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Exhibit (c)(3)
STOCKHOLDER AGREEMENT
Stockholder Agreement (this "Agreement"), dated as of April
29, 1997, between GKN Powder Metallurgy Holdings, Inc., a Delaware corporation
("Purchaser") and __________ ("Stockholder").
Background
A. Stockholder beneficially owns ______ shares of Class A
Common Stock, par value $.001 per share ("Class A Common Stock"), of which
______ are held of record by Stockholder and ________ are shares of Class A
Common Stock issuable upon exercise of stock options held by Stockholder, and no
shares of Class B Common Stock, par value $.001 per share ("Class B Common
Stock," and together with the Class A Common Stock, the "Common Stock"), of
Sinter Metals, Inc., a Delaware corporation (the "Company").
B. Concurrently herewith, Purchaser, GKN Power Metallurgy,
Inc., a Delaware corporation and a wholly owned subsidiary of Purchaser ("Merger
Sub"), and the Company are entering into an Agreement and Plan of Merger, of
even date herewith (the "Merger Agreement"), pursuant to which Merger Sub has
agreed to make a tender offer (the "Offer") for all outstanding shares of Common
Stock at $37.00 per share (the "Offer Price"), net to the seller in cash, to be
followed by a merger of Merger Sub with and into the Company.
C. As a condition to the willingness of Purchaser to enter
into the Merger Agreement, Purchaser has required that Stockholder agree, and,
in order to induce Purchaser to enter into the Merger Agreement, Stockholder has
agreed, among other things, (i) to tender all of the shares of Class A Common
Stock and Class B Common Stock now owned or which may hereafter be acquired by
Stockholder (the "Shares") to Merger Sub pursuant to the Offer, (ii) to appoint
Purchaser as Stockholder's proxy to vote the Shares, and (iii) with respect to
certain questions put to stockholders of the Company for a vote, to vote the
Shares, in each case, in accordance with the terms and conditions of this
Agreement.
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In consideration of the mutual covenants and agreements contained herein and
other good and valuable consideration, the adequacy of which is hereby
acknowledged, and intending to be legally bound hereby, the parties hereto agree
as follows:
Agreement
1. Tender of Shares. Stockholder agrees to tender and sell to
Merger Sub all of the Shares pursuant to and in accordance with the terms of the
Offer. Stockholder agrees that Stockholder shall deliver to the depositary for
the Offer, no later than the third Business Day (as defined below) following the
commencement of the Offer pursuant to Section 1.1 of the Merger Agreement, a
letter of transmittal together with the certificates for the Shares.
Notwithstanding any term of the Offer to the contrary, Stockholder agrees not to
withdraw any Shares tendered into the Offer pursuant to this Section 1 during
the term of this Agreement. Stockholder hereby acknowledges and agrees that
Merger Sub's obligation to accept for payment and pay for the Shares in the
Offer is subject to the terms and conditions of the Offer. Stockholder hereby
permits Purchaser and Merger Sub to publish and disclose in the Offer Documents
and, if approval of the Company's stockholders is required under applicable law,
the Proxy Statement (including all documents and schedules filed with the SEC),
his or her identity and ownership of the Shares and the nature of his or her
commitment, arrangements and understandings under this Agreement. For purposes
of this Agreement, the term "Business Day" shall mean a day on which banks are
not required or authorized to be closed in the City of New York.
2. Adjustments Upon Changes in Capitalization. In the event of
any change in the number of issued and outstanding shares of Common Stock by
reason of any stock dividend, subdivision, merger, recapitalization,
combination, conversion or exchange of shares, or any other change in the
corporate or capital structure of the Company (including, without limitation,
the declaration or payment of an extraordinary dividend of cash or securities)
which would have the effect of diluting or otherwise adversely affecting
Purchaser's rights and privileges under this Agreement, the number and kind of
the Shares and the consideration
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payable in respect of the Shares shall be appropriately and equitably adjusted
to restore to Purchaser his or her rights and privileges under this Agreement.
