EXHIBIT (c)(2)
TITAN ACQUISITIONS, LTD.
June 23, 1999
Ravine Partners, Ltd.
0000 XxXxxxxx Xxxxxx
Xxxxxx, XX 00000
Dear Sirs:
Reference is made to the Pre-Acquisition Agreement dated June 23, 1999 (the
"Pre-Acquisition Agreement") between Titan Acquisitions, Ltd. (the "Offeror"),
United Technologies Corporation ("Parent") and International Comfort Products
Corporation ("ICP") pursuant to which the Offeror has agreed to make an offer to
purchase all of the outstanding shares (the "Shares") of ICP. All capitalized
terms referred herein and not otherwise defined herein shall have the meanings
attributed thereto in the Pre-Acquisition Agreement.
The Offeror understands, and by your acceptance of this letter agreement
(the "Agreement") you (the "Seller") represent and warrant to the Offeror that,
there are 7,889,870 Shares beneficially owned, directly or indirectly, by the
Seller or over which the Seller exercises direction or control (collectively,
the "Seller's Shares").
This Agreement sets out the terms and conditions by which the Seller
irrevocably and unconditionally agrees to deposit the Seller's Shares under the
Offer, grants an Option over the Seller's Shares to the Offeror and sets out the
obligations and commitments of the Seller in connection therewith. This
Agreement is also the Seller's agreement to ensure that the Seller's associates
(as defined in the Securities Act (Ontario)) are bound by and perform the
obligations of the Seller hereunder, and any reference to the Seller in this
Agreement shall include the Seller's associates, all to the extent applicable.
Section 1. Acceptance of the Offer
1.1 Deposit. The Seller hereby irrevocably and unconditionally agrees to
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deposit the Seller's Shares, together with a completed and executed
letter of transmittal, under the Offer prior to the Initial Expiry Time.
1.2 Non-Withdrawal. The Seller hereby irrevocably and unconditionally
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agrees not to withdraw or take any action to withdraw any portion of the
Seller's Shares following their deposit under the Offer, notwithstanding
any statutory rights or other rights under the terms of the Offer or
otherwise which the Seller might have, unless the Pre-Acquisition
Agreement is terminated in accordance with its terms prior to the taking
up of the Seller's Shares under the Offer.
Section 2 Option
2.1 Grant of Option. On the terms and subject to the conditions set forth
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herein, the Seller hereby grants to Offeror an irrevocable option (the
"Option") to purchase all of the right, title and interest of the Seller
in and to the Seller's Shares at a price equal to the greater of (a)
US$11.75 per share and (b) any higher price per share paid by the
Offeror in the Offer.
2.2 Exercise of the Option. Offeror may exercise the Option in accordance
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with the terms of Section 2.1 hereof in whole, but not in part, if, but
only if, the fee provided for in Section 11.2(b), (d) or (e) of the Pre-
Acquisition Agreement has become payable to Offeror in accordance with
the terms thereof. Offeror may exercise the Option at any time within
the 60 days following the date when the Option first becomes
exercisable.
In the event that Offeror is entitled to and wishes to exercise the
Option, Offeror shall send a written notice to the Seller (the "Notice"
and the date on which the Notice is sent shall be referred to herein as
the "Notice Date") specifying the place and the date (the "Closing
Date") promptly after the Notice Date for the closing of such purchase
(the "Closing"); provided, however, that in the event that prior
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notification to, or approval of, any regulatory or antitrust agency is
required in connection with the exercise of the Option, Offeror shall
promptly file the required notice or application for approval and shall
promptly notify the Company of such filing, and the period of time that
otherwise would run pursuant to this Section 2.2 shall run instead from
the last the date on which all required notification or waiting periods
shall have expired or been terminated or all required approvals shall
have been obtained; provided further that in the event there shall be in
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effect any preliminary or final injunction or other order issued by any
court or governmental, administrative or regulatory agency or authority
prohibiting the exercise of the Option pursuant to this Agreement, the
period of time that otherwise would run pursuant to this Section 2.2
shall run instead from the date on which such prohibition shall have
been vacated, terminated or waived. Any exercise of the Option shall be
deemed to have occurred on the Notice Date relating thereto.
2.3 Closing. At the Closing, simultaneously with the payment by Offeror of
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the purchase price for the Seller's Shares, the Seller shall deliver, or
cause to be delivered, to Offeror certificates representing the Seller's
Shares duly endorsed to Offeror or accompanied by stock powers duly
executed by the Seller in blank, together with any necessary stock
transfer stamps properly affixed.
