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Exhibit 2
STOCKHOLDERS AGREEMENT
This Stockholders Agreement, dated as of November 20, 1997 (this
"Agreement"), is made and entered into among TRW Inc., an Ohio corporation
("Parent"), Systems Acquisition Inc., a Delaware corporation and a wholly owned
subsidiary of Parent ("Merger Sub"), and each other party listed on the
signature pages hereof (each, a "Stockholder").
WHEREAS, as of the date hereof, each Stockholder owns (beneficially
and of record) the number of shares of common stock, par value $.01 per share,
of BDM International, Inc., a Delaware corporation (the "Company"), set forth
opposite such Stockholder's name on Exhibit A hereto (all such shares so owned
and which may hereafter be acquired by the Stockholders prior to the termination
of this Agreement, whether upon the exercise of Company Options or by means of
purchase, dividend, distribution or otherwise, being referred to herein as the
"Shares");
WHEREAS, immediately prior to the execution and delivery of this
Agreement, Parent, Merger Sub and the Company have entered into an Agreement and
Plan of Merger, dated as of the date hereof (the "Merger Agreement"), which
provides, upon the terms and subject to the conditions set forth therein, for
the merger of Merger Sub with and into the Company (the "Merger"); and
WHEREAS, as a condition to the willingness of Parent and Merger Sub
to enter into the Merger Agreement, Parent and Merger Sub have required that the
Stockholders agree, and in order to induce Parent and Merger Sub to enter into
the Merger Agreement, each Stockholder has agreed, severally and not jointly, to
enter into this Agreement.
NOW, THEREFORE, in consideration of the premises and the
representations, warranties, covenants and agreements hereinafter set forth, the
parties hereto hereby agree as follows:
ARTICLE I.
TRANSFER AND VOTING OF SHARES
1.1. VOTING OF SHARES. Each Stockholder hereby agrees that from the
date hereof until the termination of this Agreement pursuant to Section 6.2
hereof ("the Term"), at any meeting of the stockholders of the Company, however
called, and in any action by consent of the stockholders of the Company, such
Stockholder shall vote its Shares (i) in favor of the Merger and the Merger
Agreement (as amended from time to time), (ii) against any Takeover Proposal and
against any proposal for action or
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agreement that would result in a breach of any covenant, representation or
warranty or any other obligation or agreement of the Company under the Merger
Agreement or which is reasonably likely to result in any of the conditions of
the Company's obligations under the Merger Agreement not being fulfilled, any
change in the directors of the Company, any change in the present capitalization
of the Company or any amendment to the Company's certificate of incorporation or
bylaws, any other material change in the Company's corporate structure or
business, or any other action which in the case of each of the matters referred
to in this clause (ii) could reasonably be expected to impede, interfere with,
delay, postpone or materially adversely affect the transactions contemplated by
the Merger Agreement or the likelihood of such transactions being consummated
and (iii) in favor of any other matter necessary for consummation of the
transactions contemplated by the Merger Agreement which is considered at any
such meeting of shareholders or in such consent, and in connection therewith to
execute any documents which are necessary or appropriate in order to effectuate
the foregoing, including the ability for Merger Sub or its nominees to vote the
Shares directly.
1.2. DISPOSITION OR ENCUMBRANCE OF SHARES. Each Stockholder hereby
agrees that, during the Term, it shall not, and shall not offer or agree to,
sell, transfer, tender, assign, pledge, hypothecate or otherwise dispose of, or
create or permit to exist any Encumbrance (as hereinafter defined) on any of
such Stockholder's Shares.
1.3. PROXY. Each Stockholder hereby revokes any and all prior
proxies or powers of attorney in respect of any Shares and constitutes and
appoints Merger Sub and Parent, or any nominee of Merger Sub and Parent, with
full power of substitution and resubstitution, at any time during the Term, as
its true and lawful attorney and proxy (its "Proxy"), for and in its name, place
and stead, to demand that the Secretary of the Company call a special meeting of
the stockholders of the Company for the purpose of considering any matter
referred to in Section 1.1 and to vote each of such Shares as its Proxy, at
every annual, special, adjourned or postponed meeting of the stockholders of the
Company, including the right to sign its name (as stockholder) to any consent,
certificate or other document relating to the Company that the law of the State
of Delaware may permit or require as provided in Section 1.1.
