SEC Form PRER14A filed by Manitex International Inc.

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No. 1)

 

 

Filed by the Registrant ☒

Filed by a Party other than the Registrant ☐

Check the appropriate box:

 

☒	Preliminary Proxy Statement

 

☐	Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

 

☐	Definitive Proxy Statement

 

☐	Definitive Additional Materials

 

☐	Soliciting Material Pursuant to §240.14a-12

MANITEX INTERNATIONAL, INC.

(Name of Registrant as Specified in its Charter)

Payment of Filing Fee (Check the appropriate box):

 

☐	No fee required.

 

☒	Fee paid previously with preliminary materials.

 

☐	Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

 

 

 

    , 2024

Dear Manitex International, Inc. Shareholder:

You are cordially invited to attend a special meeting of shareholders of Manitex International, Inc. that will be held on     ,     , 2024, at      (Central Standard Time) ( as may be adjourned or postponed from time to time, the “special meeting”) at our principal executive offices located at 9725 Industrial Drive, Bridgeview, Illinois, 60455.

On September 12, 2024, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among the Company, Tadano Ltd., a Japanese corporation (“Tadano”) and Lift SPC Inc., a Michigan corporation and a wholly owned subsidiary of Tadano (“Merger Sub”). Pursuant to the Merger Agreement, Merger Sub will be merged with and into the Company (the “Merger”), with the Company continuing as the surviving corporation and a wholly owned subsidiary of Tadano. At the special meeting you will be asked to, among other things, consider and vote upon a proposal to approve the Merger Agreement.

If the Merger is completed, and upon the satisfaction of the conditions set forth in the Merger Agreement, you will be entitled to receive $5.80 in cash, without interest, less any required withholding taxes, for each share of our common stock owned by you. Acting in reliance upon the unanimous recommendation of a special committee of our board of directors, comprised solely of independent and disinterested directors (the “Transaction Committee”), our board of directors (the “Board”), has determined that the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement are fair to and in the best interests of the Company and the Company’s shareholders (other than holders of Excluded Shares, as defined below) and has adopted, authorized, approved and declared advisable the Merger Agreement and the transactions contemplated by the Merger Agreement. The Board made its determination based in part on the recommendation of the Transaction Committee and after consultation with its legal and financial advisors and in part after consideration of a number of other factors as described in the accompanying proxy statement. “Excluded Shares” means shares of our common stock owned by Tadano, Merger Sub or the Company or their respective subsidiaries.

The proposed transaction contemplated by the Merger Agreement may be deemed a “Rule 13e-3 transaction” under the rules of the U.S. Securities and Exchange Commission (the “SEC”). If the transactions contemplated by the Merger Agreement are completed, we expect that the Company will become wholly-owned by Tadano. We further expect that the consummation of the transactions contemplated by the Merger Agreement will cause the Company’s common stock to be delisted from trading on Nasdaq.

Approval of the Merger Agreement requires the affirmative vote of holders of a majority of the shares of common stock outstanding at the close of business on the record date. The Board recommends that you vote “FOR” the proposal to approve the Merger Agreement, “FOR” the proposal to approve, by a non-binding advisory vote, the Merger-related compensation and “FOR” any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum at the special meeting.

Your vote is very important. The Merger cannot be completed unless the Merger Agreement is approved by the affirmative vote of holders of a majority of the shares of common stock outstanding at the close of business on the record date. Whether or not you plan to attend the special meeting, please complete, date, sign

and return, as promptly as possible, the enclosed proxy card in the accompanying prepaid reply envelope, or submit your proxy by telephone or over the Internet. If you attend the special meeting and vote in person, your vote by ballot will revoke any proxy previously submitted. The failure to return your proxy or vote at the special meeting in person will have the same effect as a vote “AGAINST” the proposal to approve the Merger Agreement.

If your shares of common stock are held in “street name” by your bank, brokerage firm or other nominee, your bank, brokerage firm or other nominee will be unable to vote your shares of common stock without instructions from you. You should instruct your bank, brokerage firm or other nominee to vote your shares of common stock in accordance with the procedures provided by your bank, brokerage firm or other nominee. The failure to instruct your bank, brokerage firm or other nominee to vote your shares of common stock “FOR” the proposal to approve the Merger Agreement will have the same effect as voting “AGAINST” the proposal to approve the Merger Agreement.

In considering the recommendation of the Board with respect to the proposal to approve the Merger Agreement, you should be aware that our directors and executive officers may have interests in the Merger that are different from, or in addition to, yours. Completion of the Merger is subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement.

The accompanying proxy statement provides you with detailed information about the special meeting and the Merger Agreement and the transactions contemplated by it, including the Merger. A copy of the Merger Agreement is attached as Annex A to the accompanying proxy statement and is incorporated by reference therein. We encourage you to carefully read the entire proxy statement and its annexes, including the Merger Agreement. In addition, you should read the ‘Risk Factors’ section beginning on page 7 in our annual report on Form 10-K for the year ended December 31, 2023, and other risk factors detailed from time to time in the Company’s reports filed with the SEC and incorporated by reference in this proxy statement, for risks relating to our business and for a discussion of the risks that you should consider in evaluating the proposed transaction and how it may affect you. You may also obtain additional information about the Company from other documents we have filed with the SEC.

If you have any questions or need assistance voting your shares of the Company common stock, please contact InvestorCom LLC, which is acting as the proxy solicitation agent and information agent for the Company in connection with the special meeting, or the Company at the following addresses or telephone numbers:

 

 

19 Old Kings Highway S. – Suite 130

Darien, CT 06820

Shareholders may call toll-free: (877) 972-0090

Banks and brokers call collect: (203) 972-9300

E-mail: [email protected]

– or –

Manitex International, Inc.

Attn: Corporate Secretary

9725 Industrial Drive

Bridgeview, Illinois 60455

(708) 237-2052

Thank you for your cooperation, continued support and interest in Manitex International, Inc.

 

Sincerely,

Lynn Logerquist

Corporate Secretary

Neither the SEC, nor any state securities regulatory agency has approved or disapproved the Merger, passed upon the merits or fairness of the Merger, the Merger Agreement or the other transactions contemplated thereby, or passed upon the adequacy or accuracy of the disclosure in this document. Any representation to the contrary is a criminal offense.

The accompanying proxy statement is dated     , 2024 and is first being mailed to shareholders on or about     , 2024.

 

MANITEX INTERNATIONAL, INC.

9725 Industrial Drive

Bridgeview, Illinois 60455

 

 

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

    , 2024

(Central Standard Time)

Notice is hereby given that a Special Meeting of Shareholders of Manitex International, Inc. will be held at our principal executive offices located at 9725 Industrial Drive, Bridgeview, Illinois 60455 on     ,     , 2024 at 11:00 a.m. (Central Standard Time) to consider and vote upon:

 

1.

A proposal to approve the Agreement and Plan of Merger, dated as of September 12, 2024 (as it may be amended from time to time in accordance with its terms, the “Merger Agreement”), by and among the Company, Tadano Ltd., a Japanese corporation (“Tadano”), and Lift SPC Inc., a Michigan corporation and a wholly owned subsidiary of Tadano (“Merger Sub”). The Merger Agreement provides for the acquisition by Tadano of the Company through the Merger of Merger Sub with and into the Company (the “Merger”) with the Company continuing as the surviving corporation and a wholly owned subsidiary of Tadano. A copy of the Merger Agreement is attached as Annex A to the accompanying proxy statement.

 

2.

A proposal to approve, by a non-binding advisory vote, certain compensation arrangements for the Company’s named executive officers in connection with the Merger, which compensation arrangements we refer to as the Merger-related compensation.

 

3.

Any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of our common stock, no par value per share (“common stock”), present or represented by proxy at the special meeting to constitute a quorum.

The Merger Agreement and the Merger, along with the other transactions that would be effected in connection with the Merger, are described more fully in the attached proxy statement of which this notice forms a part, and we urge you to read the attached proxy statement carefully and in its entirety.

Approval of the Merger Agreement requires the affirmative vote of holders of a majority of the shares of common stock outstanding at the close of business on the record date. Approval of (i) the Merger-related compensation and (ii) any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum, each requires the affirmative vote of holders of a majority of the votes cast by the holders entitled to vote thereon at the special meeting. Acting in reliance upon the unanimous recommendation of a special committee of the board of directors, comprised solely of independent and disinterested directors (the “Transaction Committee”), the Company’s board of directors (the “Board”) has determined that the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement are fair to, and in the best interests of, the Company and its shareholders (other than holders of Excluded Shares, as defined below) and has adopted, authorized, approved and declared advisable the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement. The Board made its determination based in part on the recommendation of the Transaction Committee and after consultation with its legal and financial advisors and in part after consideration of a number of other factors as described in the accompanying proxy statement. “Excluded Shares” means shares of our common stock owned by Tadano, Merger Sub or the Company or their respective subsidiaries.

The Board recommends that you vote “FOR” the proposal to approve the Merger Agreement, “FOR” the proposal to approve, by a non-binding advisory vote, the Merger-related compensation and “FOR”

any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum at the special meeting.

Your vote is very important, regardless of the number of shares of common stock of the Company you own. The Merger cannot be completed unless the Merger Agreement is approved by the affirmative vote of holders of a majority of the shares of common stock outstanding at the close of business on the record date. Even if you plan to attend the special meeting in person, we request that you complete, sign, date and return, as promptly as possible, the enclosed proxy card in the accompanying prepaid reply envelope or submit your proxy by telephone or over the Internet prior to the special meeting to ensure that your shares of common stock will be represented at the special meeting if you are unable to attend. If you fail to return your proxy card or fail to submit your proxy by phone or over the Internet, it will have the same effect as a vote “AGAINST” the proposal to approve the Merger Agreement. If you are a shareholder of record, voting in person at the special meeting will revoke any proxy previously submitted. If you hold your shares of common stock through a bank, brokerage firm or other nominee, you should follow the procedures provided by your banker, brokerage firm or other nominee in order to vote.

The Board has fixed the close of business on     , 2024, as the record date for determination of shareholders entitled to notice of, and to vote at, the special meeting and any adjournments or postponements thereof. Only shareholders of record at the close of business on the record date are entitled to notice of, and to vote (in person or by proxy) at, the special meeting and at any adjournment or postponement thereof. You will be entitled to one vote for each share of common stock that you owned on the record date. A complete list of our shareholders of record entitled to vote at the special meeting will be available at the special meeting for inspection by any shareholder present at the special meeting.

Shareholders whose shares are registered directly with the Company’s transfer agent are considered, with respect to those shares, to be the shareholder of record. The Company has engaged Broadridge Financial Solutions, Inc. (“Broadridge”), to send this notice of special meeting, the proxy statement and the proxy card directly to shareholders of record. Shareholders of record have the right to vote online, vote by telephone, submit a proxy directly to Broadridge, or to vote in person at the special meeting. Shareholders whose shares are held in a brokerage account, or by another nominee, are considered the beneficial owners of shares held in “street name.” Materials for those shareholders are being forwarded to beneficial owners, together with a voting instruction card. Beneficial owners have the right to direct their bank, brokerage firm or other nominee as to how to vote and also are invited to attend the special meeting. Since a beneficial owner is not the shareholder of record, he or she may not vote those shares in person at the special meeting without a proxy from the bank, brokerage firm or other nominee that holds the shares, giving the beneficial owner the right to vote the shares at the meeting.

WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN, AS PROMPTLY AS POSSIBLE, THE ENCLOSED PROXY CARD IN THE ACCOMPANYING PREPAID REPLY ENVELOPE, OR SUBMIT YOUR PROXY BY TELEPHONE OR OVER THE INTERNET. IF YOU WILL ATTEND THE SPECIAL MEETING AND VOTE IN PERSON, YOUR VOTE BY BALLOT WILL REVOKE ANY PROXY PREVIOUSLY SUBMITTED. IF YOU HOLD YOUR SHARES OF COMMON STOCK THROUGH A BANK, BROKERAGE FIRM OR OTHER NOMINEE, YOU SHOULD FOLLOW THE PROCEDURES PROVIDED BY YOUR BANK, BROKERAGE FIRM OR OTHER NOMINEE IN ORDER TO VOTE.

 

Dated:     , 2024

TABLE OF CONTENTS

 

		Page
Summary Term Sheet			1
Questions and Answers About the Special Meeting and the Merger			12
Cautionary Statement Regarding Forward-Looking Statements			20
Parties to the Merger			23
The Company			23
Tadano			24
Merger Sub			24
The Special Meeting			25
Date, Time and Place of the Special Meeting			25
Purpose of the Special Meeting			25
Record Date and Quorum			25
Attendance			26
Vote Required			26
Proxies and Revocation			28
Anticipated Date of Completion of the Merger			28
No Appraisal Rights			28
Solicitation of Proxies; Payment of Solicitation Expenses			28
Proposal 1: The Merger			30
Merger Consideration			30
Background of the Merger			30
Reasons for the Merger; Recommendation of the Company’s Board of Directors			38
Opinion of Brown Gibbons Lang & Company			44
Position of the Purchaser Filing Persons as to the Fairness of the Merger			56
Tadano Purpose of and Reasons for the Merger			59
Certain Effects of the Merger for Tadano			61
Plan of Tadano after the Merger			61
Benefits of the Merger for the Company’s Unaffiliated Shareholders			62
Detriments of the Merger for the Company’s Unaffiliated Shareholders			62
Consultation with Perella Weinberg Partners, Financial Advisor to Tadano			62
Certain Unaudited Company Forecasts			69
Financing of the Merger			76
Closing and Effective Time of the Merger			76
Payment of Merger Consideration and Surrender of Stock Certificates			77
Interests of the Company’s Directors and Executive Officers in the Merger			77
Intent to Vote in Favor of the Merger			80
Tadano’s Obligation to Vote in Favor of the Merger			81
Accounting Treatment			81
Material U.S. Federal Income Tax Consequences of the Merger			81
Regulatory Approvals			83
Litigation Relating to the Merger			83
The Merger Agreement			84
Explanatory Note Regarding the Merger Agreement			84
Effects of the Merger; Directors and Officers; Articles of Incorporation; Bylaws			84
Treatment of Common Stock and Equity Awards			85
Exchange and Payment Procedures			85
Representations and Warranties			87
Covenants of the Company			90
Acquisition Proposals			93
Change of Board Recommendation			94
Covenants of Tadano			96
Efforts to Complete the Merger			97

		Page
Conditions to the Merger			98
Termination			99
Termination Fees			100
Fees and Expenses			100
Remedies			100
Modification or Amendment; Waiver			101
Governing Law and Jurisdiction			101
Provisions for Unaffiliated Company Shareholders			102
Important Information Regarding the Company			102
Company Background			102
Directors and Executive Officers of the Company			102
Market Price of the Company’s Common Stock			104
Dividends			104
Prior Public Offerings			104
Transactions in the Company’s Common Stock			104
Proposal 2: Advisory Vote on Merger-Related Compensation			106
Proposal 3: Vote on Adjournment			107
Principal Shareholders			108
No Appraisal Rights			110
Delisting and Deregistration of Common Stock			110
Where You Can Find More Information			111
Additional Information			113
Other Matters to Come Before the Meeting			113
Shareholder Proposals			113
Delivery of Proxy Materials to Households			113
Request to Return Proxies Promptly			113
Annex A—Agreement and Plan of Merger			A-1
Annex B—Opinion of Brown Gibbons Lang & Company			B-1

 

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER

The following questions and answers are intended to briefly address some commonly asked questions regarding the Merger, the Merger Agreement and the special meeting. These questions and answers may not address all questions that may be important to you as a Company shareholder. Please refer to the “Summary Term Sheet” beginning on page 1 and the more detailed information contained elsewhere in this proxy statement, the annexes to this proxy statement and the documents referred to in this proxy statement, which you should read carefully and in their entirety. You may obtain the information incorporated by reference in this proxy statement without charge by following the instructions under “Where You Can Find More Information” beginning on page 111.

 

Q.	Why am I receiving this proxy statement and proxy card or voting instruction form?

 

A.

You are receiving this proxy statement and proxy card or voting instruction form because you own shares of our common stock. This proxy statement describes matters on which we urge you to vote and is intended to assist you in deciding how to vote your shares of common stock with respect to such matters.

 

Q.	When and where is the special meeting?

 

A.	The special meeting of the shareholders will be held on    , 2024 at    , Central Standard Time, at the Company’s executive offices, located at 9725 Industrial Drive, Bridgeview, Illinois 60455. Information on how to vote in person at the special meeting is discussed below.

 

Q.	What am I being asked to vote on at the special meeting?

 

A.	You are being asked to consider and vote on:

 

•

a proposal to approve the Merger Agreement that provides for the acquisition of the Company by Tadano;

 

•

a proposal to approve, by a non-binding advisory vote, the Merger-related compensation; and

 

•

a proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum.

 

Q.	What is the proposed Merger and what effects will it have on the Company?

 

A.

The Merger will result in the acquisition of the Company by Tadano, pursuant to the terms and subject to the conditions of the Merger Agreement. If the proposal to approve the Merger Agreement is approved by our shareholders and the other closing conditions set forth in the Merger Agreement are satisfied or waived and the Merger closes, Merger Sub will merge with and into the Company, with the Company being the surviving corporation. As a result of the Merger, the Company will become a wholly owned subsidiary of Tadano and will no longer be a publicly held corporation, and you, as a holder of common stock, will no longer have any interest in our future earnings or growth. In addition, following the Merger, our common stock will be delisted from Nasdaq and deregistered under the Exchange Act, and we will no longer file periodic reports with the SEC.

 

Q.	What will I receive if the Merger is completed?

 

A.

In the Merger, each share of common stock, other than Excluded Shares, will be converted into the right to receive cash in the amount of $5.80 per share, without interest. At the effective time, (i) each Excluded Share held by Tadano or any subsidiary thereof will remain outstanding as a share of common stock of the surviving corporation and (ii) each other Excluded Share will be cancelled and will cease to exist, and no consideration will be payable for such shares.

 

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Q:	How does the Merger consideration compare to the market price of the Company common stock?

 

A:	The Merger consideration of $5.80 represents a premium of approximately 47.9% to the 30-day average closing share price of $3.92 as of September 11, 2024.

 

Q.	When do you expect the Merger to be completed?

 

A.

We are working towards completing the Merger as soon as possible. Assuming timely receipt of required regulatory approvals and the satisfaction or waiver of other closing conditions, including approval by our shareholders of the proposal to approve the Merger Agreement, we anticipate that the Merger will be completed early in the first quarter of 2025.

 

Q.	What happens if the Merger is not completed?

 

A.

If the Merger Agreement is not approved by the shareholders or if the Merger is not completed for any other reason, the shareholders will not receive any payment for their shares of our common stock in connection with the Merger. Instead, the Company will remain an independent public company and our common stock will continue to be listed and traded on Nasdaq.

Under certain circumstances, upon termination of the Merger Agreement, we may be obligated to pay to Tadano a termination fee of $4.9 million. More information can be found in the section titled “The Merger Agreement—Termination Fees” beginning on page 100.

 

Q.	What conditions must be satisfied to complete the Merger?

 

A.

There are several conditions which must be satisfied to complete the Merger, including, among others, customary conditions relating to the approval of the Merger Agreement by the requisite vote of the Company’s shareholders, the receipt of certain foreign regulatory approvals, the approval of the Merger by CFIUS and the accuracy of the representations and warranties of the parties set forth in the Merger Agreement, subject in most cases to “materiality” and “material adverse effect” qualifications. Additionally, each of the parties shall have performed in all material respects all material obligations required to be performed by such party.

The parties have subsequently determined that a filing is not required to be made under the HSR Act.

Consummation of the Merger is not subject to any financing condition.

 

Q.	Am I entitled to exercise appraisal rights under the MBCA, instead of receiving the per share merger consideration for my shares of common stock?

 

A.	No. Under Section 762(2) of the MBCA, as well as the Company’s governing documents, shareholders are not entitled to appraisal rights or dissenters’ rights in connection with the Merger, as further explained under the section of this proxy statement entitled “No Appraisal Rights.”

 

Q.	What happens if I sell my shares of common stock before the special meeting?

 

A.

The record date for shareholders entitled to vote at the special meeting is earlier than both the date of the special meeting and the consummation of the Merger. If you transfer your shares of common stock after the record date but before the special meeting, unless special arrangements (such as provision of a proxy) are made between you and the person to whom you transfer your shares and each of you notifies the Company in writing of such special arrangements, you will retain your right to vote such shares at the special meeting but will transfer the right to receive the per share merger consideration to the person to whom you transfer your shares.

 

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Q.	What happens if I sell my shares of common stock after the special meeting but before the effective time?

 

A.

If you transfer your shares after the special meeting but before the effective time, you will have transferred the right to receive the per share merger consideration to the person to whom you transfer your shares. In order to receive the per share merger consideration, you must hold your shares of common stock through completion of the Merger.

 

Q.	Should I send in my stock certificates now?

 

A.

No. If the Merger Agreement is approved by shareholders, the other conditions to the Merger are satisfied or waived and the Merger closes, you will be sent a letter of transmittal promptly after the completion of the Merger, describing how you may exchange your shares of common stock for the per share merger consideration. If your shares of common stock that are held in “street name” through a bank, brokerage firm or other nominee, you should contact your bank, brokerage firm or other nominee for instructions as to how to effect the surrender of your “street name” shares of common stock in exchange for the per share merger consideration. Please do NOT return your stock certificate(s) with your proxy.

 

Q.	Is the Merger expected to be taxable to me?

 

A.

Yes. The exchange of shares of common stock for cash pursuant to the Merger generally will be a taxable transaction to U.S. holders (as defined in “Proposal 1: The Merger—Material U.S. Federal Income Tax Consequences of the Merger” on page 81) for U.S. Federal income tax purposes. If you are a U.S. holder and you exchange your shares of our common stock in the Merger for cash, you will generally recognize gain or loss in an amount equal to the difference, if any, between the amount of cash received with respect to such shares (determined before deduction of any applicable withholding taxes) and your adjusted tax basis in such shares of our common stock. Backup withholding may apply to cash payments paid to a Shareholder pursuant to the Merger unless such Shareholder provides their taxpayer identification number, certifies that such number is correct and otherwise complies with the backup withholding rules. You should read “Proposal 1: The Merger—Material U.S. Federal Income Tax Consequences of the Merger” beginning on page 81 for a general discussion of the U.S. Federal income tax consequences of the Merger. You should also consult your own tax advisor regarding the tax consequences of the Merger to you based upon your particular circumstances, including the applicability and effect of any U.S. state or local or non-U.S. tax laws.

 

Q.	Why am I being asked to consider and vote on a proposal to approve, by a non-binding advisory vote, the Merger-related compensation?

 

A.	Under SEC rules, we are required to seek a non-binding advisory vote with respect to the compensation that may be paid or become payable to our named executive officers in connection with the Merger, or “golden parachute” compensation.

 

Q.	What will happen if the Company’s shareholders do not approve the Merger-related compensation?

 

A.

Approval of the Merger-related compensation is not a condition to completion of the Merger. The vote to approve the Merger-related compensation is an advisory vote and will not be binding on the Company or the surviving corporation. Because the Merger-related compensation is based on contractual arrangements with the named executive officers, such compensation may be payable, regardless of the outcome of this advisory vote, if the Merger Agreement is approved (subject only to the contractual obligations applicable thereto).

 

Q.	What vote is required for the Company’s shareholders to approve the Merger Agreement?

 

A.	Approval of the Merger Agreement requires the affirmative vote of holders of a majority of the shares of common stock outstanding at the close of business on the record date. A failure to vote your shares of

 

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common stock or an abstention from voting will have the same effect as a vote “AGAINST” the proposal to approve the Merger Agreement. If your shares are held in “street name” by your bank, brokerage firm or other nominee and you do not instruct the nominee how to vote your shares, the failure to instruct your nominee will have the same effect as a vote “AGAINST” the proposal to approve the Merger Agreement.

 

Q.	What vote of our shareholders is required to approve, by a non-binding advisory vote, the Merger-related compensation?

 

A.	Approving Merger-related compensation requires the affirmative vote of holders of a majority of the votes cast by the holders entitled to vote thereon at the special meeting.