2.4 Acquired Option Shares. In the event the Seller's Shares are acquired
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by Offeror pursuant to the exercise of the Option (the "Acquired Option
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Shares") and Offeror subsequently disposes of, sells or transfers the
Acquired Option Shares in connection with any Take-over Proposal for
which a binding contract of sale is executed within 12 months of the
Closing (a "Sale"), the Seller shall be entitled to receive an amount
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in cash equal to 75% of the excess, if any, of the aggregate proceeds
received by
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Offeror in such Sale (net of selling commissions, if any) over the
aggregate purchase price paid by Offeror for the Acquired Option Shares
subject to such Sale.
If any of the consideration received by Offeror in a Sale consists of
securities, for purposes hereof, the proceeds of such Sale shall be
deemed to be the net after-tax amount that would actually have been
received by Offeror in an orderly sale of such securities commencing on
the first business day following actual receipt of such securities by
Offeror, in the written opinion of an investment banking firm of
national reputation selected by Offeror and reasonably satisfactory to
the Seller.
Any payment due to the Seller pursuant to this Section 2.4 shall be paid
by Offeror to the Seller within three Business Days following receipt by
Offeror of the Sale proceeds or, if any of such consideration consists
of securities, within three Business Days after receipt of the Sale
proceeds or, if later, the date on which the investment banking firm's
written opinion is received by Offeror.
Nothing herein shall create any duty by Offeror to engage in a Sale of
the Acquired Option Shares.
Section 3 Representations and Warranties
3.1 Representations and Warranties of Seller. The Seller hereby
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represents and warrants to and in favour of the Offeror that:
(a) the Seller is a limited partnership duly organized and validly
existing under the laws of the State of Texas;
(b) the Seller has the power and capacity and has received all requisite
approvals to enter into this Agreement and to perform its
obligations hereunder and this Agreement is a valid and binding
agreement enforceable by the Offeror against the Seller in
accordance with its terms;
(c) the Seller is (and, if applicable, upon the deposit of the Seller's
Shares under the Offer, will be) the sole legal and beneficial owner
of the Seller's Shares and has and will have the exclusive right to
dispose of the Seller's Shares as provided in this Agreement;
(d) the Seller's Shares are owned (and, if applicable, will be acquired
by the Offeror) with good and marketable title, free and clear of
any and all mortgages, liens, charges, encumbrances and adverse
claims;
(e) no person, firm or corporation has any agreement or option, or any
right or privilege (whether by law, pre-emptive or contractual)
capable of becoming an agreement or option, for the purchase,
acquisition or transfer of any of the Seller's Shares or any
interest therein or right thereto, except pursuant to this
Agreement; and
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(f) the execution and delivery of this Agreement and the fulfilment of
the terms hereof by the Seller do not and will not result in a
breach of any agreement or instrument to which the Seller is a party
or by which the Seller is contractually bound.
3.2 Representations and Warranties of the Offeror. The Offeror hereby
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represents and warrants to the Seller that:
(a) the Offeror is a corporation duly incorporated and validly existing
under the laws of its jurisdiction of incorporation;
(b) the Offeror has the financial resources and is financially capable
of completing the Offer; and
(c) the Offeror has the corporate power and capacity and has received
all requisite approvals to enter into this Agreement and this
Agreement is a valid and binding agreement enforceable by the Seller
against the Offeror in accordance with its terms.
