Please wait
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
FOX & HOUND RESTAURANT GROUP
AT
$15.50 NET PER SHARE
BY
NPSP ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
F&H ACQUISITION CORP.
THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME,
ON MONDAY, FEBRUARY 6, 2006, UNLESS THE OFFER IS EXTENDED.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (I) THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN BEFORE THE EXPIRATION OF THE OFFER A NUMBER OF
SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE (THE "SHARES"), OF FOX & HOUND
RESTAURANT GROUP (THE "COMPANY"), WHICH, TOGETHER WITH THE SHARES THEN OWNED BY
F&H ACQUISITION CORP. ("PARENT") AND ITS SUBSIDIARIES (INCLUDING NPSP ACQUISITION
CORP. (THE "PURCHASER")), REPRESENTS AT LEAST A MAJORITY OF THE TOTAL NUMBER OF
SHARES OUTSTANDING ON A FULLY DILUTED BASIS, (II) EXPIRATION OR TERMINATION OF THE
APPLICABLE WAITING PERIOD UNDER THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS
ACT OF 1976, (III) THE OBTAINING OF ALL CONSENTS, APPROVALS OR AUTHORIZATIONS
REQUIRED BY ALL STATE, CITY OR LOCAL LIQUOR LICENSING BOARDS, AGENCIES OR OTHER
SIMILAR ENTITIES AND (IV) PARENT BEING SATISFIED THAT SECTION 203 OF THE DELAWARE
GENERAL CORPORATION LAW IS INAPPLICABLE TO THE OFFER TO PURCHASE AND THE
POTENTIAL MERGER THEREAFTER.
PARENT AND THE PURCHASER HAVE SOUGHT TO AND MAY AGAIN SEEK IN THEIR SOLE
DISCRETION TO NEGOTIATE A BUSINESS COMBINATION WITH THE COMPANY. SUBJECT TO
APPLICABLE LAW, THE PURCHASER RESERVES THE RIGHT TO AMEND THE OFFER (INCLUDING
AMENDING THE NUMBER OF SHARES TO BE PURCHASED, THE OFFER PRICE AND THE
CONSIDERATION TO BE OFFERED IN THE PROPOSED MERGER) UPON AND SUBJECT TO ENTERING
INTO A MERGER AGREEMENT WITH THE COMPANY, OR TO NEGOTIATE A MERGER AGREEMENT
WITH THE COMPANY NOT INVOLVING A TENDER OFFER PURSUANT TO WHICH THE PURCHASER
WOULD TERMINATE THE OFFER AND THE SHARES WOULD, UPON CONSUMMATION OF SUCH
MERGER, BE CONVERTED INTO THE CONSIDERATION NEGOTIATED BY PARENT, THE PURCHASER
AND THE COMPANY.
IMPORTANT
Any stockholder of the Company desiring to tender Shares in the Offer
should either (i) complete and sign the Letter of Transmittal or a facsimile
thereof in accordance with the instructions in the Letter of Transmittal, and
mail or deliver the Letter of Transmittal together with the certificates
representing tendered Shares and all other required documents to American Stock
Transfer & Trust Company, the Depositary for the Offer, or tender such Shares
pursuant to the procedure for book-entry transfer set forth in "The
Offer--Section 3--Book-Entry Delivery" or (ii) request such stockholder's
broker, dealer, commercial bank, trust company or other nominee to effect the
transaction for such stockholder. Stockholders whose Shares are registered in
the name of a broker, dealer, commercial bank, trust company or other nominee
must contact such person if they desire to tender their Shares.
Any stockholder who desires to tender Shares and whose certificates
representing such Shares are not immediately available, or who cannot comply
with the procedures for book-entry transfer on a timely basis, may tender such
Shares pursuant to the guaranteed delivery procedure set forth in "The
Offer--Section 3--Guaranteed Delivery".
Questions and requests for assistance may be directed to the
Information Agent at its address and telephone number set forth on the back
cover of this Offer to Purchase. Additional copies of this Offer to Purchase,
the Letter of Transmittal, the Notice of Guaranteed Delivery and other related
materials may be obtained from the Information Agent or from brokers, dealers,
commercial banks and trust companies.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION, AND YOU SHOULD CAREFULLY READ BOTH IN THEIR ENTIRETY
BEFORE MAKING A DECISION WITH RESPECT TO THE OFFER.