Abstentions and broker non-votes will have no effect on the outcome of the vote on this proposal.

 

Q.	What vote of our shareholders is required to approve any proposal to adjourn the special meeting, if necessary or appropriate?

 

A.

Approval of any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of our common stock, present or represented by proxy at the special meeting to constitute a quorum, requires the affirmative vote of holders of a majority of the votes cast by the holders entitled to vote thereon at the special meeting.

Abstentions and broker non-votes will have no effect on the outcome of the vote on this proposal.

 

Q.	How does the Board recommend that I vote?

 

A.

The Board recommends that you vote “FOR” the proposal to approve the Merger Agreement, “FOR” the proposal to approve, by a non-binding advisory vote, the Merger-related compensation and “FOR” any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum.

 

Q.	How do the Company’s directors and officers intend to vote?

 

A.

We currently expect that the Company’s directors and executive officers will vote their shares in favor of the proposal to approve the Merger Agreement, the proposal to approve, by a non-binding advisory vote, the Merger-related compensation and any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum.

 

Q.	Do any of the Company’s directors or officers have interests in the Merger that may differ from or be in addition to my interests as a shareholder?

 

A.

In considering the recommendation of the Board with respect to the proposal to approve the Merger Agreement, you should be aware that our directors and executive officers have certain interests in the Merger that may be different from, or in addition to, the interests of our shareholders generally. The Board was aware of and considered these interests, among other matters, in evaluating and negotiating the Merger Agreement and the Merger, and in recommending that shareholders of the Company approve the Merger Agreement. See “Proposal 1: The Merger—Interests of the Company’s Directors and Executive Officers in the Merger” beginning on page 77 and “Proposal 2: Advisory Vote on Merger-Related Compensation” beginning on page 106.

 

Q.	What is the difference between holding shares as a shareholder of record and as a beneficial owner?

 

A.	Shareholder of Record. If your shares are registered directly in your name with our transfer agent, you are considered the shareholder of record with respect to those shares. As the shareholder of record, you have the

 

15

right to vote, grant your voting rights directly to the Company or to a third party or to vote in person at the special meeting. Whether or not you plan to attend the special meeting, we urge you to submit your proxy or voting instructions as soon as possible.

Beneficial Owner of Shares Held in “Street Name.” If your shares of common stock are held by your bank, brokerage firm or other nominee, you are considered the beneficial owner of shares held in “street name,” and your bank, brokerage firm or other nominee, or their intermediary, is considered the shareholder of record with respect to those shares. Your bank, brokerage firm or other nominee should send you, as the beneficial owner, a package describing the procedure for voting your shares of common stock. You should follow the instructions provided by them to vote your shares of common stock. You may not vote these shares of common stock in person at the special meeting unless you obtain a “legal proxy” from your bank, brokerage firm or other nominee that holds your shares of common stock, giving you the right to vote the shares of common stock at the special meeting.

 

Q.	If my shares of common stock are held in “street name” by my bank, brokerage firm or other nominee, will my bank, brokerage firm or other nominee vote my shares of common stock for me?

 

A.

Your bank, brokerage firm or other nominee will only be permitted to vote your shares of common stock if you instruct your bank, brokerage firm or other nominee how to vote. You should follow the procedures provided by your bank, brokerage firm or other nominee regarding the voting of your shares of common stock. Banks, brokerage firms or other nominees who hold shares in “street name” for customers have the authority to vote on “routine” proposals when they have not received instructions from beneficial owners. However, banks, brokerage firms and other nominees are precluded from exercising their voting discretion with respect to approving non-routine matters, such as the proposal to approve the Merger Agreement, and, as a result, absent specific instructions from the beneficial owner of such shares of common stock, banks, brokerage firms or other nominees are not empowered to vote those shares of common stock on non-routine matters. If you do not instruct your bank, brokerage firm or other nominee to vote your shares of common stock, your shares of common stock will not be voted (“broker non-votes”) and the effect will be the same as a vote “AGAINST” the proposal to approve the Merger Agreement, and your shares of common stock will not be voted and will not have an effect on the proposal to approve by a non-binding advisory vote, certain compensation arrangements for the Company’s named executive officers in connection with the Merger or any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum.

 

Q.	Who can vote at the special meeting?

 

A.	All of the shareholders as of the close of business on    , 2024, the record date for the special meeting, are entitled to receive notice of, and to vote at, the special meeting.

 

Q.	How many votes do I have?

 

A.	You are entitled to one vote for each share of common stock held of record by you as of the record date,    , 2024. As of the close of business on the record date, there were    outstanding shares of common stock.

 

Q.	What is a quorum?

 

A.

The shareholders present at the special meeting in person or by proxy who, as of the record date for the special meeting, were holders of a majority of the outstanding shares of the Company’s common stock entitled to vote at the special meeting will constitute a quorum. Abstentions are counted as present for the purpose of determining whether a quorum is present, but broker non-votes will not count toward the establishment of a quorum.

 

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Q.	How do I vote?

 

A.	Shareholder of Record. If you are a shareholder of record, you may have your shares of common stock voted on matters presented at the special meeting in any of the following ways:

 

•

In Person. You may attend the special meeting and cast your vote there.

 

•

Via Our Internet Voting Site. Follow the instructions for Internet voting printed on your proxy card.

 

•

By Telephone. Call the toll-free number specified on your proxy card. You can vote by telephone by following the instructions provided on the Internet voting site or by following the instructions provided on your proxy card.

 

•

In Writing. You can vote by completing, signing, dating and returning the proxy card in the enclosed prepaid reply envelope.

Beneficial Owner. If you are a beneficial owner, please refer to the instructions provided by your bank, brokerage firm or other nominee to see which of the above choices are available to you. Please note that if you are a beneficial owner and wish to vote in person at the special meeting, you must provide a legal proxy from your bank, brokerage firm or other nominee at the special meeting. To attend the special meeting in person (regardless of whether you intend to vote your shares in person at the special meeting), you must bring with you to the special meeting a valid photo identification and proof of your beneficial ownership. For more information, see the instructions under “The Special Meeting—Attendance” beginning on page 26 of this proxy statement.

IT IS IMPORTANT THAT YOU PROMPTLY VOTE YOUR SHARES OF COMMON STOCK. WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN, AS PROMPTLY AS POSSIBLE, THE ENCLOSED PROXY CARD IN THE ACCOMPANYING PREPAID REPLY ENVELOPE, OR SUBMIT YOUR PROXY BY TELEPHONE OR OVER THE INTERNET. SHAREHOLDERS WHO ATTEND THE SPECIAL MEETING MAY REVOKE THEIR PROXIES BY VOTING IN PERSON.

 

Q.	How can I change or revoke my vote?

 

A.	If you own shares in your own name, you may revoke any prior proxy or voting instructions, regardless of how your proxy or voting instructions were originally submitted, by:

 

•

sending a written statement to that effect to our Corporate Secretary, which must be received by us before the special meeting;

 

•

submitting a properly signed proxy card or voting instruction form dated a later date;

 

•

submitting a later-dated proxy or providing new voting instructions via the Internet or by telephone; or

 

•

attending the special meeting in person and voting your shares.

If you hold shares in “street name,” you should contact the intermediary for instructions on how to change your vote.

 

Q.	What is a proxy?

 

A.

A proxy is your legal designation of another person, referred to as a “proxy,” to vote your shares of common stock. The written document describing the matters to be considered and voted on at the special meeting is called a “proxy statement.” The document used to designate a proxy to vote your shares of common stock is called a “proxy card.”

 

Q.	If a shareholder gives a proxy, how are the shares of common stock voted?

 

A.	Regardless of the method you choose to vote, the individuals named on the enclosed proxy card will vote your shares of common stock in the way that you indicate. When completing the Internet or telephone

 

17

processes or the proxy card, you may specify whether your shares of common stock should be voted for or against or to abstain from voting on all, some or none of the specific items of business to come before the special meeting.

If you own shares that are registered in your own name and return a signed proxy card or grant a proxy via the Internet or by telephone, but do not indicate how you wish your shares to be voted, the shares represented by your properly signed proxy will be voted “FOR” the proposal to approve the Merger Agreement, “FOR” the proposal to approve, by a non-binding advisory vote, certain compensation arrangements for the Company’s named executive officers in connection with the Merger and “FOR” any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum.

 

Q.	How are votes counted?

 

A.	For the proposal to approve the Merger Agreement, each of the “FOR,” “AGAINST” or “ABSTAIN” categories will be tabulated separately. Abstentions and broker non-votes will have the same effect as votes “AGAINST” the proposal to approve the Merger Agreement.

For the proposals to approve certain compensation arrangements for the Company’s named executive officers in connection with the Merger and to adjourn the meeting, if necessary or appropriate, each of the “FOR,” “AGAINST” or “ABSTAIN” categories will be tabulated separately. Abstentions and broker non-votes will have no effect on the outcome of the vote.

 

Q.	What do I do if I receive more than one proxy or set of voting instructions?

 

A.

If you received more than one proxy card, your shares are likely registered in different names or with different addresses or are in more than one account. You must separately vote the shares shown on each proxy card that you receive in order for all of your shares to be voted at the special meeting.

 

Q.	What do I need to do now?

 

A.

Even if you plan to attend the special meeting, after carefully reading and considering the information contained in this proxy statement, please vote promptly to ensure that your shares are represented at the special meeting. If you hold your shares of common stock in your own name as the shareholder of record, you may submit a proxy to have your shares of common stock voted at the special meeting in one of three ways: (i) using the Internet in accordance with the instructions set forth on the enclosed proxy card; (ii) calling the toll-free number specified on your proxy card; or (iii) completing, signing, dating and returning the enclosed proxy card in the accompanying prepaid reply envelope. If you decide to attend the special meeting and vote in person, your vote by ballot will revoke any proxy previously submitted. If you are a beneficial owner, please refer to the instructions provided by your bank, brokerage firm or other nominee to see which of the above choices are available to you.

 

Q.	What is householding and how does it affect me?

 

A.

The SEC permits companies to send a single set of proxy materials to any household at which two or more shareholders reside, unless contrary instructions have been received, but only if the company provides advance notice and follows certain procedures. In such cases, each shareholder continues to receive a separate notice of the meeting and proxy card. Certain brokerage firms may have instituted householding for beneficial owners of common stock held through brokerage firms. If your family has multiple accounts holding common stock, you may have already received householding notification from your broker. Please contact your broker directly if you have any questions or require additional copies of this proxy statement. The broker will arrange for delivery of a separate copy of this proxy statement promptly upon your written or oral request. You may decide at any time to revoke your decision to household, and thereby receive multiple copies.

 

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Q:	Who will solicit and pay the costs of soliciting proxies?

 

A:

The Company’s Board is soliciting your proxy, and we will bear the cost of soliciting proxies. This includes the charges and expenses of brokerage firms and others for forwarding solicitation material to beneficial owners of our outstanding common stock. The Company has retained InvestorCom LLC (“InvestorCom”), a proxy solicitation firm, to assist the Board in the solicitation of proxies for the special meeting, and we expect to pay InvestorCom approximately $15,000, plus reimbursement of out-of-pocket expenses. Proxies may be solicited by mail, personal interview, email, telephone, or via the Internet by InvestorCom or, without additional compensation, by certain of the Company’s directors, officers and employees.

 

Q.	Where can I find more information about the Company?

 

A.	You can find more information about the Company from various sources described in the section titled “Where You Can Find More Information” beginning on page 111.

 

Q:	Who can help answer my other questions?

 

A:

If you have more questions about the Merger or any of the other matters set forth in this proxy statement, or require assistance in submitting your proxy or voting your shares or need additional copies of this document or the enclosed proxy card, please contact InvestorCom, which is acting as the proxy solicitation agent and information agent for the Company in connection with the special meeting, or the Company at the following addresses or telephone numbers:

 

 

19 Old Kings Highway S. – Suite 130

Darien, CT 06820

Shareholders may call toll-free: (877) 972-0090

Banks and brokers call collect: (203) 972-9300

E-mail: [email protected]

– or –

Manitex International, Inc.

Attn: Corporate Secretary

9725 Industrial Drive

Bridgeview, Illinois 60455

(708) 237-2052

If your broker, bank or other nominee holds your shares, you should also call your broker, bank or other nominee for additional information.

 

19

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act.

These statements are based on management’s current expectations or beliefs and on currently available competitive, financial and economic data and are subject to uncertainty and changes in circumstances. Actual results may vary materially from those expressed or implied by the forward-looking statements herein due to changes in economic, business, competitive, technological and/or regulatory factors, and other risks and uncertainties affecting the operation of the business of the Company, including many factors beyond our control. These risks and uncertainties include, but are not limited to, those associated with:

 

•

the risk that the Merger may not be completed in a timely manner or at all, which may adversely affect the Company’s business and the price of its common stock;

 

•

the failure to satisfy the conditions to the consummation of the Merger, including the approval of the Merger Agreement by the shareholders of the Company, and the receipt of certain governmental and regulatory approvals in a timely manner or at all or that such approvals may be subject to conditions that are not anticipated;

 

•

the occurrence of any event, change or other circumstance that could give rise to the termination of the Merger Agreement;

 

•

the effect of the announcement or pendency of the Merger on the Company’s business relationships, operating results and business generally;

 

•

the risk that the Merger disrupts the Company’s current plans and operations and potential difficulties in the Company’s employee retention as a result of the Merger;

 

•

the outcome of any legal proceedings that may be instituted against the Company related to the Merger Agreement or the Merger;

 

•

the risk that the Merger and its announcement could have an adverse effect on the ability of the Company to retain and hire key personnel and to maintain relationships with customers, vendors, employees, shareholders and other business partners and on its operating results and business generally;

 

•

the risk that the Company’s business and/or Tadano’s business will be adversely impacted during the pendency of the acquisition;

 

•

risks related to financial community and rating agency perceptions of the Company or Tadano or their respective businesses, operations, financial condition and the industry in which they operate;

 

•

risks related to disruption of management attention from ongoing business operations due to the Merger;

 

•

risks related to the potential impact of general economic, political and market factors on the Company, Tadano or the Merger;

 

•

expected cost savings, synergies and other financial benefits from the Merger not being realized within the expected time frames and costs or difficulties relating to integration matters being greater than expected;

 

•

a future substantial deterioration in economic conditions, especially in the United States and Europe;

 

•

the reliance of our customers on government spending, fluctuations in activity levels in the construction industry;

 

•

our level of indebtedness and our ability to meet financial covenants required by our debt agreements;

 

20

•

our ability to negotiate extensions of our credit agreements and to obtain additional debt or equity financing when needed;

 

•

any failure on our part to maintain an effective system of internal controls;

 

•

the cyclical nature of the markets in which we operate;

 

•

a substantial portion of our revenues are attributed to a limited number of customers which may decrease or cease purchasing at any time;

 

•

unfavorable changes in interest rates;

 

•

our increasingly international operations expose us to additional risks and challenges associated with conducting business internationally, including currency exchange risks;

 

•

difficulties in implementing new systems, integrating acquired businesses, managing anticipated growth, and responding to technological change;

 

•

the availability of the third-party financing that some of our customers rely on to purchase our products;

 

•

our highly competitive industry and the Company’s unique, acute risks arising out of such competition;

 

•

our dependency upon third-party suppliers makes us vulnerable to supply shortages;

 

•

the potential for future price increases in materials that could reduce our profitability;

 

•

the age of our rental fleet causing significant impact to profitability;

 

•

the risk that the Company is unable to collect on rental revenue;

 

•

the residual value risk of our rental fleet;

 

•

the risk arising out of the Company facing product liability claims and other liabilities due to the nature of its business;

 

•

the fact that the Company’s success depends upon the continued protections of its trademarks and that the Company may be forced to incur substantial costs to maintain, defend, protect and enforce its intellectual property rights;

 

•

the volatility relating to our stock price;

 

•

our ability to access the capital markets to raise funds and provide liquidity;

 

•

the willingness of our shareholders and directors to approve mergers, acquisitions, and other business transactions;

 

•

compliance with changing laws and regulations;

 

•

a disruption or breach in our information technology systems;

 

•

the significant percentage of our common stock is held by principal shareholders, executive officers and directors;

 

•

our reliance on the management and leadership skills of our senior executives;

 

•

the possibility of an impairment in the carrying value of goodwill and/or other intangible assets negatively affecting our operating results;

 

•

information technology system failures, data security breaches, data privacy compliance, network disruptions, and cybersecurity, malware or ransomware attacks;

 

•

provisions of the Michigan Business Corporation Act and the Company’s Articles of Incorporation that may discourage or prevent a change in control of the Company; and

 

21

•

other risks and uncertainties affecting the operations of our business, including those described in our filings with the SEC, including our annual report on Form 10-K and our quarterly reports on Form 10-Q.

The forward-looking statements speak only as of the date such statements are made. The Company does not undertake, and expressly disclaims, any obligation to update or alter its forward-looking statements, whether as a result of new information, future events, changes in assumptions or otherwise, except as required by applicable law.

For a discussion of the various factors that may cause actual plans implemented and actual results achieved to differ materially from those set forth in the forward-looking statements, please refer to the risk factors and other disclosures contained in the Company’s Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC, on February 29, 2024, Form 10-Q for the quarterly periods ended March 31, 2024, filed with the SEC on May 2, 2024, and June 30, 2024, filed with the SEC on August 7, 2024, and other filings made with the SEC after the date thereof. See the section titled “Where You Can Find More Information” for additional information.

The cautionary statements referred to above also should be considered in connection with any subsequent written or oral forward-looking statements that may be issued by the Company or persons acting on the Company’s behalf. The Company undertakes no obligation to publicly update or revise any forward-looking statements for any facts, events or circumstances after the date hereof that may bear upon forward-looking statements except as required by law. Furthermore, the Company cannot guarantee future results, events, levels of activity, performance or achievements. The Company’s shareholders are advised to consult any future disclosures that the Company makes on related subjects as may be detailed in its other filings made from time to time with the SEC. To the extent that any of the periodic reports incorporated by reference in this proxy statement contain references to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 with respect to forward-looking statements, the Company notes that these safe harbor provisions do not apply to any forward-looking statements the Company makes in connection with the going private transaction described in the proxy statement.

You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this document or, in the case of documents referred to or incorporated by reference, the dates of those documents.

 

22

PARTIES TO THE MERGER

The Company

The Company is a leading provider of engineered lifting solutions. The Company designs, manufactures and distributes a diverse group of products that serve different functions and are used in a variety of industries. Following the completion of the Rabern Rentals, LLC (“Rabern”) acquisition in 2022, the Company reports in two business segments and has four operating segments, in which there are five reporting units.

Lifting Equipment Segment

The Company markets a comprehensive line of boom trucks, truck cranes, aerial platforms and electrical industrial cranes. The Company’s boom trucks and crane products are primarily used for industrial projects, energy exploration, energy distribution and infrastructure development, including roads, bridges and commercial construction and the tree care industry.

PM and Oil and Steel S.p.A. (“PM” or “PM Group”) is a leading Italian manufacturer of truck-mounted hydraulic knuckle boom cranes with a 65-year history of technology and innovation, and a product range spanning more than 50 models. PM has an innovative line of 1.5 to 210 ton hydraulic articulated cranes serving the power generation, transmission and distribution industry, tree care and landscaping industry and mining and mineral industries. PM is also a manufacturer of truck-mounted and self-propelled aerial platforms with a diverse product line and an international client base. Truck-mounted aerial work platforms are widely used in several diverse applications. High reach aerial work platforms are used in highway signage maintenance and construction, parking lot lighting applications, as well as telecommunication maintenance and upgrades. Medium reach aerial work platforms cover most retail shopping and commercial advertising. Larger capacity aerial work platforms are used as support vehicles to service and maintain equipment in mining applications. Cranes and aerial platforms are configured for tree management and removal, both manned and remote applications. Through its consolidated subsidiaries, PM Group has locations in Modena, Italy; Valencia, Spain; Arad, Romania; Chassieu, France; Buenos Aires, Argentina; Santiago, Chile; Singapore and Querétaro, Mexico. PM cranes are also distributed by the Company’s subsidiary, Manitex Inc., in Georgetown, Texas.

The Company’s subsidiary, Manitex Valla S.r.L. (“Valla”) produces a full range of precision pick and carry industrial cranes using electric, diesel, and hybrid power options. Its cranes offer wheeled or tracked, and fixed or swing boom configurations, with special applications designed specifically to meet the needs of its customers. The cranes have a lifting capacity of 2 to 25 metric tons and serve the industrial manufacturing, general construction and maintenance, signs and lifting industries. These products are sold internationally through dealers and into the rental distribution channel.

Rental Equipment Segment

On April 11, 2022, the Company entered into a Membership Interest Purchase Agreement (the “Rabern Agreement”) with Rabern and Steven Berner, as owner of 100% of Rabern’s outstanding membership interests. Pursuant to the Rabern Agreement, the Company acquired a 70% membership interest in Rabern from Steven Berner for a purchase price of approximately $26 million in cash plus assumed debt of $14 million. Rabern is a construction rental equipment provider, headquartered in Amarillo, Texas, primarily servicing business in the Texas panhandle.

The Company’s majority-owned subsidiary, Rabern, rents heavy duty and light duty commercial construction equipment, mainly to commercial contractors on a short-term rental basis. Rabern also rents equipment to homeowners for do-it-yourself projects. Rabern operates through commercial distribution and delivery stores (branches). Rabern has four branches: three located in the greater Amarillo, Texas market and one located in Lubbock, Texas.

 

23

General Corporate Information

For more information about the Company and its subsidiaries, visit the Company’s website at https://www.manitexinternational.com. Our website address is provided as an inactive textual reference only. The information contained on our website is not incorporated into, and does not form a part of, this proxy statement or any other report or document on file with or furnished to the SEC. See also “Where You Can Find More Information” beginning on page 111.

The Company’s common stock is listed on Nasdaq under the symbol “MNTX.” The principal executive offices of the Company are located at 9725 Industrial Drive, Bridgeview, Illinois 60455 and its telephone number is (708) 430-7500.

Tadano

Tadano is a Japanese corporation. Tadano is a premier original equipment manufacturer and distributor of construction and vehicle-mounted cranes, aerial work platforms, and other specialized material handling solutions sold globally under a set of highly recognized brands.

Since its founding in 1948, Tadano has grown to be one of the largest machinery manufacturers in the world, offering a wide range of industrial equipment. Products and services offered include all-terrain, rough terrain, truck, crawler, and cargo cranes; components for hydraulic cranes; vehicle and industrial vehicle carriers; elevated road/bridge inspection vehicles, pole digging and lighting cars, track and land vehicles, hydraulic cranes for ships, lifters and lifting houses; aerial work platforms; and used car information services.

Tadano operates its manufacturing and sales facilities across Europe, the Americas, Asia, the Middle East and Australia.

General Corporate Information

For more information about Tadano and its subsidiaries and affiliates, visit Tadano’s website at https://www.tadano.com. This website address is provided as an inactive textual reference only. The information contained on Tadano’s website is not incorporated into, and does not form a part of, this proxy statement or any other report or document on file with or furnished to the SEC. See also “Where You Can Find More Information” beginning on page 111.

Tadano’s stock is listed on the Tokyo Stock Exchange under the code “6395.” The principal executive offices of Tadano are located at Ko-34, Shinden-cho, Takamatsu, Kagawa 761-0185, Japan, and its telephone number is +81-87-839-5555.

Merger Sub

Merger Sub is a Michigan corporation and a wholly owned subsidiary of Tadano. Merger Sub was formed on September 6, 2024, solely for the purpose of completing the Merger and has conducted no business activities other than those related to the structuring and negotiation of the Merger. Merger Sub has not engaged in any business except as contemplated by the Merger Agreement.

The principal executive offices of Merger Sub are located at Ko-34, Shinden-cho, Takamatsu, Kagawa 761-0185, Japan (c/o Tadano Ltd.) and its telephone number is +81-87-839-5555.

 

24

THE SPECIAL MEETING

Date, Time and Place of the Special Meeting

This proxy statement is being furnished to shareholders as part of the solicitation of proxies by the Board for use at the special meeting to be held on     , 2024 at     , Central Standard Time, at the Company’s executive offices, located at 9725 Industrial Drive, Bridgeview, Illinois 60455, or at any postponement or adjournment thereof.