THE FOREGOING PROXY AND POWER OF ATTORNEY ARE IRREVOCABLE AND COUPLED WITH AN
INTEREST THROUGHOUT THE TERM.
1.4. NO SOLICITATION. Each Stockholder covenants and agrees that,
during the Term, it shall not, directly or indirectly through any officer,
director, agent or other representative, solicit, initiate or encourage, or take
any other action designed or reasonably likely to facilitate, any inquiries
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or the making of any proposal from any person (other than Parent, Merger Sub and
any of their affiliates) relating to (i) any acquisition of all or any of the
such Stockholder's Shares or (ii) any transaction that constitutes a Takeover
Proposal, or participate in any negotiations regarding, or furnish to any person
any information with respect to, or otherwise cooperate in any way with, or
assist or participate in or facilitate or encourage, any effort or attempt by
any person to do or seek any of the foregoing. Each Stockholder immediately
shall cease and cause to be terminated all existing discussions or negotiations
of such Stockholder and its officers, directors, agents or other representatives
with any person conducted heretofore with respect to any of the foregoing. Each
Stockholder shall notify Parent and Merger Sub promptly if any such proposal or
offer, or any inquiry or contact with any person with respect thereto, is made
and shall, in any such notice to Parent and Merger Sub, indicate in reasonable
detail the identity of the person making such proposal, offer, inquiry or
contact and the terms and conditions of such proposal, offer, inquiry or
contact. Notwithstanding any provision of this Section 1.4 to the contrary, if
any Stockholder or any officer, director, agent or representative of such
Stockholder is a member of the Board of Directors of the Company, such member of
the Board of Directors of the Company may take actions in such capacity to the
extent permitted by Section 4.8 of the Merger Agreement.
ARTICLE II.
TENDER OF SHARES
2.1. TENDER. Each Stockholder hereby agrees to validly tender (or
cause the record owner of such shares to validly tender), and not to withdraw,
pursuant to and in accordance with the terms of the Offer, not later than the
fifth business day after commencement of the Offer pursuant to Section 1.1 of
the Merger Agreement and Rule 14d-2 under the Securities Exchange Act, its
Shares. Each Stockholder hereby acknowledges and agrees that Parent's and Merger
Sub's obligation to accept for payment and pay for the Shares in the Offer,
including the Shares owned by such Stockholder, is subject to the terms and
conditions of the Offer. For all its Shares validly tendered in the Offer and
not withdrawn, each Stockholder will be entitled to receive the highest price
paid by Parent pursuant to the Offer.
2.2. CERTAIN WARRANTIES. Without limiting the generality or effect
of any other term or condition of the Offer, the transfer by each Stockholder of
the Shares to Merger Sub in the Offer shall pass to and unconditionally vest in
Merger Sub good and valid title to the Shares, free and clear of all liens,
claims, restrictions, security interests, pledges, limitations and encumbrances
whatsoever.
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2.3. DISCLOSURE. Each Stockholder hereby authorizes Parent 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), its identity and
ownership of the Company Common Stock and the nature of its commitments,
arrangements and understandings under this Agreement.
ARTICLE III.
