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EXHIBIT 2
CONFORMED COPY
STOCKHOLDER AGREEMENT, dated as of February 13, 1996,
among CONOPCO, INC., a New York corporation ("Parent"),
CONOPCO ACQUISITION COMPANY, INC., a Delaware corporation and
a wholly owned subsidiary of Parent ("Sub"), and the
individual and partnerships listed on Schedule A hereto (each
a "Stockholder" and, collectively, the "Stockholders").
WHEREAS, Parent, Sub and ▇▇▇▇▇▇ ▇▇▇▇▇▇ Industries, Inc., a Delaware
corporation (the "Company"), propose to enter into an Agreement and Plan of
Merger of even date herewith (as the same may be amended or supplemented, the
"Merger Agreement") providing for the making of a cash tender offer (as such
offer may be amended from time to time, the "Offer") by Sub for any and all
shares of Common Stock, par value $.50 per share, of the Company (the "Common
Stock") and the merger of the Company and Sub (the "Merger"); and
WHEREAS, each Stockholder owns the number of shares of Class B
Common Stock, par value $.50 per share, of the Company (the "Class B Common
Stock") set forth opposite his or its name on Schedule A hereto; such shares of
Class B Common Stock, as such shares may be adjusted by conversion into shares
of Common Stock or by any stock dividend, stock split, recapitalization,
combination or exchange of shares, merger, consolidation, reorganization or
other change or transaction of or by the Company, other than the payment of
regular cash dividends consistent with past practice (each, an "Adjustment
Event"), being referred to herein as the "Subject Shares"; and
WHEREAS, as a condition to their willingness to enter into the
Merger Agreement, Parent and Sub have requested that the Stockholders enter
into this Agreement;
NOW, THEREFORE, to induce Parent and Sub to enter into, and in
consideration of their entering into, the Merger Agreement, and in
consideration of the premises and the representations, warranties and
agreements contained herein, the parties agree as follows:
1. Purchase of Subject Shares.
(a) Each Stockholder hereby grants Sub an irrevocable option (the
"Option") to purchase all of the Subject Shares owned by him or it for a
purchase price per share equal to $70.00 (as such amount may be adjusted
to appropriately reflect any Adjustment Events, the "Original Offer
Price"). The Option may be
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exercised in whole (but not in part) at any time after the date hereof
and on or prior to the first anniversary of the date hereof (such first
anniversary, the "Option Expiration Date") in the event that (i) a
Specified Event (as defined in Section 1(b) below) shall have occurred on
or prior to the Option Expiration Date and (ii) the waiting period under
the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of ▇▇▇▇ (▇▇▇ "▇▇▇ ▇▇▇")
with respect to the exercise of the Option shall have expired or been
terminated.
(b) The term "Specified Event" shall mean (i) Parent or Sub shall
have terminated the Merger Agreement under Section 9.01(d) thereof, (ii)
the Company shall have terminated the Merger Agreement under Section
9.01(e) thereof, (iii) prior to termination of the Merger Agreement
(other than by the Company pursuant to Section 9.01(f) or 9.01(g)), a
Takeover Proposal (as defined in the Merger Agreement) shall have been
commenced or the Company shall have entered into an agreement with
respect to, approved or recommended or taken any action to facilitate, a
Takeover Proposal or (iv) Sub shall have accepted for payment, and paid
for, shares of Common Stock in the Offer.
(c) In the event that Sub wishes to exercise the Option, Sub may
do so by giving written notice (the date of such notice being herein
called the "Notice Date") to each of the Stockholders specifying that all
the Subject Shares are to be purchased and specifying the place, time and
date (not earlier than two trading days, nor later than 10 trading days,
from the Notice Date) for the closing of the purchase by Sub pursuant to
such exercise. In the event that any share of Common Stock is accepted
for payment, and paid for, by Sub pursuant to the Offer, Sub shall be
obligated to exercise the Option no later than two trading days following
the date of such payment and close the purchase of and pay for such
Subject Shares within two trading days following the date of such
exercise. A "trading day" shall mean any date on which the New York
Stock Exchange shall be open for business.
2. Payments to Parent or Stockholders.
(a) In the event that a Specified Event shall have occurred and
during the period from the first anniversary of the date hereof to and
including the second anniversary of the date hereof, the Stockholder
sells, transfers, assigns or otherwise disposes of (including by
conversion or exchange in a merger, exchange offer or the like) any of
the Subject Shares
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for value in a bona fide arm's length transaction, the Stockholder shall
pay to Parent an amount in cash equal to the product of (i) the number of
Subject Shares disposed of by the Stockholder and (ii) 50% of the excess,
if any, of (A) the per share cash consideration or the per share fair
market value of any non-cash consideration, as the case may be, received
by the Stockholder as a result of such disposition less (B) the Original
Offer Price; provided, however, that no such payment shall be required to
be made in the event the Company shall have terminated the Merger
Agreement pursuant to Section 9.01(f) or 9.01(g) thereof or Parent or Sub
shall be in material breach of this Agreement (and such breach shall not
have been cured within 10 days following receipt by Parent or Sub of
written notice of such breach).