Purpose of the Special Meeting

At the special meeting, shareholders will be asked to:

 

•

consider and vote on a proposal to approve the Merger Agreement (Proposal 1 on your proxy card);

 

•

consider and vote on a proposal to approve, by a non-binding advisory vote, the Merger-related compensation (Proposal 2 on your proxy card); and

 

•

consider and vote on any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum (Proposal 3 on your proxy card).

The Board recommends that you vote “FOR” each of the above proposals.

The holders of a majority of the shares of common stock outstanding at the close of business on the record date must approve the Merger Agreement in order for the Merger to occur. If the holders of a majority of the shares of common stock outstanding at the close of business on the record date fail to approve the Merger Agreement, the Merger will not occur.

A copy of the Merger Agreement is attached as Annex A to this proxy statement and is incorporated herein by reference. We encourage you to read it carefully and in its entirety. Additionally, certain provisions of the Merger Agreement are described in the section of this proxy statement entitled “The Merger Agreement.”

The proposal to approve, by a non-binding advisory vote, the Merger-related compensation requires approval by the holders of a majority of the shares of common stock outstanding at the close of business on the record date. However, approval of the proposal to approve, by a non-binding advisory vote, the Merger-related compensation is not a condition to the completion of the Merger.

Any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum, requires approval by the holders of a majority of the shares of common stock outstanding at the close of business on the record date. However, approval of proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum, is not a condition to the completion of the Merger.

Record Date and Quorum

You are entitled to receive notice of, and to vote at, the special meeting if you own shares of common stock at the close of business on     , 2024, the record date for the special meeting. You will be entitled to one vote for each share of common stock that you owned on the record date. As of the close of business on the record date, there were      shares of common stock outstanding and entitled to vote at the special meeting.

The shareholders present at the special meeting in person or by proxy who, as of the record date for the special meeting, were holders of a majority of the outstanding shares of the Company’s common stock entitled to

 

25

vote at the special meeting will constitute a quorum. Abstentions are counted as present for the purpose of determining whether a quorum is present, but broker non-votes will not count toward the establishment of a quorum.

Attendance

Only shareholders of record, their duly authorized proxy holders and beneficial shareholders with proof of ownership as of the record date may attend the special meeting. To attend the special meeting in person (regardless of whether you intend to vote your shares in person at the special meeting), you must bring with you to the special meeting a valid photo identification and, if you are a beneficial owner, proof of your beneficial ownership.

Vote Required

Approval of the Merger Agreement requires the affirmative vote of holders of a majority of the shares of common stock outstanding at the close of business on the record date. As of the record date,      votes constitute a majority of the outstanding shares of common stock entitled to vote at the special meeting. For the proposal to approve the Merger Agreement, you may vote “FOR,” “AGAINST” or “ABSTAIN.” Abstentions will not be counted as votes cast in favor of the proposal to approve the Merger Agreement, but will count for the purpose of determining whether a quorum is present. If you fail to submit a proxy or to vote in person at the special meeting, or abstain, it will have the same effect as a vote “AGAINST” the proposal to approve the Merger Agreement.

If your shares of common stock are registered directly in your name with our transfer agent, you are considered, with respect to those shares of common stock, the “shareholder of record.” This proxy statement and proxy card have been sent directly to you by the Company.

If your shares of common stock are held through a bank, brokerage firm or other nominee, you are considered the “beneficial owner” of shares of common stock held in “street name.” In that case, this proxy statement has been forwarded to you by your bank, brokerage firm or other nominee who is considered, with respect to those shares of common stock, the shareholder of record. As the beneficial owner, you have the right to direct your bank, brokerage firm or other nominee how to vote your shares by following their instructions for voting.

Banks, brokerage firms or other nominees who hold shares in “street name” for customers generally have the authority to vote on “routine” proposals when they have not received instructions from beneficial owners. However, banks, brokerage firms and other nominees are precluded from exercising their voting discretion with respect to approving non-routine matters, such as the proposal to approve the Merger Agreement, and, as a result, absent specific instructions from the beneficial owner of such shares of common stock, banks, brokerage firms or other nominees are not empowered to vote those shares of common stock on non-routine matters. These broker non-votes will not be counted for purposes of determining a quorum, and will have the same effect as a vote “AGAINST” the proposal to approve the Merger Agreement.

The proposal to approve, by a non-binding advisory vote, the Merger-related compensation requires the affirmative vote of holders of a majority of the votes cast by the holders entitled to vote thereon at the special meeting. For this proposal, you may vote “FOR,” “AGAINST” or “ABSTAIN.” Abstentions and broker non-votes will have no effect on the outcome of the vote.

Any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of common stock present or represented by proxy at the special meeting to constitute a quorum, requires the affirmative vote of holders of a majority of the votes cast by the holders entitled to vote thereon at the special meeting. For this proposal, you may vote “FOR,” “AGAINST” or “ABSTAIN.” Abstentions and broker non-votes will have no effect on the outcome of the vote.

 

26

If you are a shareholder of record, you may have your shares of common stock voted on matters presented at the special meeting in any of the following ways:

 

•

by proxy—shareholders of record have a choice of voting by proxy:

 

•

by telephone or over the Internet, by accessing the telephone number or website specified on the enclosed proxy card. The control number provided on your proxy card is designed to verify your identity when voting by telephone or by Internet. Please be aware that if you vote over the Internet, you may incur costs such as telephone and Internet access charges for which you will be responsible.

 

•

by signing, dating and returning the enclosed proxy card in the accompanying prepaid reply envelope; or

 

•

in person—you may attend the special meeting and cast your vote there.

If you are a beneficial owner, you should receive instructions from your bank, brokerage firm or other nominee that you must follow in order to have your shares of common stock voted. Those instructions will identify which of the above choices are available to you in order to have your shares voted. Please note that if you are a beneficial owner and wish to vote in person at the special meeting, you must provide a legal proxy from your bank, brokerage firm or other nominee at the special meeting.

Please refer to the instructions on your proxy or voting instruction card to determine the deadlines for voting over the Internet or by telephone. If you choose to submit a proxy by mailing a proxy card, your proxy card should be mailed in the accompanying prepaid reply envelope, and your proxy card must be filed with our Corporate Secretary by the time the special meeting begins. Please do not send in your stock certificates with your proxy card. When the Merger is completed, a separate letter of transmittal will be mailed to you that will enable you to receive the per share merger consideration in exchange for your stock certificates.

If you vote by proxy, regardless of the method you choose to vote, the individuals named on the enclosed proxy card, and each of them, with full power of substitution, will vote your shares of common stock in the way that you indicate. When completing the Internet or telephone processes or the proxy card, you may specify whether your shares of common stock should be voted for or against or to abstain from voting on all, some or none of the specific items of business to come before the special meeting.

If you properly sign your proxy card but do not mark the boxes showing how your shares of common stock should be voted on a matter, the shares of common stock represented by your properly signed proxy will be voted “FOR” the proposal to approve the Merger Agreement, “FOR” the proposal to approve, by a non-binding advisory vote, the Merger-related compensation and “FOR” any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of our common stock, present or represented by proxy at the special meeting to constitute a quorum.

IT IS IMPORTANT THAT YOU PROMPTLY VOTE YOUR SHARES OF COMMON STOCK. WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN, AS PROMPTLY AS POSSIBLE, THE ENCLOSED PROXY CARD IN THE ACCOMPANYING PREPAID REPLY ENVELOPE, OR SUBMIT YOUR PROXY BY TELEPHONE OR THE INTERNET. SHAREHOLDERS WHO ATTEND THE SPECIAL MEETING MAY REVOKE THEIR PROXIES BY VOTING IN PERSON.

As of the record date, the directors and executive officers of the Company beneficially owned and were entitled to vote, in the aggregate,      shares of common stock (not including any shares of common stock deliverable upon exercise of any Company RSUs, Company PSUs or Company Options), representing approximately   percent of the outstanding shares of common stock as of the record date.

We currently expect that all of our directors and executive officers will vote their shares “FOR” each of the above proposals.

 

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Proxies and Revocation

Any shareholder of record entitled to vote at the special meeting may submit a proxy by telephone, over the Internet or by returning the enclosed proxy card in the accompanying prepaid reply envelope, or may vote in person by appearing at the special meeting. If your shares of common stock are held in “street name” through a bank, brokerage firm or other nominee, you should instruct your bank, brokerage firm or other nominee on how to vote your shares of common stock using the instructions provided by your bank, brokerage firm or other nominee. If you fail to submit a proxy or to vote in person at the special meeting, or do not provide your bank, brokerage firm or other nominee with instructions, as applicable, your shares of common stock will not be voted on the proposal to approve the Merger Agreement, which will have the same effect as a vote “AGAINST” the proposal to approve the Merger Agreement, and your shares of common stock will not be counted in respect of, and will not have an effect on, the proposal to approve, by a non-binding advisory vote, certain compensation arrangements for the Company’s named executive officers in connection with the Merger or any proposal to adjourn the special meeting, if necessary or appropriate, including if there are not holders of a sufficient number of shares of our common stock, present or represented by proxy at the special meeting to constitute a quorum.

A proxy may be revoked by a shareholder of record at any time prior to the vote at the special meeting by (i) delivering a written notice of revocation to our Corporate Secretary at c/o Manitex International, Inc., 9725 Industrial Drive, Bridgeview, Illinois 60455, (ii) subsequently submitting a duly executed proxy bearing a later date than that of the previously submitted proxy (including by submission over the telephone or Internet) or (iii) attending the special meeting and voting in person. Attending the special meeting without voting will not revoke your previously submitted proxy. Please note that if you want to revoke your proxy by mailing a new proxy card to us or by sending a written notice of revocation to us, you should ensure that you send your new proxy card or written notice of revocation in sufficient time for it to be received by us before the special meeting. If your shares of common stock are held in “street name” through a bank, brokerage firm or other nominee, you should contact your bank, brokerage firm or other nominee with questions about how to change or revoke your voting instructions.

Anticipated Date of Completion of the Merger

We are working towards completing the Merger as soon as possible. Assuming timely receipt of required regulatory approvals and satisfaction or waiver of other closing conditions, including the approval by our shareholders of the Merger Agreement, we anticipate that the Merger will be completed early in the first quarter of 2025. If our shareholders vote to approve the Merger Agreement, the Merger will become effective as promptly as practicable following the satisfaction or waiver of the other conditions to the Merger, subject to the terms of the Merger Agreement. See “Proposal 1: The Merger—Closing and Effective Time of the Merger” beginning on page 76.

No Appraisal Rights

Under Section 762(2) of the MBCA, as well as the governing documents of the Company, shareholders are not entitled to exercise dissenters’, appraisal or similar rights in connection with the Merger.

Solicitation of Proxies; Payment of Solicitation Expenses

The Board is soliciting your proxy, and the Company will bear the cost of this solicitation of proxies. This includes the charges and expenses of brokerage firms and others for forwarding solicitation material to beneficial owners of the outstanding common stock.

Questions and Additional Information

If you have more questions about the Merger, the special meeting or how to submit your proxy, or if you need additional copies of this proxy statement or the enclosed proxy card or voting instructions, please contact

 

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InvestorCom LLC, which is acting as the proxy solicitation agent and information agent for the Company in connection with the special meeting, or the Company at the following addresses or telephone numbers:

19 Old Kings Highway S. – Suite 130

Darien, CT 06820

Shareholders may call toll-free: (877) 972-0090

Banks and brokers call collect: (203) 972-9300

E-mail: [email protected]

– or –

Manitex International, Inc.

Attn: Corporate Secretary

9725 Industrial Drive

Bridgeview, Illinois 60455

(708) 237-2052

If your broker, bank or other nominee holds your shares, you should also call your broker, bank or other nominee for additional information.

 

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PROPOSAL 1: THE MERGER

This discussion of the Merger is qualified in its entirety by reference to the Merger Agreement, which is attached to this proxy statement as Annex A and incorporated herein by reference. You should read the entire Merger Agreement carefully as it is the legal document that governs the Merger.

The Company is asking you to approve the Merger Agreement, pursuant to which, among other things, Merger Sub will merge with and into the Company and the Company will be the surviving corporation. As a result of the Merger, the Company will cease to be a publicly traded company and will become a wholly owned subsidiary of Tadano.

Merger Consideration

If the Merger is completed, each share, other than Excluded Shares, will be converted into the right to receive cash in the amount of $5.80 per share, without interest, less any required withholding taxes. At the effective time, (i) each Excluded Share owned by Tadano or any subsidiary thereof will remain outstanding as a share of common stock of the surviving corporation and (ii) each other Excluded Share will be cancelled and will cease to exist, and no consideration will be payable therefor.

Background of the Merger

The following chronology summarizes the key meetings and events that led to the signing of the Merger Agreement. This chronology does not purport to catalog every conversation of or among the Manitex International, Inc. Board of Directors (the “Board”), the Transaction Committee of the Board, the Company’s management, the Company’s representatives, Tadano, Merger Sub or their financial advisors, legal advisors, affiliates or other representatives or any other person.

As part of their ongoing review of the Company’s business, in concert with the Company’s financial and legal advisors, the Board and the Company’s senior management team periodically review and evaluate the Company’s business and operations, long-term strategy, opportunities for organic growth and growth through acquisitions, capital structure and requirements, competitive position, historical performance, future prospects, and opportunities to increase shareholder value. These reviews have, from time to time, included discussions as to whether the Company should pursue various alternatives, including acquisitions or divestitures, a sale of the Company, continued execution on its strategy as a public company, and/or alternative capital allocation approaches. In such reviews, the Board and the Company’s senior management team consider, among other things, whether any potential alternative would enhance shareholder value and the potential benefits and risks of any such potential alternative.

 

•

During its June 1, 2023 Board meeting, the Board formally decided to engage investment banks regarding the viability for a potential strategic transaction involving the Company, including exploring the viability of a premium offer for the Company. In early August 2023, the Board met with representatives of multiple experienced investment banking firms to discuss a potential strategic transaction involving the Company, initial views on valuation, and the process that would be involved in a potential transaction.

 

•

At a Board meeting on August 17, 2023, the Board discussed various aspects of how to best facilitate the potential strategic transaction review process. At this meeting, the Board determined that having a Transaction Committee to supervise and provide input into the process would allow for a more efficient and streamlined process. The Board determined that having the Transaction Committee consist solely of non-management and independent directors made the most sense. Accordingly, Messrs. Clark, Knox and Tober were appointed as the members of the Transaction Committee, with Mr. Tober appointed as the Chair of the Transaction Committee. While the Transaction Committee was charged with supervising the process, it was also directed to regularly report back to the full Board regarding key developments related to the process and the status generally thereof.

 

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•

On August 24, 2023, the Company retained Brown Gibbons Lang & Company Securities, Inc. (“BGL”) as its investment banker to advise on possible strategic transactions. The Board selected BGL to serve as its investment banker due to BGL’s qualifications, expertise, reputation, extensive knowledge of the industry and its participants, and its knowledge of the Company’s business and financial profile.

 

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On August 30, 2023, representatives of BGL met with members of management of the Company to begin collecting information in order to review strategic alternatives and to discuss a list of potential buyers and the preparation of confidential information presentation materials to be shared with prospective buyers.

 

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From September 8, 2023, through October 9, 2023, representatives of BGL contacted seven private equity counterparties and executed non-disclosure agreements with six of such counterparties, including Parties B and C. These non-disclosure agreements, similar to all non-disclosure agreements utilized with potential counterparties during the events outlined herein, contained a “standstill” provision and did not contain a “don’t ask, don’t waive” provision.

 

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On October 11, 2023, members of the management team and representatives of BGL held preliminary management meetings with four private equity groups, including Party C.

 

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Following these meetings, the Transaction Committee authorized BGL to confidentially contact an additional 133 private equity and 41 strategic counterparties, which representatives of BGL did from November 2, 2023, through December 19, 2023. Representatives of BGL, on behalf of the Company, executed non-disclosure agreements with 61 of such counterparties. From November 16, 2023, through December 26, 2023, on behalf of the Company, representatives of BGL delivered the confidential information presentation and corresponding process letters (“First Round Process Letters”) outlining bidding procedures approved by the Transaction Committee to submit first round non-binding indications of interest (“First Round Proposals” and each a “First Round Proposal”) to the 67 counterparties who had previously executed non-disclosure agreements.

 

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On December 6, 2023, the Board held a regularly scheduled meeting. Representatives of BGL attended and presented to the Board a report on the status of the marketing process, including feedback received from parties and evaluations of indications of interest received to date. Plans to extend invitations to select parties to attend a management presentation were also discussed. Representatives of BGL also presented a proposed indicative timeline of a potential transaction and outlined key next steps in the process.

 

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Between December 21, 2023 and December 22, 2023, BGL received non-binding First Round Proposals from three private equity parties:

 

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On December 21, 2023, Party A, a private equity investment firm, submitted a written non-binding First Round Proposal to acquire the Company for an Enterprise Value between $170 million and $200 million, or $4.30 and $5.78 per share of common stock, which would be reduced by transaction expenses expected to be incurred by the Company, and subject to additional due diligence.

 

•

On December 21, 2023, Party B, a private equity investment firm, submitted a written non-binding First Round Proposal to acquire the Company for an Enterprise Value between 6.0x to 7.0x last twelve-months EBITDA less normalized capital expenditures, subject to additional due diligence.

 

•

On December 22, 2023, Party C, a private equity investment firm, submitted a written non-binding First Round Proposal to acquire the Company for an Enterprise Value between $167 million and $200 million in Enterprise Value, subject to additional due diligence.

 

•

On December 22, 2023, the Transaction Committee and members of management of the Company held a special meeting. Representatives of BGL attended the meeting and presented to the Transaction Committee on the status of the marketing process and an updated process timeline and overview of key

 

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next steps. The group discussed the First Round Proposals received and potential counteroffers and next steps. The Transaction Committee instructed the representatives of BGL to further its marketing process and discussions with interested parties.

 

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On January 3, 2024, a meeting was held with the Transaction Committee, members of management of the Company, representatives of BGL, and legal counsel to the Company, Bryan Cave Leighton Paisner LLP (“Bryan Cave”). At this meeting, representatives of BGL provided a process update including a summary of discussions with potential bidders and expected key next steps. The group further discussed the First Round Proposals and representatives of BGL presented a preliminary valuation summary with respect to such First Round Proposals.

 

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From January 3, 2024, through January 22, 2024, BGL contacted five additional counterparties and executed non-disclosure agreements with three of such counterparties, including Party D, a private equity group. BGL, on behalf of the Company, delivered confidential information presentations and First Round Process Letters outlining bidding procedures approved by the Transaction Committee to the three parties who had executed non-disclosure agreements.

 

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From January 8, 2024 through January 9, 2024, representatives of BGL discussed and clarified details with Parties A, B, and C related to their respective non-binding First Round Proposals and next steps in their due diligence priorities.

 

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On January 12, 2024 and January 19, 2024, representatives of BGL conducted marketing calls with Party D to address its preliminary diligence questions and provided the basis on which the Transaction Committee would evaluate a written non-binding First Round Proposal.

 

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On January 25, 2024, Party D submitted a written non-binding First Round Proposal to acquire the Company for an Enterprise Value between $183 million and $217 million, subject to additional due diligence.

 

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On January 25, 2024, representatives of BGL met with the Transaction Committee and presented an updated preliminary valuation summary that included the First Round Proposals and the proposal received from Party D, including the per share merger consideration price implied by each proposal, as well as an overview of other potential strategic and financial buyers that were reviewing the Company’s confidential information presentation.

 

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During February 2024, BGL, on behalf of the Company, contacted four additional potential acquirers and the Company entered into non-disclosure agreements with two of such potential acquirers, including Party E, a private equity firm. During this period, BGL delivered the confidential information presentation to the two additional counterparties under non-disclosure agreements.

 

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On February 21, 2024, members from management and representatives of BGL held a virtual meeting with Party E to discuss the Company’s business strategy, products, and end markets.

 

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On February 26, 2024, the Board held a regularly scheduled meeting. Representatives of BGL also attended and presented to the Board a report on the status of the marketing process including feedback received from parties to date. Representatives of BGL also discussed its initial outreach efforts to lenders to request preliminary financing terms for a potential transaction and initial feedback received. An overview of comparable publicly-traded original equipment manufacturer (OEM) and rental equipment businesses was also presented, along with an analysis of the Company’s share price and recent trading activity. Representatives of BGL also presented an updated preliminary valuation summary related to the First Round Proposals and the proposal received from Party D. Immediately following this meeting, the Transaction Committee authorized representatives of BGL to communicate to Party B that its offer was deemed inadequate, and Party B was not invited to continue in the process.

 

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On March 6, 2024, a virtual data room was opened, and Parties A, C, and D were invited to further their preliminary due diligence.

 

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•

On March 20, 2024, Party E submitted a written non-binding First Round Proposal to acquire the Company for a value between $5.50 and $6.50 per share of common stock, which would be reduced by transaction expenses expected to be incurred by the Company, and subject to additional due diligence. Party E was subsequently provided access to a virtual data room on March 29, 2024, to continue its preliminary due diligence.

 

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On March 27, 2024, the Board held a regularly scheduled meeting. Representatives of BGL also attended the meeting and updated the Board on the status of the marketing process, which included details on the March 20, 2024 bid received from Party E. Representatives of BGL also presented an updated comparable public company group analysis for OEM and rental equipment businesses and revised share price analysis as of March 26, 2024, as well as an updated preliminary valuation summary that included the bid received from Party E. In addition, representatives of BGL provided an overview of recommended next steps and timing, which included timing to hold management presentations with certain parties.

 

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From April 16, 2024, through April 25, 2024, members of management and representatives of BGL held management presentations with Parties A, D, and E in Georgetown, Texas, during which the respective parties were afforded the opportunity to tour the Company’s facility. Due to a scheduling conflict for Party C, a virtual management presentation was held on April 24, 2024, rather than an in-person meeting. Between April 20, 2024 and April 22, 2024, representatives of BGL transmitted process letters (“Second Round Process Letters”) to Parties A, C, D and E outlining procedures approved by the Transaction Committee to submit second round non-binding indications of interest (“Second Round Proposals”) to acquire the Company. Subsequent to the transmission of the Second Round Process Letters, representatives of BGL provided a draft of the form of merger agreement prepared by Bryan Cave to Parties A, C, D, and E via the virtual data room on April 23, 2024.

 

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On May 7, 2024:

 

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Party C submitted a written non-binding Second Round Proposal to acquire the Company for an Enterprise Value of $160 million, subject to additional due diligence.

 

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Party E submitted a written non-binding Second Round Proposal to acquire the Company for a value between $5.50 and $6.50 per share of common stock, which would be further reduced by transaction expenses expected to be incurred by the Company, and subject to additional due diligence.

 

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On May 8, 2024, Party A submitted a written non-binding Second Round Proposal to acquire the Company for an Enterprise Value between $190 million and $220 million, subject to additional due diligence.

 

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On May 9, 2024, the Transaction Committee and members from management held a meeting to review the Second Round Proposals. Representatives of BGL also attended the meeting and presented an overview and analysis of the Second Round Proposals. Following the discussion, the Transaction Committee authorized representatives of BGL to communicate to Party C that its offer was deemed inadequate to move forward in the process. Additionally, BGL was authorized to invite Parties A and E on behalf of the Company to submit additional questions, tour the Company’s European operations, and with their respective third-party consultants and advisors hold additional discussions with members of management on diligence matters.

 

•

On May 10, 2024, Party D verbally submitted a non-binding Second Round Proposal to acquire the Company for an Enterprise Value between $160 million and $175 million, subject to additional due diligence. The same day, based on discussions with the Transaction Committee, representatives of BGL communicated to Party D that its offer was deemed inadequate to move forward in the process.

 

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On May 16, 2024, representatives of BGL, on behalf of the Company, contacted one additional potential acquirer, with which the Company entered into a non-disclosure agreement. Representatives of BGL delivered the confidential information presentation and provided an overview of the process.

