..................................... 5,174 7,020 22,898 22,408 20,554
Selling expenses............................... 12,996 13,126 58,347 55,160 44,503
General and administrative expenses............ 4,167 4,201 17,006 15,006 12,868
Restructuring charge............................. -- -- 4,392 -- --
------------ ----------- ---------- ---------- ----------
22,337 24,347 102,643 92,574 77,925
------------ ----------- ---------- ---------- ----------
Income (loss) from operations.................... 1,407 (5,507) (8,887) (2,476) 13,405
Interest and other expenses...................... 1,740 1,112 6,256 3,482 1,437
Litigation settlement............................ -- 300 5,100 -- --
------------ ----------- ---------- ---------- ----------
Income (loss) before income taxes................ (333) (6,919) (20,243) (5,958) 11,968
Provision (benefit) for income taxes............. (100) (2,076) (6,073) (2,252) 5,594
------------ ----------- ---------- ---------- ----------
Net income (loss)................................ $ (233) $ (4,843) $ (14,170) $ (3,706) $ 6,374
------------ ----------- ---------- ---------- ----------
------------ ----------- ---------- ---------- ----------
Net income (loss) per common share............... $ (0.03) $ (0.63) $ (1.87) $ (0.50) $ 0.86
BALANCE SHEET DATA (AT END OF PERIOD):
Working capital.................................. $ (5,291) $ (5,787) $ 14,777 $ 29,574
Total assets..................................... 160,877 172,065 160,588 133,431
Stockholders' equity............................. 42,636 42,734 55,271 56,977
13
Although neither Parent nor the Purchaser has any knowledge that any such
information is untrue, neither Parent nor the Purchaser takes any responsibility
for the accuracy or completeness of information contained in this Offer to
Purchase with respect to the Company or any of its subsidiaries or affiliates or
for any failure by the Company to disclose events which may have occurred or may
affect the significance or accuracy of any such information.
The Company is subject to the information and reporting requirements of the
Exchange Act and in accordance therewith is required to file periodic reports,
proxy statements and other information with the Commission relating to its
business, financial condition and other matters. Certain information, as of
particular dates, concerning the Company's business, principal physical
properties, capital structure, material pending legal proceedings, operating
results, financial condition, directors and officers (including their
remuneration and the stock options granted to them), the principal holders of
the Company's securities, any material interests of such persons in transactions
with the Company and certain other matters is required to be disclosed in proxy
statements and annual reports distributed to the Company's stockholders and
filed with the Commission. Such reports, proxy statements and other information
may be inspected and copied at the Commission's public reference facilities at
Judiciary Plaza, 000 Xxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000, and should also
be available for inspection at the following regional offices of the Commission:
7 World Trade Center, New York, New York 00000 xxx 000 Xxxx Xxxxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxx 00000-0000; and copies may be obtained by mail at prescribed
rates from the principal office of the Commission at 000 Xxxxx Xxxxxx, X.X.,
Xxxxxxxxxx, X.X. 00000. Reports, proxy statements and other information
concerning the Company also should be available for inspection at the offices of
NASDAQ Operations, 0000 X Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000.
In the course of the discussions between representatives of Parent and the
Company (see Section 10) certain projections of future operating performance
were furnished to Parent's representatives. These projections were not prepared
with a view to public disclosure or compliance with published guidelines of the
Commission or the guidelines established by the American Institute of Certified
Public Accountants regarding projections, and are included in this Offer to
Purchase only because they were provided to Parent. None of Parent, the
Purchaser or the Company assumes any responsibility for the accuracy of these
projections. While presented with numerical specificity, these projections are
based upon a variety of assumptions relating to the businesses of the Company
which may not be realized and are subject to significant uncertainties and
contingencies, many of which are beyond the control of the Company. These
assumptions, uncertainties and contingencies include, without limitation, the
Company's assumed ability to continue to realize historical revenue growth of
approximately 14% per year and operating margin improvements based on the
assumption that the Company will continue to be successful in implementing
initiatives to reduce procurement expenses and other operating expenses. There
can be no assurance that the projections will be realized, and actual results
may vary materially from those shown.
These projections indicated sales of $268.7 million, $305.9 million and
$350.0 million for fiscal years 1997, 1998 and 1999, respectively, net income of
$8.7 million, $16.0 million and $21.9 million for fiscal years 1997, 1998 and
1999, respectively and earnings per share of $1.13, $2.06 and $2.77 for fiscal
years 1997, 1998 and 1999, respectively. These projections should be read
together with the historical financial statements of the Company referred to
herein.
14
9. CERTAIN INFORMATION CONCERNING PARENT AND THE PURCHASER.
Parent is a Delaware corporation whose principal executive offices are
located at 000 Xxxxx Xxxxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx, 00000-0000.
Parent operates in two principal business segments, "Oilfield Services" and
"Industrial Automation Systems". Oilfield Services' operations are conducted
through a wholly owned subsidiary of Parent, ("WAII"), and WAII's divisions and
subsidiaries. Oilfield Services operates in the high-technology information
services sector of the industry. As a source of integrated reservoir
description, Oilfield Services is involved worldwide in seismic surveys and
well-logging for exploration, development and production of oil and gas.
Oilfield Services also develops software products for analysis, integration and
graphic presentation of reservoir characteristics.
Parent's Industrial Automation Systems business segment is an international
supplier of industrial automation technologies and products, including
integrated manufacturing systems and automated data collection systems. Parent
supplies machining, body and assembly and precision grinding systems for the
automotive industry, and automated data collection systems for manufacturing and
distribution applications. Overall, customers of Industrial Automation Systems
are the global automotive and off-road vehicle industries, retail and wholesale
distribution companies, manufacturing industries, airlines and government
agencies.
Parent's automated data collection business is conducted by Intermec
Corporation ("Intermec") and Intermec's Subsidiaries. Automated data collection
systems are used to gather and organize data, and then transmit selected
information from various locations to a user's central computer or retrieval
system. Such products are employed in a growing number of applications worldwide
to improve productivity, efficiency and accuracy in data collection. Automated
data collection systems are typically used to track personnel, parts or products
and transactions through manufacturing, distribution and other processes.
Technologies used for automated data collection include bar code printers, laser
scanners and other imaging methods, as well as hand-held computers and wireless
radio frequency ("RF") transmission devices. Bar coding is currently the most
widely used technology for automated data collection, providing a cost-effective
solution and a rapid return on investment for customers.
The Purchaser's principal executive offices are located at 000 Xxxxx
Xxxxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx, 00000-0000. The Purchaser is a newly
formed Delaware corporation and a wholly owned subsidiary of Parent. The
Purchaser has not conducted any business other than in connection with the Offer
and the Merger.
The name, business address, citizenship, present principal occupation and
employment history for the past five years of each of the directors and
executive officers of Parent and the Purchaser are set forth in Schedule I.
Parent is subject to the information and reporting requirements of the
Exchange Act and in accordance therewith is required to file periodic reports,
proxy statements and other information with the Commission relating to its
business, financial condition and other matters. Certain information, as of
particular dates, concerning Parent's business, principal physical properties,
capital structure, material pending legal proceedings, operating results,
financial condition, directors and officers (including their remuneration and
stock options granted to them), the principal holders of Parent's securities,
any material interests of such persons in transactions with Parent and certain
other matters is required to be disclosed in proxy statements and annual reports
distributed to Parent's stockholders and filed with the Commission. Such
reports, proxy statements and other information may be inspected and copied at
the Commission's public reference facilities and should also be available for
inspection in the same manner as set forth with respect to the Company in
Section 8.
Set forth below is certain consolidated financial information with respect
to Parent and its consolidated subsidiaries for its fiscal years ended and as of
December 31, 1995, and 1994 and for the nine-month
15
periods ended as of September 30, 1996 and 1995. More comprehensive financial
and other information is included in Parent's Annual Report on Form 10-K for its
fiscal year ended December 31, 1995 and Parent's Quarterly Report on Form 10-Q
for the quarter and nine-month period ended November 30, 1996 (including
management's discussion and analysis of financial condition and results of
operations) and in other reports and documents filed by Parent with the
Commission. The financial information set forth below is qualified in its
entirety by reference to such reports and documents filed with the Commission
and the financial statements and related notes contained therein. These reports
and other documents may be examined and copies thereof may be obtained in the
manner set forth above.
WESTERN ATLAS INC.
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
NINE MONTHS ENDED FISCAL YEAR ENDED
SEPTEMBER 30 DECEMBER 31
-------------------- --------------------
1996 1995 1995 1994
--------- --------- --------- ---------
INCOME STATEMENT DATA:
Sales............................................................ $ 1,848.5 $ 1,641.3 $ 2,225.8 $ 2,165.7
Costs and Expenses............................................... 1,700.1 1,519.2 2,058.0 2,032.4
Earnings Before Taxes............................................ 148.4 122.0 167.8 133.3
Net Earnings..................................................... 89.0 72.6 99.8 77.7
Net Earnings Per Shares.......................................... $ 1.64 $ 1.35 $ 1.85 $ 1.60
BALANCE SHEET DATA (AT END OF PERIOD):
Working Capital.................................................. $ 453.4 $ 494.1 $ 400.0
Total Assets..................................................... 2,576.9 2,489.2 2,404.1
Long-term Obligations............................................ 489.3 535.0 522.3
Total Shareholders' Investment................................... 1,457.9 1,356.8 1,248.3
Except as set forth elsewhere in this Offer to Purchase or Schedule I
hereto: (i) neither Parent nor the Purchaser nor, to the knowledge of Parent or
the Purchaser, any of the persons listed in Schedule I hereto or any associate
or majority-owned subsidiary of Parent or the Purchaser or any of the persons so
listed, beneficially owns or has a right to acquire any Shares or any other
equity securities of the Company; (ii) neither Parent nor the Purchaser nor, to
the knowledge of Parent or the Purchaser, any of the persons or entities
referred to in clause (i) above or any of their executive officers, directors or
subsidiaries has effected any transaction in the Shares or any other equity
securities of the Company during the past 60 days; (iii) neither Parent nor the
Purchaser nor, to the knowledge of Parent or the Purchaser, any of the persons
listed in Schedule I hereto, has any contract, arrangement, understanding or
relationship with any other person with respect to any securities of the Company
(including, but not limited to, any contract, arrangement, understanding or
relationship concerning the transfer or the voting of any such securities, joint
ventures, loan or option arrangements, puts or calls, guaranties of loans,
guaranties against loss or the giving or withholding of proxies, consents or
authorizations); (iv) since September 1, 1993, there have been no transactions
which would require reporting under the rules and regulations of the Commission
between Parent or the Purchaser or any of their respective subsidiaries or, to
the knowledge of Parent or the Purchaser, any of the persons listed in Schedule
I hereto, on the one hand, and the Company or any of its executive officers,
directors or affiliates, on the other hand; and (v) since September 1, 1993,
there have been no contacts, negotiations or transactions between Parent or the
Purchaser or any of their respective subsidiaries or, to the knowledge of Parent
or the Purchaser, any of the persons listed in Schedule I hereto, on the one
hand, and the Company or any of its subsidiaries or affiliates, on the other
hand, concerning a merger, consolidation or acquisition, a tender offer or other
acquisition of securities, an election of directors or a sale or other transfer
of a material amount of assets.