(b) In the event that Sub shall have exercised the Option pursuant
to Section 1 with respect to the Subject Shares and, on or prior to the
second anniversary of the date hereof, Sub shall sell, transfer, assign
or otherwise dispose of (including by conversion or exchange in a merger,
exchange offer or the like) any of such Subject Shares for value in a
bona fide arm's length transaction, Sub shall pay to the Stockholder an
amount in cash equal to the product of (i) the number of such Subject
Shares disposed of by Sub and (ii) 50% of the excess, if any, of (A) the
per share cash consideration or the per share fair market value of any
non-cash consideration, as the case may be, received by Sub as a result
of such disposition less (B) the Original Offer Price; provided, however,
that no such payment shall be required to be made to any Stockholder in
the event such Stockholder shall be in material breach of this Agreement
(and such breach shall not have been cured within 10 days following
receipt by such Stockholder of written notice of such breach).
(c) For purposes of Section 2 of this Agreement, the fair market
value of any non-cash consideration consisting of:
(i) securities listed on a national securities exchange or
traded on the NASDAQ/NMS shall be equal to the average
closing price per share of such security as reported on
such exchange or NASDAQ/NMS for the five trading days
after the date of disposition; and
(ii) consideration which is other than cash or securities of
the form specified in
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clause (i) of this Section 2(c) shall be determined by
a nationally recognized independent investment banking
firm mutually agreed upon by the parties within 10
business days of the selection of such banking firm;
provided, however, that if the parties are unable to
agree within two business days after the date of
disposition as to the investment banking firm, then the
parties shall draw lots to select the investment
banking firm from among the following three firms:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., CS First Boston Corporation and
Salomon Brothers Inc; provided further, that the
fees and expenses of such investment banking firm shall
be borne equally by Parent and the Stockholder. The
determination of the investment banking firm shall be
binding upon the parties.
(d) Any payment required to be made pursuant to Section 2 of this
Agreement shall be made two trading days after the later of (i) the fifth
trading day after settlement of any disposition or (ii) the date on which
the investment banking firm delivers to the parties its determination of
the per share value of any non-cash consideration received by the
Stockholder or Sub, as the case may be, pursuant to any disposition. In
the event that Sub or any Stockholder shall sell, transfer, assign or
otherwise dispose of any Subject Shares, other than for value in a bona
fide arm's length transaction, the obligation of Sub or such Stockholder,
as the case may be, to make payments pursuant to this Section 2 shall
continue until and apply to any subsequent disposition of such Subject
Shares in a bona fide arm's length transaction for value.
3. Representations and Warranties of the Stockholder. Each
Stockholder hereby, severally and not jointly, represents and warrants to
Parent in respect of himself or itself as follows:
(a) Authority. The Stockholder has all requisite power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. This Agreement has been duly authorized, executed
and delivered by the Stockholder and constitutes a valid and binding
obligation of the Stockholder enforceable in accordance with its terms.
The execution and delivery of this Agreement does not, and the
consummation of the transactions contemplated hereby and compliance with
the terms hereof will not, conflict
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with, or result in any violation of, or default (with or without notice
or lapse of time or both) under any provision of, any trust agreement,
loan or credit agreement, note, bond, mortgage, indenture, lease or other
agreement, instrument, permit, concession, franchise, license,
judgment, order, notice, decree, statute, law, ordinance, rule or
regulation applicable to the Stockholder or to the Stockholder's property
or assets. Except for the expiration or termination of the waiting
period under the HSR Act and informational filings with the SEC, no
consent, approval, order or authorization of, or registration,
declaration or filing with, any court, administrative agency or
commission or other governmental authority or instrumentality, domestic,
foreign or supranational, is required by or with respect to the
Stockholder in connection with the execution and delivery of this
Agreement or the consummation by the Stockholder of the transactions
contemplated hereby.
(b) The Subject Shares. The Stockholder has good and marketable
title to the Subject Shares, free and clear of any claims, liens,
encumbrances and security interests whatsoever. The Stockholder owns no
shares of Class B Common Stock other than the Subject Shares.