 

33

•

On May 16, 2024 and May 17, 2024, members of management of the Company and representatives of BGL held a follow-up meeting with Parties A and E, in-person and virtually, respectively, to discuss European operations and growth initiatives of the Company.

 

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Between May 23, 2024 and June 17, 2024, representatives of BGL facilitated multiple virtual meetings with members of the Company’s management, and provided written responses to submitted questions and additional diligence information from Parties A and E and their respective third-party consultants and advisors.

 

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On May 23, 2024 and May 30, 2024, a representative of BGL and members of the management team facilitated a tour of the Company’s Romanian and two Modena, Italy facilities, respectively, for Party E.

 

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On May 24, 2024, BGL, on behalf of the Company, delivered a process letter outlining bidding procedures approved by the Transaction Committee to submit third round non-binding indications of interest (“Third Round Proposals”) to acquire the Company to Parties A and E.

 

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On June 19, 2024, Party A submitted a written non-binding Third Round Proposal to acquire the Company for $5.50 per share of common stock, which would be reduced by transaction expenses expected to be incurred by the Company. The proposal included a markup from Party A’s legal counsel to the draft merger agreement prepared by Bryan Cave, and lender letters of support from various financing partners. Additionally, the proposal indicated that the contemplated transaction would be subject to a financing contingency and that the anticipated sources of capital included equity from Party A’s committed fund, the Company’s existing working capital facilities which would remain in place, and a new senior and subordinated debt facility to be identified. The proposal was also contingent upon the completion of outstanding due diligence items outlined in the proposal prior to the execution of a definitive merger agreement. Party A requested the Company provide exclusivity through August 28, 2024.

 

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On June 21, 2024, Party E submitted a written non-binding Third Round Proposal to acquire the Company for a value between $5.50 and $5.75 per share of common stock, which would be further reduced by transaction expenses expected to be incurred by the Company. The proposal included a memorandum prepared by Party E’s legal counsel, which detailed certain changes to the key transaction terms within the draft merger agreement prepared by Bryan Cave. Additionally, the proposal indicated the contemplated transaction would be funded through third-party debt and Party E’s committed fund, and would not be subject to a financing contingency. The proposal included a summary of key outstanding diligence items to be resolved before signing a definitive merger agreement and requested that the Company provide exclusivity through August 7, 2024.

 

•

On June 24, 2024, the Board held a regularly scheduled meeting. Representatives of BGL also attended and presented to the Board on the status of the marketing process including details of the Third Round Proposals received from Parties A and E. Representatives of BGL briefly discussed its lender outreach efforts and the six parties that had provided indicative financing terms to date. Representatives of BGL also presented an analysis of comparable public company OEM and rental equipment businesses, which had been updated from the March 27, 2024 presentation. A comparison of the Company’s recent trading activity against the market generally and comparable groups, as well as an updated overview of the Company’s shareholder base for Q1 2024, was also provided. Lastly, representatives of BGL summarized the due diligence process conducted to date with Parties A and E, and presented an updated process timeline and overview of important next steps. The Board discussed the relative merits of the Third Round Proposals and provided authorization for BGL to negotiate the offers received so as to receive final and best offers.

 

•

On June 26, 2024, representatives of BGL held a virtual meeting with Party A and informed Party A that it would need to enhance its proposal in order for its offer to be considered acceptable to the

 

34

Board. Following this conversation, on June 28, 2024, Party A verbally indicated that it could increase its proposal to $5.60 per share of common stock prior to transaction expenses expected to be incurred by the Company.

 

•

On June 26, 2024, representatives of BGL held a virtual meeting with Party E and informed Party E that it would need to enhance its proposal in order for its offer to be considered acceptable to the Board. Following this conversation, on July 3, 2024, Party E submitted a written amendment to its non-binding Third Round Proposal increasing its offer to $6.00 per share of common stock prior to transaction expenses expected to be incurred by the selling shareholders; Party E also requested exclusivity through August 9, 2024. Additionally, Party E confirmed that its proposal was not contingent on third-party financing and that the transaction could be completed with equity capital from its committed fund. Representatives of Party E provided a supporting schedule which reflected an implied enterprise value of $224 million.

 

•

On July 4, 2024, the Transaction Committee, members of management of the Company, and representatives of BGL discussed the Third Round Proposals and key terms. During this conversation, the Transaction Committee informed representatives of BGL that it had concluded that, in comparison, Party A’s proposal was inferior to Party E’s proposal and that it wished to execute the exclusivity agreement with Party E. The Transaction Committee authorized Bryan Cave to negotiate the exclusivity agreement with Party E’s legal counsel.

 

•

On July 9, 2024, the Transaction Committee approved Party E’s non-binding Third Round Proposal and the Company entered into the revised exclusivity agreement, as negotiated by Bryan Cave, with Party E with a term expiring on August 9, 2024. The Company and Party E, with the assistance of their respective counsel and third-party advisors, began working through confirmatory due diligence.

 

•

From July 9, 2024 to August 9, 2024, Party E and Party E’s advisors and representatives conducted due diligence with the assistance of members of Company management and representatives of BGL, which included multiple calls, information sharing, and review of documents in the virtual data room.

 

•

On July 20, 2024, BGL sent the Company’s Executive Chairman a draft engagement letter agreement, outlining the terms under which BGL would render a fairness opinion to the Board in connection with a potential transaction. On July 23, 2024, the Company and BGL entered into the proposed engagement letter agreement.

 

•

On July 24, 2024, the Company received an unsolicited non-binding proposal from Tadano to acquire the common stock of the Company that Tadano does not already own for $6.25 to $6.50 per share in cash, subject to completion of due diligence by Tadano. The proposal indicated that Tadano would be prepared to sign a definitive merger agreement within 30 days and that Tadano had access to capital sufficient to consummate the transaction as proposed.

 

•

On July 25, 2024, Bryan Cave delivered a letter to Tadano and its financial advisor, Perella Weinberg Partners LP (“Perella Weinberg Partners”), acknowledging the receipt of the proposal, but informing them of existing exclusivity obligations and the Company’s inability to engage as a result thereof.

 

•

On July 31, 2024, members of the management team and representatives of BGL held an in-person meeting with Party E in Georgetown, Texas and discussed operations, growth opportunities, and other operational items.

 

•

Also on July 31, 2024, members of Tadano senior management met with representatives of Perella Weinberg Partners, Sullivan & Cromwell LLP, Tadano’s legal advisor (“S&C”) and Deloitte Touche Tohmatsu Limited, Tadano’s accounting advisor (“Deloitte”) to discuss potential transaction process and timeline. Representatives of Perella Weinberg Partners also presented to Tadano management certain preliminary views on valuation derived solely from publicly available information regarding the Company.

 

•

On August 2, 2024 and on August 8, 2024, Mr. Noriaki Yashiro, Director and Managing Executive Officer of Tadano, discussed with Mr. David Langevin, the Company’s Executive Chairman, whether

 

35

Tadano could commence its due diligence investigation following the expiration of the Company’s exclusivity obligations with Party E.

 

•

On August 9, 2024, representatives of BGL held a virtual meeting with Party E following the expiration of the exclusivity period. Party E informed representatives of BGL that it was not in a position to execute a definitive merger agreement prior to the expiration of exclusivity. Subsequently at 5:00 pm Eastern Time, Party E’s exclusivity period expired without extension.

 

•

On August 10, 2024, representatives of Perella Weinberg Partners, at the direction of Tadano, contacted representatives of BGL regarding Tadano’s interest in acquiring the Company.

 

•

On August 11, 2024, the Company and Tadano executed a non-disclosure agreement and Tadano was granted access to the virtual data room to aid in its confirmatory due diligence. The non-disclosure agreement contained customary “standstill” provisions, with customary fall-away terms upon the Company’s entry into a definitive agreement with, or the launch of a tender offer by, an unaffiliated third party.

 

•

From August 11, 2024, until September 11, 2024, Tadano, with the assistance of its advisors and representatives and the assistance of Company management and representatives of BGL, conducted due diligence, which included multiple calls, information sharing, and review of documents in the virtual data room.

 

•

On August 12, 2024, Mr. Langevin, the Company’s Executive Chairman, Mr. Coffey, the Company’s Chief Executive Officer, representatives of BGL, Mr. Yashiro, and representatives of Perella Weinberg Partners held an in-person meeting in Chicago, Illinois, to discuss Tadano’s proposed due diligence scope and associated timeline to execute a definitive merger agreement with the Company.

 

•

On August 14, 2024, representatives of Perella Weinberg Partners, at the direction of Tadano, delivered to representatives of BGL a preliminary due diligence work plan illustrating a timeline to complete their proposed work streams and sign a definitive merger agreement.

 

•

On August 17, 2024, S&C delivered an initial markup of the draft merger agreement to Bryan Cave.

 

•

On August 22, 2024, Tadano and the Company executed an amendment to the non-disclosure agreement, pursuant to which Tadano and the Company agreed to certain obligations regarding the sharing of competitively sensitive information.

 

•

On August 25, 2024, Bryan Cave delivered to S&C a revised draft of the merger agreement following feedback from management, the Transaction Committee and representatives of BGL.

 

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On August 27, 2024, members of Tadano’s executive team, including Messrs. Toshiaki Ujiie, Yashiro, Tamitoshi Kumano, and Yasuhiro Fukumori, as well as representatives of Perella Weinberg Partners, met in person with members of management of the Company and representatives of BGL in Georgetown, Texas to tour the Company’s facility and discuss the Company’s operations.

 

•

On August 30, 2024, representatives of Perella Weinberg Partners, at the direction of Tadano, discussed with representatives of BGL updates to the potential timeline for the execution and announcement of a transaction.

 

•

On September 5, 2024, representatives of Perella Weinberg Partners reviewed with certain senior management of Tadano certain preliminary views on the valuation of the Company, based on certain historical and projected financial information provided by Tadano to representatives of Perella Weinberg Partners for purposes of its financial analysis of the Company.

 

•

On September 6, 2024, representatives of Perella Weinberg Partners, at Tadano’s direction, held a phone call with representatives of BGL, where representatives of Perella Weinberg Partners explained that Tadano would not be in a position to pay more than $5.75 per share in cash as an indicative purchase price, given Tadano’s due diligence to date, including with respect to certain debt-like

 

36

financial items incurred by the Company. Subsequently, on September 7, 2024, representatives of Perella Weinberg Partners, at the direction of Tadano, delivered to representatives of BGL a list of such debt-like items.

 

•

On September 7, 2024, S&C delivered a revised draft of the Merger Agreement to Bryan Cave.

 

•

On September 8, 2024, members of management, the Transaction Committee and representatives of BGL met with representatives of the Company’s tax accountant Andersen Tax LLC (“Andersen”) to review and discuss the diligence findings of Tadano and its advisors. Subsequently, representatives of BGL, at the direction of the Transaction Committee, held a call with representatives of Perella Weinberg Partners and Deloitte to discuss details and questions regarding such diligence findings.

 

•

On September 9, 2024, Company management provided written confirmation to representatives of BGL, concerning certain historical and projected financial information provided by the Company to representatives of BGL for purposes of its analysis and opinion, and approved BGL’s reliance on the financial projections for use in connection with preparing its financial analyses.

 

•

On September 9, 2024, members of Company management, representatives of BGL and Andersen met with representatives of Perella Weinberg Partners and Deloitte to discuss the diligence findings presented. Subsequently, representatives of Perella Weinberg Partners, at the direction of Tadano, held a phone call with representatives of BGL during which they explained that Tadano would be able to increase its offer by approximately $0.05 per share to $5.80 per share in cash as an indicative purchase price, provided that the per share amount would be reduced by certain change of control expenses estimated to be between approximately $250,000 and $1.41 million in value.

 

•

On September 10, 2024, Bryan Cave and S&C exchanged drafts of the Merger Agreement.

 

•

On September 10, 2024, members of Company management, the Transaction Committee, and representatives of Bryan Cave and BGL met to discuss the revised offer and whether the Transaction Committee was willing to move forward with the transaction based on such revised offer. After discussion, the Transaction Committee authorized representatives of BGL to negotiate further with representatives of Perella Weinberg Partners. Subsequently, representatives of BGL and Perella Weinberg Partners held a call to discuss the revised proposal. During this call representatives of Perella Weinberg Partners, at the direction of Tadano, communicated that Tadano would be prepared to increase its offer to $5.80 per share in cash, without reduction for certain change of control expenses. Representatives of BGL reported the details of this proposal to the Transaction Committee. After a discussion, the Transaction Committee determined to continue to pursue a transaction with Tadano.

 

•

On September 10, 2024, representatives of BGL, the Transaction Committee and the remainder of the full Board (excluding Mr. Takashi Fukui, who recused himself due to his affiliation with Tadano and was not privy to any information regarding the Company’s negotiations or discussions with the other potential buyers following submission of Tadano’s initial indication of interest) held a joint meeting, which was attended virtually by members of management, representatives of BGL and representatives of Bryan Cave. At the request of the Transaction Committee, representatives of BGL then reviewed and discussed its draft financial analyses of the per share merger consideration. The meeting was then adjourned to the following day.

 

•

On September 10, 2024, representatives of Tadano met in person with representatives of the Company in Romania to tour the Company’s facility.

 

•

On September 11, 2024, S&C delivered to Bryan Cave a revised draft of the Merger Agreement, which Bryan Cave described as materially complete and final to the Board and BGL. The Transaction Committee and the Board (excluding Mr. Fukui, who recused himself due to his affiliation with Tadano) reconvened their joint meeting at 5:00 p.m. Central time, at which time Bryan Cave gave a presentation to the Board regarding fiduciary duties under Michigan law. At the request of the Transaction Committee, representatives of BGL then reviewed and discussed its financial analyses of the per share merger consideration, which financial analyses had been updated to reflect public market

 

37

trading data as of September 11, 2024, but were otherwise similar in all material respects to the financial analyses reviewed and discussed on September 10, 2024.

 

•

Subsequently, on September 11, 2024, at the request of the Transaction Committee, BGL rendered its oral opinion (which was subsequently confirmed in writing by delivery of BGL’s written opinion addressed to the Transaction Committee dated September 12, 2024) to the effect that, as of the date and based on and subject to the procedures followed, assumptions made, qualifications, conditions and limitations on the review undertaken and other matters considered by BGL, as set forth in its written opinion, the per share merger consideration to be received by holders of common stock in the Merger pursuant to the Merger Agreement (other than holders of Excluded Shares) is fair to them from a financial point of view. The Transaction Committee approved the Merger Agreement, the Merger, the contingent equity grants to Messrs. Coffey and Doolan, the contingent conversion of certain of Mr. Coffey’s Company PSUs to Company RSUs, and the contingent cash bonus to Mr. Tober (with Mr. Tober abstaining as to the vote on his bonus), and recommended that the full Board approve each matter. The full Board, with Mr. Fukui abstaining, then approved the Merger Agreement and the Merger, recommended that the shareholders of the Company approve the Merger Agreement and the Merger, and approved the special equity grants and cash bonus identified above, contingent on the completion of the Merger.

 

•

On September 12, 2024, the board of directors of Tadano met virtually with members of management and approved Tadano’s entry into the Merger Agreement and the Merger.

 

•

Following conclusion of such board meetings on September 12, 2024, the parties executed the Merger Agreement and issued a press release announcing the Merger. Tadano amended its Schedule 13D in respect of shares of Company common stock to disclose Tadano’s entry into the Merger Agreement with the Company on September 12, 2024.

Reasons for the Merger; Recommendation of the Company’s Board of Directors

After careful consideration, with the assistance of independent financial and legal advisors, and acting in reliance upon the unanimous recommendation of the Transaction Committee, the Board (which, for purposes of this section of this proxy statement entitled “Proposal 1: The Merger—Reasons for the Merger; Recommendation of the Company’s Board of Directors,” means the Board without the participation of Mr. Takashi Fukui (the “Recused Director”), who recused himself due to his affiliation with Tadano), and including a majority of the directors of the Company who are not employees of the Company, has determined that the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement are advisable, fair to, and in the best interests of, the Company and its shareholders (other than holders of Excluded Shares) and adopted and declared advisable the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement, resolved that the Merger Agreement be submitted for consideration by the shareholders of the Company at a special meeting of shareholders and recommended that the shareholders of the Company vote to approve the Merger Agreement. In addition, the Board believes that the Merger is fair to the Company’s “unaffiliated security holders,” as defined under Rule 13e-3 of the Exchange Act.

Accordingly, the Board recommends that you vote (1) “FOR” the proposal to approve the Merger Agreement; (2) “FOR” the non-binding, advisory proposal to approve compensation that will or may become payable to the Company’s named executive officers in connection with the Merger; and (3) “FOR” the proposal to adjourn the special meeting.

 

38

In the course of reaching its determination and recommendation, the Board consulted with and received the advice and assistance of its legal and financial advisors as well as the unanimous recommendation of the Transaction Committee. In recommending that shareholders vote in favor of approval of the Merger Agreement, the Board considered a number of factors, including the following (which factors are not necessarily presented in order of relative importance):

 

•

Attractive Value. The Board considered the $5.80 per share merger consideration relative to the current and historical trading prices and anticipated future trading prices of the common stock, including the fact that the per share merger consideration constituted a premium of approximately 52.2% to the closing price per share on September 11, 2024, 47.9% to the volume-weighted average price during the three months ended September 11, 2024, and 7.4% to the volume-weighted average price during the six months ended September 11, 2024.

 

•

Best Alternative for Maximizing Shareholder Value. The Board considered, after discussions with its financial advisor and members of management, that the per share merger consideration was more favorable to the shareholders than the potential value that would reasonably be expected to result from other alternatives reasonably available to the Company, including, but not limited to, the continued operation of the Company as a standalone, independent public company with no change in its relationship with Tadano, and especially in light of the current environment in the industry as well as broader economic and commercial trends affecting the Company’s business and financial results, including:

 

•

the Board’s assessment of the Company’s business, operations, financial condition, earnings, assets and prospects, its competitive position and historical and projected financial performance and the nature of the industry in which the Company operates, including changing competitive dynamics;

 

•

the strategic and other alternatives reasonably available to the Company, including the alternative of remaining a standalone public company and the likelihood or unlikelihood of other parties being willing and able to engage in a shareholder-value-maximizing strategic transaction with the Company, and the risks and uncertainties associated with those alternatives, none of which were deemed likely to result in value to the Company’s shareholders that would exceed, on a present-value basis, the value of the Merger consideration;

 

•

that Party E had informed representatives of BGL that it would need significant additional time following the expiration of its exclusive negotiating period before it would be in a position to proceed with the process of negotiating a definitive merger agreement, raising significant uncertainty regarding Party E’s interest in and ability to negotiate a binding transaction with the Company;

 

•

that Tadano was the most logical acquirer of the Company and, in light of Tadano’s long-term investment in the Company, deep understanding of the Company’s businesses and industries and track record of providing the Company with strategic support, that Tadano was the potential transaction partner most likely to offer the highest value to the Company’s shareholders; and

 

•

the risks and uncertainties relating to possible future headwinds for companies operating in the industry in which the Company operates, including the potential need for greater scale to be able to compete effectively in the markets in which the Company operates or may operate in the future.

 

•

Certainty of Consideration. The Board considered that the all-cash Merger consideration provides the shareholders with certainty of value and, upon closing, immediate liquidity for their shares, especially when viewed against the potential risks and uncertainties inherent in the Company’s business, including risks associated with remaining a standalone entity and changing competitive dynamics.

 

39

•

Transaction Committee Process and Recommendation. The Board considered the process undertaken by the Transaction Committee, including:

 

•

the receipt of the advice of its outside advisors and Company management, consideration with the Board and such advisors of a wide range of options, and identification of the candidates viewed as most likely to be interested in acquiring the Company and capable of paying the highest price and

 

•

the course and history of the negotiations between Tadano and the Company, as described under “Proposal 1: The Merger—Background of the Merger” and the Board’s belief that it had obtained Tadano’s best and final offer and that it was unlikely that any other party would be willing to acquire the Company at a higher price.

 

•

Receipt of Fairness Opinion from Brown Gibbons Lang & Company. The Board considered the opinion of BGL, orally rendered on September 11, 2024 to the Transaction Committee (and subsequently confirmed in writing by delivery of BGL’s written opinion addressed to the Transaction Committee dated September 12, 2024), as to the fairness, from a financial point of view, and as of such date, of the per share merger consideration to be received by the holders of common stock of the Company in the Merger pursuant to the Merger Agreement (other than holders of Excluded Shares), as more fully described in the section entitled “Proposal 1: The Merger—Opinion of Brown Gibbons Lang & Company” and which written opinion is attached in its entirety as Annex B hereto. The summary of the opinion of BGL herein is qualified in its entirety by reference to the full text of the opinion. We encourage you to read BGL’s opinion and the summary of BGL’s opinion carefully and in their entirety.

 

•

Likelihood of Completion; Certainty of Payment. The Board considered its belief that, absent a superior proposal, the Merger represented a transaction that would highly likely be consummated based on, among other factors:

 

•

Tadano’s reputation and its credibility as an acquirer;

 

•

the absence of any financing condition to consummation of the Merger (as more fully described under “Proposal 1: The Merger—Financing of the Merger”);

 

•

the Company’s ability, under circumstances specified in the Merger Agreement, to seek specific performance of Tadano’s and Merger Sub’s obligation to cause the Merger to occur;

 

•

the commitment of Tadano in the Merger Agreement to use reasonable best efforts to satisfy conditions and complete the Merger, and to obtain applicable regulatory approvals (as more fully described under “Proposal 1: The Merger—Regulatory Approvals”); and

 

•

the absence of any conditions to the consummation of the Merger that are unlikely to be satisfied Merger (as more fully described under “The Merger Agreement—Conditions to the Merger”).

 

•

Opportunity to Receive Unsolicited Acquisition Proposals and to Terminate the Tadano Merger in Order to Accept a Superior Proposal. The Board considered the terms of the Merger Agreement permitting the Company to receive unsolicited acquisition proposals, and the other terms and conditions of the Merger Agreement, including:

 

•

that until the effective time, subject to certain conditions and requirements set forth in the Merger Agreement, the Company is permitted to receive, consider and respond to unsolicited acquisition proposals or engage in discussions or negotiations with third parties making such acquisition proposals (as more fully described under “The Merger Agreement—Change of Board Recommendation”); and

 

•

the ability of the Board to change its recommendation prior to obtaining the Company shareholder approval in specified circumstances relating to the receipt of a superior proposal or the occurrence of an intervening event (as defined in the section entitled “The Merger Agreement—Change of Board Recommendation”), subject to (i) the Company’s notification and good faith negotiation

 

40

obligations and (ii) Tadano’s right to terminate the Merger Agreement and receive payment of the applicable termination fee of $4,900,000, which amount the Board believed to be reasonable under the circumstances taking into account the range of such termination fees in similar transactions, and the unlikelihood that a fee of such size would be a meaningful deterrent to alternative acquisition proposals (as more fully described under “The Merger Agreement—Termination Fees”).

 

•

Other Terms of the Merger Agreement. The Board considered other terms and conditions of the Merger Agreement and related transaction documents, including:

 

•

that the approval of Proposal 1: The Merger is conditioned on the affirmative vote of the majority of the outstanding shares (as more fully described under “The Special Meeting—Vote Required”);

 

•

that the terms of the Merger Agreement provide the Company sufficient operating flexibility to conduct its business in the ordinary course until the earlier of the consummation of the Merger or the termination of the Merger Agreement (as more fully described under “The Merger Agreement—Conduct of Our Business Pending the Merger”);

 

•

the termination date of the Merger Agreement on which date either party, subject to certain exceptions, can terminate the Merger Agreement, and the Board’s view that the termination date, and the provisions of the Merger Agreement providing for extensions of the termination date under certain circumstances, allow for sufficient time to consummate the Merger;

 

•

the Board’s belief that it was fully informed about the extent to which the interests of Tadano and its affiliates in the Merger differ from those of the Company’s other shareholders; and

 

•

the Board’s belief that the other terms of the Merger Agreement, taken as a whole, are reasonable.