16
10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY.
Initial contacts between the Company and Parent concerning a possible
business combination or other strategic relationship began in January 1996. In
February 1996, the Company and Parent entered into a mutual
confidentiality/standstill agreement (the "Confidentiality Agreement") (SEE
SECTION 11) and began exchanging certain non-public information concerning the
Company. This process continued through May 1996.
In June 1996, the Company and Parent agreed to defer further consideration
of a possible transaction pending the resolution of certain stockholder
litigation against the Company. An agreement providing for the settlement of
such litigation was reached in August 1996 and confirmed by the court in
December 1996.
On January 6 and 7, 1997, representatives of the Company and Parent met to
discuss a possible business combination and the Company's financial outlook.
Additional discussions were held by telephone over the period between January 8
and January 16. Meetings among representatives of the Company and Parent and
their advisors took place on January 19 through January 21 at which the
significant terms of the Merger Agreement were negotiated. On January 21, 1997,
the Merger Agreement was presented to, and approved by, the Board of Directors
of the Company and the Executive Committee of the Board of Directors of Parent
(acting with the authority of the full Board of Directors), and the Merger
Agreement was executed by the parties.
11. PURPOSE OF THE OFFER; THE MERGER AGREEMENT; STATUTORY REQUIREMENTS;
APPRAISAL RIGHTS; PLANS FOR THE COMPANY; OTHER AGREEMENTS.
PURPOSE. The purpose of the Offer and the Merger is to acquire control of,
and the entire equity interest in, the Company.
THE MERGER AGREEMENT. The following summary description of the Merger
Agreement is qualified in its entirety by reference to such agreement, which has
been filed as an exhibit to the Tender Offer Statement on Schedule 14D-1 filed
with the Commission by Parent and the Purchaser (the "Schedule 14D-1"), which
may be examined and copies obtained as set forth in Section 8 above (except that
it will not be available at the regional offices of the Commission).
The Merger Agreement provides that in accordance with the provisions thereof
and the General Corporation Law of the State of Delaware (the "DGCL"), at the
date and time when the Merger shall become effective pursuant to Section 2.02 of
the Merger Agreement (the "Effective Time"), the Purchaser will be merged with
and into the Company, and the Company will be the surviving corporation
(hereinafter sometimes called the "Surviving Corporation") and continue its
corporate existence under the laws of the State of Delaware. At the Effective
Time the separate existence of the Purchaser shall cease.
Pursuant to the Merger Agreement, as of the Effective Time, by virtue of the
Merger and without any action on the part of the holders thereof, each Share
issued and outstanding immediately prior to the Effective Time (other than any
Shares held by Parent, the Purchaser, any subsidiary of Parent or the Purchaser
or in the treasury of the Company, which Shares, by virtue of the Merger and
without any action on the part of the holder thereof, shall be cancelled and
retired and shall cease to exist with no payment being made with respect
thereto, and other than any Dissenting Shares) will be converted into the right
to receive $33.50 net to its holder in cash or any higher price per Share paid
in the Offer, payable to the holder thereof, without interest thereon, upon
surrender of the certificate formerly representing such Share.
For a description of certain appraisal rights available to stockholders
under the DGCL in connection with the Merger, see "--Appraisal Rights" below in
this Section 11.
As of the Effective Time, by virtue of the Merger and without any action on
the part of the holders thereof, each share of capital stock of the Purchaser
issued and outstanding immediately prior to the
17
Effective Time will be converted into and become one fully paid and
nonassessable share of Common Stock, par value $0.01 per share, of the Surviving
Corporation.
Under the Merger Agreement, the Company and Parent have agreed to take all
actions necessary to provide that immediately prior to consummation of the Offer
(i) each outstanding option to purchase Shares (the "Options") granted under any
of the Company's 1989 Stock Option Plan, the Company's Long-Term Performance
Program or the Company's 1994 Stock Option Plan for Non-Employee Directors
(collectively, the "Option Plans") will, by virtue of the Merger and without any
further action on the part of the Company or the holder of such Option, be
assumed by Parent in a manner which complies with certain provisions of the
Internal Revenue Code of 1986, as amended (the "Code"). At the Effective Time,
all references in the Option Plans to the Company will be deemed to refer to
Parent, and Parent will issue to each holder of an Option a document evidencing
the assumption of such option by Parent. Each Option assumed by Parent will be
exercisable upon the same terms and conditions including, without limitation,
vesting, as under the applicable Option Plan and the applicable option agreement
issued thereunder, except that (a) each such Option will be exercisable for the
number of shares of Common Stock, par value $1.00 per share, of Parent ("Parent
Common Stock") (rounded to the nearest whole share) obtained by multiplying the
number of Shares subject to such Option immediately prior to the Effective Time
by $33.50 and dividing the result by the average of the closing prices for the
Parent Common Stock reported on the New York Stock Exchange Consolidated Tape
for the 10 consecutive trading days immediately prior to the Effective Time; and
(b) the option price per share of Parent Common Stock shall be an amount equal
to the aggregate exercise price of such Option prior to adjustment divided by
the number of shares of Parent Common Stock subject to such Option after
adjustment (the option price per share, as so determined, being rounded upward
to the nearest full cent). The date of grant of each Parent Option will be the
date on which the corresponding Option was granted. No payment will be made for
fractional interests.
Except as provided in the Merger Agreement or as otherwise agreed to by the
parties and to the extent permitted by the Option Plans (i) the Option Plans
will terminate as of the Effective Time and the provisions in any other plan,
program or arrangement providing for the issuance or grant by the Company or any
of its subsidiaries of any interest in respect of the capital stock of the
Company or any of its subsidiaries will be deleted as of the Effective Time and
(ii) the Company will use all reasonable efforts to ensure that following the
Effective Time no holder of Options or any participant in any Option Plan or any
other such plans, programs or arrangements shall have any right thereunder to
acquire any equity securities of the Company, the Surviving Corporation or any
subsidiary thereof.
The Merger Agreement provides that the Certificate of Incorporation and
By-Laws of the Purchaser will be the Certificate of Incorporation and By-Laws of
the Surviving Corporation until thereafter amended as provided by law, except
that the name of the Surviving Corporation will be "Norand Corporation."
Under the Merger Agreement the directors of the Purchaser immediately prior
to the Effective Time will be the initial directors of the Surviving Corporation
and will hold office until their respective successors are duly elected and
qualified, or their earlier death, resignation or removal. The officers of the
Company immediately prior to the Effective Time will be the initial officers of
the Surviving Corporation and will hold office until their respective successors
are duly elected and qualified, or their earlier death, resignation or removal.
AGREEMENTS OF THE COMPANY, PARENT AND THE PURCHASER. The Merger Agreement
provides that, if required by applicable law in order to consummate the Merger,
the Company, acting through its Board of Directors, shall, in accordance with
applicable law, duly call, give notice of, convene and hold a special meeting of
its stockholders (the "Special Meeting") as soon as practicable following the
purchase of and payment for Shares by the Purchaser pursuant to the Offer for
the purpose of considering and adopting Merger Agreement and such other matters
as may be necessary to consummate the transactions contemplated by the Merger
Agreement.
18
Under the Merger Agreement, in the event that Parent, the Purchaser or any
other subsidiary of Parent acquires at least 90% of the outstanding Shares
pursuant to the Offer or otherwise, at the request of Parent or the Purchaser,
Parent, the Purchaser and the Company will take all necessary and appropriate
action to cause the Merger to become effective as soon as practicable after the
acceptance for payment and purchase of Shares by the Purchaser pursuant to the
Offer without a meeting of stockholders of the Company in accordance with
Section 253 of the DGCL.
In the Merger Agreement, the Company has covenanted and agreed that, except
as contemplated by the Merger Agreement or as expressly agreed to in writing by
Parent, during the period from the date of the Merger Agreement to the Control
Date (as defined in "--Directors" below in this Section 11), each of the Company
and its subsidiaries will conduct its operations according to its ordinary
course of business consistent with past practice and will use commercially
reasonable efforts to preserve intact its business organization, to keep
available the services of its key employees and to maintain satisfactory
relationships with material suppliers, distributors, customers and others having
business relationships with it and will take no action not required by law that
would materially adversely affect the ability of the parties to consummate the
transactions contemplated by the Merger Agreement or be inconsistent with such
transactions.
In the Merger Agreement, the Company has covenanted and agreed that prior to
the Effective Time it will keep Parent advised of the status of all discussions
and negotiations concerning possible acquisitions and divestitures by it or any
of its subsidiaries of any corporations or businesses, and has further agreed
that without the prior written consent of Parent it will not make, or agree to
make, any such acquisition or divestiture.