OPTION
3.1. OPTION SHARES. In order to induce Parent and Merger Sub to
enter into the Merger Agreement, each Stockholder hereby grants to Merger Sub an
irrevocable option (the "Stock Option") to purchase the number of Shares set
forth opposite each Stockholder's name on Exhibit A hereto (the "Option Shares")
at a purchase price per share equal to $29.50. If (a) the Company shall become
obligated, pursuant to Section 7.2(b) of the Merger Agreement by reason of
termination of the Merger Agreement pursuant to any of Section 7.1(c), 7.1(d) or
7.1(h), to pay the Termination Fee, (b) the Offer is consummated but (due to
failure by any Stockholder to validly tender and not withdraw) Merger Sub has
not accepted for payment or paid for the aggregate number of Shares set forth
opposite such Stockholder's name on Exhibit A hereto (in which case the price
per share for the Option Shares will be equal to the highest price paid in the
Offer) or (c) the Merger Agreement is terminated in accordance with its terms
for reasons other than the failure of Parent or Merger Sub to fulfill any
obligation under the Merger Agreement, the Stock Option (i) shall become
exercisable, in whole but not in part, on the date on which the first event
referred to in this sentence shall occur or, if later, the date on which (x) all
waiting periods under the HSR Act or similar German Law required for the
purchase of the Option Shares upon such exercise shall have expired or been
waived and (y) there shall not be in 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 Stock Option pursuant to
this Agreement, and (ii) shall remain exercisable until the date which is 30
days following the first such date on which the Stock Option becomes exercisable
pursuant to clause (i) of this sentence. In the event that Parent wishes to
exercise the Stock Option, Parent, prior to the expiration thereof, shall send a
written notice (the "Notice") to each Stockholder identifying the place for the
closing of such purchase at least three business days prior to such closing.
ARTICLE IV.
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REPRESENTATIONS, WARRANTIES AND COVENANTS OF
THE STOCKHOLDERS
Each Stockholder, severally and not jointly, hereby represents and
warrants to Parent and Merger Sub as follows:
4.1. DUE ORGANIZATION, AUTHORIZATION, ETC. Such Stockholder (if it
is a corporation, partnership or other legal entity) is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization. Such Stockholder has all requisite power and authority to execute,
deliver and perform this Agreement, to appoint Merger Sub and Parent as its
Proxy and to consummate the transactions contemplated hereby. The execution,
delivery and performance of this Agreement, the appointment of Merger Sub as
such Stockholders' Proxy and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary action on the part of such
Stockholder. This Agreement has been duly executed and delivered by or on behalf
of such Stockholder and, assuming its due authorization, execution and delivery
by Parent and Merger Sub, constitutes a legal, valid and binding obligation of
such Stockholder, enforceable against such 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 a Stockholder is trustee whose consent is
required for the execution and delivery of this Agreement of the consummation by
such Stockholder of the transactions contemplated hereby.
4.2. NO CONFLICTS; REQUIRED FILINGS AND CONSENTS. (a) The execution
and delivery of this Agreement by such Stockholder do not, and the performance
of this Agreement by such Stockholder will not, (i) conflict with or violate the
trust agreement, Certificate of Incorporation or Bylaws or other similar
organizational documents of such Stockholder (in the case of a Stockholder that
is a trust, corporation, partnership or other legal entity), (ii) conflict with
or violate any Law applicable to such Stockholder or by which such Stockholder
or any of such Stockholder's properties is bound or affected or (iii) result in
any breach of or constitute a default (or an event that with notice or lapse of
time or both would become a default) under, or give to others any rights of
termination, acceleration or cancellation of, or result in the creation of a
lien or encumbrance on any assets of such Stockholder or (if such Stockholder is
a corporation, partnership or other legal entity) any of its subsidiaries,
including, without limitation, the Shares, pursuant to, any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit, franchise or
other instrument or obligation to which such Stockholder is a party or by which
such Stockholder or any of such Stockholder's assets is bound or affected,
except, in the case of clauses (ii) and (iii), for any such breaches, defaults
or other occurrences that would
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not prevent or delay the performance by such Stockholder of such Stockholder's
obligations under this Agreement.
(b) The execution and delivery of this Agreement by such Stockholder
do not, and the performance of this Agreement by such Stockholder will not,
require any consent, approval, authorization or permit of, or filing with or
notification to, any governmental or regulatory authority (other than the
necessary filing under the HSR Act or the Securities Exchange Act), domestic or
foreign, except where the failure to obtain such consents, approvals,
authorizations or permits, or to make such filings or notifications, would not
prevent or delay the performance by the Stockholder of such Stockholder's
obligations under this Agreement.