The Transaction Committee also considered a number of factors relating to the procedural safeguards that it believes were and are present to ensure the fairness of the Merger and to permit the Transaction Committee to represent effectively the interests of the Unaffiliated Company Shareholders. In light of such procedural safeguards, the Transaction Committee did not consider it necessary to retain an unaffiliated representative to act solely on behalf of the Unaffiliated Company Shareholders for purposes of negotiating the terms of the Merger Agreement or preparing a report concerning the fairness of the Merger Agreement and the Merger, or to require a separate approval of the Merger Agreement and the Merger by a majority of the Unaffiliated Company Shareholders. The Transaction Committee believes these factors support its determinations and recommendations and provide assurance of the procedural fairness of the Merger to the Company’s unaffiliated shareholders:

 

•

Independence. The Transaction Committee is comprised of directors who are independent (for purposes of serving on the Transaction Committee), disinterested and not affiliated with, and are independent of, Tadano or Merger Sub and who are otherwise disinterested and independent with respect to a potential acquisition of the Company, other than as discussed in the section of this proxy statement captioned “Proposal 1: The Merger—Interests of the Company’s Directors and Executive Officers in the Merger”;

 

•

Negotiating Authority. The Transaction Committee was granted the power by the Company Board to, among other things, (1) review and evaluate the advisability of a potential strategic transaction and other strategic alternatives that may be available to the Company (including the status quo as a standalone company) and solicit expressions of interest or other proposals for a potential strategic transaction, if and to the extent the Transaction Committee deemed appropriate; (2) establish, approve, modify, monitor and direct the process and procedures related to the negotiation, review and evaluation of a potential strategic transaction, including the authority to determine not to proceed with any such process, procedures, review or evaluation; (3) respond to any communications, inquiries or proposals regarding a potential strategic transaction; (4) recommend, reject or approve the terms of a potential strategic transaction; (5) review, evaluate, investigate, pursue and negotiate the price, structure, form, terms and conditions of a potential

 

41

strategic transaction and the form, terms and conditions of any definitive agreements in connection therewith; (6) determine whether a potential strategic transaction is fair to, and in the best interests of, the Company and its shareholders (or any subset of the shareholders of the Company that the Transaction Committee determines to be appropriate); and (7) recommend to the full Board what action, if any, should be taken by the Company with respect to a potential strategic transaction.

 

•

Prior Transaction Committee Recommendation Required. The Board was not permitted to approve any potential acquisition of the Company (including a potential acquisition of the Company that also included a transaction or series of transactions in which one or more significant shareholders of the Company had an interest that was in addition to, and/or different from, the interests of the Company’s shareholders as a whole) or recommend for approval any such transactions by the Company’s shareholders without a prior favorable recommendation of the transaction by the Transaction Committee.

 

•

Active Involvement and Oversight. The numerous meetings held by the Transaction Committee (with BGL present), over the period from its August 2023 formation through the September 11, 2024 execution of the Merger Agreement, to discuss and evaluate, among other things, the process for exploring a potential strategic transaction and the proposals from Tadano, and the Transaction Committee’s active oversight of the negotiation process. The Transaction Committee was actively engaged in this process on a regular basis and was provided with full access to members of the Company’s management and its advisors in connection with the evaluation process.

 

•

Independent Advice. The Transaction Committee selected and engaged its own independent financial advisor (BGL) and received the advice of BGL throughout its review, evaluation and negotiation of a potential acquisition of the Company.

 

•

Full Knowledge. The Transaction Committee made its evaluation of a potential acquisition of the Company by Tadano based upon the factors discussed in this proxy statement and with the full knowledge of the interests of Tadano in the transaction.

 

•

No Obligation to Recommend. The recognition by the Transaction Committee that it had no obligation to recommend to the Board the approval of the Merger or any other transaction and had the authority to reject any proposals made.

In the course of reaching its recommendation, the Board also considered a variety of risks and potentially negative factors concerning the Merger and the Merger Agreement, including the following:

 

•

that the shareholders will have no ongoing equity participation in the Company following the Merger and the shareholders will cease to participate in the Company’s future earnings or growth, if any, and will not benefit from increases, if any, in the value of the Company following the Merger;

 

•

the risk that the Merger may not be consummated in a timely matter or at all, including due to the failure to obtain required regulatory approvals to the completion of the Merger or the failure to satisfy other conditions to the completion of the Merger, and the consequences thereof, including the potential loss of value to the shareholders and the potential negative impact on the operations and prospects of the Company if the Merger Agreement is terminated or the Merger is not completed for any reason;

 

•

the significant effort and cost involved in connection with negotiating the Merger Agreement and completing the Merger (including certain costs and expenses if the Merger is not consummated), the substantial management time and effort required to effectuate the Merger and the potential related disruption to the Company’s day-to-day operations during the pendency of the Merger;

 

•

the possible effects of the pendency or consummation of the Merger, including the potential for suits, actions or proceedings in respect of the Merger Agreement or the transactions contemplated by the Merger Agreement, the risk of any loss or change in the relationship of the Company and its

 

42

subsidiaries with their respective employees (including making it more difficult to attract and retain key personnel and the possible loss of key management, technical, sales and other personnel), customers, distributors, suppliers, contractors, partners, agents and others with whom they have business dealings;

 

•

the possibility that, under certain limited circumstances, the Company may be required to pay Tadano a termination payment of $4,900,000 following termination of the Merger Agreement, including if Tadano terminates the Merger Agreement as a result of the Board changing its recommendation or if the Company terminates the Merger Agreement to accept a superior proposal (as more fully described under “The Merger Agreement—Termination Fees”);

 

•

the restrictions imposed by the terms of the Merger Agreement on the conduct of the Company’s business prior to completion of the Merger, which may delay or prevent the Company from undertaking business opportunities that may arise pending completion of the Merger, and the resultant risk if the Merger is not consummated;

 

•

because the Merger Agreement provides that the Merger must be completed on or before June 12, 2025, which we refer to as the end date, the shareholders could be asked to vote on approval of the Merger Agreement in advance of completion of the transaction;

 

•

the receipt of cash in exchange for the common stock pursuant to the Merger will be a taxable transaction for U.S. federal income tax purposes for many of the shareholders;

 

•

the absence of any appraisal or dissenters’ rights under Michigan law; and

 

•

the Company’s officers and directors may have interests in the Merger that are different from, or in addition to, the interests of the shareholders, including the receipt of certain enhanced severance in connection with a qualifying termination in connection with the Merger, the acceleration of Company RSUs and Company Options held by officers and directors, the grant of Company RSUs, the conversion of Company PSUs to Company RSUs, and cash awards in connection with the completion of the Merger, and the interests of the Company’s directors and officers in being entitled to continued indemnification, advancement of expenses and insurance coverage from the surviving corporation under the Merger Agreement.

The Board concluded that the uncertainties, risks and potentially negative factors relevant to the Merger were outweighed by the potential benefits of the Merger.

The above discussion of the information and factors considered by the Board is not intended to be exhaustive, but indicates the material matters considered. In reaching its determination and recommendation, the Board did not quantify, rank or assign any relative or specific weight to any of the foregoing factors, and individual members of the Board may have considered various factors differently. The Board did not undertake to make any specific determination as to whether any specific factor, or any particular aspect of any factor, supported or did not support its ultimate recommendation. Moreover, in considering the information and factors described above, individual members of the Board each applied his or her own personal business judgment to the process and may have given differing weights to differing factors. The Board based its recommendation on the totality of the information presented. The explanation of the factors and reasoning set forth above contain forward-looking statements that should be read in conjunction with the section of this proxy statement entitled “Cautionary Statements Regarding Forward-Looking Information.”

In the course of evaluating the Merger Agreement and the transactions contemplated thereby, including the Merger, and making the decisions, determinations and recommendations described above (as applicable), the Board and the Transaction Committee did not consider the liquidation value of the Company because (1) they considered the Company to be a viable, going concern; (2) they believed that liquidation sales generally result in proceeds substantially less than sales of a going concern; and (3) they considered determining a liquidation value to be impracticable given the significant execution risk involved in any breakup of the Company. For the

 

43

foregoing reasons, the Board and the Transaction Committee did not consider liquidation value to be a relevant factor. Further, the Board and the Transaction Committee did not consider the Company’s net book value, which is an accounting concept, as a factor because they believed (1) that net book value is not a material indicator of the value of the Company as a going concern but rather is indicative of historical costs and (2) net book value does not take into account the prospects of the Company, market conditions, trends in the industry in which the Company operates or the business risks inherent in the industry. In addition, the Board and the Transaction Committee did not view the purchase prices paid in the transactions described in the section of this proxy statement captioned “Important Information Regarding the Company—Transactions in the Company’s Common Stock” (the aggregate average of which was below the per share merger consideration) to be relevant except to the extent that those prices indicated the trading price of the Company’s common stock during the applicable periods. The Board and the Transaction Committee did not seek to establish a pre-merger going concern value for the Company. Rather, the Transaction Committee believed that the Company Management Projections, as defined below, and certain financial analyses utilizing the Company Management Projections summarized in the section of this proxy statement entitled “Proposal 1: The Merger—Opinion of Brown Gibbons Lang & Company” were representative of the Company’s going concern value if the Company continued to operate its business on a standalone basis.

Other than as described in this proxy statement, the Board has not received any firm offer by any other person during the prior two years for (1) a merger or consolidation of the Company with another company; (2) the sale or transfer of all or substantially all of the Company’s assets; or (3) a purchase of the Company’s securities that would enable such person to exercise control of the Company.

Opinion of Brown Gibbons Lang & Company

On September 11, 2024, BGL orally rendered its opinion to the Transaction Committee (which was subsequently confirmed in writing by delivery of BGL’s written opinion addressed to the Transaction Committee dated September 12, 2024), as to the fairness, from a financial point of view and as of such date, of the per share merger consideration to be received by holders of Company common stock in the Merger pursuant to the Merger Agreement (other than holders of Excluded Shares), which opinion was based on and subject to the various procedures followed, assumptions made, qualifications and limitations on the review undertaken and the other matters considered by BGL in connection with the preparation of its opinion.

BGL’s opinion was directed to the Transaction Committee and only addressed the fairness, from a financial point of view and as of such date, of the per share merger consideration to be received by holders of Company common stock in the Merger pursuant to the Merger Agreement (other than holders of Excluded Shares) and did not address any other aspect or implication of the Merger or any other agreement, arrangement or understanding. The summary of BGL’s opinion in this proxy statement is qualified in its entirety by reference to the full text of its written opinion, which is attached as Annex B to this proxy statement and describes certain of the procedures followed, assumptions made, qualifications and limitations on the review undertaken and other matters considered by BGL in connection with the preparation of its opinion. However, neither BGL’s opinion nor the summary of its opinion and the related analyses set forth in this proxy statement are intended to be, and do not constitute, advice or a recommendation to the Transaction Committee, the Board, the Company, any security holder or any other person as to how to act or vote with respect to any matter relating to the merger or otherwise.

In arriving at its opinion, BGL, among other things:

 

•

reviewed the draft merger agreement dated September 10, 2024 (the “Draft Merger Agreement”);

 

•

reviewed relevant public filings, including, but not limited to, Form 10-Ks, Form 10-Qs, Form 8-Ks, proxies, investor presentations, and quarterly analyst calls;

 

•

reviewed publicly available analyst research coverage reports for the Company;

 

44

•

reviewed the Company’s audited financial statements for each of the fiscal years ended December 31, 2021, December 31, 2022, and December 31, 2023;

 

•

reviewed year-to-date unaudited financial statements prepared by the Company;

 

•

reviewed a forecast model prepared by the Company’s management in October 2023, including the budget for the fiscal year ended December 31, 2024 and forecasts for the fiscal years ended December 31, 2025, 2026, 2027, and 2028 that were prepared by the Company’s management;

 

•

participated in discussions with the Chief Executive Officer and Chief Financial Officer of the Company regarding the Company’s forecast model;

 

•

reviewed an updated forecast model, prepared by the Company’s management in August 2024, which made certain amendments to forecasts for the fiscal years ended December 31, 2025, 2026, and 2027;

 

•

reviewed schedules of non-recurring expenses and adjustments as prepared by the Company’s management and presented publicly through investor calls held by the Company’s management for the fiscal years ended December 31, 2021, 2022, and 2023 and the year-to-date period ending June 2024;

 

•

reviewed certain other historical operating and financial information provided to BGL by management of the Company, including division-level financial performance and key performance indicators of the Company;

 

•

reviewed analyses prepared by the Company regarding its business, service offerings, markets, customers, vendors, personnel, asset base, facilities, and operations;

 

•

reviewed the current and historical market prices, trading volume, and relevant financial metrics for the Company common stock and the current and historical market prices, trading volume, and relevant financial metrics of the publicly traded securities of certain other companies that BGL deemed to be relevant;

 

•

participated in meetings, discussions, interviews and facility tours with management of the Company; and

 

•

compared certain of the proposed financial terms of the Merger with the financial terms, to the extent publicly available, of certain other transactions that BGL deemed relevant and conducted such other financial studies, analyses and inquiries and considered such other factors and information as BGL deemed appropriate.

BGL assumed the accuracy and completeness of all of, and relied upon, the financial, legal, regulatory, tax, accounting, and other information provided to, discussed with or reviewed by BGL, including, without limitation, the forecasts, the components, value and computation of the per share merger consideration, without assuming any responsibility for independent verification, and BGL does not assume any liability for if any such information is not accurate or complete. As to any information provided to BGL by the Company, with the Company’s consent, BGL relied upon the assurances of the management of the Company that all such information was prepared on a reasonable basis and that the management of the Company is not aware of any information or facts that would make the information provided to BGL incomplete or misleading. BGL assumed that the forecast models and projections prepared by management of the Company are predicated upon reasonable assumptions and reflects management’s best currently available estimates and judgments and BGL expresses no view as to the reasonableness of such forecasts and projections or the assumptions on which they are based. BGL further assumed that all assets and liabilities (contingent or otherwise, known or unknown) of the Company are set forth on the financial statements provided to BGL, and that, in each case, the financial statements provided to BGL present fairly the Company’s results of operations, cash flows and financial condition for the periods and as of the dates indicated and were prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) consistently applied, and that there was no material changes in the assets, liabilities, financial condition, results of operations, business, or prospects of the Company since the date of the last financial statements made available to BGL. BGL assumed that, in the course of obtaining any

 

45

necessary regulatory or third-party approvals and consents for the transaction, no modification, delay, limitation, restriction, condition, or waiver will be imposed or granted, the effect of which would be material to BGL’s analysis or opinion.

BGL further assumed, at the direction of the Transaction Committee, that the final executed Merger Agreement that was delivered by the parties does not differ in respect material to its analysis or its opinion from the draft Merger Agreement, and that the same per share merger consideration was included in the final version of the Merger Agreement. BGL also assumed, at the direction of the Transaction Committee, that the transaction will be consummated in accordance with the terms and conditions stated in the Merger Agreement and in accordance with all applicable laws and other relevant documents or requirements, without delay or any material amendment to the Merger Agreement or waiver by any party of any condition stated in the Merger Agreement that would be material to its analysis or opinion. BGL assumed, at the direction of the Transaction Committee, that Tadano will be able to finance the aggregate payment of the per share merger consideration. BGL assumed that the representations and warranties of the parties stated in the Merger Agreement are true and correct. Each assumption included in BGL’s opinion was made with the knowledge and consent of the Transaction Committee, and BGL relied upon each such assumption without independent verification as a predicate for its opinion.

BGL’s opinion was rendered as of September 12, 2024, based upon information furnished to it, and its knowledge of economic, market and other conditions as they existed and can be evaluated, as of such date. BGL disclaimed any undertaking or obligation to advise any person of any information that comes to its attention after September 12, 2024, or to supplement, revise or withdraw its opinion in light of any such information.

BGL’s opinion addresses only the fairness, from a financial point of view, of the per share merger consideration to be received by the holders of Company common stock, other than the holders of Excluded Shares. It does not address any other issue, including, without limitation, the fairness of the amount or the nature of any compensation payable to any of the officers, directors or employees of any party in connection with the transaction or any financial or non-financial terms of the Merger Agreement or the transaction. BGL is not a legal, regulatory, accounting or tax expert and assumed that the Company and its other advisors assessed and acted upon all legal, regulatory, accounting and tax matters.

Furthermore, BGL did not make any independent valuation or appraisal of the assets or liabilities (contingent or otherwise) of the Company, nor was BGL furnished with any such valuations or appraisals, nor did BGL conduct a comprehensive physical inspection of any assets of the Company. BGL did not analyze, nor was it requested to address, nor did it express any assurance regarding any of the following: (i) the solvency of the Company, either before or after giving effect to the transaction; (ii) the merits of the transaction relative to other business strategies or transactions that might be available to the Company or in which the Company might engage; (iii) the Company’s business decision to pursue the transaction; (iv) the structure or form of the transaction, or any other agreements or arrangements contemplated by the Merger Agreement or entered into in connection with or otherwise contemplated by the transaction, including, without limitation, the fairness of the transaction or any other term or aspect of the transaction to, or any consideration to be received in connection therewith by, or the impact of the transaction on, the holders of any class of securities, creditors or other constituencies of the Company or any other party. BGL expressed no view or opinion as to any consequence that may result from the transaction, including as to the price at which the Company’s common stock will trade at any time, including following the announcement or consummation of the transaction.

BGL’s opinion was delivered to and intended for the benefit and use of the Transaction Committee, solely in connection with its consideration of the transaction, solely in their capacity as members of the Transaction Committee and not in any other capacity, and it may not be delivered, communicated or disclosed (in whole or in part) to any third party for any purposes whatsoever, or used or relied upon for any other purpose. BGL has consented to the inclusion of its opinion as Annex B to this proxy statement. BGL’s opinion is not intended to be, nor does it constitute, a recommendation to the Transaction Committee regarding how to vote with respect to the transaction.

 

46

In performing the analyses discussed below, BGL considered general business, economic, industry and market conditions, financial and otherwise, and other matters as they existed on, and could be evaluated as of, the date of the opinion. No company, transaction or business used in BGL’s analyses for comparative purposes is identical to the Company, either of its business segments, or the Merger and an evaluation of the results of those analyses is not entirely mathematical. As a consequence, mathematical derivations (such as the high, low, mean and median) of financial data are not by themselves meaningful and in selecting the ranges of multiples to be applied were considered in conjunction with experience and the exercise of judgment. The estimates contained in the financial forecasts prepared by the management of the Company and the implied reference range values indicated by BGL’s analyses are not necessarily indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than those suggested by the analyses. In addition, any analyses relating to the value of assets, businesses or securities do not purport to be appraisals or to reflect the prices at which businesses or securities actually may be sold, which may depend on a variety of factors, many of which are beyond the control of the Company. Much of the information used in, and accordingly the results of, BGL’s analyses are inherently subject to substantial uncertainty.

BGL’s opinion was only one of many factors considered by the Transaction Committee in evaluating the merger. Neither BGL’s opinion nor its analyses were determinative of the per share merger consideration of the views of the Transaction Committee of the Board or management with respect to the merger or the per share merger consideration. The type and amount of consideration payable in the Merger were determined through negotiations between the Transaction Committee of the Board and Tadano, and the decision to enter into the Merger Agreement was solely that of the Transaction Committee of the Board and the Board.

Summary of BGL Financial Analysis

The following is a summary of the material financial analysis performed by BGL in connection with the preparation of its fairness opinion and reviewed with the Transaction Committee and the remainder of the full Board (excluding Mr. Fukui) at a meeting held on September 11, 2024. The following summary, however, does not purport to be a complete description of the financial analyses performed by, or the data presented by, BGL in connection with rendering the opinion described above. The preparation of a fairness opinion is a complex process involving various quantitative and qualitative judgments and determinations with respect to the financial, comparative and other analytical methods employed and the adaptation and application of these methods to the unique facts and circumstances presented. It is not readily susceptible to partial analysis or summary description. BGL believes that the following summary and its analysis must be considered as a whole and that selecting portions of the following summary of this analysis, without considering all of its analysis, methodologies and factors could create a misleading or incomplete view of the processes underlying the analysis and its opinion.

The order of analyses described does not represent the relative importance or weight given to those analyses by BGL. In arriving at its opinion, BGL did not attribute any particular weight to any analyses or factors considered by it and did not form an opinion as to whether any individual analysis or factor (positive or negative), considered in isolation, supported or failed to support its opinion. Rather, BGL considered the totality of the factors and analyses performed in determining its opinion.

With respect to the comparable public companies analyses and the comparable precedent transactions analyses summarized below, no company or transaction used as a comparison was identical to the Company or the Merger. This analysis necessarily involves complex considerations and judgments concerning financial and operating characteristics and other factors that could affect the public trading or acquisition values of the companies concerned.

The projections furnished to BGL for the Company were prepared by the Company’s management. The Company does not publicly disclose internal management projections of the type provided to BGL in connection with BGL’s analysis, and such projections were not prepared with a view toward public disclosure. These projections were based on numerous variables and assumptions that are inherently uncertain and may be beyond

 

47

the control of the Company’s management, including, without limitation, factors related to general economic and competitive conditions and prevailing interest rates. Accordingly, analyses made by BGL are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by those analyses. This information should be read in conjunction with the section of this proxy statement entitled “Proposal 1: The Merger—Certain Unaudited Company Forecasts.”

Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before September 11, 2024, and is not necessarily indicative of current market conditions. The analyses summarized below include information presented in tabular format. The tables alone do not constitute a complete description of the analyses. Considering the data in the tables below without considering the full narrative description of the analyses, as well as the methodologies underlying, and the assumptions, qualifications and limitations affecting, each analysis, could create a misleading or incomplete view of BGL’s analyses.

For purposes of its analysis, BGL reviewed a number of financial metrics, including the following:

 

•

Enterprise Value: Generally, the value as of a specified date of the relevant company’s outstanding equity securities (taking into account outstanding options and other securities convertible, exercisable or exchangeable into or for equity securities of the company) plus the amount of its net debt (the amount of its outstanding indebtedness, non-convertible preferred stock, capital lease obligations and non-controlling interests less the amount of cash and cash equivalents on its balance sheet).

 

•

Adjusted EBITDA: Generally, the amount of the relevant company’s earnings before interest, taxes, depreciation, amortization, and non-operational items for a specified time period, as adjusted for certain non-recurring items.

Comparable Public Companies Analysis

BGL performed a comparable companies analysis (i) utilizing the Selected OEMs as defined below, and (ii) on a sum-of-the-parts basis combining the Company’s OEM and rental equipment business segments, by reviewing certain financial information and market trading data of the Company and comparing it to corresponding information of five publicly traded original equipment manufacturers (the “Selected OEMs”) and four publicly traded equipment rental companies (the “Selected Equipment Rentals”), as listed below (such companies collectively the “Selected Companies”).

Original Equipment Manufacturers:

 

•

Cargotec Corporation

 

•

The Manitowoc Company, Inc.

 

•

Palfinger AG

 

•

Tadano Ltd.

 

•

Terex Corporation

Equipment Rental:

 

•

Ashtead Group PLC

 

•

H&E Equipment Services, Inc.

 

•

Herc Holdings Inc.

 

•

United Rentals, Inc.

 

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Although none of the Selected Companies are directly comparable to the Company or either of its business segments, BGL, based on its experience and professional judgment, selected these companies for its analysis based on business sector participation, operational characteristics, and financial metrics which BGL considered similar to the Company for purposes of its analysis. However, because none of the Selected Companies is exactly the same as the Company or either of its business segments, BGL believed that it was inappropriate to, and therefore did not, rely solely on the quantitative results of the comparable public companies analysis. Accordingly, BGL also made qualitative judgments, based on its experience and professional judgment, concerning differences between the business, financial and operational characteristics of the Company and the selected companies that could affect the public trading values of each in order to provide a context in which to consider the results of the quantitative analysis.

Using publicly available information (including, but not limited to, publicly available Wall Street research analysts’ estimates and public filings) BGL calculated for each Selected Company, the Selected Company’s Enterprise Value as a multiple of the estimated Adjusted EBITDA for the trailing twelve-month period (“TTM”) ended June 30, 2024 (“TTM June-24 Adjusted EBITDA”). All calculations in this review were based on closing share prices on September 11, 2024.