Under the Merger Agreement, the Company has agreed that prior to the
Effective Time it will not, and will not authorize or permit any of its
subsidiaries or any of its or its subsidiaries' directors, officers, employees,
agents or representatives, directly or indirectly, to solicit, initiate,
facilitate or encourage (including by way of furnishing or disclosing nonpublic
information) any inquiries or the making of any proposal with respect to any
merger, consolidation or other business combination involving the Company or its
subsidiaries or acquisition of all or substantially all of the assets or capital
stock of the Company and its subsidiaries taken as a whole (an "Acquisition
Transaction") or negotiate or explore with any person (other than Parent, the
Purchaser or their respective directors, officers, employees, agents and
representatives) any Acquisition Transaction or enter into any agreement,
arrangement or understanding requiring it to abandon, terminate or fail to
consummate the Merger or any other transactions contemplated by the Merger
Agreement; provided that the Company may in response to an unsolicited written
proposal with respect to an Acquisition Transaction from a third party furnish
information to such third party, and negotiate, explore or otherwise communicate
with such third party, in each case only if the Board of Directors of the
Company determines in good faith by a majority vote, after consultation with its
financial advisors and outside legal counsel, and after the receipt of the
advice of outside legal counsel to the Company that failing to take such actions
would constitute a breach of the fiduciary duty of the Board, that failing to
take such action would constitute a breach of the fiduciary duties of the Board
of Directors of the Company. The Company has agreed to advise Parent as promptly
as practicable in writing of the receipt of any inquiries or proposals relating
to an Acquisition Transaction and any actions described in this paragraph.
Pursuant to the Merger Agreement, from the date of the Merger Agreement
until the Effective Time, and subject to any limitations imposed by applicable
law or the terms of any of the Company's or its subsidiaries' classified
contracts, the Company has agreed to give Parent and its authorized
representatives (including counsel, environmental and other consultants,
accountants and auditors) access during normal business hours to all facilities,
personnel and operations and to all books and records of the Company and its
subsidiaries, and to permit Parent to make such inspections as it may reasonably
require and to cause its officers and those of its subsidiaries to furnish
Parent with such financial and operating data and other information with respect
to its business and properties as Parent may from time to time reasonably
request.
19
Pursuant to the Merger Agreement, Parent has agreed that any information
furnished to Parent, its subsidiaries or its authorized representatives will be
subject to the provisions of the Confidentiality Agreement. See--"The
Confidentiality Agreement" below in this Section 11.
The Merger Agreement provides that, subject to the terms and conditions
therein provided and applicable law, each of the Company, Parent and the
Purchaser will use its reasonable best efforts promptly to consummate the
transactions contemplated by the Merger Agreement, including, without limitation
using such reasonable best efforts to (i) obtain all necessary consents,
approvals or waivers under its material contracts and (ii) lift any legal bar to
the Merger; provided, however, that the foregoing will not require Parent, the
Purchaser or any other affiliate of Parent to agree to any action or restriction
which, if imposed by a governmental entity, would constitute a condition
described in paragraph (A) of Section 14.
Under the Merger Agreement, before issuing any press release or otherwise
making any public statements with respect to the Merger Agreement, the Offer or
the Merger, Parent, the Purchaser and the Company will consult with each other
as to its form and substance and will not issue any such press release or make
any such public statement prior to such consultation, except in either case as
may be required by law.
Under the Merger Agreement, each of the Company and Parent have agreed to
give prompt notice to the other party of (i) the occurrence, or non-occurrence,
of any event the occurrence, or non-occurrence, of which would be likely to
cause (A) any representation or warranty contained in the Merger Agreement to be
untrue or inaccurate in any material respect at any time from the date hereof to
the acceptance for payment of Shares pursuant to the Offer, (B) any condition
set forth in Section 14 to be unsatisfied in any material respect at any time
from the date of the Merger Agreement to the date the Purchaser purchases Shares
pursuant to the Offer or (C) any conditions set forth in "--Conditions to the
Merger" below to be unsatisfied in any material respect at any time from the
date of the Merger Agreement to the Effective Time, and (ii) any material
failure of the Company or Parent, as the case may be, or any officer, director,
employee or agent thereof, to comply with or satisfy any covenant, condition or
agreement to be complied with or satisfied by it under the Merger Agreement;
provided, however, that the delivery of any notice pursuant to this paragraph
will not limit or otherwise affect the remedies available under the Merger
Agreement to the party receiving such notice.
Under the Merger Agreement, from and after the Effective Time, Parent will
indemnify, defend and hold harmless the present and former officers, directors,
employees and agents of the Company and its subsidiaries against all losses,
claims, damages, expenses or liabilities arising out of or related to actions or
omissions or alleged actions or omissions occurring at or prior to the Effective
Time, including without limitation the transactions contemplated by the Merger
Agreement, to the same extent and on the same terms and conditions (including
with respect to advancement of expenses) provided for in the Company's
Certificate of Incorporation and By-Laws and agreements in effect at the date of
the Merger Agreement (to the extent consistent with applicable law).
Pursuant to the Merger Agreement, for a period of five years after the
Effective Time, Parent has agreed to maintain in effect the current policies of
directors' and officers' liability insurance maintained by the Company (provided
that Parent may substitute therefor policies with reputable and financially
sound carriers of at least the same coverage and amounts containing terms and
conditions which are no less advantageous) with respect to claims arising from
or related to facts or events which occurred at or before the Effective Time;
provided, however, that Parent is not obligated to make annual premium payments
for such insurance to the extent such premiums exceed 150% of the annual
premiums paid as of the date of the Merger Agreement by the Company for such
insurance.
Parent has agreed pursuant to the Merger Agreement that following
consummation of the Offer, it will cause the Company to honor in accordance with
their terms certain existing employment contracts and employee benefits in
effect on the date of the Merger Agreement. In addition, Purchaser has agreed in
the Merger Agreement to provide or cause the Company to provide to individuals
who are employed by the
20
Company or any of its subsidiaries until the first anniversary of the Effective
Time employee benefits that are in the aggregate no less favorable than those
provided to them as of the date of the Merger Agreement, other than the
Company's Employee Stock Purchase Plan. Parent will make its employee stock
purchase plan available to employees of the Company as promptly as practicable
following the Effective Time.
Pursuant to the Merger Agreement, the Company has agreed that prior to the
Effective Time, it will use its reasonable best efforts to cause the Consulting
Agreement between the Company and Xxxxxx X. Xxxxxx, dated February 12, 1996, as
amended, and the Consulting Agreement between the Company and Xxx Xxxx dated
January 16, 1996, as amended, to be amended to provide that in lieu of the
warrants to purchase Shares granted pursuant to such agreements, Xx. Xxxxxx and
Xx. Xxxx each be entitled to receive from the Company an immediate cash payment
from the Company equal to the Merger Price multiplied by the number of Shares
for which their respective warrants are exercisable, minus the aggregate
exercise price of such warrants.
Under the Merger Agreement, Parent has agreed to use its reasonable best
efforts to assist the Company in obtaining from The Bank of New York Financial
Corporation ("BONYFC") a written commitment to the Company extending through at
least May 31, 1997 to lend up to $75 million to the Company on commercially
reasonable terms that are no less favorable to the Company than the terms of the
latest written proposal made by BONYFC to the Company as of the date hereof;
provided, however, that such agreement will not obligate Parent to incur any
fees or expenses payable to BONYFC or to guarantee, directly or indirectly, any
obligations or indebtedness of the Company.
If, notwithstanding the foregoing, BONYFC does not extend such written
commitment to the Company on or before March 15, 1997, then, at the Company's
option, Parent will purchase from the Company, and the Company will sell to
Parent, shares of a newly created Series A Convertible Preferred Stock of the
Company ("Series A Convertible Preferred Stock") for an aggregate purchase price
of $25,000,000 payable to the Company by wire transfer in immediately available
funds with the closing of such purchase and sale to take place no later than
March 31, 1997. If this provision becomes effective and the Series A Convertible
Preferred Stock is issued, it will have substantially the following terms. The
Series A Convertible Preferred Stock will have a liquidation preference of
$25,000,000 and will be convertible after the first anniversary of the issue
date, at the option of the holder into common stock of the Company at the rate
of one share of common stock for each $23.00 of liquidation preference, subject
to antidilution provisions substantially identical to those in the Company's
Series A and Series B Warrants. The dividend will be 6 1/2% per annum of the
liquidation preference and will be payable at the option of the Company in
shares of Series A Convertible Preferred Stock or cash. The Company will be
required to redeem the Series A Convertible Preferred Stock at the request of
the holder upon the earlier to occur of (i) consummation of a transaction
resulting in a change in control of the Company and (ii) the tenth anniversary
of the date of issuance. The Company may redeem the Series A Convertible
Preferred Stock at the option of the Company (i) during the first year after the
date of issuance at 110% of the liquidation preference and (ii) after the first
year from the date of issuance at 100% of liquidation preference as long as the
Company's common stock has traded in excess of $25.30 for any 10 consecutive
trading days. If the Company defaults on its mandatory redemption obligation,
the dividend rate will increase by 25 basis points, and will thereafter increase
by an additional 25 basis points for each 91-day period the default continues,
up to a maximum dividend rate of 10 1/2%. During continuance of the default, the
holder will be entitled to appoint one member of the Company's Board of
Directors.
DIRECTORS. In the Merger Agreement, the Company has agreed that, subject to
compliance with applicable law, promptly upon the payment by the Purchaser for
Shares purchased pursuant to the Offer representing not less than a majority of
the outstanding Shares on a fully diluted basis, and from time to time
thereafter, the Company will, upon request of Parent, promptly take all actions
necessary to cause a majority of the directors of the Company to consist of
Parent's designees, including by accepting the resignations of those incumbent
directors designated by the Company or increasing the size of the
21
Company's Board of Directors and causing Xxxxxx's designees to be elected. The
Company's obligations to appoint Xxxxxx's designees to the Board are subject to
Section 14(f) of the Exchange Act and Rule 14f-1 thereunder, if applicable.
Following the election or appointment of Xxxxxx's designees as described in this
paragraph and prior to the Effective Time, any amendment or termination of the
Merger Agreement by the Company or the Company's Board of Directors, any
extension by the Company or the Company's Board of Directors, of the time for
the performance of any of the obligations or other acts of Parent or the
Purchaser or waiver of any of the Company's rights under the Merger Agreement or
any other action by the Company concerning the Merger Agreement or any of the
transactions contemplated thereby, will require the concurrence of a majority of
the directors of the Company then in office who were not designated by Parent.