4.3. TITLE TO SHARES. Such Stockholder is the sole record and
beneficial owner of the Shares set forth opposite such Stockholder's name on
Exhibit A hereto, free and clear of any pledge, lien, security interest,
mortgage, charge, claim, equity, option, proxy, voting restriction, voting trust
or agreement, understanding, arrangement, right of first refusal, limitation on
disposition, adverse claim of ownership or use or encumbrance of any kind
("Encumbrances"), other than restrictions imposed by the securities laws or
pursuant to this Agreement and the Merger Agreement.
4.4. NO INCONSISTENT ARRANGEMENTS. Each Stockholder hereby
covenants and agrees that, except as contemplated by this Agreement and the
Merger Agreement, it shall not (i) transfer (which term shall include, without
limitation, any sale, gift, pledge or other disposition), or consent to any
transfer of, any or all of such Stockholder's Shares, Company Options or any
interest therein, (ii) enter into any contract, option or other agreement or
understanding with respect to any transfer of any or all of such shares, Company
Options or any interest therein, (iii) grant any proxy, power-of-attorney or
other authorization in or with respect to such Shares or Company Options, (iv)
deposit such Shares or Company Options into a voting trust or enter into a
voting agreement or arrangement with respect to such Shares or Company Options,
or (v) take any other action that would in any way restrict, limit or interfere
with the performance of its obligations hereunder or the transactions
contemplated hereby or by the Merger Agreement.
4.5. NO FINDER'S FEES. Other than may be payable pursuant to the
engagement letter between the Company and Wasserstein Perella & Co., Inc.
referenced in Section 2.19 of the Merger Agreement, no broker, investment
banker, financial adviser or other person is entitled to any broker's, finder's,
financial advisor's or other similar fee or commission in connection with the
transactions contemplated hereby based upon arrangements made by or on behalf of
a Stockholder.
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4.6. AFFILIATE AGREEMENTS. As of the Effective Time, each
Stockholder, on behalf of itself and its affiliates, hereby terminates any and
all contractual rights in favor of such Stockholder and its affiliates then in
effect between such Stockholder or affiliates, on the one hand, and the Company,
on the other hand, including without limitation, any monitoring and advisory
fees to The Carlyle Group, L.P., and each Stockholder, on behalf of itself and
its affiliates, hereby acknowledges that it is not entitled to receive any
broker's, finder's, financial advisor's or other similar fee or commission in
connection with the transactions contemplated hereby or by the Merger Agreement.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES OF
MERGER SUB AND PURCHASER
Parent and Merger Sub hereby, jointly and severally, represent and
warrant to each Stockholder as follows:
5.1. DUE ORGANIZATION, AUTHORIZATION, ETC. Merger Sub and Parent
are corporations duly organized, validly existing and in good standing under the
laws of the States of Delaware and Ohio, respectively. Merger Sub and Parent
have all requisite corporate power and authority to execute and deliver this
Agreement and to consummate the transactions contemplated hereby. The execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby by each of Merger Sub and Parent have been duly authorized
by all necessary corporate action on the part of Merger Sub and Parent,
respectively. This Agreement has been duly executed and delivered by each of
Merger Sub and Parent and, assuming its due authorization, execution and
delivery by each Stockholder, constitutes a legal, valid and binding obligation
of each of Merger Sub and Parent, enforceable against Merger Sub and Parent in
accordance with its terms, subject to the Enforceability Exceptions.
5.2. INVESTMENT REPRESENTATIONS. (a) Merger Sub is acquiring
the Stock Option and the Option Shares (collectively, the "Securities") for
its own account for investment only, and not with a view to, or for sale in
connection with, any distribution of the Securities in violation of the
Securities Act.
