Illinois Tool Works Inc.
0000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, XX 00000
April 10, 2001
Overseas Private Investor Partners
c/o Overseas Private Investors, Ltd.
Clarendon House, Church Street
Xxxxxxxx 0-00, Xxxxxxx
To Whom It May Concern:
This letter is to confirm the agreement between Illinois Tool
Works Inc., a Delaware corporation ("Buyer") and Overseas Private Investor
Partners ("you") regarding all of the 835,925 shares, $.01 par value,
("Common Stock") of Foilmark, Inc., a Delaware corporation (the "Company"),
beneficially owned (within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, as amended) by you and any other shares of Common
Stock as to which you may hereafter acquire beneficial ownership (the
"Shares"). In order to induce Buyer to enter into an Agreement and Plan of
Merger to be dated as of the date hereof between the Company and Buyer (the
"Merger Agreement"), you hereby agree as follows (capitalized terms used
herein but not otherwise defined shall have the meanings ascribed to them
in the Merger Agreement):
Subject to the terms and conditions hereof, as soon as practicable
after the commencement of the tender offer to be commenced by Buyer
pursuant to the Merger Agreement (the "Tender Offer"), but in no event
later than the expiration date of the Tender Offer, you will tender to
Buyer, or cause to be tendered, all of the Shares, regardless of whether a
higher offer for such Shares has been made. If you withdraw your tender of
Shares in the Tender Offer, you shall immediately, but in no event later
than the expiration date of the Tender Offer, re-tender such Shares to
Buyer.
You hereby grant to Buyer the option (the "Option") to purchase
all of the Shares, at the higher of U.S. $6.36 per Share in cash or such
higher price per Share in cash as Buyer or any of its subsidiaries may
offer to pay for shares of Common Stock in the Tender Offer (the "Per Share
Option Price"), beginning on the date of an Applicable Termination (as
defined below) and ending on the date (the "Expiration Date") that is the
later of (A) ten business days following such Applicable Termination and
(B) ten business days following the receipt by Buyer of any of the
governmental consents or approvals or the termination or expiration of any
waiting periods referred to in Section 8.01(b) of the Merger Agreement. An
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"Applicable Termination" shall mean any termination of the Merger Agreement
after an Alternative Acquisition Proposal (as defined in the Merger
Agreement) has been made, proposed, communicated or disclosed in any
manner.
If (i) Buyer acquires the Shares upon exercise of the Option, (ii)
Buyer does not acquire a number of shares of Common Stock representing at
least the Minimum Tender Condition within twelve months after such exercise
of the Option and (iii) within such twelve-month period, Buyer or any
affiliate of Buyer, directly or indirectly, sells, transfers or otherwise
disposes of (including, without limitation, pursuant to a merger,
liquidation, reorganization or business combination involving the Company)
the Shares acquired by Buyer upon exercise of the Option, other than to any
affiliate of Buyer (any of the foregoing, a "Covered Disposition"), then
upon consummation of any such Covered Disposition, Buyer shall pay to you
in cash the amount, if any, by which the aggregate of the cash
consideration per Share and the fair market value (as of the time of such
Covered Disposition) of any securities or other property or assets obtained
by Buyer in the Covered Disposition exceeds the Per Share Option Price,
multiplied by the number of Shares sold, transferred or disposed of in the
Covered Disposition (the amount so payable to you, the "Covered Amount").
In the case of any securities so obtained by Buyer in a Covered Disposition
that are traded on any national securities exchange or through any
inter-dealer quotation system, the "fair market value" of such securities
as of the time of such Covered Disposition shall be the closing market
price as reported on the securities exchange or quotation system that is
the principal trading market for such securities on the last trading day
before the Covered Disposition. In the case of any other non-cash
consideration so obtained by Buyer in a Covered Disposition, the "fair
market value" of such consideration shall be the value actually attributed
to such consideration under the terms of the Covered Disposition or, if no
such attribution was made under the terms of the Covered Disposition, the
fair market value of such consideration as determined by Buyer and you in
good faith. If Buyer and you cannot agree on the fair market value of such
consideration within ten (10) days after the consummation of the Covered
Disposition, then the fair market value shall be determined by arbitration
in accordance with the rules of the American Arbitration Association. The
Covered Amount shall be treated as additional purchase price paid for the
Shares for tax and other purposes.
You hereby agree not to sell, transfer or encumber the Shares
(except in the Tender Offer or to Buyer and for transfers of Shares to a
trust which unconditionally and irrevocably agrees to be bound by the terms
of this letter agreement with respect to the Shares being transferred)
prior to the Expiration Date.
