Opinion ID: 483599
Heading Depth: 2
Heading Rank: 3

Heading: the merger of eaton and cutler-hammer

Text: 19 On June 12, 1978, Eaton purchased Tyco's entire 33% stock interest in Cutler-Hammer--2,105,900 shares of common stock--for $115.8 million, or approximately $55 per share. Thereafter, on June 22, 1978, Eaton announced its plan to make a tender offer for all Cutler-Hammer stock. 20 The Boards of Directors of Eaton and Cutler-Hammer approved an Agreement and Plan of Merger on June 26, 1978 (the Agreement). The Agreement provided for the proposed merger of New CHI and Cutler-Hammer, and the conversion of each common and preferred share of Cutler-Hammer into $58 cash or a fixed-interest bearing subordinated installment note at the election of the stockholder. 4 The Agreement conditioned the merger upon: (1) the approval of Cutler-Hammer's shareholders at a meeting to be held on a mutually agreeable date for Eaton and Cutler-Hammer, but no later than April 30, 1979; (2) an order for the S.E.C. declaring the registration of the Eaton installment notes effective; (3) Cutler-Hammer's filing of a proxy statement with the S.E.C.; (4) approval from the Federal Trade Commission (F.T.C.) 5 and the Department of Justice; (5) the absence of any litigation, proceeding or investigation, actual or threatened, with regard to the merger; and (6) opinion letters of counsel for both companies and the certificate of Cutler-Hammer's President to be rendered after Cutler-Hammer's shareholders approved the merger. 21 Pursuant to the Agreement, Eaton issued a tender offer for all outstanding shares of Cutler-Hammer stock on July 17, 1978, at the price of $58 per share. By the conclusion of the tender offer on August 7, 1978, Eaton had acquired a 62% interest in Cutler-Hammer. Koppers did not tender or otherwise offer to sell its Cutler-Hammer preferred or common stock to Eaton during the period of the tender offer. 6 22 As for the required shareholders' meeting, on August 23, 1978, the Cutler-Hammer Board of Directors set the required meeting date for October 2, 1978, but gave the Chairman, Fitzgerald, authority to change the date without further Board action. Subsequently, Fitzgerald postponed the October 2, 1978 meeting date. On October 20, 1978, Fitzgerald set the meeting date for December 14, 1978, with the concurrence of Eaton's Chairman, and on November 6, 1978, a Notice of Special Shareholders' Meeting, Proxy Statement and Form of Proxy were sent to all record shareholders. 7 The shareholders met on December 14, 1978, and approved the merger, subject to the satisfaction or waiver of the remaining closing conditions. Those conditions were satisfied when the merger closed on January 2, 1979. On that date, Koppers sold all of its Cutler-Hammer stock and received $58 per share from Eaton, pursuant to the terms of the merger. 23 As for the required governmental authorizations, on August 21, 1978, Eaton submitted a draft Registration Statement to the S.E.C. On September 19, 1978, the S.E.C. responded with a multitude of questions and proposed changes. On October 23, 1978, Eaton filed an amended Registration Statement with the S.E.C. The S.E.C. finally declared the Registration Statement effective on November 3, 1978. As for F.T.C. approval of the merger, the F.T.C. requested Eaton and Cutler-Hammer to provide documents to the F.T.C., and, on October 20, 1978, Eaton made those documents available to the F.T.C. Eaton did not consider that it had the F.T.C.'s approval of the merger until December 14, 1978.