Dear
[Business] Associate,
By now I
hope you have heard the exciting news that Stanley and Black & Decker have
agreed to merge as companies to form an $8.4 billion global diversified
industrial company. The new company will be named Stanley Black &
Decker.
For those
of you who aren’t familiar with Black & Decker, they are a global
manufacturer and marketer of power tools, hardware and home improvement
products, and technology based fastening systems. Black & Decker has
some of the world’s most iconic brands such as DeWalt, Baldwin, Porter-Cable,
Kwikset and many others. They have manufacturing operations in 11
different countries. Additionally, their products and services are
well-known throughout the world and are extremely complementary to Stanley’s
products and services with minimal product overlap.
We are
thrilled with this transaction and the opportunity to bring two great companies
together to create an even stronger and more diversified company. I
sincerely believe this merger will bring significant benefits to our customers
and shareholders. Additionally, I believe our employees will have even
greater opportunities at a stronger company that is poised for significant
continued growth.
It is
important to keep in mind that this announcement marks the very beginning of
this process. While we expect the transaction to close in the first half
of 2010, it is still subject to customary regulatory and shareholder approvals.
Until then, Stanley and Black & Decker remain independent companies, and it
is imperative that we operate as such until after closing.
It is
also essential that we continue to serve our customers to their utmost
satisfaction. While we may not be able to answer many questions yet, I
want each of you to be comfortable coming to me if any issues with customers
arise.
I
encourage you to review the materials posted on the intranet on yesterday
afternoon which includes the press release, an employee note, a video message
from John Lundgren and a list of frequently asked questions.
Visit
Stanley@Work to view these materials.
I have
also attached a presentation that gives you a little more detail on Black &
Decker and the compelling strategic benefits of merging together. Please
feel free to contact me with any questions.
Click
here to view this presentation.
Thank you
for your continued dedication and support. Your hard work in building
Stanley has made this exciting growth opportunity possible. Let’s keep the
momentum going and close 2009 strong!
Sincerely
[Business
President]
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CAUTIONARY
STATEMENTS
Under the
Private Securities Litigation Reform Act of 1995
Statements
in this document that are not historical, including but not limited to those
regarding the consummation of the proposed transaction between Stanley and Black
& Decker and the realization of synergies in connection therewith, are
“forward looking statements” and, as such, are subject to risk and
uncertainty.
Stanley’s
and Black & Decker’s ability to deliver the results as described above is
based on current expectations and involves inherent risks and uncertainties,
including factors listed below and other factors that could delay, divert, or
change any of them, and could cause actual outcomes and results to differ
materially from current expectations. In addition to the risks, uncertainties
and other factors discussed in this document, the risks, uncertainties and other
factors that could cause or contribute to actual results differing materially
from those expressed or implied in the forward looking statements include,
without limitation, those set forth in the “Risk Factors” section, the “Legal
Proceedings” section, the “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” section and other sections of Stanley’s and
Black & Decker’s Annual Reports on Form 10-K and any material changes
thereto set forth in any subsequent Quarterly Reports on Form 10-Q, those
contained in Stanley’s and Black & Decker’s other filings with the
Securities and Exchange Commission, and those set forth below.