REPRESENTATIONS AND WARRANTIES. The Merger Agreement contains certain
representations and warranties by the Company, including representations and
warranties concerning: the organization and qualification of the Company and its
subsidiaries; the capitalization of the Company; the authority of the Company
relative to the execution and delivery of, and consummation of the transactions
contemplated by, the Merger Agreement and approval by the Board of Directors of
the Company regarding certain related matters; the absence of any violations of
the corporate documents and certain instruments of the Company or its
subsidiaries or of any statute, rule, regulation, order or decree, subject to
certain exceptions; the accuracy of reports and documents filed by the Company
with the Commission since January 1, 1994 and certain financial statements of
the Company; the absence since November 30, 1996 (except as amended or
supplemented in filings prior to the date of the Merger Agreement with the
Commission) to the date of the Merger Agreement of any event or occurrence
(including the incurrence or existence of any liability) which, individually or
in the aggregate, would have a Company Material Adverse Effect (as defined in
the Merger Agreement); the absence of litigation which could have a Company
Material Adverse Effect; compliance by the Company with applicable laws,
regulations, and similar matters; payment by the Company of taxes; compliance
with certain laws relating to employee benefit plans; the possession of right,
title and interest by the Company and its subsidiaries in certain intellectual
property; the absence of ongoing infringement by the Company of intellectual
property rights belonging to a third-party, indemnification by the Company for
any such infringement or claims or demands against the Company for any such
infringement; the absence of pending or threatened challenges, or grounds for a
challenge, to the rights of the Company to use certain trade secrets or
proprietary or confidential information; the absence of any material defect in
the programming and operation of the Company's software; the absence of material
rights of third parties to use the Company's software; the taking by the Board
of Directors of the Company of all appropriate and necessary action such that
the provisions of Section 203 of the DGCL will not apply to the transactions
contemplated by the Merger Agreement; and incurrence of broker's and similar
fees.
The Merger Agreement also contains certain representations and warranties by
Parent and the Purchaser, including that Parent or the Purchaser has and will
have at the time of acceptance for payment and purchase of Shares under the
Offer and at the Effective Time the funds necessary to consummate the Offer and
the Merger and the transactions contemplated thereby and to pay related fees and
expenses.
CONDITIONS TO THE MERGER. Under the Merger Agreement, the respective
obligations of each party to effect the Merger are subject to the fulfillment of
each of the following conditions: (i) the Purchaser shall have accepted for
payment and paid for Shares pursuant to the Offer in accordance with the terms
thereof; (ii) the vote of the stockholders of the Company necessary to
consummate the transactions contemplated by the Merger Agreement shall have been
obtained, if required by applicable law; and (iii) no statute, rule, regulation,
judgment, writ, decree, order or injunction shall have been promulgated,
enacted, entered or enforced, and no other action shall have been taken, by any
domestic, foreign or supranational government or governmental, administrative or
regulatory authority or agency of competent jurisdiction or by any court or
tribunal of competent jurisdiction, domestic, foreign or supranational, that in
any of the foregoing cases has the effect of making illegal or directly or
indirectly restraining, prohibiting or restricting the consummation of the
Merger.
22
TERMINATION. The Merger Agreement may be terminated at any time prior to
the Effective Time: (i) by mutual written consent of the Boards of Directors of
Parent and the Company; (ii) by either Parent or the Company if, without any
material breach of the terminating party of its obligations under the Merger
Agreement, the purchase of Shares pursuant to the Offer shall not have occurred
on or before September 30, 1997 (which date may be extended by mutual written
consent of the parties to the Merger Agreement); (iii) by Parent or the Company
if the Offer expires or is terminated or withdrawn pursuant to its terms without
any Shares being purchased thereunder; or (iv) by either Parent or the Company
if any court of competent jurisdiction in the United States or other
governmental body in the United States shall have issued an order (other than a
temporary restraining order), decree or ruling or taken any other action
restraining, enjoining or otherwise prohibiting the purchase of Shares pursuant
to the Offer or the Merger, and such order, decree, ruling or other action shall
have become final and nonappealable; provided that the party seeking to
terminate the Merger Agreement shall have used its reasonable best efforts,
subject to certain limitations, to remove or lift such order, decree or ruling.
The Merger Agreement may be terminated and the Offer and the Merger may be
abandoned by action of the Board of Directors of Parent at any time prior to the
purchase of Shares pursuant to the Offer if (i) the Board of Directors of the
Company shall withdraw, modify or change its recommendation or approval in
respect of the Merger Agreement or the Offer in a manner adverse to Parent, (ii)
the Board of Directors of the Company shall have recommended any proposal other
than by Parent or the Purchaser in respect of an Acquisition Transaction, or
(iii) a proposal for an Acquisition Transaction other than by Parent or the
Purchaser shall be publicly disclosed and at the scheduled expiration of the
Offer the Minimum Condition shall not have been satisfied.
Upon termination of the Merger Agreement, Xxxxxx has agreed to return to the
Company all copies of non-public information supplied to Parent by the Company
in Parent's possession at the time of such termination.
The Merger Agreement may be terminated and the Merger may be abandoned by
action of the Board of Directors of the Company at any time prior to the
Effective Time (i) if there shall be a material breach of any of Parent's or the
Purchaser's representations, warranties or covenants under the Merger Agreement,
which breach shall not be cured within ten days of notice thereof, or (ii) to
allow the Company to enter into an agreement in respect of an Acquisition
Transaction which the Board of Directors of the Company has determined is more
favorable to the Company and its stockholders than the transactions contemplated
by the Merger Agreement (provided that such termination shall not be effective
unless and until the Company shall have paid to Parent the fee described in the
second paragraph under "--Fees and Expenses" below).
FEES AND EXPENSES. Except to the extent Parent becomes entitled to an
expense reimbursement fee as described in the following paragraph, Parent and
the Company will bear their respective expenses incurred in connection with the
Merger Agreement, the Offer and the Merger, including, without limitation, the
preparation, execution and performance of the Merger Agreement and the
transactions contemplated thereby, and all fees and expenses of investment
bankers, finders, brokers, agents, representatives, counsel and accountants.
If (i) Parent shall have terminated the Merger Agreement as described in the
second paragraph of "--Termination" above or (ii) the Company shall have
terminated the Merger Agreement as described in clause (ii) of the fourth
paragraph of "--Termination" above, then the Company shall promptly, but in no
event later than two business days after the date of such termination or event,
pay Parent a termination fee of $9,000,000. If Parent shall have terminated this
Agreement pursuant to clause (iii) of the second paragraph of "--Termination"
above and, within one year after such termination, the Company shall have
entered into a definitive agreement providing for an Acquisition Transaction,
the Company shall promptly, but in no event later than two days after the date
of such definitive agreement, pay Parent a termination fee of $9,000,000. Any
termination fee payable as described in this paragraph shall be paid by the
issuance
23
to Parent of shares of a newly issued series of preferred stock of the Company
(the "Series B Convertible Preferred Stock") having substantially the following
terms. The Series B Convertible Preferred Stock will have a liquidation
preference of $9,000,000 and will be convertible after the expiration of six
months from the issue date, at the option of the holder into common stock of the
Company at the rate of one share of common stock for each $23.00 of liquidation
preference, subject to antidilution provisions substantially identical to those
in the Company's Series A and Series B Warrants. The dividend will be 6% per
annum of the liquidation preference and will be payable at the option of the
Company in shares of Series B Convertible Preferred Stock or cash. The Company
will be required to redeem the Series B Convertible Preferred Stock at the
request of the holder upon the earlier to occur of (i) consummation of a
transaction resulting in a change in control of the Company and (ii) the third
anniversary of the date of issuance. The Company may redeem the Series A
Convertible Preferred Stock at the option of the Company (i) during the first
year after the date of issuance at 110% of the liquidation preference and (ii)
after the first year from the date of issuance at 100% of liquidation preference
as long as the Company's common stock has traded in excess of $25.30 for any 10
consecutive trading days. If the Company defaults on its mandatory redemption
obligation, the dividend rate will increase by 25 basis points, and will
thereafter increase by an additional 25 basis points for each 91-day period the
default continues, up to a maximum dividend rate of 10%. During continuance of
the default, the holder will be entitled to appoint one member of the Company's
Board of Directors.
AMENDMENT. At any time prior to the Effective Time, subject to applicable
law and the provisions of the Merger Agreement, the Merger Agreement may be
amended, modified or supplemented only by written agreement of Parent, the
Purchaser and the Company with respect to any of the terms contained therein;
provided, however, that after any approval and adoption of the Merger Agreement
by the stockholders of the Company, no such amendment, modification or
supplementation shall be made which reduces the amount of per-share
consideration paid in the Merger or the form of consideration therefor or which
in any way materially adversely affects the rights of such stockholders without
the further approval of such stockholders. Following the election or appointment
of Xxxxxx's designees as Directors of the Company as described above and prior
to the Effective Time, any amendment or termination of the Merger Agreement by
the Company, any extension by the Company of the time for the performance of any
of the obligations or other acts of Parent or the Purchaser or any other action
by the Company concerning the Merger Agreement or any of the transactions
contemplated thereby, will require the concurrence of a majority of the
directors of the Company then in office who were not designated by Parent.
WAIVERS. At any time prior to the Effective Time, Parent and the Purchaser,
on the one hand, and the Company, on the other hand, may (i) extend the time for
the performance of any of the obligations or other acts of the other, (ii) waive
any inaccuracies in the representations and warranties of the other contained
herein or in any documents delivered pursuant hereto and (iii) waive compliance
by the other with any of the agreements or conditions contained herein which may
legally be waived. Any such extension or waiver shall be valid only if set forth
in an instrument in writing specifically referring to this Agreement and signed
on behalf of such party. Following the election or appointment of Xxxxxx's
designees as Directors of the Company as described above and prior to the
Effective Time, any waiver of any of the Company's rights under the Merger
Agreement will require the concurrence of a majority of the directors of the
Company then in office who were not designated by Parent.