3. Representations and Warranties of Stockholder. Stockholder hereby
represents and warrants to Purchaser as follows:
3.1. Title to the Shares. Stockholder is the owner (both
beneficially and of record) of the Shares (which term as of the date hereof is
composed of _____ shares of Class A Common Stock and no shares of Class B Common
Stock), the Shares constitute all of the shares of Common Stock owned by
Stockholder, and Stockholder does not have any rights of any nature to acquire
any additional shares of Common Stock other than pursuant to options to purchase
______ shares of Class A Common Stock. Except for the Lock-up Agreement dated
March 4, 1997 executed by Stockholder in favor of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated (the restrictions of which have been waived for purposes of the
Offer and the Merger) and the Stockholder Agreement dated October 18, 1994 among
the Company and the stockholders listed on Exhibit A thereto, Stockholder owns
all of the Shares free and clear of all security interests, liens, claims,
pledges, options, rights of first refusal, agreements, limitations on
Stockholder's voting rights, charges and other encumbrances of any nature
whatsoever, and, except as provided in this Agreement, Stockholder has not
appointed or granted any proxy, which appointment or grant is still effective,
with respect to any of the Shares. Stockholder has sole voting power and sole
power to issue instructions with respect to the matters set forth in Sections 1
and 6 hereof, sole power of disposition, sole power to demand appraisal rights
and sole power to agree to all of the matters set forth in this Agreement, in
each case with respect to the Shares, with no limitations, qualifications or
restrictions on such rights, subject to applicable securities laws and the terms
of this Agreement. Upon delivery to Purchaser by Stockholder of a certificate or
certificates evidencing the Shares and payment for the Shares pursuant to the
Offer, Purchaser will receive good and valid title to the Shares, free and clear
of all security interests, liens, claims, pledges, options, rights of first
refusal, agreements, limitations on Purchaser's voting rights, charges and other
encumbrances of any nature whatsoever.
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3.2. Authority Relative to This Agreement. Stockholder has all
necessary power and authority to execute and deliver this Agreement, to perform
his or her obligations hereunder and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement by Stockholder and the
consummation by Stockholder of the transactions contemplated hereby have been
duly and validly authorized by all necessary action on the part of Stockholder.
This Agreement has been duly and validly executed and delivered by Stockholder
and, assuming the due authorization, execution and delivery by Purchaser,
constitutes a legal, valid and binding obligation of Stockholder, enforceable
against Stockholder in accordance with its terms. There is no beneficiary or
holder of a voting trust certificate or other interest of any trust of which
Stockholder is a trustee whose consent is required for the execution and
delivery of this Agreement or the consummation by Stockholder of the
transactions contemplated hereby.
3.3. No Conflict. The execution and delivery of this Agreement
by Stockholder does not, and the performance of this Agreement by Stockholder
will not, (a) require any consent, approval, authorization or permit of, or
filing with or notification to, any governmental or regulatory authority,
domestic or foreign, except for (i) requirements of federal and state securities
laws and (ii) requirements arising out of the HSR Act, (b) conflict with or
violate any law, rule, regulation, order, judgment or decree applicable to
Stockholder or by which any property or asset of Stockholder is bound or
affected, or (c) result in any breach of or constitute a default (or an event
which with notice or lapse of time or both would become a default) under, or
give to others any right of termination, amendment, acceleration or cancellation
of, or result in the creation of a lien or other encumbrance of any nature
whatsoever on any property or asset of Stockholder, including the Shares,
pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation to which
Stockholder is a party or by which Stockholder or any property or asset of
Stockholder, including the Shares, is bound or affected, except in each case to
the extent any such breach or default, whether taken singly or in the aggregate,
would not have a material
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adverse effect on Stockholder or his or her ability to consummate the
transactions contemplated hereby.
3.4. Waiver of Appraisal Rights. Stockholder hereby waives any
rights of appraisal or rights to dissent in the Merger that he or she may have.