(b) Merger Sub has had such opportunity as it deems adequate to obtain
from representatives of the Company such information as is necessary to permit
Merger Sub to evaluate the merits and risks of its investment in the Company.
(c) Merger Sub, directly or through its affiliates, has sufficient
experience in business, financial and investment matters to be able to evaluate
the risks involved in the purchase
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of the Securities and to make an informed investment decision with respect to
such purchase.
(d) Merger Sub acknowledges that (A) the Securities have not been
registered under the Securities Act and are "restricted securities" within the
meaning of Rule 144 under the Securities Act and (B) the Securities cannot be
sold, transferred or otherwise disposed of unless they are subsequently
registered under the Securities Act or an exemption from registration is then
available.
ARTICLE VI.
MISCELLANEOUS
6.1. DEFINITIONS. Terms used but not otherwise defined in this
Agreement, including those defined in Section 8.10 of the Merger Agreement,
have the meanings assigned to such terms in the Merger Agreement.
6.2. TERMINATION. This Agreement shall terminate and be of no
further force and effect (i) by the written mutual consent of the parties
hereto, (ii) by Parent or any Stockholder (with respect to such Stockholder) if
the Offer or the Merger shall not have been consummated on or before 120
calendar days after the date hereof, or (iii) automatically and without any
required action of the parties hereto upon the earlier to occur of (A) the
Effective Time and (B) immediately after the termination of the Merger Agreement
in accordance with its terms; provided, however, that in the event that the
Stock Option shall become exercisable pursuant to Section 3.1 hereof, Articles
III, IV, V and VI of this Agreement shall survive the termination of this
Agreement until the earlier to occur of the closing of the exercise of the Stock
Option and the expiration of the Stock Option. No such termination of this
Agreement shall relieve any party hereto from any liability for any breach of
this Agreement prior to termination.
6.3. EXPENSES. All costs and expenses incurred in connection
with the transactions contemplated by this Agreement shall be paid by the
party incurring such costs and expenses.
6.4. NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given when delivered in
person, by facsimile, receipt confirmed, or on the next business day when sent
by overnight courier or on the second succeeding business day when sent by
registered or certified mail (postage prepaid, return receipt requested) to the
respective parties at the following addresses (or at such other address for a
party as shall be specified by like notice):
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(a) if to Parent or Merger Sub, to:
TRW Inc.
1900 Richmond Road
Cleveland, Ohio 44124
Attention: Secretary
Telecopy:
with copies to:
TRW Inc.
1900 Richmond Road
Cleveland, Ohio 44124
Attention: Treasurer
Telecopy:
and
Jones, Day, Reavis & Pogue
599 Lexington Avenue
New York, New York 10022
Attention: Robert A. Profusek, Esq.
Telecopy: (212) 755-7306
(b) If to a Stockholder, to:
The Carlyle Group, L.P.
1001 Pennsylvania Avenue, N.W.
Suite 220 South
Washington, D.C. 20004
Attention: William E. Conway, Jr.
Telecopy: 202-347-9250
6.5. SEVERABILITY. In case any provision in this Agreement shall be
held invalid, illegal or unenforceable in a jurisdiction, such provision shall
be modified or deleted, as to the jurisdiction involved, only to the extent
necessary to render the same valid, legal and enforceable, and the validity,
legality and enforceability of the remaining provisions hereof shall not in any
way be affected or impaired thereby nor shall the validity, legality or
enforceability of such provision be affected thereby in any other jurisdiction.
6.6. ENTIRE AGREEMENT; ASSIGNMENT. This Agreement and the Merger
Agreement, as amended from time to time, constitutes the entire agreement among
the parties with respect to the subject matter hereof and supersedes all prior
agreements and understandings, both written and oral, among the parties, or any
of them, with respect thereto. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned or delegated by any of the
parties hereto (whether by operation of law or otherwise), provided, however,
that Parent or Merger Sub may, in its sole discretion, assign or delegate its
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rights and obligations hereunder to any direct or indirect wholly-owned
subsidiary of Parent.