The Selected OEMs and the results of this analysis are summarized as follows:

 

($ in millions)		Market Capitalization				Enterprise Value				TTM June-24 Adjusted EBITDA				Enterprise Value / TTM June-24 Adjusted EBITDA
Selected OEMs
Cargotec Corporation		$	3,183			$	3,228			$	378				8.5x
The Manitowoc Company, Inc.			319				753				137				5.5x
Palfinger AG			823				1,733				326				5.3x
Tadano Ltd.			824				911				187				4.9x
Terex Corporation			3,339				3,685				690				5.3x
Mean		$	1,698			$	2,062			$	344				5.9x
Median		$	824			$	1,733			$	326				5.3x

The Selected Equipment Rentals and the results of this analysis are summarized as follows:

 

($ in millions)		Market Capitalization				Enterprise Value				TTM June-24 Adjusted EBITDA				Enterprise Value / TTM June-24 Adjusted EBITDA
Selected Equipment Rentals
Ashtead Group PLC		$	29,338			$	40,252			$	4,893				8.2x
H&E Equipment Services, Inc.			1,556				3,292				712				4.6x
Herc Holdings Inc.			3,817				8,559				1,491				5.7x
United Rentals, Inc.			46,564				59,974				7,119				8.4x
Mean		$	20,319			$	28,019			$	3,554				6.8x
Median		$	16,577			$	24,405			$	3,192				7.0x

Based on the results of this analysis and other factors BGL considered appropriate in its professional experience and judgment, BGL selected an Enterprise Value to TTM June-24 Adjusted EBITDA multiple range of (i) 5.6x to 5.8x for the Selected OEMs, and (ii) 6.2x to 6.4x based on a sum-of-the-parts weighting of the OEM and equipment rental segments of 65% and 35%, respectively. In selecting this range of multiples, BGL used the median Enterprise Value / TTM Adjusted EBITDA multiples set forth above (5.3x for the Selected OEMs and 7.0x for the Selected Equipment Rentals), plus or minus 2.0% for each, and then factored in a 6.5% premium deemed appropriate by BGL in its professional experience and judgment that was equal to the sum of (i) a 28.9% control premium that was based on the S&P Capital IQ 1-day control premium for U.S. public transactions announced within the last five years for Industrials companies, (ii) a 14.8% standard liquidity

 

49

discount published in Duff & Phelps Stocks, Bonds, Bills, and Inflation 2021, and (iii) a 7.6% comparability discount based on size premium data for companies in market capitalization Decile 10B per the Center for Research in Security Prices. BGL also made qualitative judgments based on its experience and professional judgment concerning differences between the business, financial and operating characteristics and prospects of the Company and the Selected Companies that could affect their public trading values in order to provide a context in which to consider the results of the quantitative analysis. BGL applied the range of multiples of Enterprise Value to TTM June-24 Adjusted EBITDA for the Selected Companies to the Company’s TTM June-24 Adjusted EBITDA of $33.0 million. After adjusting for net debt as of June 30, 2024 (approximately $84.2 million), the implied value of Steven Berner’s non-controlling equity interest in Rabern as of June 30, 2024 (consistent with the terms of the stockholders’ agreement between the Company and Steven Berner and calculated as approximately $15.3 million, which is equal to 30% of 5.5x Rabern’s TTM June-24 EBITDA of approximately $11.5 million less Rabern’s net indebtedness of approximately $12.6 million) (the “Rabern Non-Controlling Interest”), and estimated Company transaction expenses as of September 11, 2024 (approximately $6.2 million), BGL then calculated the implied per share value reference ranges for (i) the entire Company based on the Selected OEMs multiple range and (ii) on a sum-of-the-parts basis, applying a weighting to the respective business unit’s contribution to the Company’s TTM June-24 Adjusted EBITDA (which was 65% and 35% for the OEM and equipment rental business units, respectively). The comparable public companies analysis indicated a range of implied equity values per share of Company common stock of: (i) $3.70 to $4.05 based on the Selected OEMs multiple range, and (ii) $4.64 to $5.03 for the sum-of-the-parts weighting of the OEM and equipment rental segments. BGL compared these ranges to the per share merger consideration of $5.80 to be paid to holders of Company common stock (other than the holders of Excluded Shares) pursuant to the Merger Agreement.

Comparable Precedent Transaction Analysis

BGL reviewed publicly available financial information relating to merger and acquisition transactions announced since December 2020 involving target companies in the OEM industry (the “Selected OEM Transactions”) and equipment rental industries (the “Selected Equipment Rental Transactions”, and collectively, the “Selected Transactions”) that BGL, based on its experience and professional judgment, deemed relevant to consider in relation to the Company and the transactions contemplated by the Merger Agreement.

No company or transaction used in this analysis is identical or directly comparable to the Company, either of its business segments or the merger. In evaluating the Selected Transactions, BGL made judgments and assumptions with regard to general business, economic, and market conditions and other factors existing at the time of the Selected Transactions, and other matters, as well as differences in financial, business, and operating characteristics and other factors relevant to the target companies or businesses in the Selected Transactions. Accordingly, an evaluation of the results of this analysis is not entirely quantitative. Rather, this analysis involves complex considerations and qualitative judgments concerning differences in financial and operating characteristics and other factors that could affect the public trading, acquisition or other values of the selected target companies and the Company.

Financial data for the Selected Transactions was based on publicly available information at the time of the announcement of the Selected Transactions that BGL obtained from public filings and other data sources. Using publicly available information, BGL calculated, for each Selected Transaction set forth below, the Enterprise Value for the applicable target company as a multiple of the target company’s Adjusted EBITDA for the TTM at the time of the transaction announcement.

 

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The Selected OEM Transactions considered in this analysis are summarized as follows:

 

($ in millions)		Announcement Date				Acquirer				Enterprise Value				TTM Adjusted EBITDA				Enterprise Value / TTM Adjusted EBITDA
Original Equipment Manufacturer Targets
Kalmar Oyj			April 2023				Existing Shareholders (Cargotec Demerger)			$	2,071			$	274				7.6x
KITO Corporation			October 2022				The Crosby Group				535				78				6.9x
Hitachi Construction Machinery Co., Ltd. (Minority sale of 26% ownership stake)			January 2022				Itochu and Japan Industrial Partners				8,625				1,229				7.0x
Mean										$	3,744			$	527				7.2x
Median										$	2,071			$	274				7.0x

The Selected Equipment Rental Transactions in this analysis are summarized as follows:

 

($ in millions)

Announcement Date

Acquirer

Enterprise Value

TTM Adjusted EBITDA

Enterprise Value / TTM Adjusted EBITDA

Equipment Rental Targets

Yak Access

March 2024

United Rentals, Inc.

$

1,100

$

171

6.4x

Ahern Rentals

November 2022

United Rentals, Inc.

2,000

310

6.5x

Ecoverse

October 2022

Alta Equipment

67

10

6.6x

Rabern Rentals

April 2022

Manitex International, Inc.

48

7

6.4x

Custom Truck One Source

December 2020

NESCO Specialty Rentals

1,475

166

8.9x

Mean

$

938

$

133

7.0x

Median

$

1,100

$

166

6.5x

Based on the results of this analysis and other factors BGL considered appropriate in its professional experience and judgment, BGL selected an Enterprise Value to TTM Adjusted EBITDA multiple range of (i) 6.4x to 6.6x for the Selected OEM Transactions, and (ii) 6.1x to 6.5 based on a sum-of-the-parts weighting of the OEM and equipment rental segments of 65% and 35%, respectively. In selecting this range of multiples, BGL used the median Enterprise Value / TTM Adjusted EBITDA multiples set forth above (7.0x for the Selected OEM Transactions and 6.5x for the Selected Equipment Rental Transactions), plus or minus 2.0% for each, and then factored in a 7.6% comparability discount deemed appropriate by BGL in its professional experience and judgment that was based on size premium data for companies in market capitalization Decile 10B per the Center for Research in Security Prices. BGL also made qualitative judgments based on its experience and professional judgment concerning differences between the business, financial and operating characteristics and prospects of the Company and the target companies in the Selected Transactions and other factors that could affect their public trading, acquisition or other values in order to provide a context in which to consider the results of the quantitative analysis. BGL applied the range of multiples of Enterprise Value to TTM Adjusted EBITDA for the Selected Transactions to the Company’s TTM June-24 Adjusted EBITDA of $33.0 million. After adjusting for net debt as of June 30, 2024 (approximately $84.2 million), the implied value of the Rabern Non-Controlling Interest, and estimated Company transaction expenses as of September 11, 2024 (approximately $6.2 million), BGL then calculated the implied per share value reference ranges for (i) the entire Company based on the Selected OEM Transactions multiple range and (ii) on a sum-of-the-parts basis, applying a weighting to the respective business unit’s contribution to TTM June-24 Adjusted EBITDA (which was 65% and 35% for the OEM and equipment rental business units, respectively). The comparable precedent transaction analysis indicated a range of implied equity values per share of Company common stock of (i) $4.92 to $5.32 based on the Selected OEM Transactions multiple range, and (ii) $4.54 to $5.13 for the sum-of-the-parts weighting of the

 

51

OEM and equipment rental segments. BGL compared these ranges to the per share merger consideration of $5.80 to be paid to holders of Company common stock (other than the holders of Excluded Shares) pursuant to the Merger Agreement.

Premiums Paid Analysis

Using publicly available information, BGL performed a premiums paid analysis based on the premiums paid in 85 transactions involving the acquisition of greater than 50% of the equity in a U.S. publicly traded target within the Industrials sector with a transaction value between $5 million and $32 billion, announced since August 2, 2019. Using publicly available information, BGL calculated the premiums paid as the percentage by which the per share consideration paid in each such transaction exceeded the closing market prices per share of the target companies one trading day and one week prior to announcement of each transaction.

This analysis indicated the following 1-day and 1-week median transaction premiums:

 

		1-Day Prior				1-Week Prior
Median			28.9	%			33.2	%

Based on the results of this analysis, and its professional judgment and experience, BGL applied a 1-day premium range of 28.3% to 29.5% (derived from the median multiple noted above plus or minus 2.0%) to the closing price per share of Company common stock of $3.81 as of September 11, 2024, and a 1-week premium range of 32.6% to 33.9% (derived from the median multiple noted above plus or minus 2.0%) to the closing price per share of Company common stock of $3.79 as of September 5, 2024. This analysis indicated a range of implied equity values per share of common stock of $4.89 to $5.07. BGL compared these ranges to the per share merger consideration of $5.80 to be paid to holders of Company common stock (other than the holders of Excluded Shares) pursuant to the Merger Agreement.

Discounted Cash Flow Analysis

BGL performed a discounted cash flow analysis of the Company to calculate the estimated present value of the standalone unlevered, after-tax free cash flows that the Company has forecasted to generate during the second half of the Company’s fiscal year 2024 and the Company’s fiscal years 2025 through 2028, as set forth in the section of this proxy statement entitled “Proposal 1: The Merger—Certain Unaudited Company Forecasts.” “Present value” refers to the current value of future cash flows or amounts and is obtained by discounting those future cash flows or amounts by a discount rate that takes into account macroeconomic assumptions and estimates of risk, the opportunity cost of capital, expected returns and other appropriate factors.

In performing this analysis, BGL calculated terminal values of the Company by applying a range of perpetuity growth rates of 1.25% to 1.55% (for both the Initial Company Management Projections and the Updated Company Management Projections), to determine a terminal year estimate of the unlevered, after-tax free cash flows that the Company was forecasted to generate based on the Initial Company Management Projections and the Updated Company Management Projections, respectively. The range of perpetuity growth rates was estimated by BGL utilizing its professional judgment and experience and taking into account a number of factors, including market expectations regarding long-term real growth of gross domestic product and inflation in the geographies the Company operates in. The perpetuity growth rate applicable to the Company in four years for the purposes of this analysis was assumed to be 1.40%, which was determined by BGL in its professional experience and judgment to be in-line with the weighted average of the Organization for Economic Co-Operation and Development’s Real GDP Long-Term Forecast for the U.S., Canada, Eurozone, and of All Other OECD Countries, weighted for the Company’s respective revenue exposure to each geography. The unlevered cash flows and terminal values in each case were then discounted to present value as of June 30, 2024, using discount rates ranging from 15.70% to 16.10% (for both the Initial Company Management Projections and Updated Company Management Projections), which were based on an estimate of the Company’s weighted average cost

 

52

of capital utilizing BGL’s professional judgment and experience and the mid-year cash flow discounting convention. As inputs to the weighted average cost of equity, BGL took into account, among other things, risk-free rate (based on the US 20 year treasury data as of September 11, 2024), market risk premium (based on data published in Kroll “Cost of Capital Navigator” as of July 2024) and a market capitalization size premium (based on data obtained from the Center for Research in Security Prices Deciles Size Data for companies in market capitalization Decile 10B as of December 2023). As inputs to the weighted average cost of debt, BGL took into account the pre-tax cost of debt and post-tax cost of debt and used an interest rate of 8.0% based on the Company’s weighted average cost of debt as of June 30, 2024. Based on its analysis, BGL calculated a range of implied Equity Values for the Company for the Initial Company Management Projections and the Updated Company Management Projections, after adjusting in both instances for net debt as of June 30, 2024 (approximately $84.2 million), the implied value of the Rabern Non-Controlling Interest, and estimated Company transaction expenses as of September 11, 2024 (approximately $6.2 million). BGL then divided these ranges of implied Equity Values by the number of fully diluted shares of Company common stock (equal to 21,113,504 as of September 11, 2024, as provided by Company management), to derive a range of implied equity values per share of Company common stock of (i) $4.65 to $5.04 based on the Initial Company Management Projections, and (ii) $4.62 to $5.01 based on the Updated Company Management Projections. BGL compared these ranges to the per share merger consideration of $5.80 to be paid to holders of Company common stock (other than the holders of Excluded Shares) pursuant to the Merger Agreement.

Other Factors

BGL also noted certain other factors, which were not considered material to its financial analyses with respect to its opinion, but were referenced for informational purposes only, including, among other things, the following:

 

•

Last 52-Week Trading Range. BGL reviewed historical trading prices of shares of Company common stock during the twelve-month period ended September 11, 2024, noting that the low and high closing prices during such period ranged from $3.21 to $9.02 per share of Company common stock, respectively. BGL noted that the historical trading range analysis is not a valuation methodology and that such analysis was presented for reference purposes only and not as a component of the fairness analysis.

General

The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or of the summary described above, without considering the analyses as a whole, could create an incomplete view of the processes underlying BGL’s opinion. In arriving at its opinion, BGL considered the results of all the analyses and did not draw, in isolation, conclusions from or with regard to any one analysis or factor considered by it for purposes of its opinion. Rather, BGL made its determination as to fairness on the basis of its professional judgment and experience after considering the results of all the analyses. In addition, BGL may have given various analyses and factors more or less weight than other analyses and factors, and may have deemed various assumptions more or less probable than other assumptions. As a result, the ranges of valuations resulting from any particular analysis or combination of analyses described above should not be taken to be the view of BGL with respect to the actual value of the shares of Company common stock. Rounding may result in total sums set forth in this section not equaling the total of the figures shown. BGL’s opinion and its presentation to the Transaction Committee were among many factors taken into consideration by the Board in deciding to approve the Merger Agreement. Consequently, the analyses as described above should not be viewed as determinative of the opinion of the Board with respect to the per share merger consideration or of whether the Board would have been willing to agree to different merger terms. The per share merger consideration and other terms of the Merger were determined through arm’s-length negotiations between the Company and Tadano and were approved by the Board. BGL did not recommend any specific amount of consideration to the Company’s Transaction Committee or the

 

53

management or that any specific amount of consideration constituted the only appropriate consideration in the Merger for the holders of Company common stock.

Pursuant to the terms of BGL’s engagement letters with the Company, the Company has agreed to pay BGL a fee for its services in the amount of approximately $3.1 million, of which (i) $125,000 was payable upon execution of the engagement letter, (ii) $125,000 was payable upon delivery of BGL’s opinion, regardless of the conclusion reached by BGL in its opinion, and (iii) the balance of which is payable contingent upon the consummation of the proposed Merger. The Company has also agreed to reimburse BGL for its expenses and to indemnify BGL against certain liabilities arising out of its engagement.

During the past two years, (i) the Company has not engaged BGL to provide, and BGL has not provided, investment banking, financial advisory or other financial services to the Company unrelated to the Merger for which the Company pays or expects to pay fees to BGL and (ii) BGL and its affiliates have not provided any investment banking or other financial services to Tadano or its affiliates, for which BGL and its affiliates have received compensation. BGL and its affiliates may provide investment banking and other financial services to Tadano or its affiliates in the future, for which BGL and its affiliates may receive compensation.

BGL and its affiliates are engaged in financial services, including, without limitation, investment banking, financial advisory, and corporate finance. In the ordinary course of business, BGL, its successors and affiliates may hold or trade the equity, debt or other securities or financial instruments (including bank loans and other obligations) of the Company or Tadano or any of their respective affiliates and, accordingly, may at any time hold a long or short position in such securities or instruments (or in related derivatives). The Company engaged BGL to act as a financial advisor based on BGL’s qualifications, experience and reputation. BGL is an internationally recognized investment banking firm that has substantial experience in connection with mergers and acquisitions, leveraged buyouts and valuations for corporate and other purposes.

Preliminary Discussion Materials

In addition to the September 11, 2024 financial presentation provided to the Transaction Committee in connection with BGL’s opinion, dated September 12, 2024, to the Transaction Committee as summarized above, BGL also provided, for informational purposes, certain preliminary discussion materials to the Transaction Committee as summarized below.

The preliminary financial considerations and other information in these materials reflected market data as of dates proximate to such materials and were based on financial, economic, monetary, market and other conditions and circumstances as in effect on, and information relating to the Company, made available to BGL as of, the date of such materials. Accordingly, to the extent preliminary financial analyses or information were included in such preliminary discussion materials, such preliminary financial analyses or information may have differed from the September 11, 2024 financial presentation as a result of, among other things, changes in the Company’s internal financial forecasts, estimates and assumptions and such other financial, economic, monetary and market conditions and circumstances, and other information. BGL also continued to refine various aspects of such preliminary financial considerations and other information. The September 11, 2024 financial presentation superseded the preliminary discussion materials, including the draft financial presentation dated September 10, 2024 referenced below. None of the preliminary discussion materials constituted an opinion of, or recommendation by, BGL with respect to a possible transaction or otherwise.

 

•

September 10, 2024 Draft Financial Presentation. The September 10, 2024 draft financial presentation materials were substantially similar to the September 11, 2024 financial presentation materials, and contained, among other things: (i) an overview of the proposed transaction with Tadano and a timeline of key events, (ii) selected observations relating to the stock price performance for the Company from August 24, 2023 to September 9, 2024, (iii) selected observations relating to the per share merger consideration based on illustrative premiums to the Company’s closing share price/volume-weighted

 

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average price (“VWAP”), (iv) a summary of the financial and comparative analyses performed by BGL, including an overview of the valuation assumptions relied upon by BGL utilizing historical financial information, the Initial Company Management Projections and the Updated Company Management Projections, and (v) a preliminary comparable public companies analysis, a preliminary comparable precedent transactions analysis, a preliminary premiums paid analysis, and a preliminary discounted cash flow analysis, which preliminary analyses used the same methodologies as described in the section entitled “Proposal 1: The Merger—Opinion of Brown Gibbons Lang & Company—Summary of BGL Financial Analysis.”

 

•

June 24, 2024 Process Update Materials. The June 24, 2024 process update materials included, among other things: (i) an update on the status of the marketing process, including details and a comparison of the Third Round Proposals received from Party A and Party E and an analysis of the per share merger consideration price implied by such proposals, (ii) an overview and analysis of selected financial information relating to comparable OEM and rental equipment public companies, updating the analysis included in the March 27, 2024 materials referenced below, (iii) an overview of certain trading data for the Company, which included, among other things, a share price analysis as of June 21, 2024 comparing the Company against the market and comparable public companies in both the OEM and rental equipment industries, (iv) selected observations related to the Company’s shareholder base as of Q1 2024, including observations related to top institutional shareholders, (v) a termination fee analysis, including enterprise value termination fee statistics from calendar years 2023 and 2022, and (vi) a summary of the due diligence process conducted to date by Parties A and E and an updated process timeline and overview of key next steps.

 

•

May 9, 2024 Process Update Materials. The May 9, 2024 process update materials included, among other things, (i) an overview of the Second Round Proposals received from Parties A, C and E, and (ii) a valuation summary analysis relating to the Second Round Proposals received from such parties, including the per share merger consideration price implied by each proposal, which updated the analysis included in the March 27, 2024 materials referenced below.

 

•

March 27, 2024 Process Update Materials. The March 27, 2024 process update materials included, among other things: (i) an update on the status of the marketing process, including details of the March 20, 2024 First Round Proposal received from Party E, (ii) an overview and analysis of selected financial information relating to comparable OEM and rental equipment public companies, updating the analysis included in the February 26, 2024 materials referenced below, (iii) a valuation summary analysis relating to the First Round Proposals received from Parties A, B, C, D and E, including the per share merger consideration price implied by each proposal, which updated the analysis included in the February 26, 2024 materials referenced below, (iv) an overview of certain trading data for the Company, which included, among other things, a share price analysis as of March 26, 2024, comparing the Company against the market and comparable public companies in both the OEM and rental equipment industries, and (v) an updated process timeline and overview of key next steps.

 

•

February 26, 2024 Discussion Materials. The February 26, 2024 discussion materials included, among other things: (i) an update on the status of the marketing process, including feedback received from all parties to date, (ii) an overview and analysis of selected financial information relating to comparable OEM and rental equipment public companies, (iii) a valuation summary analysis relating to the First Round Proposals received from Parties A, B, C and D, including the per share merger consideration price implied by each proposal, which updated the analysis included in the January 25, 2024 materials referenced below, (iv) an overview of certain trading data for the Company, which included, among other things, a share price analysis as of February 23, 2024, comparing the Company against the market and comparable public companies in both the OEM and rental equipment industries, (v) selected observations related to the Company’s shareholder base for Q4 2024, including observations related to top institutional shareholder, and (vi) an updated process timeline and overview of key next steps.

 

•

January 25, 2024 Marketing Update Materials. The January 25, 2024 marketing update materials included, among other things, (i) a valuation summary analysis relating to the First Round Proposals

 

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received from Parties A, B, C and D including the per share merger consideration price implied by each proposal, which updated the analysis included in the January 3, 2024 materials referenced below and (ii) an overview of other potential strategic and financial buyers that were reviewing the Company’s confidential information presentation.

 

•

January 3, 2024 Marketing and Process Update Materials. The January 3, 2024, marketing and process update materials included, among other things, (i) an update on the status of the marketing process, including an overview of initial discussions with potential strategic and financial buyers and expected next steps, (ii) an overview of certain trading data for the Company, which included, among other things, a share price analysis as of January 2, 2024 comparing the Company against the market and comparable public companies in both the OEM and rental equipment industries, (iii) a valuation summary analysis relating to the First Round Proposals received from Parties A, B and C including the per share merger consideration price implied by each proposal, which analysis was substantially similar to the analysis included in the December 22, 2023 materials referenced below, and (iv) an overview of historical EBITDA multiples for comparable public companies in both the OEM and rental equipment industries.

 

•

December 22, 2023 Marketing Update Materials. The December 22, 2023 marketing update materials included, among other things, (i) an update on the status of the marketing process, (ii) a valuation summary analysis relating to the First Round Proposals received from Parties A, B and C including the per share merger consideration price implied by each proposal, and (iii) an updated overview of the proposed process timeline and summary of key next steps.

 

•

December 6, 2023 Discussion Materials. The December 6, 2023 discussion materials included, among other things, (i) an update on the status of the marketing process, (ii) an overview of the proposed process timeline and summary of key next steps, and (iii) an overview of certain trading data for the Company, including select observations related to the Company’s top institutional shareholders.