3.5. Acknowledgment. Stockholder understands and acknowledges
that Purchaser is entering into the Merger Agreement in reliance upon
Stockholder's execution and delivery of this Argument.
3.6. Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated hereby based upon arrangements made by or on
behalf of Stockholder for his or her own behalf.
4. Representations and Warranties of Purchaser. Purchaser hereby
represents and warrants to Stockholder as follows:
4.1. Authority Relative to This Agreement. Purchaser has all
necessary power and authority to execute and deliver this Agreement, to perform
its obligations hereunder and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement by Purchaser and the
consummation by Purchaser of the transactions contemplated hereby have been duly
and validly authorized by all necessary corporate action on the part of
Purchaser. This Agreement has been duly and validly executed and delivered by
Purchaser and, assuming the due authorization, execution and delivery by
Stockholder, constitutes a legal, valid and binding obligation of Purchaser,
enforceable against Purchaser in accordance with its terms.
4.2. No Conflict. The execution and delivery of this Agreement
by Purchaser does not, and the performance of this Agreement by Purchaser will
not, (a) require any consent, approval, authorization or permit of, or filing
with or notification to, any governmental or regulatory authority, domestic or
foreign, except for (i) requirements of federal and state securities laws and
(ii) requirements arising out of the HSR Act and Exon ▇▇▇▇▇▇, (b) conflict with
or violate the certificate of incorporation or bylaws or equivalent
organizational documents of Purchaser, (c) conflict with or violate any law,
rule, regulation, order, judgment or decree
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applicable to Purchaser or by which any property or asset of Purchaser is bound
or affected, or (d) result in any breach of or constitute a default (or an event
which with notice or lapse of time or both would become a default) under, or
give to others any right of termination, amendment, acceleration or cancellation
of, or result in the creation of a lien or other encumbrance of any nature
whatsoever on any property or asset of Purchaser pursuant to, any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit, franchise or
other instrument or obligation to which Purchaser is a party or by which
Purchaser or any property or asset of Purchaser is bound or affected, except in
each case to the extent any such breach or default, whether taken singly or in
the aggregate, would not have a material adverse effect on Purchaser or its
ability to consummate the transactions contemplated hereby.
4.3. Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission from Stockholder
in connection with the transactions contemplated hereby based upon arrangements
made by or on behalf of Purchaser.
5. Covenants of Stockholder.
5.1. No Disposition or Encumbrance of Shares; No Acquisition
of Shares. (a) Stockholder hereby covenants and agrees that, except as
contemplated by this Agreement, Stockholder shall not offer, or agree to, sell,
transfer, tender, assign, hypothecate or otherwise dispose of, or create or
permit to exist any security interest, lien, claim, pledge, option, right of
first refusal, agreement, limitation on Stockholder's voting rights, charge or
other encumbrance of any nature whatsoever with respect to, the Shares now owned
or that may hereafter be acquired by Stockholder.
(b) Stockholder hereby covenants and agrees that it
shall not, and shall not offer to agree to, acquire any additional shares of
Common Stock or options, warrants or other rights to acquire shares of Common
Stock, without the prior written consent of Purchaser.
5.2. No Solicitation of Transactions. Subject to Section 9.14,
Stockholder, in his or her individual capacity, shall not, directly or
indirectly, through any agent
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or representative or otherwise, solicit, initiate or participate in, or
knowingly encourage, in any way, any discussions or negotiations with, or
provide any information to, or afford any access to the properties, books or
records of the Company or any of its Subsidiaries to, or otherwise assist,
facilitate or knowingly encourage any corporation, partnership, person or other
entity or group (collectively "Person") (other than Purchaser and any affiliate
of Purchaser) with respect to an Alternative Proposal and shall immediately
cease and cause to be terminated any existing activities, discussions or
negotiations with any parties conducted heretofore with respect to any of the
foregoing. Stockholder, in his or her individual capacity, hereby represents
that neither he or she nor his or her agents or representatives is now engaged
in any discussions or negotiations with any Person (other than Purchaser or
Merger Sub) with respect to any of the foregoing and will promptly notify
Purchaser if any Person attempts to engage in any such discussions or
negotiations with Stockholder.