Section 4 Covenants of the Seller
4.1 General. The Seller hereby covenants that during the term of this
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Agreement the Seller will:
(a) not take any action to solicit, initiate or encourage enquiries,
submissions, proposals or offers from, or provide information to,
any other person, entity or group relating to, and will not
participate in any negotiations regarding, or otherwise cooperate in
any way with or assist or participate in:
(i) the direct or indirect acquisition or disposition of all or any
Shares or any other securities of ICP or its subsidiaries
(except as expressly provided in this Agreement); or
(ii) except as expressly permitted by this Agreement or as
previously approved in writing by the Offeror, any
amalgamation, merger, sale of any material part of ICP's or its
subsidiaries' assets, take-over bid, plan of arrangement,
reorganization, recapitalization, liquidation or winding-up of,
or other business combination or similar transaction involving
ICP or any of its subsidiaries;
(b) not sell, assign, convey or otherwise dispose of any of the
Seller's Shares except pursuant to and in accordance with this
Agreement;
(c) not exercise any shareholder rights or remedies available at common
law or pursuant to applicable corporate and securities laws to
delay, hinder, upset or challenge the Offer;
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(d) cause the voting rights attaching to the Seller's Shares to be
exercised to oppose any proposed action by ICP, its shareholders or
others:
(i) which might reasonably be regarded as being directed towards
or likely to prevent or delay the successful completion of the
Offer; or
(ii) to materially change the business, assets, operations,
capital, affairs, financial conditions, licences, permits,
rights or privileges, whether contractual or otherwise, or
prospects of ICP which in the sole judgement of the Offeror
could individually, or in the aggregate, materially adversely
affect the value of the Shares to the Offeror;
(e) use Seller's reasonable efforts to assist the Offeror to
successfully complete the acquisition of Shares; and
(f) promptly notify the Offeror upon any of Seller's representations or
warranties contained in this Agreement becoming untrue or incorrect
in any material respect during the period commencing on the date
hereof and expiring at the time of expiry of the Offer, and for the
purposes of this provision, each representation and warranty shall
be deemed to be given at and as of all times during such period
(irrespective of any language which suggests that it is only being
given as at the date hereof).
The Seller shall not be deemed to have violated Section 4.1(a) and (e)
solely as a result of the participation by any associate of the Seller
who is a director of ICP in a decision by the Board of Directors of ICP
to provide information to any person, entity or group subject to and in
accordance with Section 8.1 of the Pre-Acquisition Agreement.
4.2 Resignation as Director. The Seller shall upon request use all
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reasonable efforts to cause any of its associates who may be directors
of ICP to resign effective at the time and in the manner requested by
the Offeror following the purchase of the Seller's Shares by the Offeror
under the Offer.
Section 5 Covenants of the Offeror
5.1 Completion of the Offer. Subject to the terms and conditions hereof,
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the Offeror hereby covenants to use its reasonable commercial efforts to
successfully complete the Offer, including diligently pursuing all
requisite regulatory approvals, subject to the limitations in Section
10.4(b) of the Pre-Acquisition Agreement.
Section 6 Termination
6.1 Termination. If the Option is not exercised in accordance with the
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terms and conditions of Section 2.2, then, from and after the last date
on which the Option is or may become exercisable pursuant to Section
2.2, no party hereto shall have any rights or obligations hereunder and
this Agreement shall terminate and become null and void.
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In the event of such termination of this Agreement, the Seller may
withdraw all of the Seller's Shares deposited in accordance with the
terms and conditions of the Offer, this Agreement shall forthwith be of
no further force and effect and there shall be no liability on the part
of either Seller or the Offeror, except to the extent that either such
party is in default of its obligations herein contained.
Section 7 General
7.1 Disclosure. Prior to the first public disclosure of the existence and
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terms and conditions of this Agreement, none of the parties hereto shall
disclose the existence of this Agreement, or any details hereof, to any
person other than ICP, its directors and officers, without the prior
written consent of the other party hereto, except to the extent required
by law including applicable securities laws. The existence and terms and
conditions of this Agreement may be disclosed by the Offeror and ICP in
press releases issued in connection with the execution of the Pre-
Acquisition Agreement, in the Offer Documents and in the directors
circular prepared by ICP.
7.2 Assignment. The Offeror may assign all or any part of its rights and/or
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obligations under this Agreement to a wholly-owned subsidiary of the
Parent, but, if such assignment takes place, the Offeror shall continue
to be liable to Seller for any default in performance by the assignee.
This Agreement shall not otherwise be assignable by any party without
the consent of the other.
7.3 Governing Law. This Agreement shall be governed by and construed in
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accordance with the laws of the Province of Ontario and of Canada
applicable therein.
7.4 Survival of Representations and Warranties. The representations and
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warranties made by the Offeror and the Seller herein shall expire
immediately following the Closing. No investigations made by or on
behalf of the Offeror or any of its authorized agents at any time shall
have the effect of waiving, diminishing the scope of or otherwise
affecting any representation, warranty or covenant made by the Seller
herein or pursuant hereto.
7.5 Amendments. This Agreement may not be amended except by written
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agreement signed by the parties to this Agreement.