EFFECTS OF INABILITY TO CONSUMMATE THE MERGER. If for any reason the Merger
is not consummated, Parent and the Purchaser will evaluate their alternatives.
Such alternatives could include purchasing additional Shares in the open market,
in privately negotiated transactions, in another tender or exchange offer or
otherwise, or taking no further action to acquire additional Shares. Any
additional purchases of Shares could be at a price greater or less than the
price to be paid for Shares in the Offer and could be for cash or other
consideration. Alternatively, the Purchaser may sell or otherwise dispose of any
or all Shares acquired pursuant to the Offer or otherwise. Such transactions may
be effected on terms and at prices then determined by Parent and the Purchaser,
which may vary from the price to be paid for Shares in the Offer.
24
STATUTORY REQUIREMENTS. In general, under the DGCL a merger of two Delaware
corporations requires the adoption of a resolution by the Board of Directors of
each of the corporations desiring to merge approving an agreement of merger
containing provisions with respect to certain statutorily specified matters and
the approval of such agreement of merger by the stockholders of each corporation
by the affirmative vote of the holders of a majority of all the outstanding
shares of stock entitled to vote on such merger. According to the Company
Certificate of Incorporation, the Shares are the only securities of the Company
which entitle the holders thereof to voting rights.
The DGCL also provides that if a parent company owns at least 90% of each
class of stock of a subsidiary, the parent company can effect a short-form
merger with that subsidiary without the action of the other stockholders of the
subsidiary. Accordingly, if as a result of the Offer or otherwise the Purchaser
acquires or controls the voting power of at least 90% of the Shares, the
Purchaser could, and intends to, effect the Merger without prior notice to, or
any action by, 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 will
have certain rights under Section 262 of the DGCL to dissent and demand
appraisal of, and payment in cash of the fair value of, their Shares. Such
rights, if the statutory procedures were complied with, could lead to a judicial
determination of the fair value (excluding any element of value arising from the
accomplishment or expectation of the Merger) required to be paid in cash to such
dissenting holders for their Shares. Any such judicial determination of the fair
value of Shares could be based upon considerations other than, or in addition
to, the price paid in the Offer and the market value of the Shares, including
asset values and the investment value of the Shares. The value so determined
could be more or less than the purchase price per Share pursuant to the Offer or
the consideration per Share to be paid in the Merger.
In addition, several decisions by Delaware courts have held that, in certain
instances, a controlling stockholder of a corporation involved in a merger has a
fiduciary duty to the other stockholders that requires the merger to be fair to
such other stockholders. In determining whether a merger is fair to minority
stockholders, the Delaware courts have considered, among other things, the type
and amount of consideration to be received by the stockholders and whether there
were fair dealings among the parties. Although the remedies of rescission or
other damages are possible in an action challenging a merger as a breach of
fiduciary duty, decisions of the Delaware courts have indicated that in most
cases the remedy available in a merger that is found not to be "fair" to
minority stockholders is a damages remedy based on essentially the same
principles as an appraisal.
THE FOREGOING SUMMARY OF THE RIGHTS OF OBJECTING STOCKHOLDERS DOES NOT
PURPORT TO BE A COMPLETE STATEMENT OF THE PROCEDURES TO BE FOLLOWED BY
STOCKHOLDERS DESIRING TO EXERCISE ANY AVAILABLE DISSENTERS' RIGHTS.
THE PRESERVATION AND EXERCISE OF DISSENTERS' RIGHTS REQUIRE STRICT ADHERENCE
TO THE APPLICABLE PROVISIONS OF THE DGCL.
PLANS FOR THE COMPANY. If Parent acquires control of the Company, it is its
present intent to operate the Company as a subsidiary under the Company's
current name and with essentially the same personnel, in the Company's existing
facilities in Cedar Rapids, Iowa. However, Parent will conduct a further review
of the Company and its subsidiaries and their respective assets, businesses,
corporate structure, capitalization, operations, properties, policies,
management and personnel. After such review, Parent will determine what actions
or changes, if any, would be desirable in light of the circumstances which then
exist, and reserves the right to effect such actions or changes. Parent's
decisions could be affected by information hereafter obtained, changes in
general economic or market conditions or in the business of the Company or its
subsidiaries, actions by the Company or its subsidiaries and other factors.
Except as described in this Offer to Purchase, neither Parent nor the
Purchaser has any present plans or proposals that would relate to or would
result in (i) an extraordinary corporate transaction, such as a
25
merger, reorganization or liquidation, involving the Company or any of its
subsidiaries, (ii) a sale or transfer of a material amount of assets of the
Company or any of its subsidiaries, (iii) any change in the present Board of
Directors or management of the Company, (iv) any material change in the present
capitalization or dividend policy of the Company, (v) any material change in the
Company's corporate structure or business, (vi) causing a class of securities of
the Company to be delisted from a national securities exchange or to cease to be
authorized to be quoted in an inter-dealer quotation system of a registered
national securities association or (vii) a class of equity securities of the
Company becoming eligible for termination of registration pursuant to Section
12(g)(4) of the Exchange Act.
The Commission has adopted Rule 13e-3 under the Exchange Act which is
applicable to certain "going private" transactions and which may under certain
circumstances be applicable to the Merger. However, Rule 13e-3 would be
inapplicable if (i) the Shares are deregistered under the Exchange Act prior to
the Merger or other business combination or (ii) the Merger or other business
combination is consummated within one year after the purchase of the Shares
pursuant to the Offer and the amount paid per Share in the Merger or other
business combination is at least equal to the amount paid per Share in the
Offer. If applicable, Rule 13e-3 requires, among other things, that certain
financial information concerning the fairness of the proposed transaction and
the consideration offered to minority stockholders in such transaction be filed
with the Commission and disclosed to stockholders prior to the consummation of
the transaction.
OTHER AGREEMENTS. The following summary description of the Original
Equipment Manufacturer Agreement (the "OEM Agreement") is qualified in its
entirety by reference to such agreement, which has been filed as an exhibit to
the Tender Offer Statement on Schedule 14D-1. The OEM Agreement gives Parent and
its subsidiaries the non-exclusive right to sell and license pen-based data
collection terminals and computers, charge coupled device products, and radio
products of the Company and the accessories, software and spare parts for such
products, for use in healthcare, manufacturing, warehouse and distribution
applications worldwide in such geographic locations where such products are
certified. The OEM Agreement is in effect as of January 21, 1997 and will expire
on January 21, 1999; provided, however, that the term of the OEM Agreement will
automatically be extended for successive one-year periods ending on the
anniversary of January 21, 1999, unless either party has, on or before 60 days
prior to the next scheduled renewal date, given notice to the other of its
intention not to renew the term of the OEM Agreement.
The OEM Agreement provides that the Company will sell the specified products
to Parent at a price based on the volume of purchases by Parent during the
twelve-month period ending on the preceding January 19, such price being no less
favorable than the lowest price then being charged by the Company for sales of
such products to other purchasers with sales volumes similar to Parent's volume
purchases during such twelve-month period. For the period beginning January 21,
1997 and continuing through January 19, 1998, the Company will sell products to
Parent at a price based on the sales forecast covering the twelve-month period
beginning on April 1, 1997, such price being no less favorable than the lowest
price then being charged by the Company for sales of such products to other
purchasers based on sales volumes similar to such forecast.
In February 1996, the Company and Parent (together with Intermec) entered
into the Confidentiality Agreement relating to (1) the mutual exchange of
confidential information concerning the business and affairs of each party and
(2) the agreement of each party to refrain from certain actions affecting
control of the other party. Pursuant to the Confidentiality Agreement, the
Company and Parent exchanged certain financial, technical, commercial and other
information concerning their respective businesses and affairs and agreed, among
other things, to use the confidential materials solely for the purpose of
evaluating a possible business combination or strategic relationship between the
Company and Parent. The Confidentiality Agreement prohibits disclosure of the
following, without prior written consent of the other party, (a) the contents of
the confidential materials, (b) the existence of the Confidentiality Agreement,
and (c) the existence of and status of negotiations over a possible business
combination or strategic relationship.
26
Pursuant to the Confidentiality Agreement, the Company and Parent also
agreed, for a period of three years following the date of the Confidentiality
Agreement, not to directly or indirectly, without prior written consent of the
other party, (i) acquire, or offer, propose or agree to acquire, any shares of
the other party's common stock, or securities convertible or exchangeable into,
or the rights to acquire, such stock, (ii) solicit proxies or consents with
respect to such stock, become a participant in any election contest relating to
the election of directors of the other party or initiate, propose or otherwise
solicit holders of such stock with respect to any such proposal, (iii) form,
join or participate in a group within the meaning of Section 13(d)(3) of the
Exchange Act with respect to such stock, (iv) arrange or participate in any
arranging of financing for the purchase of such stock, (v) propose, disclose any
intent to propose or contact any officers, employees, directors, stockholders or
agents of the other party or any other person or entity with respect to any
acquisition, business combination, recapitalization or similar transaction with
respect to the other party or any material amount to its assets, or request any
waiver, amendment or termination of certain provisions of the Confidentiality
Agreement or (vi) attempt in any way to control the other party. The
Confidentiality Agreement also prohibits any direct or indirect solicitation,
negotiation or hiring of employees of one party by the other party for a period
of three years following the date of the Confidentiality Agreement, except
through or in response to general advertisement.
Pursuant to the Merger Agreement, Parent was released from the restrictions
described in the preceding paragraph.
12. SOURCE AND AMOUNT OF FUNDS.
The Purchaser estimates that the total amount of funds required to purchase
all outstanding Shares pursuant to the Offer and to pay related fees and
expenses will be approximately $265 million. The funds necessary to purchase
Shares pursuant to the Offer will be provided to the Purchaser by Parent as a
capital contribution or loan or combination thereof.
Parent presently intends to obtain the required funds from its general
corporate funds or those of its affiliates, including available cash, short-term
investments and marketable securities, and, to the extent necessary, through
borrowing under the Credit Agreement dated as of December 22, 1994, as amended
(the "Credit Agreement"), with the banks identified below, which have committed
to lend to Parent an aggregate of $400 million (the "Commitment Amount"), none
of which is presently borrowed.