January 6, 2006
ii
TABLE OF CONTENTS
PAGE
Summary Term Sheet................................................................................................ 1
Introduction...................................................................................................... 5
The Offer......................................................................................................... 6
1. Terms of the Offer..................................................................................... 6
2. Acceptance for Payment and Payment..................................................................... 7
3. Procedure for Tendering Shares......................................................................... 8
4. Withdrawal Rights....................................................................................... 10
5. Certain Tax Considerations.............................................................................. 10
6. Price Range of Shares; Dividends....................................................................... 11
7. Possible Effects of the Offer on the Market for the Shares; Stock Exchange Listing; Registration under
the Exchange Act....................................................................................... 11
8. Certain Information Concerning the Company............................................................. 12
9. Certain Information Concerning the Purchaser, Parent and Sponsors...................................... 12
10. Source and Amount of Funds............................................................................. 14
11. Background of the Offer................................................................................ 14
12. Purpose of the Offer; Plans for the Company; Statutory Requirements; Approval of the Merger;
Appraisal Rights....................................................................................... 16
13. Dividends and Distributions............................................................................ 18
14. Conditions of the Offer................................................................................ 18
15. Certain Legal Matters; Regulatory Approvals............................................................ 21
16. Fees and Expenses...................................................................................... 23
17. Miscellaneous.......................................................................................... 23
Schedule I........................................................................................................ S-1
Schedule II....................................................................................................... S-3
SUMMARY TERM SHEET
NPSP Acquisition Corp., a wholly owned subsidiary of F&H Acquisition
Corp., is offering to purchase all outstanding shares of common stock, par value
$0.01 per share, of Fox & Hound Restaurant Group ("Fox & Hound") for $15.50 net
per share in cash, upon the terms and subject to the conditions set forth in
this Offer to Purchase and the related Letter of Transmittal. The following are
some of the questions you, as a Fox & Hound stockholder, may have and answers to
those questions. This summary term sheet is not meant to be a substitute for the
information contained in the remainder of this Offer to Purchase and the related
Letter of Transmittal, and the information contained in this summary term sheet
is qualified in its entirety by the more detailed descriptions and explanations
contained in this Offer to Purchase and the related Letter of Transmittal. We
urge you to carefully read this entire Offer to Purchase and the related Letter
of Transmittal.
WHO IS OFFERING TO BUY MY SECURITIES?
Our name is NPSP Acquisition Corp. We are a Delaware corporation formed
to serve as an acquisition vehicle with no current operations other than those
incident to the commencement of the offer. We are a wholly owned subsidiary of
F&H Acquisition Corp., a Delaware corporation owned by Newcastle Partners, L.P.,
a Texas limited partnership ("Newcastle"), and Steel Partners II, L.P., a
Delaware limited partnership ("Steel"). See "The Offer--Section 9".
WHAT SECURITIES ARE YOU OFFERING TO PURCHASE?
We are offering to purchase all of the outstanding common stock, par
value $0.01 per share, of Fox & Hound. We refer to one share of Fox & Hound
common stock as a "share" or "Share". See "Introduction".
HOW MUCH ARE YOU OFFERING TO PAY FOR MY SECURITIES AND WHAT IS THE FORM OF
PAYMENT?
We are offering to pay you $15.50 per share in cash without brokerage
fees, commissions or, except in certain circumstances, transfer taxes. See
"Introduction".
DO YOU HAVE THE FINANCIAL RESOURCES TO PAY FOR THE SHARES?
Yes. We will need approximately $142.7 million to purchase all Shares
pursuant to the offer not already owned by F&H Acquisition Corp. and to pay
related fees and expenses. As of January 5, 2006, Newcastle and Steel (together,
the "Sponsors") had cash and cash equivalents and short-term investments
substantially in excess of the approximately $142.7 million required to acquire
the Shares. Accordingly, the offer is not conditioned upon any financing
arrangements. See "The Offer--Section 10".
IS YOUR FINANCIAL CONDITION RELEVANT TO MY DECISION TO TENDER IN THE OFFER?