6. Voting Agreement; Proxy of Stockholder.
6.1. Voting Agreement. Stockholder hereby agrees that, during
the time this Agreement is in effect, at any meeting of the stockholders of the
Company, however called, and in any action by written consent of the
stockholders of the Company, Stockholder shall (a) vote all of the Shares in
favor of the Merger, the Merger Agreement (as amended from time to time) and any
of the transactions contemplated by the Merger Agreement; (b) vote the Shares
against any action or agreement that would result in a breach in any material
respect of any covenant, representation or warranty or any other obligation of
the Company under the Merger Agreement; and (c) vote the Shares against any
action or agreement that would impede, interfere with or attempt to discourage
the Offer or the Merger, including, but not limited to: (i) any extraordinary
corporate transaction (other than the Merger), such as a merger, reorganization,
recapitalization or liquidation involving the Company or any Subsidiary; (ii) a
sale or transfer of a material amount of assets of the Company or any
Subsidiary; (iii) any change in the management or board of directors of the
Company, except as otherwise agreed to in writing by
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Purchaser; (iv) any material change in the present capitalization or dividend
policy of the Company; or (v) any other material change in the Company's
corporate structure or business.
6.2. Irrevocable Proxy. Stockholder agrees that, in the event
Stockholder shall fail to comply with the provisions of Section 6.1 hereof as
determined by Purchaser in its sole discretion, such failure shall result,
without any further action by Stockholder, in the irrevocable appointment of
Purchaser as the attorney and proxy of Stockholder pursuant to the provisions of
section 212 of the DGCL, during and for the term of this Agreement, with full
power of substitution, to vote, and otherwise act (by written consent or
otherwise) with respect to all shares of Common Stock, including the Shares,
that Stockholder is entitled to vote at any meeting of stockholders of the
Company (whether annual or special and whether or not an adjourned or postponed
meeting) or consent in lieu of any such meeting or otherwise, on the matters and
in the manner specified in Section 6.1 hereof. THIS PROXY AND POWER OF ATTORNEY
IS IRREVOCABLE AND COUPLED WITH AN INTEREST. Stockholder hereby affirms that the
irrevocable proxy set forth in Section 6.2 is given to secure performance of the
duties of Stockholder under this Agreement. Stockholder hereby revokes,
effective upon the execution and delivery of the Merger Agreement by the parties
thereto, all other proxies and powers of attorney with respect to the Shares
that Stockholder may have heretofore appointed or granted, and no subsequent
proxy or power of attorney (except in furtherance of Stockholder's obligations
under Section 6.1 hereof) shall be given or written consent executed (and if
given or executed, shall not be effective) by Stockholder with respect thereto
so long as this Agreement remains in effect.
7. Option Shares. If, after the date hereof, Stockholder exercises any
option to purchase Common Stock, the provisions of this Agreement shall be
applicable to all of the shares of Common Stock issued upon such exercise (the
"Additional Shares") as if such Additional Shares had been issued and
outstanding as of the date hereof; provided, however, that the provisions of
Section 1 shall be modified to provide that the Additional Shares shall be
tendered no later than the second Business Day following such exercise.
Stockholder further agrees that,
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in the event Stockholder does not exercise any or all of Stockholder's options
to purchase Common Stock sufficiently in advance of the expiration of the Offer
to permit the tender of such Additional Shares issued upon such exercise prior
to the expiration of the Offer, Stockholder will not exercise such options, and
such options will be acquired by the Company in consideration of a cash payment
as set forth in the Merger Agreement.