You hereby represent and warrant as to the Shares issued,
outstanding and beneficially owned by you as of the date of this letter
agreement that except as disclosed on Schedule I hereto (i) you are the
sole owner of and have full right, power and authority to sell and vote the
Shares, or if you are not the sole owner, you have the full right, power
and authority to sell the Shares, and in either event, this letter
agreement is a valid and binding agreement, enforceable against
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you, in accordance with its terms; (ii) neither the execution of this
letter agreement nor the consummation by you of the transactions
contemplated hereby will constitute a violation of, or conflict with, or
default under, any contract, commitment, agreement, understanding,
arrangement or restriction of any kind to which you are a party or by which
you or the Shares are bound; and (iii) Buyer or its subsidiary shall, upon
purchase of the Shares, receive good and marketable title to the Shares,
free and clear of all liens, claims, encumbrances and security interests of
any kind.
Buyer hereby represents and warrants that it has the corporate
power and it is duly authorized to enter into this letter agreement.
You hereby agree to vote or cause to be voted all of the Shares
(i) in favor of approval and adoption of the Merger Agreement, the Merger
and the transactions contemplated by this Agreement and the Merger
Agreement and (ii) against any other mergers, recapitalizations, business
combinations, sales of assets, liquidations or similar transactions
involving the Company, or any other matters which could reasonably be
expected to impede, interfere, delay or adversely affect the Offer, the
Merger and the transactions contemplated by this Agreement and the Merger
Agreement. In furtherance of your voting agreement in this paragraph, you
hereby revoke any and all previous proxies with respect to any of the
Shares and grant to Buyer and such individuals or corporations as Buyer may
designate an irrevocable proxy to vote all of the Shares owned by you in
accordance with this paragraph on any matters which may be presented to
shareholders of the Company with respect to the matters referred to in (i)
and (ii) above in this paragraph. You hereby acknowledge that the proxy
granted by the foregoing is coupled with an interest and is irrevocable. In
addition, you hereby agree to execute such additional documents as Xxxxx
may reasonably request to effectuate its proxy and voting rights under this
paragraph. Notwithstanding anything to the contrary contained herein, the
proxy granted to Buyer hereby shall automatically terminate and be of no
further force and effect upon the termination of this letter agreement in
accordance with its terms.
We each hereby agree that you are not making any agreement or
understanding herein in any capacity other than in your capacity as a
stockholder of the Company. If you are a member of a Board of Directors of
the Company, nothing herein shall in any way limit or affect actions taken
by you in such capacity, and no action taken in furtherance of your
fiduciary duties shall be deemed to be a breach of the provisions of this
letter agreement.
We each hereby agree that this letter agreement creates legally
binding commitments, enforceable in accordance with their terms. This
letter agreement (i) constitutes the entire agreement among the parties
hereto with respect to the subject matter hereof and (ii) supersedes all
other prior agreements and understandings, both written and oral, between
the parties with respect to the subject matter hereof. This letter
agreement is not intended to confer upon any other person any rights or
remedies hereunder.
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This letter agreement may be terminated at any time (i) by mutual
written consent of the parties hereto, (ii) by either party on or after the
termination of the Merger Agreement other than pursuant to an Applicable
Termination or (iii) by either party on or after the Expiration Date;
provided, however, that the provisions of the fourth paragraph of this
letter agreement (related to Covered Dispositions) shall survive any such
termination in accordance with its terms. Notwithstanding the foregoing,
such right of termination shall not be available to any party whose breach
of any representation, warranty, agreement or obligation hereunder has been
the cause of or resulted in the failure of the transactions contemplated
hereunder to be consummated. No such termination shall relieve any party
from liability for any breach of this letter agreement.
Each party shall be entitled, without prejudice to the rights and
remedies otherwise available to such party, to specific performance of all
of the other party's obligations hereunder. This letter agreement shall be
governed by and construed in accordance with the internal laws (and not the
law of conflicts) of the State of Delaware. Each of the parties shall pay
its own expenses in connection with the execution and performance of this
letter agreement.
If any term, provision, covenant or restriction of this letter
agreement is held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this letter agreement shall remain in full force and effect
and shall in no way be affected, impaired or invalidated.
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Please indicate your agreement to the foregoing by signing this
letter agreement in the space provided below, whereupon a binding agreement
will have been formed between us in respect of the foregoing.
Sincerely,
ILLINOIS TOOL WORKS INC.
By:_____________________
Name:
Title:
Acknowledged and agreed as of the date first written above:
OVERSEAS PRIVATE INVESTOR PARTNERS
By: Overseas Private Investors, Ltd.
its Managing Partner
By: _______________________________________________
Name:
Title:
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SCHEDULE I
No Exceptions.
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