Because (i) the form of payment for your Shares consists solely of cash
and (ii) the purchase of the Shares is not conditioned upon any financing
arrangements, we do not think our financial condition is material to your
decision whether to tender in the offer.
WHAT DOES THE BOARD OF DIRECTORS OF FOX & HOUND RESTAURANT GROUP THINK OF THE
OFFER?
Fox & Hound's Board of Directors has not approved this offer or
otherwise commented on it as of the date of this Offer to Purchase. Within 10
business days after the date of this Offer to Purchase, Fox & Hound is required
by law to publish, send or give to you (and file with the Securities and
Exchange Commission) a statement as to whether it recommends acceptance or
rejection of the offer, that it has no opinion with respect to the offer or that
it is unable to take a position with respect to the offer.
1
HOW LONG DO I HAVE TO DECIDE WHETHER TO TENDER IN THE OFFER?
You have until the expiration date of the offer to tender. The offer
currently is scheduled to expire at 12:00 Midnight, New York City time, on
Monday, February 6, 2006. We currently expect that the offer will be extended
until the principal conditions to the offer, which are described below, are
satisfied. If the offer is extended, we will issue a press release announcing
the extension at or before 9:00 A.M. New York City time on the next business day
after the date the offer was scheduled to expire. See "The Offer--Section 1".
We may elect to provide a "subsequent offering period" for the offer. A
subsequent offering period, if one is included, will be an additional period of
time beginning after we have purchased shares tendered during the offer, during
which stockholders may tender, but not withdraw, their shares and receive the
offer consideration. We do not currently intend to include a subsequent offering
period, although we reserve the right to do so. See "The Offer--Section 1".
WHAT ARE THE MOST SIGNIFICANT CONDITIONS TO THE OFFER?
The offer is conditioned upon, among other things, (i) there being
validly tendered and not withdrawn before the expiration of the offer a number
of shares, which, together with the shares then owned by F&H Acquisition Corp.
and its subsidiaries (including us), represents at least a majority of the total
number of shares outstanding on a fully diluted basis, (ii) expiration or
termination of the applicable waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, (iii) the obtaining of all consents,
approvals or authorizations required by all state, city or local liquor
licensing boards, agencies or other similar entities and (iv) Parent being
satisfied that Section 203 of the Delaware General Corporation Law is
inapplicable to the Offer to Purchase and the potential merger thereafter. See
"The Offer--Section 14".
HOW WILL I BE NOTIFIED IF THE OFFER IS EXTENDED?
If we decide to extend the offer, we will inform American Stock
Transfer & Trust Company, the depositary for the offer, of that fact and will
make a public announcement of the extension, no later than 9:00 A.M., New York
City time, on the next business day after the date the offer was scheduled to
expire. See "The Offer--Section 1".
HOW DO I TENDER MY SHARES?
To tender shares, you must deliver the certificates representing your
shares, together with a completed Letter of Transmittal and any other required
documents, to American Stock Transfer & Trust Company, the depositary for the
offer, not later than the time the offer expires. If your shares are held in
street name by your broker, dealer, bank, trust company or other nominee, such
nominee can tender your shares through The Depository Trust Company. If you
cannot deliver everything required to make a valid tender to the depositary
before the expiration of the offer, you may have a limited amount of additional
time by having a financial institution (including most banks, savings and loan
associations and brokerage houses) that is a member of a recognized Medallion
Program approved by The Securities Transfer Association Inc., including the
Securities Transfer Agents Medallion Program (STAMP), the Stock Exchange
Medallion Program (SEMP) and the New York Stock Exchange, Inc. Medallion
Signature Program (MSP), guarantee, pursuant to a Notice of Guaranteed Delivery,
that the missing items will be received by the depositary within three business
days. However, the depositary must receive the missing items within that three
business day period. See "The Offer--Section 3".
UNTIL WHAT TIME CAN I WITHDRAW TENDERED SHARES?
You can withdraw tendered shares at any time until the offer has
expired, and, if we have not by March 7, 2006, agreed to accept your shares for
payment, you can withdraw them at any time after such time until we accept
shares for payment. You may not, however, withdraw shares tendered during a
subsequent offering period, if one is included. See "The Offer--Section 4".
2
HOW DO I WITHDRAW TENDERED SHARES?
