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Technology Stocks : FORE Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Art M who wrote (12258)	4/26/1999 4:53:00 PM
From: Riskmgmt	Respond to of 12559

Art: Re: How long do you think it will take to close the deal. GEC Incorporated and FORE Systems have entered into a definitive merger agreement (the "Merger Agreement") under which a US subsidiary of GEC ("Acquisition Corp.") will commence a cash tender offer (the "Offer") on or before 30 April 1999 for all of FORE Systems' shares at $35 per share. Following the completion of the Offer, GEC and FORE Systems have agreed to effect a merger between Acquisition Corp. and FORE Systems (the "Merger"), in which the remaining shareholders of FORE Systems will receive the same price per share paid in the Offer. Upon completion of this Merger, FORE Systems will be a wholly owned subsidiary of GEC. The Merger Agreement provides that FORE Systems will pay a termination fee to GEC in the event that the Merger Agreement is terminated under certain circumstances. In addition, GEC and FORE Systems have entered into a Stock Option Agreement (the "Stock Option Agreement") whereby FORE Systems has granted an option to GEC Acquisition Corp. to purchase up to 19.9% of the shares of FORE Systems at the offer price, which shall be exercisable in most cases when the termination fee is payable and in certain other limited circumstances. Simultaneously, on entering into the Merger Agreement, certain members of the management and board of FORE Systems have entered into a stockholder agreement (the "Stockholders Agreement") whereby they have agreed to sell their shares in FORE Systems to Acquisition Corp. and to vote in favour of the merger. The senior management group has also entered into new employment agreements. The Merger Agreement and the Stock Option Agreement have been approved by the Boards of Directors of GEC and FORE Systems and the Stockholders Agreement has been approved by the Board of Directors of GEC. The Offer and the Merger are conditional upon, inter alia, receipt of the required regulatory approvals and clearances. Assuming regulatory approvals and clearances are received, it is anticipated that the acquisition of FORE Systems will be completed in June 1999. I can't remember off hand the percentage owned by the insiders and I have to go to an appointment, perhaps someone else can verify. It seems to me that it is a done deal (subject to regulatory approval) in that they have enough control. GEC also appears to have protected themselves against a better offer coming in by optioning close to 20%. Wish I had more time to spend on it. Anyone else care to comment? Ray