6.7. PARTIES IN INTEREST. This Agreement shall be binding upon and
shall inure solely to the benefit of, and be enforceable by, the parties hereto
and their respective successors and permitted assigns, and nothing in this
Agreement, express or implied, is intended to or shall confer upon any person,
other than the parties hereto or their respective successors and permitted
assigns, any rights, remedies, obligations or liabilities of any nature
whatsoever under or by reason of this Agreement, provided, however, that the
parties hereto specifically acknowledge that the provisions of Section 4.6
hereof are intended to be for the benefit of, and shall be enforceable by, the
Company.
6.8. WAIVER OF APPRAISAL RIGHTS. Each Stockholder hereby
waives any rights of appraisal or rights to dissent from the Merger.
6.9. FURTHER ASSURANCE. From time to time, at the other party's
request and without consideration, each party hereto shall execute and deliver
such additional documents and take all such further action as may be necessary
or desirable to consummate and make effective, in the most expeditious manner
practicable, the transaction contemplated by this Agreement.
6.10. STOP TRANSFER. Each Stockholder agrees with, and covenants
to, Parent and Merger Sub that such Stockholder shall not request that the
Company register the transfer (book-entry or otherwise) of any certificate or
uncertificated interest representing any of such Stockholder's Shares, unless
such transfer is made in compliance with this Agreement (including the
provisions of Article III hereof).
6.11. CERTAIN EVENTS. Each Stockholder agrees that this Agreement
and the obligations hereunder shall attach to such Stockholder's Shares and
shall be binding upon any person or entity to which legal or beneficial
ownership of such Shares shall pass, whether by operation of law or otherwise,
including, without limitation, such Stockholder's heirs, guardians,
administrators, or successors. Notwithstanding any transfer of Shares, the
transferor shall remain liable for the performance of all obligations under this
Agreement.
6.12. NO WAIVER. The failure of any party hereto to exercise any
right, power, or remedy provided under this agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, any custom or practice of the
parties at variance with the terms hereof shall not constitute a
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waiver by such party of its right to exercise any such or other right, power or
remedy or to demand such compliance.
6.13. SPECIFIC PERFORMANCE. The parties hereto 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. Accordingly, the parties further agree that each party shall
be entitled to an injunction or restraining order to prevent breaches of this
Agreement and to enforce specifically the terms and provisions hereof in any
court of the United States or any state having jurisdiction, this being in
addition to any other right or remedy to which such party may be entitled under
this Agreement, at law or in equity.
6.14. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware applicable to
contracts executed in and to be performed in that state.
6.15. 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.
6.16. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, each of Parent and Merger Sub has caused this
Agreement to be executed by its officer thereunto duly authorized and each
Stockholder has caused this Agreement to be executed, or duly executed by an
authorized signatory, as of the date first written above.
TRW INC.
By: /s/ William B. Lawrence
------------------------
Name: William B. Lawrence
Title: Executive Vice President and
General Counsel
SYSTEMS ACQUISITION INC.
By: /s/ Kathleen A. Weigand
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Name: Kathleen A. Weigand
Title: Vice President and Secretary
STOCKHOLDERS
THE CARLYLE PARTNERS LEVERAGED CAPITAL
FUND I, L.P.
BDM ACQUISITION PARTNERS, L.P.
BDM ACQUISITION PARTNERS II, L.P.
By THE CARLYLE GROUP, L.P.
General Partner of Each
By TWC VIRGINIA, INC.
Its General Partner
By: /s/ William E. Conway, Jr.
--------------------------
Name: William E. Conway, Jr.
Title: Executive Vice President
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EXHIBIT A
List of Stockholders
Name of Stockholder Number of Shares
The Carlyle Partners Leveraged 6,470,000
Capital Fund I, L.P.
BDM Acquisition Partners, L.P. 190,000
BDM Acquisition Partners II, L.P. 1,000,000