To withdraw shares, you must deliver a written notice of withdrawal, or
a facsimile of one, with the required information to American Stock Transfer &
Trust Company while you have the right to withdraw the shares. See "The
Offer--Section 4".
WHEN AND HOW WILL I BE PAID FOR MY TENDERED SHARES?
Subject to the terms and conditions of the Offer, we will pay for all
validly tendered and not withdrawn shares promptly after termination or
withdrawal of the Offer. See "The Offer--Section 2".
We will pay for your validly tendered and not withdrawn shares by
depositing the purchase price with American Stock Transfer & Trust Company,
which will act as your agent for the purpose of receiving payments from us and
transmitting such payments to you. In all cases, payment for tendered shares
will be made only after timely receipt by American Stock Transfer & Trust
Company of certificates for such shares (or of a confirmation of a book-entry
transfer of such shares as described in "The Offer--Section 3--Book-Entry
Delivery"), a properly completed and duly executed Letter of Transmittal (or
facsimile thereof) and any other required documents for such shares. See "The
Offer--Section 2".
WILL THE OFFER BE FOLLOWED BY A MERGER IF ALL THE FOX & HOUND SHARES ARE NOT
TENDERED IN THE OFFER?
If we accept for payment and pay for a number of Shares, which,
together with the Shares then owned by F&H Acquisition Corp. and its
subsidiaries (including us), represents at least a majority of the outstanding
shares on a fully diluted basis, NPSP Acquisition Corp. expects to be merged
with and into Fox & Hound. If that merger takes place, F&H Acquisition Corp.
will own all of the shares and all remaining stockholders (other than us, F&H
Acquisition Corp., the Sponsors and stockholders properly exercising their
appraisal rights) will receive the price per share paid in the offer. See "The
Offer--Section 12--Purpose of the Offer; Plans for the Company".
IF A MAJORITY OF THE SHARES ARE TENDERED AND ACCEPTED FOR PAYMENT, WILL FOX &
HOUND CONTINUE AS A PUBLIC COMPANY?
If the merger takes place, Fox & Hound will no longer be publicly
owned. Even if the merger does not take place, if we purchase all the tendered
shares, there may be so few remaining stockholders and publicly held shares that
the shares will no longer be eligible to be traded on a securities exchange,
there may not be a public trading market for the shares, and Fox & Hound may
cease making filings with the Securities and Exchange Commission or otherwise
cease being required to comply with the Securities and Exchange Commission's
rules relating to publicly held companies. See "The Offer--Section 7".
IF I DECIDE NOT TO TENDER, HOW WILL THE OFFER AFFECT MY SHARES?
If the offer is successful, NPSP Acquisition Corp. expects to conclude
a merger transaction in which all shares of Fox & Hound will be exchanged for an
amount in cash per share equal to the price per share paid in the offer. If the
proposed second-step merger takes place, stockholders who do not tender in the
offer (other than those properly exercising their appraisal rights) will receive
the same amount of cash per share that they would have received had they
tendered their shares in the offer. Therefore, if such merger takes place, the
only difference between tendering and not tendering shares in the offer is that
tendering stockholders will be paid earlier. If, however, the merger does not
take place and the offer is consummated, the number of stockholders and shares
that are still in the hands of the public may be so small that there will no
longer be an active or liquid public trading market (or, possibly, any public
trading market) for shares held by stockholders other than NPSP Acquisition
Corp., which may affect prices at which shares trade. Also, as described above,
Fox & Hound may cease making filings with the Securities and Exchange Commission
or being required to comply with the Securities and Exchange Commission's rules
relating to publicly held companies. See "The Offer--Section 7".
3
WHAT IS THE MARKET VALUE OF MY SHARES AS OF A RECENT DATE?
On December 9, 2005, the last full business day before the announcement
of our intention to commence the offer, the last reported sales price of Fox &
Hound common stock reported on the Nasdaq was $13.22 per share. Please obtain a
recent quotation for your shares prior to deciding whether or not to tender.
WHAT ARE THE FEDERAL INCOME TAX CONSEQUENCES OF PARTICIPATING IN THE OFFER?
In general, your sale of shares pursuant to the offer will be a taxable
transaction for U.S. federal income tax purposes and may also be a taxable
transaction under applicable state, local or foreign income or other tax laws.