4. Representations and Warranties of Parent and Sub. (a) Parent
and Sub hereby represent and warrant to the Stockholder that each of Parent and
Sub has all requisite corporate power and authority to enter into this
Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement by Parent and Sub, and the
consummation of the transactions contemplated hereby, have been duly authorized
by all necessary corporate action on the part of Parent and Sub. This
Agreement has been duly executed and delivered by Parent and Sub and
constitutes a valid and binding obligation of Parent and Sub enforceable in
accordance with its terms.
(b) Securities Act. The Subject Shares will be acquired in
compliance with, and Sub will not offer to sell or otherwise dispose of any
Subject Shares so acquired by it in violation of any of, the registration
requirements of the Securities Act of 1933, as amended.
(c) Financing. Sub has, or will have at the time that any payment
is required to be made to any Stockholder hereunder, the funds necessary to
make such payment to such Stockholder.
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5. Covenants of the Stockholder. Up to and including the Option
Expiration Date, each Stockholder, severally and not jointly, agrees as
follows:
(a) At any meeting of stockholders of the Company called to vote
upon the Merger and the Merger Agreement or at any adjournment thereof or
in any other circumstances upon which a vote, consent or other approval
with respect to the Merger and the Merger Agreement is sought, the
Stockholder shall vote (or cause to be voted) the Subject Shares in favor
of the Merger, the adoption by the Company of the Merger Agreement and
the approval of the terms thereof and each of the other transactions
contemplated by the Merger Agreement, provided that the terms of the
Merger Agreement shall not have been amended to adversely affect the
Stockholder.
(b) At any meeting of stockholders of the Company or at any
adjournment thereof or in any other circumstances upon which the
Stockholder's vote, consent or other approval is sought, the Stockholder
shall vote (or cause to be voted) the Subject Shares against (i) any
merger agreement or merger (other than the Merger Agreement and the
Merger), consolidation, combination, sale of substantial assets,
reorganization, recapitalization, dissolution, liquidation or winding up
of or by the Company or any other Takeover Proposal or (ii) any amendment
of the Company's certificate of incorporation or by-laws or other
proposal or transaction involving the Company or any of its subsidiaries,
which amendment or other proposal or transaction would in any manner
impede, frustrate, prevent or nullify the Merger, the Merger Agreement or
any of the other transactions contemplated by the Merger Agreement.
(c) The Stockholder agrees not to (i) other than by operation of
law, sell, transfer, pledge, assign or otherwise dispose of, or enter
into any contract, option or other arrangement (including any profit
sharing arrangement) with respect to the sale, transfer, pledge,
assignment or other disposition of, the Subject Shares to any person
other than Sub or Sub's designee, (ii) enter into any voting arrangement,
whether by proxy, voting agreement or otherwise, in connection, directly
or indirectly, with any Takeover Proposal or (iii) convert the Subject
Shares into Common Stock (except as required to effect the transaction
contemplated by Section 1 of this Agreement).
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(d) Until the Merger is consummated or the Merger Agreement is
terminated, the Stockholder shall not, nor shall it permit any investment
banker, attorney or other adviser or representative of the Stockholder
to, (i) directly or indirectly solicit, initiate or encourage the
submission of, any Takeover Proposal or (ii) directly or indirectly
participate in any discussions or negotiations regarding, or furnish to
any person any information with respect to, or take any other action to
facilitate any inquiries or the making of any proposal that constitutes,
or may reasonably be expected to lead to, any Takeover Proposal.
6. Further Assurances. Each Stockholder will, from time to time,
execute and deliver, or cause to be executed and delivered, such additional or
further transfers, assignments, endorsements, consents and other instruments as
Parent or Sub may reasonably request for the purpose of effectively carrying
out the transactions contemplated by this Agreement.
7. Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
without the prior written consent of the other parties, except that Sub may
assign, in its sole discretion, any or all of its rights, interests and
obligations hereunder to Parent or to any direct or indirect wholly owned
subsidiary of Parent. Subject to the preceding sentence, this Agreement will
be binding upon, inure to the benefit of and be enforceable by the parties and
their respective successors and assigns.
8. Termination. Except as provided otherwise herein, this
Agreement shall terminate upon the earlier of (i) the close of business on the
second anniversary of the date hereof and (ii) the disposition by each
Stockholder of all the Subject Shares in one or more bona fide arm's length
transactions for value; provided, however, that to the extent any Stockholder
or Sub, as the case may be, shall be required to make payment to the other
pursuant to Section 2, this Agreement shall not terminate until all such
payments shall have been made.
9. General Provisions.
(a) Payments. All payments required to be made to any party to
this Agreement shall be made by wire transfer of immediately available
funds to an account designated by such party within one trading day prior
to such payment.