Position of Purchaser Filing Persons as to the Fairness of the Merger

Under the SEC rules governing “going-private” transactions, each of the Purchaser Filing Persons may be deemed to be an affiliate of the Company, and therefore required to express its belief as to the fairness of the proposed Merger to the Company’s “unaffiliated security holders,” as defined in Rule 13e-3 under the Exchange Act. The Merger is a Rule 13e-3 transaction for which a Schedule 13E-3 Transaction Statement has been filed with the SEC. The Purchaser Filing Persons are making the statements included in this section solely for purposes of complying with the requirements of Rule 13e-3 and related rules and regulations under the Exchange Act. However, the view of the Purchaser Filing Persons as to the fairness of the Merger is not intended to be and should not be construed as a recommendation to any Minority Shareholder as to how that shareholder should vote on the proposal to approve the Merger Agreement. The Purchaser Filing Persons have interests in the Merger that are different from, and/or in addition to, the unaffiliated security holders of the Company.

The Purchaser Filing Persons did not participate in the deliberations of the Board or the Transaction Committee regarding, and did not receive advice from the Board’s or the Transaction Committee’s legal or financial advisors as to, the fairness of the Merger. Directors of the Company who were affiliated with the Purchaser Filing Parties were excluded from all Board deliberations relating to the approval of the Merger Agreement, as discussed in the section of this proxy statement entitled “Proposal 1: the Merger — Background of the Merger.” The Purchaser Filing Persons have not performed, or engaged a financial advisor to perform, any valuation or other analysis for the purpose of assessing the fairness of the Merger to the Company’s unaffiliated security holders. Moreover, the Merger is not structured so that approval of at least a majority of the Unaffiliated Company Shareholders is required. However, based on the knowledge and analysis by the Purchaser Filing Persons of available information regarding the Company, and the factors considered by, and the analysis and resulting conclusions of, the Purchaser Filing Persons discussed in “Tadano Purpose of and Reasons for the Merger,” as well as the factors considered by, and the analysis and resulting

 

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conclusions of, the Board discussed in “Reasons for the Merger; Recommendation of the Company’s Board of Directors” (which analysis and resulting conclusions the Purchaser Filing Persons adopt as its own), the Purchaser Filing Persons believe, notwithstanding the absence of a condition that the transaction be approved by a majority of the Unaffiliated Company Shareholders, that the Merger is substantively and procedurally fair to the Company’s unaffiliated security holders.

In particular, the Purchaser Filing Persons believe that the Merger is both procedurally and substantively fair to the Company’s unaffiliated security holders based on their consideration of the following factors, among others, which are not presented in any relative order of importance. Based on these factors, the Purchaser Filing Persons believe that the interests of the unaffiliated security holders were represented by the Transaction Committee. These factors, which are not presented in any relative order of importance, are as follows:

 

•

the Merger consideration represents a premium of approximately 52.2% to the closing price per common stock on September 11, 2024 (the last trading day prior to Tadano’s initial non-binding proposal to acquire the remaining common stock that Tadano does not already own, on which date the closing price was $3.81) and a premium of approximately 47.9% to the 30-calendar day VWAP per common stock through September 11, 2024 (which was $3.81);

 

•

the common stock traded as low as $3.07 per share during the 52-week period prior to the Company’s entry into the Merger Agreement;

 

•

the Merger consideration consists entirely of cash, which provides a degree of certainty of value and liquidity to the Company’s unaffiliated security holders;

 

•

the Merger consideration consists entirely of cash, therefore the Company’s unaffiliated security holders that are subject to U.S. federal income taxation generally should be able to have cash on hand with which to pay all or a portion of their U.S. federal income taxes in connection with the sale of their shares of common stock of the Company;

 

•

the Company’s unaffiliated security holders will not be exposed to risks and uncertainties relating to the prospects of the Company following completion of the Merger;

 

•

that the Board established the Transaction Committee, comprised of directors who are independent (for purposes of serving on the Transaction Committee), disinterested and not affiliated with, and are independent of, Tadano or Merger Sub and who are otherwise disinterested and independent with respect to a potential acquisition of the Company, other than as discussed in the section of this proxy statement captioned “Proposal 1: The Merger—Interests of the Company’s Directors and Executive Officers in the Merger”;

 

•

that the Transaction Committee was granted the power by the Company Board to, among other things, (1) review and evaluate the advisability of a potential strategic transaction and other strategic alternatives that may be available to the Company (including the status quo as a standalone company) and solicit expressions of interest or other proposals for a potential strategic transaction, if and to the extent the Transaction Committee deemed appropriate; (2) establish, approve, modify, monitor and direct the process and procedures related to the negotiation, review and evaluation of a potential strategic transaction, including the authority to determine not to proceed with any such process, procedures, review or evaluation; (3) respond to any communications, inquiries or proposals regarding a potential strategic transaction; (4) recommend, reject or approve the terms of a potential strategic transaction; (5) review, evaluate, investigate, pursue and negotiate the price, structure, form, terms and conditions of a potential strategic transaction and the form, terms and conditions of any definitive agreements in connection therewith; (6) determine whether a potential strategic transaction is fair to, and in the best interests of, the Company and its shareholders (or any subset of the shareholders of the Company that the Transaction Committee determines to be appropriate); and (7) recommend to the full Board what action, if any, should be taken by the Company with respect to a potential strategic transaction;

 

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•

that the Board was not permitted to approve any potential acquisition of the Company (including a potential acquisition of the Company that also included a transaction or series of transactions in which one or more significant shareholders of the Company had an interest that was in addition to, and/or different from, the interests of the Company’s shareholders as a whole) or recommend for approval any such transactions by the Company’s shareholders without a prior favorable recommendation of the transaction by the Transaction Committee;

 

•

the numerous meetings held by the Transaction Committee (with BGL present), over the period from its August 2023 formation through the September 11, 2024 execution of the Merger Agreement, to discuss and evaluate, among other things, the process for exploring a potential strategic transaction and the proposals from Tadano, and the Transaction Committee’s active oversight of the negotiation process. The Transaction Committee was actively engaged in this process on a regular basis and was provided with full access to members of the Company’s management and its advisors in connection with the evaluation process;

 

•

the Transaction Committee selected and engaged its own independent financial advisor (BGL) and received the advice of BGL throughout its review, evaluation and negotiation of a potential acquisition of the Company;

 

•

the Transaction Committee made its evaluation of a potential acquisition of the Company by Tadano based upon the factors discussed in this proxy statement and with the full knowledge of the interests of Tadano in the transaction;

 

•

the recognition by the Transaction Committee that it had no obligation to recommend to the Board the approval of the Merger or any other transaction and had the authority to reject any proposals made;

 

•

the terms of the Merger Agreement (including the Merger consideration) and the transactions contemplated by it, including the Merger, were extensively negotiated with the Company’s management, and were closely reviewed and scrutinized by the Transaction Committee;

 

•

that the Transaction Committee unanimously recommended that the Board approve and declare advisable the Merger Agreement and the transactions contemplated thereby, including the Merger;

 

•

the Transaction Committee received an opinion from Brown Gibbons Lang, dated September 12, 2024, as to the fairness, from a financial point of view and as of such date to the holders of the common stock of the Company (other than holders of Excluded Shares) of the $5.80 per share merger consideration to be paid to such holders in connection with the Merger, which opinion was based upon and subject to the factors and assumptions set forth therein as more fully described in the section entitled “Proposal 1: The Merger—Opinion of Brown Gibbons Lang & Company” and which written opinion is attached in its entirety as Annex B hereto, notwithstanding that the opinion of Brown Gibbons Lang was provided for the information and assistance of the Transaction Committee and none of the Purchaser Filing Persons are entitled to, and did not, rely on such opinion;

 

•

the ability of the Board to change its recommendation prior to obtaining the Company shareholder approval in specified circumstances relating to the receipt of a superior proposal or the occurrence of an intervening event (as defined in the section entitled “The Merger Agreement—Change of Board Recommendation”), subject to (i) the Company’s notification and good faith negotiation obligations and (ii) Tadano’s right to terminate the Merger Agreement and receive payment of the applicable termination fee of $4,900,000; and

 

•

the Merger and Merger Agreement were unanimously approved by the Board, and the Board determined (with Mr. Fukui recused) that entry into the Merger Agreement was in the best interests of the Company and its shareholders.

The Purchaser Filing Persons did not find it practicable to assign, nor did they assign, specific relative weights to the individual factors considered in reaching their conclusion as to fairness. The Purchaser Filing Persons also did not consider the liquidation value of the Company’s assets, and did not perform a

 

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liquidation analysis, because they consider the Company to be a viable going concern. Therefore, no appraisal of liquidation value was sought for purposes of valuing the shares of the Company’s common stock, and the Purchaser Filing Persons believe that the liquidation value of the shares of the Company’s common stock is irrelevant to a determination as to whether the proposed Merger is fair to the Company’s unaffiliated security holders. Further, the Purchaser Filing Persons did not consider the Company’s net book value, which is an accounting concept, as a factor because they believe that net book value is not a material indicator of the value of the Company as a going concern, but rather is indicative of historical costs, and net book value does not take into account the prospects of the Company, market conditions, trends in the industry in which the Company operates or the business risks inherent in the industry. In addition, the Purchaser Filing Persons did not consider recent purchases of shares of Company Common Stock as the Company had not repurchased shares of Company Common Stock during the preceding two years in transactions that would be relevant for the Purchaser Filing Persons’ fairness determinations. The Purchaser Filing Persons did not establish a going concern value for the Company as a public company to determine the fairness of the Merger consideration to unaffiliated security holders because, following the Merger, the Company will have a significantly different capital structure. Finally, the Purchaser Filing Persons were not aware of any firm offer for a merger, sale of all or a substantial part of the Company’s assets, or a purchase of a controlling amount of the Company securities having been received by the Company from anyone other than as described in this proxy statement with respect to the current transaction in the two years preceding the signing of the merger agreement.

Tadano Purpose of and Reasons for the Merger

Under the SEC rules governing “going-private” transactions, including Rule 13e-3 under the Exchange Act, the Purchaser Filing Persons may be deemed to be “affiliates” of the Company and engaged in a “going-private” transaction, and therefore, may be required to disclose its purposes and reasons for the Merger to the Company’s “unaffiliated security holders” as defined under Rule 13e-3 under the Exchange Act. The Purchaser Filing Persons are making the statements included in this section solely for the purpose of complying with the requirements of Rule 13e-3 and related rules under the Exchange Act. However, the Purchaser Filing Persons are not making any recommendation to any Minority Shareholders as to how that shareholder should vote on any proposal, and the views of each of the Purchaser Filing Persons should not be construed as a recommendation to any Minority Shareholder as to how such shareholder should vote. The Purchaser Filing Persons have interests in the Merger that are different from those of the Minority Shareholders.

If the Merger is completed, the Company will become a wholly owned subsidiary of Tadano. As a result, the common stock will cease to be listed on Nasdaq or publicly traded and will be deregistered under the Exchange Act. The members of the board of directors of Merger Sub immediately prior to the effective time will, from and after the effective time, be the members of the board of directors of the surviving corporation until the earlier of their resignation or removal or until their successors have been duly elected and qualified, as the case may be. The officers of the Company immediately prior to the effective time will, from and after the effective time, be the officers of the surviving corporation until the earlier of their resignation or removal or until their successors have been duly elected and qualified, as the case may be. As of the date of this proxy statement, no executive officer of the Company has had any discussions or reached any understandings on potential employment with the surviving corporation or with Tadano or Merger Sub (or any of their respective affiliates) following the consummation of the Merger.

For the Purchaser Filing Persons, the purpose of the Merger is to enable Tadano to acquire 100% ownership and control of the Company. In this regard, the Purchaser Filing Persons will bear the risks and rewards of such ownership in the Company after the Merger, including any future earnings and growth of the Company as a result of improvements to the Company’s operations, synergies that may result from the Merger or acquisitions of other businesses.

The Purchaser Filing Persons determined that the structuring of the transaction as a Merger in which the Minority Shareholders receive $5.80 in cash for each common stock is preferable to other transaction structures as it provides the holders of common stock (other than shares owned by Tadano, Merger Sub or the Company or

 

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any subsidiary thereof) with immediate liquidity for their common stock through their receipt of the per share merger consideration, which represents a premium of approximately 52.2% to the closing price per common stock on September 11, 2024 (the last trading day prior to Tadano’s initial non-binding proposal to acquire the remaining common stock that Tadano does not already own, on which date the closing price was $3.81) and a premium of approximately 47.9% to the 30-calendar day VWAP per common stock through September 11, 2024 (which was $3.81). Conversely, as a result of the Merger, the Minority Shareholders will no longer have an opportunity to participate in any future benefits associated with the ownership of common stock, including the receipt of any dividends from the Company in the future and participation in any potential appreciation in the trading price of the common stock beyond the per share merger consideration. The Minority Shareholders’ receipt of cash in exchange for their common stock pursuant to the Merger generally will be a taxable transaction for U.S. federal income tax purposes to the Minority Shareholders who are “U.S. holders.”

In addition, the Purchaser Filing Persons believe that structuring the transaction in such a manner is preferable to other alternative transaction structures because it (i) will enable the Purchaser Filing Persons to directly acquire all of the outstanding shares of the Company not beneficially owned by them at the same time, (ii) will allow the Company to cease to be a public reporting company, reducing management time and attention spent on those activities, as well as operating costs, (iii) will allow the Purchaser Filing Persons to control and determine product and investment strategies, and (iv) is consistent with recent precedent transactions. Because the transaction structure is consistent with the objectives of the Purchaser Filing Persons and with market practice, the Purchaser Filing Persons did not pursue or propose an alternative transaction structure.

In deciding to pursue the Merger, the Purchaser Filing Persons considered and took into account various risks and other factors that potentially could adversely affect them. These included that its directors, officers and other employees would expend considerable time and effort in negotiating, implementing and completing the Merger, and in doing so their time would be diverted from other important business opportunities and operational matters. The Purchaser Filing Persons recognized that it would incur significant transaction costs and expenses in connection with the Merger, regardless of whether the Merger is completed. There is a risk that the Merger may not be completed despite the Purchaser Filing Persons’ efforts, including in the event that the approval by a majority of the outstanding common stock is not obtained. Although each of the Purchaser Filing Persons believes that there will be significant opportunities associated with their investment in the Company, the Purchaser Filing Persons realize that there are also substantial risks (including the risks and uncertainties relating to the prospects of the Company and as described in this paragraph) and that such opportunities may not be fully realized on the expected timeframe or at all.

The Purchaser Filing Persons believe that after the Merger is consummated, the Company should have greater operating flexibility and more efficient access to capital, which should support the Company’s long-term growth and profitability, including due to (i) the reduction in expenses resulting from the Company ceasing to be a public company, (ii) the ability of the Purchaser Filing Persons to efficiently provide certain administrative functions to the Company and (iii) greater operational flexibility for the Company to pursue alternatives than it would have as a public company, including the ability to pursue transactions without focusing on the reaction of the market or of the Minority Shareholders to such transactions or the collective risk tolerance of such Minority Shareholders as it relates to such transactions. If that happens, the Purchaser Filing Persons (and not the Minority Shareholders) will benefit from any resulting increase in the value of the Company. Accordingly, the Purchaser Filing Persons have decided to undertake to pursue the Merger at this time for the reasons described above.

If the Merger is not completed for any reason, Tadano and their affiliates reserve the right (subject to certain conditions contained in the Confidentiality Agreement, dated as of August 11, 2024, between the Company and Tadano, including that Tadano may not acquire Company common stock for a period of 1 year from August 11, 2024 unless, among other conditions, the Company enters into a definitive agreement with an unaffiliated third party for the acquisition of the Company or a majority of the Company’s assets or a tender or exchange offer is announced by an unaffiliated third party) to acquire additional common stock through private purchases, market

 

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transactions, tender or exchange offers or otherwise on terms and at prices that may be more or less favorable than those provided in the Merger Agreement, or, subject to any applicable legal restrictions, to dispose of any or all common stock acquired by them.

Certain Effects of the Merger for Tadano

Following the consummation of the Merger, Tadano will own all of the equity interests of the Company and be the sole beneficiary of future earnings, growth and value, and will be the only one entitled to vote on corporate matters affecting the Company.

Additionally, following the Merger, shares of common stock will be delisted and cease to be registered under the Exchange Act. See the section of the proxy statement entitled “Plan of Tadano after the Merger.” As such, the Company will be relieved of the requirements applicable to companies having publicly traded equity securities, including the pressure to meet analyst forecasts and the requirements and restrictions on trading that directors, officers and beneficial owners of more than 10% of the shares of the Company’s common stock face as a result of the provisions of Section 16 of the Exchange Act. The Company will also be relieved of the obligation to separately prepare and furnish information to its shareholders. Tadano will benefit from any regulatory compliance cost savings realized by the Company after it becomes a private company.

The primary detriments of the Merger to Tadano include the fact that all of the risk of any possible decrease in the future earnings, growth or value of the Company following the Merger will be borne by Tadano. Additionally, Tadano’s ownership of the Company will be illiquid, with no public trading market for such securities.

The table below sets forth the beneficial ownership of the Company’s common shares and resulting interests in the Company’s net book value and net earnings of the Purchaser Filing Persons prior to and immediately after the consummation of the Merger, based on the Company’s net book value at June 30, 2024 and net earnings for the six months ended June 30, 2024, as if the Merger were completed on such date:

 

		Prior to the Consummation of the Merger												After the Consummation of the Merger
(in thousands, except %)		% Ownership(1)				Net book value at June 30, 2024(1)				Net earnings (loss) for the six months ended June 30, 2024(1)				% Ownership				Net book value at June 30, 2024				Net earnings (loss) for the six months ended June 30, 2024
Tadano and its affiliates			14.5	%		$	12,068			$	547				100	%		$	83,229			$	3,773

 

(1)	Calculated based on 20,397,358 Company common outstanding as of July 31, 2024 and Tadano’s ownership as of September 12, 2024 of 2,963,542 Company common shares

Plan of Tadano after the Merger

Following completion of the Merger, Merger Sub will have been merged with and into the Company, with the Company surviving the Merger as a subsidiary of Tadano. The shares of Company common stock are currently listed on Nasdaq and registered under the Exchange Act. Following completion of the Merger, there will be no further market for the shares of Company common stock and, as promptly as practicable following the effective time and in compliance with applicable law, Company common stock will be delisted from Nasdaq, deregistered under the Exchange Act and will cease to be publicly traded. The Company may experience positive effects on profitability as a result of the elimination of direct and indirect costs and expenses related to compliance with such rules and regulations.

Given Tadano’s long-standing ownership stake in the Company, the Purchaser Filing Persons currently anticipate that the Company’s strategy and operations will initially be conducted following completion of the Merger substantially as they are currently being conducted (except that the Company will cease to be a public

 

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company and will instead be a wholly owned subsidiary of Tadano). Following completion of the Merger, the Purchaser Filing Persons will continue to assess the Company’s assets, corporate and capital structure, capitalization, operations, business, properties and personnel to determine what additional changes, if any, would be desirable with a view towards determining possible synergies and the efficient allocation of resources in order to maximize the Company’s long-term earnings potential as a private company, which may include material changes in the Company’s corporate structure and business.

From and after the effective time, the officers of the Company at the effective time will be the officers of the surviving corporation and the directors of Merger Sub immediately prior to the Effective Time will be the directors of the surviving corporation, in each case, to hold office in accordance with the certificate of incorporation and bylaws of the surviving corporation until their death, resignation or removal or until their respective successors have been duly elected or appointed and qualified in accordance with the MBCA or the certificate of incorporation and bylaws of the surviving corporation, as the case may be. As of the date of this proxy statement, no executive officer of the Company has had any discussions or reached any understandings on potential employment with the surviving corporation or with Tadano or Merger Sub (or any of their respective affiliates) following the consummation of the Merger.

Benefits of the Merger for the Company’s Unaffiliated Shareholders

The primary benefit of the Merger to the unaffiliated shareholders will be their right to receive the Merger consideration of $5.80 in cash per share of Company common stock, less applicable withholding taxes, as described above, which represents a per share premium of approximately (1) 52.2% above the closing price per share on September 11, 2024, the last full trading day before announcement of the transaction, (2) 47.9% above the volume-weighted average price during the three months ended September 11, 2024, and (3) 7.4% to the volume-weighted average price during the six months ended September 11, 2024. Additionally, such shareholders will avoid the risk after the Merger of any possible decrease in our future earnings, growth or value.

Detriments of the Merger for the Company’s Unaffiliated Shareholders

The primary detriments of the Merger to our unaffiliated shareholders include the lack of an interest of such shareholders in the potential future earnings, growth or value realized by the Company after the Merger.

Consultation with Perella Weinberg Partners, Financial Advisor to Tadano

Tadano engaged Perella Weinberg Partners to act as its exclusive financial advisor in connection with the Merger. As part of that engagement and at Tadano’s request, Perella Weinberg Partners provided certain discussion materials dated July 31, 2024 (the “July 31 Materials”) and September 5, 2024 (the “September 5 Materials” and, together with the July 31 Materials, the “Perella Weinberg Partners Materials”) to Tadano management.

Copies of the Perella Weinberg Partners Materials are attached as exhibits to the transaction statement on Schedule 13E-3 filed with the SEC in connection with the Merger and are incorporated herein by reference. The description of the Perella Weinberg Partners Materials set forth in this proxy statement is qualified in its entirety by reference to the full text of the Perella Weinberg Partners Materials, which also may be obtained from the SEC in the manner described under “Where You Can Find More Information”.

The Perella Weinberg Partners Materials were prepared solely to assist Tadano in determining whether to make a proposal to acquire all of the outstanding shares of Common Stock not already owned by Tadano and what the terms of any proposal might be and do not purport to be appraisals or necessarily reflect the prices at which businesses or securities actually may be sold, which are inherently subject to uncertainty.

Perella Weinberg Partners has not acted as financial advisor to the Company, the Board or the Transaction Committee. Perella Weinberg Partners was not requested to, and did not, render an opinion with respect to the fairness of the transaction or the consideration to be paid in the Merger, or as to

 

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valuation or otherwise. The Perella Weinberg Partners Materials were not furnished to the Company, the Transaction Committee or the Board and are not an opinion as to the fairness to the Company or its shareholders of the transaction or the consideration to be paid in the Merger. The Perella Weinberg Materials do not constitute a recommendation to the Company or its shareholders with respect to the Merger, or as to how any shareholder should vote with respect to the Merger or any other matter, and should not be relied on as the basis for any investment decision. In addition, the financial analyses and observations reflected in the Perella Weinberg Partners Materials should not be viewed as a factor considered by the Company, the Board, the Transaction Committee, the Company’s management, Tadano or any other person with respect to the fairness of any consideration (including, without limitation, the Merger consideration of $5.80 per share of Common Stock), the Merger Agreement and the transactions contemplated thereby, including the Merger or otherwise.

Perella Weinberg Partners has not made any representation or warranty, express or implied, to any person regarding the accuracy or completeness of any of the information contained in the Perella Weinberg Partners Materials and any liability therefor to third parties (including in respect of direct, indirect or consequential loss or damages) is expressly disclaimed. Any valuations, estimates or projections contained in the Perella Weinberg Partners Materials were derived from public sources or information provided by management of the Company and Tadano, which may or may not be correct.

For purposes of preparing the Perella Weinberg Partners Materials, Perella Weinberg Partners assumed and relied upon, without assuming any responsibility for independent verification of, the accuracy and completeness of all of the financial, accounting, legal, tax, regulatory and other information provided to, discussed with or reviewed by it (including information that was available from public sources) and has further relied upon the assurances of management of Tadano that they are not aware of any facts or circumstances that would make such information inaccurate or misleading in any material respect. In particular, management of the Company provided Tadano with the Initial Company Management Projections described in the Section entitled “Proposal 1: The Merger—Certain Unaudited Company Forecasts—Company Management Projections” beginning on page 69 and, based upon the Initial Company Management Projections, management of Tadano prepared and provided Perella Weinberg Partners with the Tadano Adjusted Projections described in the section entitled “Proposal 1: The Merger—Certain Unaudited Company Forecasts—Tadano Adjusted Projections”. Perella Weinberg Partners did not rely upon the Initial Company Management Projections for purposes of preparing the Perella Weinberg Partners Materials. With respect to the Tadano Adjusted Projections, Perella Weinberg Partners was advised by the management of Tadano and assumed with Tadano’s consent, that the Tadano Adjusted Projections had been reasonably prepared on bases reflecting the best currently available estimates and good faith judgments of the management of Tadano as to the future financial performance of the Company and the other matters covered thereby. Perella Weinberg Partners expressed no view as to the reasonableness of the Tadano Adjusted Projections or the Initial Company Management Projections or the assumptions on which they were based. Tadano did not provide the Tadano Adjusted Projections to the Company, the Board, the Transaction Committee or any of their respective advisors. Perella Weinberg Partners did not receive the Updated Company Management Projections described in the Section entitled “Proposal 1: The Merger—Certain Unaudited Company Forecasts—Company Management Projections” beginning on page 69.