You should consult your tax advisor about the tax consequences to you of
participating in the offer in light of your particular circumstances. See "The
Offer--Section 5".
WHO CAN I TALK TO IF I HAVE QUESTIONS ABOUT THE OFFER?
You can call MacKenzie Partners, Inc., the information agent for the
offer, at (212) 929-5500 (collect) or (800) 322-2885 (toll-free). See the back
cover of this Offer to Purchase.
4
To the Stockholders of Fox & Hound Restaurant Group:
INTRODUCTION
We, NPSP Acquisition Corp. (the "Purchaser"), a Delaware corporation
and wholly owned subsidiary of F&H Acquisition Corp., a Delaware corporation
("Parent"), are offering to purchase all outstanding shares of common stock (the
"Common Stock"), par value $0.01 per share (the "Shares"), of Fox & Hound
Restaurant Group, a Delaware corporation (the "Company") for $15.50 per Share,
net to the seller in cash, upon the terms and subject to the conditions set
forth in this Offer to Purchase and the related Letter of Transmittal (which,
together with any amendments or supplements thereto, collectively constitute the
"Offer"). Stockholders who have Shares registered in their own names and tender
directly to American Stock Transfer & Trust Company, the depositary for the
Offer (the "Depositary"), will not have to pay brokerage fees or commissions.
Stockholders with Shares held in street name by a broker, dealer, bank, trust
company or other nominee should consult with their nominee to determine if they
charge any transaction fees. Except as set forth in Instruction 6 of the Letter
of Transmittal, stockholders will not have to pay transfer taxes on the sale of
Shares pursuant to the Offer. We will pay all charges and expenses of the
Depositary and MacKenzie Partners, Inc. (the "Information Agent") incurred in
connection with the Offer. See "The Offer--Section 16".
The Offer is conditioned upon, among other things, (i) there being
validly tendered and not withdrawn before the Expiration Date (as defined below)
a number of Shares, which, together with the Shares then owned by Parent and its
subsidiaries (including us), represents at least a majority of the total number
of Shares outstanding on a fully diluted basis (the "Minimum Tender Condition"),
(ii) expiration or termination of the applicable waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the "HSR Condition"),
(iii) the obtaining of all consents, approvals or authorizations required by all
state, city or local liquor licensing boards, agencies or other similar entities
(the "Liquor Condition") and (iv) Parent being satisfied that Section 203 of the
Delaware General Corporation Law (the "Delaware Law") is inapplicable to the
Offer and the potential merger thereafter (the "Section 203 Condition").
According to the Company's Quarterly Report on Form 10-Q filed on
October 17, 2005 with the Securities and Exchange Commission (the "SEC"), as of
October 17, 2005, there were outstanding 10,029,307 Shares. Parent beneficially
owns 836,049 Shares, representing approximately 8.3% of the outstanding Shares.
The purpose of the Offer is to acquire control of, and the entire
equity interest in, the Company. We currently intend, as soon as practicable
after consummation of the Offer, to seek maximum representation on the Company's
Board of Directors (the "Company Board") and to seek to have the Company
consummate a merger or other similar business combination with us (or one of our
subsidiaries). Under the Delaware Law, if we acquire, pursuant to the Offer or
otherwise, at least 90% of the outstanding Shares, we believe we would be able
to approve a merger or other business combination without a vote of the Company
Board or other stockholders. If we do not acquire at least 90% of the
outstanding Shares, we will have to seek approval of a merger or other business
combination by the Company's stockholders. Approval of a merger or other
business combination requires the affirmative vote of holders of a majority of
the outstanding Shares. Pursuant to such merger or business combination,
outstanding Shares not owned by Parent or its subsidiaries (including us) would
be converted into the right to receive cash in an amount equal to the price per
Share provided pursuant to the Offer.
Parent and the Purchaser have sought to and may again seek in their
sole discretion to negotiate a business combination with the Company. Subject to
applicable law, the Purchaser reserves the right to amend the Offer (including
amending the number of Shares to be purchased, the offer price and the
consideration to be offered in the proposed merger) upon and subject to entering
into a merger agreement with the Company, or to negotiate a merger agreement
with the Company not involving a tender offer pursuant to which the Purchaser
would terminate the Offer and the Shares would, upon consummation of such
merger, be converted into the consideration negotiated by Parent, the Purchaser
and the Company.