(b) Specific Performance. The parties hereto acknowledge that
damages would be an inadequate remedy
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for any breach of the provisions of this Agreement and agree that the
obligations of the parties hereunder shall be specifically enforceable.
(c) Expenses. Except as set forth in Section 1 of this Agreement,
all costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party incurring
such expense.
(d) Amendments. This Agreement may not be amended except by an
instrument in writing signed by each of the parties hereto.
(e) Notice. All notices and other communications hereunder shall
be in writing and shall be deemed given if delivered personally or sent
by overnight courier (providing proof of delivery) to the parties at the
following addresses (or at such other address for a party as shall be
specified by like notice):
(i) if to Parent, to
Conopco, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
with a copy to:
Cravath, Swaine & ▇▇▇▇▇
Worldwide Plaza
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Esq., and
(ii) if to a Stockholder, to the address set forth under the name
of such Stockholder on Schedule A hereto
with a copy to:
Winston & ▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
(e) Interpretation. When a reference is made in this Agreement to
Sections, such reference shall be to a Section to this Agreement unless
otherwise indicated.
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The headings contained in this Agreement are for reference purposes only
and shall not affect in any way the meaning or interpretation of this
Agreement. Wherever the words "include", "includes" or "including" are
used in this Agreement, they shall be deemed to be followed by the words
"without limitation".
(f) Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same
agreement, and shall become effective when one or more of the
counterparties have been signed by each of the parties and delivered to
the other party, it being understood that each party need not sign the
same counterpart.
(g) Entire Agreement; No Third-Party Beneficiaries. This
Agreement (including the documents and instruments referred to herein)
(i) constitutes the entire agreement and supersedes all prior agreements
and understandings, both written and oral, among the parties with respect
to the subject matter hereof and (ii) is not intended to confer upon any
person other than the parties hereto any rights or remedies hereunder.
(h) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without
regard to any applicable conflicts of law.
10. Stockholder Capacity. No person executing this Agreement who
is or becomes during the term hereof a director or officer of the Company makes
any agreement or understanding herein in his or her capacity as such director
or officer. Each Stockholder signs solely in his or her capacity as the record
holder and beneficial owner of, or the trustee of a trust whose beneficiaries
are the beneficial owners of, such Stockholder's Subject Shares and nothing
herein shall limit or affect any actions taken by a Stockholder in its capacity
as an officer or director of the Company to the extent specifically permitted
by the Merger Agreement.
11. Performance by Sub. Parent covenants and agrees for the
benefit of the Stockholders that it shall cause Sub to perform in full each
obligation of Sub set forth in this Agreement.
12. Enforcement. The parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached.
It is accordingly agreed that the parties shall
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be entitled to an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions of this
Agreement in any court of the United States located in the State of Delaware or
in a Delaware state court, this being in addition to any other remedy to which
they are entitled at law or in equity. In addition, each of the parties hereto
(i) consents to submit such party to the personal jurisdiction of any Federal
court located in the State of Delaware or any Delaware state court in the event
any dispute arises out of this Agreement or any of the transactions
contemplated hereby, (ii) agrees that such party will not attempt to deny or
defeat such personal jurisdiction by motion or other request for leave from any
such court, (iii) agrees that such party will not bring any action relating to
this Agreement or any of the transactions contemplated hereby in any court
other than a Federal court sitting in the state of Delaware or a Delaware state
court and (iv) waives any right to trial by jury with respect to any claim or
proceeding related to or arising out of this Agreement or any of the
transactions contemplated hereby.
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IN WITNESS WHEREOF, each of Parent and Sub has caused this
Agreement to be signed by its officer thereunto duly authorized and each
Stockholder has signed this Agreement or has caused this Agreement to be signed
by its managing general partners, all as of the date first written above.
CONOPCO, INC.
By: /s/ Mart Laius
-----------------------------------
Name: Mart Laius
Title: Vice President
CONOPCO ACQUISITION COMPANY, INC.
By: /s/ Mart Laius
-----------------------------------
Name: Mart Laius
Title: President
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President and Chief Executive Officer
GIDWITZ FAMILY PARTNERSHIP
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing General
Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing General
Partner
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By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing General
Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing General
Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing General
Partner
HCI PARTNERSHIP
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing General
Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing General
Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing General
Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing General
Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing General
Partner
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SCHEDULE A
Number of
Class B Shares
Owned of Record
---------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ 120,000
c/o ▇▇▇▇▇▇ ▇▇▇▇▇▇ Industries, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
HCI Partnership 569,909
c/o ▇▇▇▇▇▇ ▇▇▇▇▇▇ Industries, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Gidwitz Family Partnership 2,084,197
c/o ▇▇▇▇▇▇ ▇▇▇▇▇▇ Industries, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