The banks that are party to the Credit Agreement (the "Banks") are Xxxxxx
Guaranty Trust Company of New York, Bank of America National Trust and Savings
Association, The Bank of New York, The Chase Manhattan Bank, N.A., CIBC Inc.,
Nationsbank of Texas, N.A., Union Bank of Switzerland, Xxxxx Fargo Bank, N.A.,
Credit Suisse, Dresdner Bank AG, Mellon Bank, N.A., The First National Bank of
Chicago, Toronto Dominion (Texas), Inc., Bank of Hawaii, and The Northern Trust
Company. The Credit Agreement provides that Parent may borrow any or all of the
Commitment Amount on a revolving basis during the period prior to December 22,
2000.
Borrowings under the Credit Agreement presently bear interest at one of the
following rates of interest as specified by Parent: (1) the prime rate of Xxxxxx
Guaranty Trust Company of New York, or, if higher, the Federal Funds rate plus
1/2 of 1%; (2) .16% over the average London Interbank Offered Rate of certain
designated reference banks for the relevant interest period; or (3) .285% over
the prevailing average rates bid by recognized dealers for the purchase of
certificates of deposit of high quality with a maturity comparable to the
relevant interest period, adjusted to take into account applicable bank reserve
requirements and the assessment rate for members of the Bank Insurance Fund. In
the case of borrowings bearing interest at either of the second and third
alternatives described above, Parent may select an interest period of one, two,
three or six months (30, 60, 90 or 180 days in the case of the third
alternative). Parent is also required to pay the Banks a facility fee of .09%
per annum. The margins over the London Interbank Offered Rate and the adjusted
certificate of deposit rate, as well as the facility fee referred to above, are
those in effect on the date of this Offer to Purchase. In the event of a change
in the ratings of
27
Parent's senior unsecured long-term debt by national rating agencies, such
margins and fee are subject to adjustment upward (in the case of lowered
ratings) or downward (in the case of improved ratings).
There are no compensating balance requirements under the Credit Agreement.
The Credit Agreement contains representations, warranties, covenants,
conditions, and events of default which are customary in agreements of that
kind. Parent believes that, following payment for Xxxxxx purchased in the Offer
and related fees and expenses, Parent will continue to be in compliance with the
terms of the Credit Agreement.
Parent intends to repay any borrowings incurred for the purchase of Shares
and payment of related fees and expenses from internally generated funds of
Parent and its subsidiaries (possibly including the Company) and future
borrowings or financings, which may include the proceeds of short-term or
long-term borrowings or the public sale of debt.
The text of the Credit Agreement and all amendments thereto through the date
of this Offer to Purchase have been included as an exhibit to the Schedule 14D-1
with respect to the Offer filed by the Purchaser and Parent with the Commission,
and are available for inspection and copying at the offices of the Commission as
set forth in Section 8 of this Offer to Purchase.
13. DIVIDENDS AND DISTRIBUTIONS.
If on or after the date of the Merger Agreement the Company (i) splits,
combines or otherwise changes the Shares or its capitalization, (ii) acquires
Shares or otherwise causes a reduction in the number of Shares, (iii) issues or
sells additional Shares (other than the issuance of Shares reserved for issuance
as of the date of the Merger Agreement under option and employee stock purchase
plans in accordance with their terms as publicly disclosed as of the date of the
Merger Agreement) or any shares of any other class of capital stock, other
voting securities or any securities convertible into or exchangeable for, or
rights, warrants or options, conditional or otherwise, to acquire, any of the
foregoing or (iv) discloses that it has taken such action, then, without
prejudice to the Purchaser's rights under Section 14, the Purchaser, in its sole
discretion, may make such adjustments in the purchase price and other terms of
the Offer as it deems appropriate to reflect such split, combination or other
change or action, including, without limitation, the Minimum Condition or the
number or type of securities offered to be purchased.
If on or after the date of the Merger Agreement the Company declares or pays
any dividend on the Shares or any distribution (including, without limitation,
the issuance of additional Shares pursuant to a stock dividend or stock split,
the issuance of other securities or the issuance of rights for the purchase of
any securities) with respect to the Shares that is payable or distributable to
stockholders of record on a date prior to the transfer into the name of the
Purchaser or its nominees or transferees on the Company's stock transfer records
of the Shares purchased pursuant to the Offer, and if Shares are purchased in
the Offer, then, without prejudice to the Purchaser's rights under Section 14,
any such dividend, distribution, issuance, proceeds or rights to be received by
the tendering stockholders shall (A) be received and held by the tendering
stockholders for the account of the Purchaser and will be required to be
promptly remitted and transferred by each tendering stockholder to the
Depositary for the account of the Purchaser, accompanied by appropriate
documentation of transfer or (B) at the direction of the Purchaser, be exercised
for the benefit of the Purchaser, in which case the proceeds of such exercise
will promptly be remitted to the Purchaser. Pending such remittance and subject
to applicable law, the Purchaser will be entitled to all rights and privileges
as owner of any such dividend, distribution, issuance, proceeds or rights and
may withhold the entire purchase price or deduct from the purchase price the
amount or value thereof, as determined by the Purchaser in its sole discretion.
28
14. CERTAIN CONDITIONS OF THE OFFER.
Notwithstanding any other provision of the Offer, the Purchaser shall not be
required to accept for payment or, subject to any applicable rules and
regulations of the Commission, including Rule 14e-1(c) promulgated under the
Exchange Act (relating to the Purchaser's obligation to pay for or return
tendered Shares promptly after termination or withdrawal of the Offer), pay for,
and may delay the acceptance for payment of any tendered Shares and, except as
set forth in the Merger Agreement, amend or terminate the Offer as to any Shares
not then paid for if (i) the Minimum Condition shall not have been satisfied,
(ii) any applicable waiting period under the HSR Act shall not have expired or
been terminated prior to the expiration of the Offer or (iii) at any time after
execution of the Merger Agreement and before the time of payment for any such
Shares (whether or not any Shares have theretofore been accepted for payment or
paid for pursuant to the Offer), any of the following conditions exists:
(A) there shall be in effect an injunction or other order, decree,
judgment or ruling by a court of competent jurisdiction or by a
governmental, regulatory or administrative agency or commission of competent
jurisdiction or a statute, rule, regulation, executive order or other action
shall have been promulgated, enacted, taken or threatened by a governmental
authority or a governmental, regulatory or administrative agency or
commission of competent jurisdiction which in any such case (I) restrains or
prohibits the making or consummation of the Offer or the consummation of the
Merger, (II) prohibits or restricts the ownership or operation by Parent or
the Purchaser (or any of their respective affiliates or subsidiaries) of any
portion of its or the Company's business or assets which is material to the
business of all such entities taken as a whole, or compels Parent or the
Purchaser (or any of their respective affiliates or subsidiaries) to dispose
of or hold separate any portion of its or the Company's business or assets
which is material to the business of all such entities taken as a whole,
(III) imposes material limitations on the ability of the Purchaser
effectively to acquire or to hold or to exercise full rights of ownership of
the Shares, including, without limitation, the right to vote the Shares
purchased by the Purchaser on all matters properly presented to the
stockholders of the Company, (IV) imposes any material limitations on the
ability of Parent or the Purchaser or any of their respective affiliates or
subsidiaries effectively to control in any material respect the business and
operations of the Company and its subsidiaries, or (V) which otherwise would
materially adversely affect the Company and its subsidiaries taken as a
whole; or
(B) there shall be pending any litigation or other proceeding brought by
any governmental entity or agency that seeks to impose any of the effects
referred to in paragraph (A) above or seeks material damages from the
Company or Parent in connection with the Offer or the Merger; or
(C) the Merger Agreement shall have been terminated by the Company,
Parent or the Purchaser in accordance with its terms; or
(D) (I) the representations and warranties made by the Company in the
Merger Agreement that are qualified as to materiality shall not have been
true and correct, or any such representations and warranties that are not so
qualified shall not be true and correct in all material respects, when made
or shall have ceased to be true and correct in all material respects as of
the Expiration Date as if made as of such date, or (II) as of the Expiration
Date the Company shall not in all material respects have performed its
material obligations and agreements and complied with its material covenants
to be performed and complied with by it under the Merger Agreement; or
(E) there shall have occurred (I) any general suspension of, or
limitation on prices for, trading in securities on any national securities
exchange or the over-the-counter market, (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) the commencement of a war, armed
hostilities or other international or national calamity directly involving
the United States, (IV) from the date of the Merger Agreement through the
date of termination or expiration of the Offer, a decline of at least 25% in
the Standard &
29
Poor's 500 Index, or (V) in the case of any of the foregoing existing at the
time of the commencement of the Offer, a material acceleration or worsening
thereof; or
(F) Parent, the Purchaser and the Company shall have agreed that the
Purchaser shall amend the Offer to terminate the Offer or postpone the
payment for Shares pursuant thereto.
The foregoing conditions are for the sole benefit of Parent and the
Purchaser and may be asserted by Parent or the Purchaser regardless of the
circumstances (including any action or inaction by Parent or the Purchaser)
giving rise to any such conditions and may be waived by Parent or the Purchaser
in whole or in part at any time and from time to time, in each case, in the
exercise of the good faith judgment of Parent and the Purchaser and subject to
the terms of the Merger Agreement. The failure by Parent or the Purchaser at any
time to exercise any of the foregoing rights shall not be deemed a waiver of any
such right and each such right shall be deemed an ongoing right which may be
asserted at any time and from time to time.
A public announcement may be made of a material change in, or waiver of,
such conditions and the Offer may, in certain circumstances, be extended in
connection with any such change or waiver.
The Purchaser acknowledges that the Commission believes that (i) if the
Purchaser is delayed in accepting the Shares it must either extend the Offer or
terminate the Offer and promptly return the Shares and (ii) the circumstances in
which a delay in payment is permitted are limited and do not include unsatisfied
conditions of the Offer, except with respect to most required regulatory
approvals.