According to the Company's Annual Report on Form 10-K for the year
ended December 28, 2004 (the "Company 10-K"), the Company did not declare any
dividends in fiscal 2004 and 2003 and does not anticipate paying any cash
dividends in the foreseeable future. If we acquire control of the Company, we
currently intend that no dividends will be declared on the Shares prior to the
acquisition of the entire equity interest in the Company.
5
This Offer to Purchase and the related Letter of Transmittal contain
important information, and you should carefully read both in their entirety
before you make a decision with respect to the Offer.
THE OFFER
1. TERMS OF THE OFFER. Upon the terms and subject to the conditions set
forth in the Offer, we will accept for payment and pay for all Shares that are
validly tendered before the Expiration Date and not withdrawn. "Expiration Date"
means 12:00 Midnight, New York City time, on Monday, February 6, 2006, unless
extended, in which event "Expiration Date" means the latest time and date at
which the Offer, as so extended, shall expire.
The Offer is subject to the conditions set forth in "The Offer--Section
14", which include, among other things, satisfaction of the Minimum Tender
Condition, the HSR Condition, the Liquor Condition and the Section 203
Condition. If any such condition is not satisfied, we may (i) terminate the
Offer and return all tendered Shares to tendering stockholders, (ii) extend the
Offer and, subject to withdrawal rights as set forth in "The Offer--Section 4",
retain all such Shares until the expiration of the Offer as so extended, (iii)
waive such condition and, subject to any requirement to extend the period of
time during which the Offer is open, purchase all Shares validly tendered prior
to the Expiration Date and not withdrawn or (iv) delay acceptance for payment or
payment for Shares, subject to applicable law, until satisfaction or waiver of
the conditions to the Offer.
Subject to any applicable rules and regulations of the SEC, the
Purchaser expressly reserves the right (but will not be obligated), in its
reasonable discretion, at any time and from time to time, to extend the period
during which the Offer is open for any reason by giving oral or written notice
of the extension to the Depositary and by making a public announcement of the
extension. During any extension, all Shares previously tendered and not
withdrawn will remain subject to the Offer and subject to the right of a
tendering stockholder to withdraw Shares.
Subject to any applicable rules and regulations of the SEC, including
Rule 14e-1(c) under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), the Purchaser expressly reserves the right to (i) terminate or
amend the Offer if any of the conditions set forth in "The Offer--Section 14"
has not been satisfied or (ii) waive any condition or otherwise amend the Offer
in any respect, in each case, by giving oral or written notice of such
termination, waiver or amendment to the Depositary and by making a public
announcement thereof, as described below. Rule 14e-1(c) under the Exchange Act
requires the Purchaser to pay the consideration offered or return the Shares
tendered promptly after the termination or withdrawal of the Offer.
If we decrease the percentage of Shares being sought or increase or
decrease the consideration to be paid for Shares pursuant to the Offer and the
Offer is scheduled to expire at any time before the expiration of a period of 10
business days from, and including, the date that notice of such increase or
decrease is first published, sent or given in the manner specified below, the
Offer shall be extended until the expiration of such period of 10 business days.
If we make any other material change in the terms of or information concerning
the Offer or waive a material condition of the Offer, we will extend the Offer,
if required by applicable law, for a period sufficient to allow you to consider
the amended terms of the Offer. In a published release, the SEC has stated that
in its view an offer must remain open for a minimum period of time following a
material change in the terms of such offer and that the waiver of a condition
such as the Minimum Tender Condition is a material change in the terms of an
offer. The release states that an offer should remain open for a minimum of five
business days from the date the material change is first published, sent or
given to stockholders, and that if material changes are made with respect to
information that approaches the significance of price and share levels, a
minimum of 10 business days may be required to allow adequate dissemination and
investor response. "Business day" means any day other than Saturday, Sunday or a
U.S. federal holiday and consists of the time period from 12:01 A.M. through
12:00 Midnight, New York City time.