8. Termination. This Agreement shall terminate on the earlier of (i)
the Termination Date (as hereinafter defined) or (ii) the date on which Merger
Sub purchases all of the Shares pursuant to the Offer in accordance with Section
1. For purposes of this Agreement, "Termination Date" means the date on which
notice is given, or publication of a press release or other announcement is
made, by Purchaser, the Company or Purchaser and the Company, jointly, that it
or they, as the case may be, has or have terminated the Merger Agreement in
accordance with its terms (which notice or publication will be operative for all
purposes of terminating this Agreement, without further action).
9. Miscellaneous.
9.1. Expenses. Except as otherwise provided herein, all costs
and expenses incurred in connection with the transactions contemplated by this
Agreement shall be paid by the party incurring such expenses.
9.2. Further Assurances. Stockholder and Purchaser will
execute and deliver all such further documents and instruments and take all such
further action as may be necessary in order to consummate the transactions
contemplated hereby.
9.3. Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or in equity.
9.4. Entire Agreement. This Agreement constitutes the entire
agreement between Purchaser and Stockholder with respect to the subject matter
hereof and
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supersedes all prior agreements and understandings, both written and oral,
between Purchaser and Stockholder with respect to the subject matter hereof.
9.5. Assignment. This Agreement shall not be assigned by
operation of law or otherwise, except that Purchaser may assign all or any of
its rights and obligations hereunder to any wholly-owned subsidiary of
Purchaser, provided that no such assignment shall relieve Purchaser of its
obligations hereunder if such assignee does not perform such obligations.
9.6. Parties in Interest. This Agreement shall be binding
upon, inure solely to the benefit of, and be enforceable by, the parties hereto
and their successors and permitted assigns. Nothing in this Agreement, express
or implied, is intended to or shall confer upon any other person any right,
benefit or remedy of any nature whatsoever under or by reason of this Agreement.
9.7. Amendment; Waiver. This Agreement may not be amended
except by an instrument in writing signed by the parties hereto. Any party
hereto may (a) extend the time for the performance of any obligation or other
act of any other party hereto, (b) waive any inaccuracy in the representations
and warranties contained herein or in any document delivered pursuant hereto and
(c) waive compliance with any agreement or condition contained herein. Any such
extension or waiver shall be valid if set forth in an instrument in writing
signed by the party or parties to be bound thereby.
9.8. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law,
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of this Agreement is not affected in any manner materially adverse to
any party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in a mutually acceptable manner in order that the
terms of this Agreement remain as originally contemplated to the fullest extent
possible.
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9.9. Notices. Except as otherwise provided herein, any notice
required to be given herein shall be sufficient if in writing, and sent by
facsimile transmission (with a confirmation copy sent by overnight courier), by
courier service (with proof of service), hand delivery or certified or
registered mail (return receipt requested and first-class postage prepaid),
addressed as follows:
if to Purchaser:
GKN Powder Metallurgy Holdings, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Fried, Frank, Harris, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
if to Stockholder:
c/o Sinter Metals, Inc.
Terminal Tower
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
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with a copy of all communications to Stockholder to:
▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇
North Point, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
9.10. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware without regard
to any principles of choice of law or conflicts of law of such state. All
actions and proceedings arising out of or relating to this Agreement shall be
heard and determined in any state or federal court sitting in the City of New
York.
9.11. Headings. The descriptive headings contained in this
Agreement are included for convenience of reference only and shall not affect in
any way the meaning or interpretation of this Agreement.
9.12. Counterparts. This Agreement may be executed and
delivered (including by facsimile transmission) in one or more counterparts, and
by the different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
9.13. Defined Terms. Capitalized terms used herein but not
defined shall have the meanings ascribed thereto in the Merger Agreement.
9.14. Director and Officer. Notwithstanding anything herein to
the contrary, the covenants and agreements set forth herein shall not prevent
Stockholder, in his or her capacity as an officer and director of the Company,
from taking any action, subject to the applicable provisions of the Merger
Agreement, while acting in such capacity as an officer and director of the
Company.
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
duly executed and delivered as of the date first written above.
GKN POWDER METALLURGY
HOLDINGS, INC.
By:
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
By:
--------------------------------
Name:
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