15. CERTAIN LEGAL MATTERS; REQUIRED REGULATORY APPROVALS.
Except as set forth in this Offer to Purchase, based on its review of
publicly available filings by the Company with the Commission and other
information regarding the Company, neither Parent nor the Purchaser is aware of
any governmental licenses or regulatory permits that appear to be material to
the business of the Company and its subsidiaries, taken as a whole, and that
might be adversely affected by the Purchaser's acquisition of Shares (and the
indirect acquisition of the stock of the Company's subsidiaries) as contemplated
herein, or any filings, approvals or other actions by or with any domestic,
foreign or supranational governmental authority or administrative or regulatory
agency that would be required for the acquisition or ownership of the Shares (or
the indirect acquisition of the stock of the Company's subsidiaries) by the
Purchaser pursuant to the Offer as contemplated herein. Should any such approval
or other action be required, it is presently contemplated that such approval or
action would be sought except as described below under "--State Takeover Laws."
Should any such approval or other action be required, there can be no assurance
that any such approval or action would be obtained without substantial
conditions or that adverse consequences might not result to the Company's or its
subsidiaries' businesses, or that certain parts of the Company's, Parent's, the
Purchaser's or any of their respective subsidiaries' businesses might not have
to be disposed of or held separate or other substantial conditions complied with
in order to obtain such approval or action or in the event that such approvals
were not obtained or such actions were not taken. The Purchaser's obligation to
purchase and pay for Shares is subject to certain conditions, including
conditions with respect to litigation and governmental actions. See Introduction
and Section 14 for a description thereof.
STATE TAKEOVER LAWS. A number of states (including Delaware, where the
Company is incorporated) have adopted takeover laws and regulations which
purport, to varying degrees, to be applicable to attempts to acquire securities
of corporations which are incorporated in such states or which have substantial
assets, stockholders, principal executive offices or principal places of
business therein. To the extent that certain provisions of certain of these
state takeover statutes purport to apply to the Offer or the Merger, the
Purchaser believes that such laws conflict with federal law and constitute an
unconstitutional burden on interstate commerce. In 1982, the Supreme Court of
the United States, in XXXXX X. MITE CORP., invalidated on constitutional grounds
the Illinois Business Takeovers Statute, which as a matter of state securities
law
30
made takeovers of corporations meeting certain requirements more difficult. The
reasoning in such decision is likely to apply to certain other state takeover
statutes. In 1987, however, in CTS CORP. V. DYNAMICS CORP. OF AMERICA, the
Supreme Court of the United States held that the State of Indiana could as a
matter of corporate law and, in particular, those aspects of corporate law
concerning corporate governance, constitutionally disqualify a potential
acquiror from voting on the affairs of a target corporation without the prior
approval of the remaining stockholders, provided that such laws were applicable
only under certain conditions. Subsequently, in TLX ACQUISITION CORP. V. TELEX
CORP., a Federal district court in Oklahoma ruled that the Oklahoma statutes
were unconstitutional insofar as they apply to corporations incorporated outside
Oklahoma in that they would subject such corporations to inconsistent
regulations. Similarly, in TYSON FOODS, INC. X. XXXXXXXXXX, a Federal district
court in Tennessee ruled that four Tennessee takeover statutes were
unconstitutional as applied to corporations incorporated outside Tennessee. This
decision was affirmed by the United States Court of Appeals for the Sixth
Circuit. In December 1988, a Federal district court in Florida held, in GRAND
METROPOLITAN PLC X. XXXXXXXXXXX, that the provisions of the Florida Affiliated
Transactions Act and Florida Control Share Acquisition Act were unconstitutional
as applied to corporations incorporated outside of Florida.
The Purchaser has not attempted to comply with any state takeover statutes
in connection with the Offer or the Merger. The Purchaser reserves the right to
challenge the validity or applicability of any state law allegedly applicable to
the Offer or the Merger, and nothing in this Offer to Purchase nor any action
taken in connection herewith is intended as a waiver of that right. In the event
that it is asserted that one or more takeover statutes apply to the Offer or the
Merger, and it is not determined by an appropriate court that such statute or
statutes do not apply or are invalid as applied to the Offer or the Merger, as
applicable, the Purchaser may be required to file certain documents with, or
receive approvals from, the relevant state authorities, and the Purchaser might
be unable to accept for payment or purchase Shares tendered pursuant to the
Offer or be delayed in continuing or consummating the Offer. In such case, the
Purchaser may not be obligated to accept for purchase, or pay for, any Shares
tendered. SEE SECTION 14.
ANTITRUST. Under the HSR Act, and the rules and regulations that have been
promulgated thereunder by the Federal Trade Commission (the "FTC"), certain
acquisition transactions may not be consummated until certain information and
documentary material has been furnished for review by the FTC and the Antitrust
Division of the Department of Justice (the "Antitrust Division") and certain
waiting period requirements have been satisfied. The acquisition of Shares
pursuant to the Offer and the Merger is subject to such requirements.
Under the provisions of the HSR Act applicable to the Offer and the Merger,
the purchase of Shares pursuant to the Offer and the Merger may not be
consummated until the expiration of a 15-calendar-day waiting period following
the filing of certain required information and documentary material with respect
to the Offer with the FTC and the Antitrust Division, unless such waiting period
is earlier terminated by the FTC and the Antitrust Division. The Purchaser
expects to file a Premerger Notification and Report Form with the FTC and the
Antitrust Division in connection with the purchase of Shares pursuant to the
Offer and the Merger under the HSR Act on or about January 28, 1997, and, in
such event, the required waiting period with respect to the Offer and the Merger
will expire at 11:59 p.m., New York City time, on February 12, 1997, unless
earlier terminated by the FTC or the Antitrust Division or the Purchaser
receives a request for additional information or documentary material prior
thereto. If within such 15-calendar-day waiting period either the FTC or the
Antitrust Division were to request additional information or documentary
material from the Purchaser, the waiting period with respect to the Offer and
the Merger would be extended for an additional period of 10 calendar days
following the date of substantial compliance with such request by the Purchaser.
Only one extension of the waiting period pursuant to a request for additional
information is authorized by the rules promulgated under the HSR Act.
Thereafter, the waiting period could be extended only by court order or with the
consent of the Purchaser. The additional 10-calendar-day waiting period may be
terminated sooner by the FTC or the Antitrust Division. Although the Company is
required to file certain information and documentary material with the FTC and
31
the Antitrust Division in connection with the Offer, neither the Company's
failure to make such filings nor a request made to the Company (as opposed to a
request made to the Purchaser) from the FTC or the Antitrust Division or the
failure of the Company to be in substantial compliance with a request for
additional information or documentary material will extend the waiting period
with respect to the purchase of Shares pursuant to the Offer and the Merger.
The FTC and the Antitrust Division frequently scrutinize the legality under
the antitrust laws of transactions such as the acquisition of Shares by the
Purchaser pursuant to the Offer and the Merger. At any time before or after the
Purchaser's purchase of Shares, the FTC or the Antitrust Division could take
such action under the antitrust laws as either deems necessary or desirable in
the public interest, including seeking to enjoin the purchase of Shares pursuant
to the Offer and the Merger, the divestiture of Shares purchased pursuant to the
Offer or the divestiture of substantial assets of Parent, the Purchaser, the
Company or any of their respective subsidiaries or affiliates. Private parties
as well as state attorneys general may also bring legal actions under the
antitrust laws under certain circumstances. SEE SECTION 14.
Based upon an examination of publicly available information relating to the
businesses in which the Company is engaged, the Purchaser believes that the
acquisition of Shares pursuant to the Offer and the Merger should not violate
the applicable antitrust laws. Nevertheless, there can be no assurance that a
challenge to the Offer and the Merger on antitrust grounds will not be made, or,
if such challenge is made, what the result will be. SEE SECTION 14.
FOREIGN APPROVALS. According to publicly available information, the Company
owns property and conducts business in a number of other foreign countries and
jurisdictions. 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.
Under German laws and regulations relating to the control of concentrations,
certain acquisition transactions may not be consummated in Germany unless
certain information has been furnished to the German Federal Cartel Office (the
"FCO"), and certain waiting period requirements have been satisfied. The
purchase of Shares by the Purchaser pursuant to the Offer and the consummation
of the Merger may be subject to such requirements. Parent expects to file such
information as soon as practicable and such waiting period will expire one month
from the date of filing or may be extended by the FCO for a total of four months
from the date of the filing. Parent will request early termination of the
waiting period, although there can be no assurance of the outcome of such
request. Purchaser does not believe that the consummation of the Offer will
result in a violation of any applicable law or regulation in Germany relating to
the regulation of monopolies and competition. However, there can be no assurance
that a challenge to the Offer on such grounds will not be made, or if such a
challenge is made, of the result thereof.
32
16. CERTAIN FEES AND EXPENSES.
The Bank of New York has been retained by the Purchaser as the Depositary in
connection with the Offer. The Purchaser will pay the Depositary reasonable and
customary compensation for its services in connection with the Offer, will
reimburse the Depositary for its reasonable out-of-pocket expenses in connection
therewith and will indemnify the Depositary against certain liabilities and
expenses in connection therewith, including certain liabilities under the
federal securities laws.
Xxxxxxxxx & Company Inc. has been retained by the Purchaser as Information
Agent in connection with the Offer. The Information Agent may contact holders of
Shares by mail, telephone, telex, telegraph and personal interview and may
request brokers, dealers and other nominee stockholders to forward material
relating to the Offer to beneficial owners of Shares. The Purchaser will pay the
Information Agent reasonable and customary compensation for all such services in
addition to reimbursing the Information Agent for reasonable out-of-pocket
expenses in connection therewith.
Except as set forth above, neither Parent nor the Purchaser will pay any
fees or commissions to any broker, dealer or other person for soliciting tenders
of Shares pursuant to the Offer. Brokers, dealers, commercial banks and trust
companies and other nominees will, upon request, be reimbursed by Parent or the
Purchaser for customary clerical and mailing expenses incurred by them in
forwarding offering materials to their customers.
17. MISCELLANEOUS.
The Purchaser is not aware of any jurisdiction where the making of the Offer
is prohibited by any administrative or judicial action pursuant to any valid
state statute. If Purchaser becomes aware of any valid state statute prohibiting
the making of the Offer or the acceptance of the Shares pursuant thereto, the
Purchaser will make a good faith effort to comply with such state statute. If,
after such good faith effort, the Purchaser cannot comply with any such state
statute, the Offer will not be made to (nor will tenders be accepted from or on
behalf of) the holders of Shares in such state.