These
factors include but are not limited to the risk that regulatory and stockholder
approvals of the transaction are not obtained on the proposed terms and
schedule; the future business operations of Stanley or Black & Decker will
not be successful; the risk that the proposed transaction between Stanley and
Black & Decker will not be consummated; the risk that Stanley and Black
& Decker will not realize any or all of the anticipated benefits from the
transaction; the risk that cost synergy, customer retention and revenue
expansion goals for the transaction will not be met and that disruptions from
the transaction will harm relationships with customers, employees and suppliers;
the risk that unexpected costs will be incurred; the outcome of litigation
(including with respect to the transaction) and regulatory proceedings to which
Stanley or Black & Decker may be a party; pricing pressure and other changes
within competitive markets; the continued consolidation of customers
particularly in consumer channels; inventory management pressures on Stanley’s
and Black & Decker’s customers; the impact the tightened credit markets may
have on Stanley or Black & Decker or customers or suppliers; the extent to
which Stanley or Black & Decker has to write off accounts receivable or
assets or experiences supply chain disruptions in connection with bankruptcy
filings by customers or suppliers; increasing competition; changes in laws,
regulations and policies that affect Stanley or Black & Decker, including
but not limited to trade, monetary, tax and fiscal policies and laws; the timing
and extent of any inflation or deflation in 2009 and beyond; currency exchange
fluctuations; the impact of dollar/foreign currency exchange and interest rates
on the competitiveness of products and Stanley’s and Black & Decker’s debt
programs; the strength of the U.S. and European economies; the extent to which
world-wide markets associated with homebuilding and remodeling continue to
deteriorate; the impact of events that cause or may cause disruption in
Stanley’s or Black & Decker’s manufacturing, distribution and sales networks
such as war, terrorist activities, and political unrest; and recessionary or
expansive trends in the economies of the world in which Stanley or Black &
Decker operates, including but not limited to the extent and duration of the
current recession in the US economy.
Neither
Stanley nor Black & Decker undertake any obligation to publicly update or
revise any forward-looking statements to reflect events or circumstances that
may arise after the date hereof.
Additional
Information
The
proposed transaction involving Stanley and Black & Decker will be submitted
to the respective stockholders of Stanley and Black & Decker for their
consideration. In connection with the proposed transaction, Stanley will
file with the Securities and Exchange Commission (the “SEC”) a registration
statement on Form S-4 that will include a joint proxy statement of Stanley and
Black & Decker that will also constitute a prospectus of Stanley.
Investors and security holders are urged to read the joint proxy
statement/prospectus and any other relevant documents filed with the SEC when
they become available, because they will contain important information.
Investors and security holders may obtain a free copy of the joint proxy
statement/prospectus and other documents (when available) that Stanley and Black
& Decker file with the SEC at the SEC’s website at www.sec.gov and Stanley’s
website related to the transaction at www.stanleyblackanddecker.com. In
addition, these documents may be obtained from Stanley or Black & Decker
free of charge by directing a request to Investor Relations, The Stanley Works,
1000 Stanley Drive, New Britain, CT 06053, or to Investor Relations, The Black
& Decker Corporation, 701 E. Joppa Road, Towson, Maryland 21286,
respectively.
Certain
Information Regarding Participants
Stanley,
Black & Decker and certain of their respective directors and executive
officers may be deemed to be participants in the proposed transaction under the
rules of the SEC. Investors and security holders may obtain information
regarding the names, affiliations and interests of Stanley’s directors and
executive officers in Stanley’s Annual Report on Form 10-K for the year ended
January 3, 2009, which was filed with the SEC on February 26, 2009, and its
proxy statement for its 2009 Annual Meeting, which was filed with the SEC on
March 20, 2009. Investors and security holders may obtain information
regarding the names, affiliations and interests of Black & Decker’s
directors and executive officers in Black & Decker’s Annual Report on Form
10-K for the year ended December 31, 2008, which was filed with the SEC on
February 17, 2009, and its proxy statement for its 2009 Annual Meeting, which
was filed with the SEC on March 16, 2009. These documents can be obtained
free of charge from the sources listed above. Additional information
regarding the interests of these individuals will also be included in the joint
proxy statement/prospectus regarding the proposed transaction when it becomes
available.
Non-Solicitation
A
registration statement relating to the securities to be issued by Stanley in the
proposed transaction will be filed with the SEC, and Stanley will not issue,
sell or accept offers to buy such securities prior to the time such registration
statement becomes effective. This document shall not constitute an offer
to sell or the solicitation of an offer to buy, nor shall there be any sale of
such securities, in any jurisdiction in which such offer, solicitation or sale
would be unlawful prior to appropriate registration or qualification under the
securities laws of such
jurisdiction.