7.6 Specific Performance and other Equitable Rights. Each of the parties
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recognizes and acknowledges that this Agreement is an integral part of
the Offer, that the Offeror would not contemplate causing the Offer to
be made unless this Agreement was executed, and that a breach by any
party of any covenants or other commitments contained in this Agreement
will cause the other party to sustain injury for which it would not have
an adequate remedy at law for money damages. Therefore, each of the
parties agrees that in the event of any such breach, the aggrieved party
shall be entitled to the remedy of specific performance of such
covenants or commitments and preliminary and permanent injunctive and
other equitable relief in addition to any other remedy to which it or
they may be entitled, at law or in equity, and the parties
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further agree to waive any requirement for the securing or posting of
any bond in connection with the obtaining of any such injunctive or
other equitable relief.
7.7 Expenses. The Offeror and the Seller shall each pay its legal,
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financial advisory and accounting costs and expenses incurred in
connection with the preparation, execution and delivery of this
Agreement and all documents and instruments executed or prepared
pursuant to this Agreement and any other costs and expenses whatsoever
and howsoever incurred, and none of such costs and expenses shall be
borne by ICP.
7.8 Counterparts. This Agreement may be executed in one or more
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counterparts which together shall be deemed to constitute one valid and
binding agreement, and delivery of the counterparts may be effected by
means of a telecopier transmission.
7.9 Entire Agreement. This Agreement constitutes the entire agreement and
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understanding between the parties pertaining to the subject matter of
this Agreement.
7.10 Time. Time shall be of the essence of this Agreement.
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7.11 Notices. Any notice, request, consent, agreement or approval which
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may or is required to be given pursuant to this Agreement shall be in
writing and shall be sufficiently given or made if delivered, or sent by
telecopier, in the case of:
(a) The Offeror addressed as follows:
United Technologies Corporation
Xxx Xxxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: Xxx Xxxxxxx
Telecopier No.: 000-000-0000
United Technologies Corporation
Xxx Xxxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: General Counsel
Telecopier No.: 000-000-0000
(b) The Seller, addressed as follows:
Xxxxxx Capital Corporation
0000 XxXxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attn: Xxxxxxx Xxxxxx
Telecopier No.: 000-000-0000
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or to such other address as the relevant party may from time to time advise
by notice in wiring given pursuant to this Section 7.11. The date of
receipt of any such notice, request, consent, agreement or approval shall
be deemed to be the date of delivery or sending thereof.
(Intentionally Blank)
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If the terms and conditions of this Agreement are acceptable to you, please so
indicate by executing and returning the enclosed copy hereof and the attached
resignation to the undersigned prior to 11:59 p.m. (Toronto time) on June 23,
1999, failing which this letter shall be null and void.
Yours truly,
TITAN ACQUISITIONS, LTD.
By: /s/ Xxx Xxxxxxx
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(Acceptance on following page)
ACCEPTANCE
Agreed and accepted this 23rd day of June, 1999.
/s/ Xxxxxx Xxxxx Xxxxxx
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Xxxxxx Xxxxx Xxxxxx
Attorney-in-Fact for Ravine Partners, Ltd.
POWER OF ATTORNEY
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We, Xxxxxxx X. Xxxxxx and Xxxxxxx X. Xxxxxx, both domiciliaries and residents of
Dallas County, Texas and the General Partners of Ravine Partners, Ltd., a Texas
limited partnership, do hereby appoint Xxxxxx Xxxxx Xxxxxx, also of Dallas
County, Texas as true and lawful attorney-in-fact on behalf of Ravine Partners,
Ltd. with authority to negotiate and execute on its behalf the letter agreement,
dated June 23, 1999, between Ravine Partners, Ltd. And Titan Acquisitions, Ltd.
IN WITNESS WHEREOF, we hereunto have set our hands this 23rd day of June, 1999.
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
General Partner - Ravine Partners, Ltd.
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
General Partner - Ravine Partners, Ltd.
Acknowledgment
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STATE OF TEXAS
Before me, this 23rd day of June, 1999, personally appeared Xxxxxx Xxxxx Xxxxxx,
Xxxxxxx X. Xxxxxx and Xxxxxxx X. Xxxxxx, known to me to be the persons whose
names are subscribed to the foregoing instrument and acknowledged to me that
they executed the same for the purposes and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this 23rd day of June, 1999.
/s/ Xxxxx X. Xxxxxx
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/s/ [Seal] XXXXX X. XXXXXX Notary Public in and for The State of Texas
NOTARY PUBLIC
State of Texas My commission expires: 10/3/99
Comm. Exp. 10-03-99 -------