Parent and the Purchaser have filed with the Commission a Schedule 14D-1,
together with exhibits, pursuant to Rule 14d-3 of the General Rules and
Regulations under the Exchange Act, furnishing certain additional information
with respect to the Offer, and may file amendments thereto. Such Schedule 14D-1
and any amendments thereto, including exhibits, may be examined and copies may
be obtained from the office of the Commission in the same manner as described in
Section 8 with respect to information concerning the Company, except that copies
will not be available at the regional offices of the Commission.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION ON BEHALF OF PARENT OR THE PURCHASER NOT CONTAINED IN THIS OFFER
TO PURCHASE OR IN THE LETTER OF TRANSMITTAL AND, IF GIVEN OR MADE, ANY SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED.
Neither the delivery of the Offer to Purchase nor any purchase pursuant to
the Offer shall under any circumstances create any implication that there has
been no change in the affairs of Parent, the Purchaser, the Company or any of
their respective subsidiaries since the date as of which information is
furnished or the date of this Offer to Purchase.
WAI ACQUISITION CORP.
January 24, 1997
33
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF PARENT
The following table sets forth the name 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 Parent. Unless
otherwise indicated below, each occupation set forth opposite each person refers
to employment with Parent. The business address of each such person is 000 Xxxxx
Xxxxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000-0000 and each such person is a
citizen of the United States of America.
(A) DIRECTORS OF PARENT
PRINCIPAL OCCUPATION AND
NAME FIVE-YEAR EMPLOYMENT HISTORY
--------------------------------------------- ------------------------------------------------------------------
Xxxx Xxxxxxxx, III........................... Director since 1994. Independent venture capitalist and con-
sultant since 1988.
Xxxxx X. Xxxxx............................... Director since 1994. Chairman of the Board and Chief Executive
Officer since 1994. Chairman of the Board of Xxxxxx Industries,
Inc. from 1994 to 1995, Chief Executive Officer of Xxxxxx from
1992 to 1994, and President of Xxxxxx from 1990 to 1994.
Xxxxxx X. Xxxxx.............................. Director since 1994. Vice Chairman and Chief Financial Officer
from 1994 to 1996. Prior thereto, Vice Chairman and Chief
Financial Officer of Xxxxxx Industries, Inc. from 1988 to 1994.
Principal business: Independent consultant.
Xxxxxxx X. Xxxxxxx........................... Director since 1994. Partner of Xxxxx & Xxxxxxx since 1986 and
general partner of Xxxxxx Partners and Banner Partners since 1962.
Principal Business: Venture capital investor.
Xxxxxx X. Xxxxxxxx........................... Director since 1994. Vice Chairman of Diversified Search and
Diversified Health Search (an executive recruiting firm) since
1990.
Xxxxx X. Xxxx................................ Director since 1994. Chairman Emeritus of Xxxxxx Industries, Inc.
Chairman of the Board of Xxxxxx from 1988 to 1994 and Chief
Executive Officer of Xxxxxx from 1988 to 1992. Principal business:
Independent consultant.
Xxxxxx X. Xxxxxx............................. Director since 1994. President of the University of Southern
California since 1991.
(B) EXECUTIVE OFFICERS OF PARENT
PRINCIPAL OCCUPATION AND
NAME FIVE-YEAR EMPLOYMENT HISTORY
--------------------------------------------- ------------------------------------------------------------------
Xxxxx X. Xxxxx............................... Chairman of the Board and Chief Executive Officer since 1994. (For
further information see paragraph (A) above.)
Xxxxx X. Xxxxxxx............................. Senior Vice President since 1994 and President of E & P Services*
since 1995. Prior to assuming his present position, Xx. Xxxxxxx
served as President of the Western Geophysical* from 1991 to 1995.
S-1
PRINCIPAL OCCUPATION AND
NAME FIVE-YEAR EMPLOYMENT HISTORY
--------------------------------------------- ------------------------------------------------------------------
Xxxxxxx X. Xxxxxxxx.......................... Vice President, Finance since 1996. Prior to assuming his present
position, Xx. Xxxxxxxx served as Vice President and Controller
from 1994 to 1996 and as Vice President, Finance for Xxxxxx
Industries, Inc.'s Industrial Automation Systems Group from 1988
to 1994.
Xxxxxxx X. Xxxxx............................. Senior Vice President and Chief Financial Officer since 1996.
Prior to assuming his present position, Xx. Xxxxx served as Vice
President and Treasurer from 1994 to 1996 and as Director of
Pensions and Insurance of Xxxxxx Industries, Inc. from 1991 to
1994.
Xxxxxxx Xxxxxxx.............................. Vice President since 1996 and President of Intermec Corporation (a
wholly owned subsidiary of Parent) since 1995. Prior to assuming
his present position, Xx. Xxxxxxx served as an independent
consultant in 1994 and as Vice President, Strategic and Government
Programs for Intermec Corporation from 1987 to 1994.
Xxxxxx X. Xxxxxxx............................ Senior Vice President and General Counsel since 1994. Prior to
assuming his present position, Xx. Xxxxxxx served as Senior Vice
President and General Counsel of Xxxxxx Industries, Inc. from 1990
to 1994.
Xxxx X. Xxxxxxx.............................. Executive Vice President and Chief Operating Officer, Oilfield
Services since 1994 and President of Western Atlas International,
Inc. (a wholly owned subsidiary of Parent) since 1991. Prior to
assuming his present position, Xx. Xxxxxxx served as Senior Vice
President of Xxxxxx Industries, Inc. and as Group Executive of
Litton's Resource Exploration Services Group from 1991 to 1994.
Xxxxx X. Xxxxx............................... Senior Vice President since 1994 and President of Western Atlas
Logging Services* since 1992.
Xxxxxxx X. Xxxxx............................. Senior Vice President since 1996 and President of Western
Geophysical* since 1995. Prior assuming his present position, Xx.
Xxxxx served as Vice President from 1995 to 1996, as Chief
Operating Officer for the global activities of Western Geophysical
from 1994 to 1995, as Senior Vice President of its North and South
American Operations from 1993 to 1994, and as Vice President of
its North American Operations in 1992.
Xxxxxxx X. Xxxxxxxx.......................... Senior Vice President since 1996 and Group Executive of the
Manufacturing Systems Group since 1995. Prior to assuming his
present position, Xx. Xxxxxxxx was a Vice President from 1995 to
1996 and, prior thereto, a Vice President of Xxxxxx Industries,
Inc. from 1992 to 1995 and President of its Applied Technology
division from 1990 to 1995.
------------------------
* A division of Western Atlas International, Inc., a wholly owned subsidiary
of Parent.
S-2
DIRECTORS AND EXECUTIVE OFFICERS OF THE PURCHASER
The following table sets forth the name 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 below, each occupation set forth opposite each person refers
to employment with Parent. The business address of each such person is 000 Xxxxx
Xxxxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000-0000 and each such person is a
citizen of the United States of America.
(A) DIRECTORS OF THE PURCHASER
PRINCIPAL OCCUPATION AND
NAME FIVE-YEAR EMPLOYMENT HISTORY
--------------------------------------------- ------------------------------------------------------------------
Xxxxxxx X. Xxxxx............................. Director of the Purchaser. (For further information see "Executive
Officers of Parent" above.)
Xxxxxx X. Xxxxxxx............................ Director of the Purchaser. (For further information see "Executive
Officers of Parent" above.)
Xxxxxxxx X. Xxxxx............................ Director of the Purchaser. Vice President and Secretary since
1994. Prior thereto, Vice President and Secretary of Xxxxxx
Industries, Inc. from 1992 to 1994.
(B) EXECUTIVE OFFICERS OF THE PURCHASER
PRINCIPAL OCCUPATION AND
NAME FIVE-YEAR EMPLOYMENT HISTORY
--------------------------------------------- ------------------------------------------------------------------
Xxxxxxx X. Xxxxx............................. President of the Purchaser. (For further information see
"Executive Officers of Parent" above.)
Xxxxxxx X. Xxxxxxxx.......................... Vice President of the Purchaser. (For further information see
"Executive Officers of Parent" above.)
Xxxxxx X. Xxxxxxx............................ Vice President of the Purchaser. (For further information see
"Executive Officers of Parent" above.)
Xxxxxxxx X. Xxxxx............................ Vice President and Secretary of the Purchaser. (For further
information see "Directors of the Purchaser" above.)
Xxxx X. Xxxxxx............................... Treasurer of the Purchaser. Treasurer since October 1996. Prior to
assuming her present position, Xx. Xxxxxx was Assistant Treasurer
from March to October 1996 and, prior thereto, Assistant Treasurer
of The Hillhaven Corporation from 1991 to 1996.
S-3
Facsimile copies of Letters of Transmittal, properly completed and duly
executed, will be accepted. The appropriate 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 its addresses set forth below:
THE DEPOSITARY FOR THE OFFER IS:
THE BANK OF NEW YORK
BY MAIL: BY FACSIMILE BY HAND OR OVERNIGHT
Tender & Exchange Department TRANSMISSION: COURIER:
P.O. Box 11248 (for Eligible Tender & Exchange Department
Church Street Station Institutions Only) 000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000 (000) 000-0000 Receive & Deliver Window
New York, New York 10286
FOR INFORMATION TELEPHONE:
(000) 000-0000
Questions and requests for assistance may be directed to the Information
Agent at its address and telephone number set forth below. Additional copies of
this Offer to Purchase, the Letters of Transmittal and other tender offer
materials may be obtained from the Information Agent as set forth below and will
be furnished promptly at the Purchaser's expense. You may also contact your
broker, dealer, commercial bank, trust company or other nominee for assistance
concerning the Offer.
THE INFORMATION AGENT FOR THE OFFER IS:
XXXXXXXXX
Wall Street Plaza
New York, New York 10005
BANKS AND BROKERS CALL COLLECT (000) 000-0000
ALL OTHERS CALL TOLL FREE (000) 000-0000