If we extend the Offer, are delayed in accepting for payment or paying
for Shares or are unable to accept for payment or pay for Shares pursuant to the
Offer for any reason, then, without prejudice to our rights under the Offer, the
Depositary may, on our behalf, retain all Shares tendered, and such Shares may
not be withdrawn except as provided in "The Offer--Section 4". Our reservation
of the right to delay acceptance for payment of or payment for Shares is subject
to applicable law, which requires that we pay the consideration offered or
return the Shares deposited by or on behalf of stockholders promptly after the
termination or withdrawal of the Offer.
6
Any extension, delay, termination, waiver or amendment of the Offer
will be followed as promptly as practicable by a public announcement thereof.
Without limiting the manner in which we may choose to make any public
announcement, we will have no obligation (except as otherwise required by
applicable law) to publish, advertise or otherwise communicate any such public
announcement other than by making a release to the Dow Jones News Service. In
the case of an extension of the Offer, we will make a public announcement of
such extension no later than 9:00 A.M., New York City time, on the next business
day after the previously scheduled Expiration Date.
After the expiration of the Offer, we may, but are not obligated to,
include a subsequent offering period of between three and 20 business days to
permit additional tenders of Shares (a "Subsequent Offering Period"). Pursuant
to Rule 14d-11 under the Exchange Act, we may include a Subsequent Offering
Period so long as, among other things, (i) the Offer remains open for a minimum
of 20 business days and has expired, (ii) all conditions to the Offer are
satisfied or waived by us on or before the Expiration Date, (iii) we accept and
promptly pay for all securities validly tendered during the Offer, (iv) we
announce the results of the Offer, including the approximate number and
percentage of Shares deposited in the Offer, no later than 9:00 A.M., New York
City time, on the next business day after the Expiration Date and immediately
begin the Subsequent Offering Period and (v) we immediately accept and promptly
pay for Shares as they are tendered during the Subsequent Offering Period. In
addition, we may extend any initial Subsequent Offering Period by any period or
periods, provided that the aggregate of the Subsequent Offering Period
(including extensions thereof) is no more than 20 business days. No withdrawal
rights apply to Shares tendered in a Subsequent Offering Period, and no
withdrawal rights apply during a Subsequent Offering Period with respect to
Shares previously tendered in the Offer and accepted for payment. The same price
paid in the Offer will be paid to stockholders tendering Shares in the Offer or
in a Subsequent Offering Period, if one is included.
We do not currently intend to include a Subsequent Offering Period,
although we reserve the right to do so. If we elect to include or extend a
Subsequent Offering Period, we will make a public announcement of such inclusion
or extension no later than 9:00 A.M., New York City time, on the next business
day after the Expiration Date or date of termination of any prior Subsequent
Offering Period.
We have made a request to the Company for its stockholder list and
security position listings for the purpose of disseminating the Offer to holders
of Shares. We will send this Offer to Purchase, the related Letter of
Transmittal and other related documents to record holders of Shares and to
brokers, dealers, banks, trust companies and other nominees whose names appear
on the stockholder list or, if applicable, who are listed as participants in a
clearing agency's security position listing for subsequent transmittal to
beneficial owners of Shares.
2. ACCEPTANCE FOR PAYMENT AND PAYMENT. Upon the terms and subject to
the conditions of the Offer, we will accept for payment and pay for all Shares
validly tendered and not withdrawn promptly after the termination or withdrawal
of the Offer. For a description of our right to terminate the Offer and not
accept for payment or pay for Shares, see "The Offer--Section 14". If we
increase the consideration to be paid for Shares pursuant to the Offer, we will
pay such increased consideration for all Shares purchased pursuant to the Offer.
We will pay for Shares accepted for payment pursuant to the Offer by
depositing the purchase price with the Depositary, which will act as your agent
for the purpose of receiving payments from us and transmitting such payments to
you. In all cases, payment for Shares accepted for payment pursuant to the Offer
will be made only after timely receipt by the Depositary of (i) certificates for
such Shares (or a confirmation of a book-entry transfer of such Shares into the
Depositary's account at the Book-Entry Transfer Facility (as defined in "The
Offer--Section 3")), (ii) a properly completed and duly executed Letter of
Transmittal (or facsimile thereof) and (iii) any other required documents. For a
description of the procedure for tendering Shares pursuant to the Offer, see
"The Offer--Section 3". Accordingly, payment may be made to tendering
stockholders at different times if delivery of the Shares and other required
documents occurs at different times. Under no circumstances will we pay interest
on the consideration paid for Shares pursuant to the Offer, regardless of any
delay in making such payment.
