Item 1.01 ENTRY INTO MATERIAL DEFINITIVE AGREEMENT
Merger Agreement
On
The Merger Agreement provides that upon the satisfaction of certain conditions
prescribed in the Merger Agreement and summarized below, (i) MGP will merge with
and into Merger Sub 1, with Merger Sub 1 as the surviving corporation ("MGP
Merger"); (ii) EGP will merge with and into Merger Sub 2, with Merger Sub 2 as
the surviving corporation ("EGP Merger" and together with the MGP Merger, the
"GP Mergers"); and (iii) Merger Sub 3 will merge with and into the Partnership,
with the Partnership as the surviving entity ("Partnership Merger" and together
with the GP Mergers, the "Mergers"). Upon consummation of the Partnership
Merger, holders of limited partner units of the Partnership (including the
depositary receipts therefor, the "Partnership Units"), less the number of
Partnership Units held by Rayonier and certain of their respective affiliates,
will be entitled to receive, for each Partnership Unit, merger consideration
consisting of (i) 3.929 common shares of Rayonier, (ii) 3.929 units of
Based on Rayonier's then 10-day volume-weighted average price, the transaction
values the Partnership's limited partnership equity at
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After the Mergers are completed, and subject to a 60-day notice period and
certain other conditions, the units representing partnership interests in
Completion of the Mergers is subject to the satisfaction (or waiver, if permissible under applicable law) of customary closing conditions, including the approval of the holders of a majority of the outstanding Partnership Units. The approval measures set forth above is referred to herein as the "Unitholder Approval."
The Merger Agreement contains representations and warranties and covenants of the parties that the Partnership believes are customary for a transaction of this nature. Among other things, the parties have agreed to use reasonable best efforts to promptly take all actions necessary to obtain all necessary approvals applicable to the Mergers, and to forbear from taking any actions that would result in certain adverse tax treatment or that would reasonably be expected to adversely affect Rayonier's ability to obtain approval under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The Merger Agreement also requires the parties to take any of the following measures if necessary to obtain antitrust approvals, subject to certain terms and conditions: (i) take or commit to take any action that limits their respective freedom of action with respect to, or their ability to retain, any property, assets or businesses, and (ii) initiate or defend against any lawsuit, action or proceeding, judicial or administrative, challenging the Merger Agreement or the Mergers.
Until the earlier of the termination of the Merger Agreement or the consummation
of the Mergers, the Partnership has agreed to operate its business in the
ordinary course consistent with past practice and has agreed to certain other
operating covenants and to not take certain specified actions prior to the
consummation of the Mergers, as set forth more fully in the Merger Agreement.
The Partnership has also agreed to convene and hold a meeting for the purpose of
obtaining the Unitholder Approval. In addition, the Merger Agreement requires
that, subject to certain exceptions, the board of directors of the Partnership
(the "Board") recommend that the Partnership's unitholders approve the Merger
Agreement and the Mergers. In addition, the Partnership and each of the
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The Merger Agreement contains certain termination rights for the Partnership and
Rayonier, including, among others, the right of Rayonier to terminate the Merger
Agreement as a result of the Board changing its recommendation with respect to
the Merger Agreement and the Mergers. The Merger Agreement provides that in the
event of a termination under specified circumstances, including the one
described above, the Partnership will be required to pay Rayonier a termination
fee of
Voting Agreements
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Certain Information
The Merger Agreement and the Voting Agreement have been filed as exhibits to the
original filing of this report to provide investors and security holders with
information regarding their respective terms. Neither agreement is intended to
provide any other factual information about the parties thereto or to modify or
supplement any factual disclosures about the Partnership or any of its
subsidiaries, in the public reports filed by the Partnership with the
Additional Information and Where to Find It
This communication may be deemed to be solicitation material in respect of the
proposed acquisition of the Partnership. In connection with the proposed
acquisition, the Partnership intends to file relevant materials with the
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Participants in the Solicitation
The Partnership and its directors, executive officers, general partners, limited
partners and other members of management and employees, under
Cautionary Note Regarding Forward-Looking Statements
The information contained in this communication includes "forward-looking statements." All statements that express belief, expectation, estimates or intentions, as well as those that are not statements of historical facts, are forward-looking statements. Such statements use forward-looking words such as "proposed," "anticipate," "project," "potential," "could," "should," "continue," "estimate," "expect," "may," "believe," "will," "plan," "seek," "outlook" and other similar expressions that are intended to identify forward-looking statements, although some forward-looking statements are expressed differently. These statements discuss future expectations and contain projections, including without limitation the expectation that the Mergers will occur at the estimated time or at all. Specific factors that could cause actual results to differ from those in the forward-looking statements include, but are not limited to: (i) changes in federal, state, local and foreign laws and regulations to which the Partnership is subject, including those governing timber harvesting, transportation and sale (particularly international sales) and those that treat the Partnership as a partnership for federal income tax purposes; (ii) terrorism and other security risks, including cyber risk, adverse weather conditions, including hurricanes, wildfires, environmental releases and natural disasters; (iii) changes in the marketplace for the Partnership's products or services, such as increased competition or general reductions in demand; (iv) adverse regional, national, or international economic conditions, adverse capital market conditions and adverse political developments; (v) demonstrations, shutdowns or interruptions at the Partnership's tree farms and points of delivery; (vi) unanticipated capital expenditures in connection with the construction, repair or replacement of the Partnership's assets; (vii) volatility in the price of timber and related products; (viii) nonpayment or nonperformance by the Partnership's customers; (ix) Rayonier's ability to integrate the Partnership's business with its own and to realize anticipated cost savings and other efficiencies and benefits; (x) the Partnership's risk of failure to receive the Unitholder Approval on a timely basis or otherwise; (xi) the possibility that competing offers or acquisition proposals for the Partnership will be made or that a change in its assets or business prospects will affect the desirability of the Transactions (as defined in the Merger Agreement); (xii) the possibility that any or all of the various conditions to the consummation of the Mergers may not be satisfied or waived, including the failure to receive antitrust or other regulatory approvals (or any conditions, limitations or restrictions placed on such approvals); (xiii) the occurrence of any event, change or other circumstance that could give rise to the termination of the Merger Agreement; (xiv) the effect of the announcement or pendency of the Mergers or the Partnership's ability to retain and hire key personnel, its ability to maintain relationships with its customers, suppliers, third-party contractors, and others with which it does business, or its operating results and business generally; (xv) risks related to diverting management's attention from the Partnership's ongoing business operations; (xvi) the risk that unitholder litigation in connection with the Mergers may result in significant costs to defend or resolve; and (xvii) the cautionary discussion of risks and uncertainties detailed in Part I, Item 1A, "Risk Factors" and Part II, Item 7, "Management's
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Discussion and Analysis of Financial Condition and Results of Operations" of the
Partnership's Annual Report on Form 10-K for the fiscal year ended
The forward-looking statements contained in this communication speak only as of
the date hereof. Although the expectations in the forward-looking statements are
based on the current beliefs and expectations of the Partnership and its general
partners, readers should use caution not to place undue reliance on any such
forward-looking statements because such statements speak only as of the date
hereof. Except as required by federal and state securities laws, the Partnership
undertakes no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or any other
reason. All forward-looking statements attributable to the Partnership or any
person acting on the Partnership's behalf are expressly qualified in their
entirety by the cautionary statements contained or referred to in this
communication and in the Partnership's future periodic reports filed with the
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