In preparing the Perella Weinberg Partners Materials, Perella Weinberg Partners did not make and was not provided with any independent valuation or appraisal of the assets or liabilities (including any contingent, derivative or off-balance-sheet assets or liabilities) of the Company, or any of its subsidiaries. Perella Weinberg Partners did not assume any obligation to conduct, nor did it conduct, any physical inspection of the properties or facilities of the Company or any other party. In addition, Perella Weinberg Partners did not evaluate the solvency of any party to the Merger Agreement, or the impact of the Merger thereon, including under any applicable laws relating to bankruptcy, insolvency or similar matters.

In preparing certain analyses, Perella Weinberg Partners utilized Wall Street research analyst forecasts for the Company and certain other companies, as well as certain internal forecasts prepared by management of the Company and management of Tadano including the Initial Company Management Projections and the Tadano

 

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Adjusted Projections. In preparing its materials, Perella Weinberg Partners expressed no view as to the reasonableness of such forecasts or the assumptions on which they are based.

The Perella Weinberg Partners Materials were necessarily based upon financial, economic, market, monetary and other conditions as in effect on, and the information made available to it as of, their respective dates. It should be understood that subsequent developments may affect the Perella Weinberg Partners Materials and the assumptions used in preparing them, and Perella Weinberg Partners does not have any obligation to update, revise, or reaffirm the Perella Weinberg Partners Materials. Perella Weinberg Partners expressly disclaimed any undertaking or obligation to advise any person of any change in any fact or matter affecting the Perella Weinberg Partners Materials of which it becomes aware after any such date.

For purposes of the Perella Weinberg Partners analyses described below, “EBITDA” means earnings before interest, taxes, depreciation and amortization, adjusted for non-recurring items and burdened by stock-based compensation expense (“SBC”).

July 31 Materials

The following is a summary of the material information and analyses contained in the July 31 Materials. Neither the following summary, nor any of the summaries of the Perella Weinberg Partners Materials described elsewhere in this proxy statement, however, purports to be a complete description of the information and analyses contained in the related Perella Weinberg Partners Materials.

On July 31, 2024, representatives of Perella Weinberg Partners, provided Tadano management with the July 31 Materials. The July 31 Materials contained preliminary valuation analyses of the Company based solely on publicly available historical financial information for the Company, Wall Street equity research analyst estimates for the Company and then-current publicly available market information, including, among other things, (i) an illustrative comparable company analysis, (ii) an illustrative selected precedent transactions analysis, (iii) an illustrative discounted cash flow analysis, and (iv) an overview of certain trading data for the Company.

Summary of September 5 Materials

The following is a summary of the material information and analyses contained in the September 5 Materials. Neither the following summary, nor any of the summaries of the Perella Weinberg Partners Materials described elsewhere in this proxy statement, however, purports to be a complete description of the information and analyses contained in the related Perella Weinberg Partners Materials. Some of the summaries of the financial analyses in the September 5 Materials include information presented in tabular format. The tables must be read together with the full text of each summary and are alone not a complete description of Perella Weinberg Partners’ analyses. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before September 3, 2024 and is not necessarily indicative of current market conditions.

For purposes of the analyses in the September 5 Materials, Perella Weinberg Partners reduced the aggregate valuation of the Company by the value of the 30% non-controlling interest in Rabern that is held by a third party, which Perella Weinberg Partners valued on a market basis by applying an illustrative 6.5x multiple to the Company’s estimated calendar year 2025 EBITDA for Rabern based on the Tadano Adjusted Projections.

Comparable Company Analysis

Perella Weinberg Partners reviewed and compared certain financial information for the Company with corresponding financial information, ratios and public market multiples for the following (i) ten publicly traded companies in the equipment manufacturing industry (the “Manufacturing Peers”) and (ii) four publicly traded companies in the equipment rental industry (the “Rental Peers” and, together with the Manufacturing Peers, the “Selected Publicly Traded Companies”):

 

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Manufacturing Peers		Rental Peers
Alamo Group Inc.		Ashtead Group plc
Astec Industries, Inc.		Custom Truck One Source, Inc.
Cargotec OYJ		Herc Holdings Inc.
Hyster-Yale Materials Handling, Inc.		United Rentals, Inc.
Konecranes PLC
Miller Industries, Inc.
Palfinger AG
Tadano
Terex Corporation
The Manitowoc Company, Inc.

Although none of the Selected Publicly Traded Companies are a perfect comparable business to the Company, Perella Weinberg Partners selected these companies because they had publicly traded equity securities and were deemed to be similar to the Company in one or more respects. Perella Weinberg Partners selected the companies used in the analysis on the basis of its experience and knowledge of companies in the industry and various other factors.

With respect to the Company and each of the Selected Publicly Traded Companies, Perella Weinberg Partners calculated and reviewed (a) enterprise value (“EV”) as of September 3, 2024 as a multiple of estimated calendar year 2024 EBITDA (“CY2024E EBITDA”) and estimated calendar year 2025 EBITDA (“CY2025E EBITDA”) and (b) the average of enterprise value as a multiple of estimated next twelve months EBITDA (“NTM EBITDA”) for the ten-year, five-year, and three-year periods ended September 3, 2024 (which is referred to in the table below as “L10Y,” “L5Y,” “L3Y” respectively), in each case based on company filings for historical information and consensus third party research estimates from FactSet forecasted information. The results of certain aspects of Perella Weinberg Partners’ analysis are summarized in the following table:

 

		EV/ CY2024E EBITDA		EV/ CY2025E EBITDA		Average L10Y EV/NTM EBITDA		Average L5Y EV/NTM EBITDA		Average L3Y EV/NTM EBITDA
Manufacturing Peers
Mean		7.2x		6.8x		8.5x		8.4x		7.6x
Median		6.3x		6.0x		8.3x		7.6x		6.7x
Rental Peers
Mean		7.4x		6.9x		6.8x		7.2x		7.3x
Median		7.6x		7.1x		6.8x		7.4x		7.5x
The Company		6.0x		6.4x		10.1x		10.3x		9.5x

Based on the multiples calculated above, Perella Weinberg Partners’ analyses of the Selected Publicly Traded Companies and on professional judgements made by Perella Weinberg Partners, Perella Weinberg Partners selected a representative range of multiples of 6.0x – 7.0x and applied such range to (a) the Company’s CY2025E EBITDA, to derive a range of estimated implied values of approximately $3.82 to $5.35 per share of the Common Stock, (b) to the Company’s CY2025E EBITDA including $3,000,000 of run rate public company savings identified by Tadano management (the “Estimated Public Company Savings”), to derive a range of estimated implied values of approximately $4.55 to $6.22 per share of Common Stock and (c) to the Company’s CY2025E EBITDA including both the Estimated Public Company Savings and $2,000,000 of incremental preliminary run rate cost synergies identified by Tadano management (the “Estimated Synergies”), to derive a range of implied values of approximately $5.03 to $6.79 per share of Common Stock, in each case based on the Tadano Adjusted Projections.

Perella Weinberg Partners compared these ranges of estimated implied value per share of Common Stock to (a) the $6.25 to $6.50 range of value per share of Common Stock set forth in Tadano’s initial proposal submitted to the Board on July 24, 2024 (the “Tadano July 24 Offer”) and (b) $3.82, the closing price of the Common Stock on September 3, 2024.

 

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Selected Precedent Transaction Analysis

Using publicly available information, Perella Weinberg Partners reviewed the financial terms of the following selected precedent transactions involving (i) companies that operated in, or were exposed to, the equipment manufacturing industry (the “Manufacturing Selected Precedent Transactions”) and (ii) companies that operated in, or were exposed to, the equipment rental industry (the “Rental Selected Precedent Transactions” and, together with the Manufacturing Selected Precedent Transactions, the “Selected Precedent Transactions”):

Manufacturing Selected Precedent Transactions:

 

Transaction Announcement		Target		Acquirer
July 2024		Dover Corporation- Environmental Solutions Group		Terex Corporation
May 2023		JBT Corporation - AeroTech Business		Oshkosh Corporation
April 2021		Custom Truck One Source, Inc.		Nesco Holdings, Inc.
December 2020		Nesco Holdings, Inc.		Platinum Equity
December 2019		MHE-Demag		Konecranes PLC
February 2019		Terex Corporation – Demag Crane Business		Tadano
June 2017		Wirtgen Group		Deere & Company
May 2016		Terex Corporation- Material Handling & Port Solutions segment		Konecranes PLC

Rental Selected Precedent Transactions:

 

Transaction Announcement		Target		Acquirer
March 2024		Yak Access, LLC		United Rentals, Inc.
November 2022		Ahern Rentals, Inc.		United Rentals, Inc.
November 2019		Cramo Plc		Boels Topholding B.V.
June 2019		Ramirent Plc		Loxam SAS
September 2018		Blue Line Rental		United Rentals, Inc.

Perella Weinberg Partners selected these transactions in the exercise of its professional judgment and experience because Perella Weinberg Partners deemed them to be most relevant.

For each of the Selected Precedent Transactions, Perella Weinberg Partners calculated and compared the resulting enterprise value in the transaction as a multiple of last twelve months EBITDA (“LTM EBITDA”) publicly reported prior to the announcement of the transaction (“EV / LTM EBITDA”). Perella Weinberg Partners noted that the median and mean EV / LTM EBITDA multiples for the Manufacturing Selected Precedent Transactions were 9.3x and 9.6x, respectively, and that the median and mean EV / LTM EBITDA multiples for the Rental Selected Precedent Transactions were 5.7x and 6.0x, respectively.

Based on the multiples of enterprise value to LTM EBITDA described above, Perella Weinberg Partners’ analyses of the various Selected Precedent Transactions and on professional judgments made by Perella Weinberg Partners with respect to, among other things, the financial performance and competitive positioning of the Company and the target companies in the Selected Precedent Transactions, Perella Weinberg Partners applied a range of multiples of 7.5x to 8.5x (a) to the Company’s 2024E EBITDA to derive a range of estimated implied values of approximately $5.34 to $6.76 per share of Common Stock, (b) the Company’s 2024E EBITDA including the Estimated Public Company Savings, to derive a range of estimated implied values of approximately $6.28 to $7.84 per share of Common Stock and (c) the Company’s 2024E EBITDA, including the Estimated Public Company Savings and Estimated Synergies to derive a range of implied values of approximately $6.91 to $8.56 per share of Common Stock, in each case based on the Tadano Adjusted Projections.

 

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Perella Weinberg Partners compared these ranges of estimated implied value per share of Common Stock to (a) the $6.25 to $6.50 range of value per share of Common Stock set forth in the Tadano July 24 Offer and (b) $3.82, the closing price of the Common Stock on September 3, 2024.

Although the Selected Precedent Transactions were used for comparison purposes, none of the Selected Transactions nor the companies involved in them were either a perfect comparable business or directly comparable to the Merger or the Company.

Discounted Cash Flow Analysis

Perella Weinberg Partners conducted separate discounted cash flow analyses based on (i) the Tadano Adjusted Projections excluding the Estimated Public Company Savings and the Estimated Synergies (the “Status Quo Case”), (ii) the Tadano Adjusted Projections including the Estimated Public Company Savings (the “Public Company Savings Case”) and (ii) the Tadano Adjusted Projections including the Estimated Public Company Savings and the Estimated Synergies (the “Synergies and Public Company Savings Case”) for the Company to derive ranges of implied enterprise value of the Company by:

 

•

calculating the present value as of December 31, 2024 of the estimated standalone free cash flows (calculated as EBITDA, less cash taxes, minus changes in net working capital, minus capital expenditures) that the Company is expected to generate for the calendar years 2025 through 2028, using discount rates ranging from 11.75% to 12.50%; and

 

•

calculating the present value as of December 31, 2024 of the terminal value of the Company at the end of calendar year 2028 using terminal exit multiples ranging from 6.5x-7.5x and discount rates ranging from 11.75% to 12.50%.

Perella Weinberg Partners estimated the range of exit multiples utilizing its professional judgment and experience, taking into account current trading multiples and long-term valuation trends and multiples, as well as the Company’s current position in the market relative to the Selected Publicly Traded Companies.

Perella Weinberg Partners derived the foregoing range of discount rates by the application of the capital asset pricing model, which takes into account certain company-specific metrics, including the Company’s target capital structure, the cost of long-term debt, forecasted tax rate and an unlevered beta as estimated with reference to the Selected Publicly Traded Companies’ 2-Year Weekly Bloomberg Betas and on professional judgments made by Perella Weinberg Partners, as well as certain financial metrics for the United States financial markets generally.

From the range of implied enterprise values, Perella Weinberg Partners derived a range of implied values per share of Common Stock by subtracting approximately $110 million of net debt, debt-like items, and non-controlling interest and dividing the implied equity value by the approximately 20,670,630 fully diluted shares of Common Stock outstanding, based on information provided by Company management. For purposes of this analysis, stock-based compensation was not added back to unlevered free cash flow. This analysis resulted (i) a range of estimated implied value per share of Common Stock of $4.95 to $6.49 in the Status Quo Case, (ii) a range of estimated implied value per share of Common Stock of $5.87 to $7.53 in the Public Company Savings Case and (iii) a range of estimated implied value per share of the Common Stock of $6.48 to $8.23 in the Synergies and Public Company Savings Case.

Perella Weinberg Partners compared these ranges of estimated implied value per share of Common Stock to (a) the $6.25 to $6.50 range of value per share of Common Stock set forth in the Tadano July 24 Offer and (b) $3.82, the closing price of the Common Stock on September 3, 2024.

52-Week Trading Range.

For reference purposes only, Perella Weinberg Partners reviewed the 52-week trading range of the Common Stock for the period ended September 3, 2024, which indicated low to high closing prices per share of Common Stock during such period of $3.07 to $9.16.

 

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Selected Historical U.S M&A Premia Analysis and Analysis at Various Prices.

Perella Weinberg Partners reviewed and analyzed the average acquisition premia for all transactions involving the acquisition of United States public companies with transaction values between $200M and $500M over both the five- and ten-year periods prior to September 3, 2024, excluding mergers of equals and majority stake transactions, using publicly available sources. Announced premia were calculated relative to (i) the target’s unaffected closing share price prior to announcement of the applicable transaction (the “Unaffected Price”), (ii) the volume-weighted average price for the 30 calendar days ending on the date of the Unaffected Price of the applicable transaction (“30-Day VWAP”), (iii) the volume-weighted average price for the 60 calendar days ending on the date of the Unaffected Price of the applicable transaction (“60-Day VWAP”) and (iv) the volume-weighted average price for the 90 calendar days ending on the date of the Unaffected Price of the applicable transaction (“90-Day VWAP”) . The following table summarizes the results of this analysis:

 

Key Metric		L5Y				L10Y
Unaffected Price			48	%			41	%
30-Day VWAP			49	%			42	%
60-Day VWAP			47	%			42	%
90-Day VWAP			45	%			42	%

Perella Weinberg Partners then calculated the premia implied by a range of potential offer prices of $5.00 to $7.00 per share of Common Stock relative to the $3.82 closing price of the Common Stock as of September 3, 2023, the $4.07 30-Day VWAP of the Common Stock, the $4.32 60-Day VWAP of the Common Stock and the $5.25 90-Day VWAP of the Common Stock and the $9.16 52-week high trading price of the Common Stock, in each case as of September 3, 2024, which resulted in the ranges of premia described in the following table:

 

		Premium (Discount) to Price of Common Stock
		$5.00				$7.00
Unaffected Price			31	%			83	%
30-Day VWAP			23	%			72	%
60-Day VWAP			16	%			62	%
90-Day VWAP			(5	%)			33	%
52-Week High			(45	%)			(24	%)

General

The Perella Weinberg Partners Materials were prepared solely to assist Tadano in determining whether to make a proposal to acquire all of the outstanding shares of Common Stock not already owned by Tadano and what the terms of any proposal might be, and do not purport to be appraisals or necessarily reflect the prices at which businesses or securities actually may be sold, which are inherently subject to uncertainty.

Perella Weinberg Partners’ analyses took into account numerous assumptions with respect to industry performance, general business and economic conditions and other matters, many of which are beyond the control of Perella Weinberg Partners, the Purchaser Filing Persons or the Company. Analyses based on estimates or forecasts of future results are not necessarily indicative of actual past or future values or results, which may be significantly more or less favorable than suggested by such analyses. Because such analyses are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the Purchaser Filing Persons, the Company or their respective advisors, Perella Weinberg Partners does not assume responsibility if future results or actual values are materially different from these forecasts or assumptions.

The terms of the Merger under the Merger Agreement were determined through negotiations between Tadano and the Transaction Committee and their respective representatives. Although Perella Weinberg Partners provided advice to Tadano during the course of these negotiations, any decision to make the proposal or enter

 

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into the Merger Agreement was solely that of Tadano. Perella Weinberg Partners’ advice was only one of a number of factors taken into consideration by Tadano in making its determination to approve the transaction.

Tadano selected Perella Weinberg Partners as its exclusive financial advisor in connection with the Merger based on Perella Weinberg Partners’ qualifications, expertise, reputation and experience. Pursuant to an engagement letter between Tadano and Perella Weinberg Partners, dated July 23, 2024, Perella Weinberg Partners is entitled to receive a success fee of $3,500,000 upon the consummation of the Merger and a discretionary fee to be determined by Tadano of up to $1,000,000. Perella Weinberg Partners will also be entitled to receive a termination fee equal to a portion of any compensation Tadano may receive as a result of any termination of the Merger Agreement. Tadano has also agreed to reimburse Perella Weinberg Partners for fees and disbursements of Perella Weinberg Partners’ counsel and all of Perella Weinberg Partners’ reasonable travel and other out-of-pocket expenses incurred in connection with the Merger or otherwise arising out of the retention of Perella Weinberg Partners under the engagement letter. Tadano also agreed to indemnify Perella Weinberg Partners and certain related persons to the fullest extent lawful against certain liabilities, including certain liabilities under the federal securities laws arising out of its engagement or the Merger.

Except in connection with Perella Weinberg Partners’ engagement as financial advisor to Tadano in connection with the Merger, during the two-year period prior to the delivery of the Perella Weinberg Partners Materials, no investment banking relationship existed between Perella Weinberg Partners and its affiliates and Tadano or the Company pursuant to which compensation was received by Perella Weinberg Partners or its affiliates.

Perella Weinberg Partners and its affiliates may in the future provide investment banking and other financial services to Tadano, the Company and their respective affiliates and in the future may receive compensation for the rendering of such services. In the ordinary course of its business activities, Perella Weinberg Partners or its affiliates may at any time hold long or short positions, and may trade or otherwise effect transactions, for its own account or the accounts of customers or clients, in (i) debt or equity or other securities (or related derivative securities) or financial instruments (including bank loans or other obligations) of Tadano, the Company or any of their respective affiliates and (ii) any currency or commodity that may be material to the parties or otherwise involved in the Merger.

Certain Unaudited Company Forecasts

Company Management Projections

Other than in connection with its regular earnings press releases and related investor materials, the Company does not, as a matter of course, make public projections as to its long-term future financial performance, given, among other reasons, the uncertainty, unpredictability and subjectivity of the underlying assumptions and estimates, including the difficulty of predicting general economic and market conditions. However, the Company’s management prepares projections as to its future financial performance for internal use.

In connection with its evaluation of the Merger, the Company’s management prepared projections regarding the operations of the Company on a standalone basis without giving effect to the Merger for the fiscal years ended December 31, 2024 through December 31, 2028, including initial projections prepared in October 2023 (the “Initial Company Management Projections”) and updated projections prepared in August 2024 (the “Updated Company Management Projections” and, together with the Initial Company Management Projections, the “Company Management Projections”). As described in the section of this proxy statement entitled “Proposal 1: The Merger—Background of the Merger,” the Company Management Projections were provided to the Transaction Committee to assist in its decision-making process in determining whether to authorize and approve the execution of the Merger Agreement, and whether to recommend that Company shareholders adopt the Merger Agreement, as described in the section of this proxy statement entitled “Proposal 1: The Merger—Reasons for the Merger; Recommendation of the Company’s Board of Directors.” The Company Management Projections also were provided to BGL for its use and reliance in connection with its opinion to the Board and the financial analyses contained in contained in the September 11, 2024 financial presentation and related opinion

 

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described in the section of this proxy statement entitled “Proposal 1: The Merger—Opinion of Brown Gibbons Lang & Company.” The Initial Company Management Projections were provided to Tadano for its evaluation of the Merger. The Updated Company Management Projections were not provided to Tadano. The Company Management Projections were prepared for internal use only and not for public disclosure. Although the information in the Company Management Projections is presented with specificity, it reflects various estimates and assumptions made by the Company’s management with respect to OEM and rental equipment industry performance, general business, economic, regulatory, market and financial conditions, the financing of future growth and development projects, and other future events, as well as matters specific to the Company’s business, in each case as of the date on which it was prepared, all of which are difficult or impossible to predict and many of which are beyond the Company’s control.

The table below summarizes the Initial Company Management Projections:

 

		Historical												TTM				Budget				Projected
($ in thousands)		2021PF				2022PF				2023				Jun-24				2024P				Jul-Dec 2024P				2025P				2026P				2027P				2028P
Sales		$	232,994			$	279,377			$	291,389			$	299,560			$	309,050			$	132,884			$	346,519			$	382,922			$	414,409			$	442,067
Growth -%			24.3	%			19.9	%			4.3	%			n/a				6.1	%			n/a				12.1	%			10.5	%			8.2	%			6.7	%
Cost of Sales			186,520				226,594				229,190				232,510				237,145								258,002				284,124				305,801				324,060
Gross Profit		$	46,475			$	52,783			$	62,199			$	67,050			$	71,904							$	88,517			$	98,798			$	108,608			$	118,008
Gross Profit Margin -%			19.9	%			18.9	%			21.3	%			22.4	%			23.3	%							25.5	%			25.8	%			26.2	%			26.7	%
Operating Expenses		$	36,593			$	39,684			$	43,536			$	45,029			$	47,146							$	51,743			$	56,205			$	60,712			$	64,878
Operating Expenses - % of Sales			15.7	%			14.2	%			14.9	%			15.0	%			15.3	%							14.9	%			14.7	%			14.7	%			14.7	%
Operating Income		$	9,881			$	13,100			$	18,662			$	22,021			$	24,758			$	14,853			$	36,774			$	42,592			$	47,896			$	53,130
(+): Depreciation and Amortization			5,397				9,408				11,399				10,945				10,960				2,218				12,474				12,640				13,488				13,674
Adjusted EBITDA		$	15,278			$	22,507			$	30,061			$	32,965			$	35,718			$	17,070			$	49,248			$	55,232			$	61,384			$	66,804
Adjusted EBITDA Margin - %			6.6	%			8.1	%			10.3	%			11.0	%			11.6	%			12.8	%			14.2	%			14.4	%			14.8	%			15.1	%
Unlevered Adjusted Net Income																						$	11,140			$	27,581			$	31,944			$	35,922			$	39,847
Plus: Depreciation & Amortization																							2,218				12,474				12,640				13,488				13,674
Less: Change in Working Capital																							801				(1,644	)			(4,847	)			(2,733	)			(4,451	)
Less: Capital Expenditures																							(4,493	)			(13,157	)			(14,608	)			(20,980	)			(14,911	)
Unlevered Free Cash Flow																						$	9,666			$	25,254			$	25,129			$	25,697			$	34,159

 

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