For purposes of the Offer, we shall be deemed to have accepted for
payment tendered Shares when, as and if we give oral or written notice of our
acceptance to the Depositary.
We reserve the right to transfer or assign, in whole or from time to
time in part, to one or more of our affiliates the right to purchase Shares
tendered pursuant to the Offer, but any such transfer or assignment will not
7
relieve us of our obligations under the Offer or prejudice your rights to
receive payment for Shares validly tendered and accepted for payment.
If any tendered Shares are not purchased pursuant to the Offer for any
reason, or if certificates are submitted for more Shares than are tendered,
certificates for such unpurchased or untendered Shares will be returned (or, in
the case of Shares tendered by book-entry transfer, such Shares will be credited
to an account maintained at the Book-Entry Transfer Facility), without expense
to you, promptly following the expiration or termination of the Offer.
3. PROCEDURE FOR TENDERING SHARES.
VALID TENDER OF SHARES. To tender Shares pursuant to the Offer, either
(i) the Depositary must receive at one of its addresses set forth on the back
cover of this Offer to Purchase (a) a properly completed and duly executed
Letter of Transmittal (or facsimile thereof) and any other documents required by
the Letter of Transmittal and (b) certificates for the Shares to be tendered or
delivery of such Shares pursuant to the procedures for book-entry transfer
described below (and a confirmation of such delivery including an Agent's
Message (as defined below) if the tendering stockholder has not delivered a
Letter of Transmittal), in each case by the Expiration Date, or (ii) the
guaranteed delivery procedure described below must be complied with.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS,
INCLUDING THROUGH THE BOOK-ENTRY TRANSFER FACILITY, IS AT YOUR OPTION AND RISK,
AND DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY.
IF CERTIFICATES FOR SHARES ARE SENT BY MAIL, WE RECOMMEND REGISTERED MAIL WITH
RETURN RECEIPT REQUESTED, PROPERLY INSURED, IN TIME TO BE RECEIVED ON OR PRIOR
TO THE EXPIRATION DATE.
The tender of Shares pursuant to any one of the procedures described
above will constitute your acceptance of the Offer, as well as your
representation and warranty that (i) you own the Shares being tendered within
the meaning of Rule 14e-4 under the Exchange Act, (ii) the tender of such Shares
complies with Rule 14e-4 under the Exchange Act and (iii) you have the full
power and authority to tender, sell, assign and transfer the Shares tendered, as
specified in the Letter of Transmittal. Our acceptance for payment of Shares
tendered by you pursuant to the Offer will constitute a binding agreement
between us with respect to such Shares, upon the terms and subject to the
conditions of the Offer.
BOOK-ENTRY DELIVERY. The Depositary will establish an account with
respect to the Shares for purposes of the Offer at The Depository Trust Company
(the "Book-Entry Transfer Facility") within two business days after the date of
this Offer to Purchase. Any financial institution that is a participant in the
system of the Book-Entry Transfer Facility may deliver Shares by causing the
Book-Entry Transfer Facility to transfer such Shares into the Depositary's
account in accordance with the procedures of the Book-Entry Transfer Facility.
However, although delivery of Shares may be effected through book-entry
transfer, the Letter of Transmittal (or facsimile thereof) properly completed
and duly executed together with any required signature guarantees or an Agent's
Message and any other required documents must, in any case, be received by the
Depositary at one of its addresses set forth on the back cover of this Offer to
Purchase by the Expiration Date, or the guaranteed delivery procedure described
below must be complied with. Delivery of the Letter of Transmittal and any other
required documents to the Book-Entry Transfer Facility does not constitute
delivery to the Depositary. "Agent's Message" means a message, transmitted by
the Book-Entry Transfer Facility to, and received by, the Depositary and forming
a part of a book-entry confirmation stating that the Book-Entry Transfer
Facility has received an express acknowledgment from the participant in the
Book-Entry Transfer Facility tendering the Shares that are the subject of such
book-entry confirmation that such participant has received, and agrees to be
bound by, the terms of the Letter of Transmittal and that the Company may
enforce such agreement against such participant.
SIGNATURE GUARANTEES. All signatures on a Letter of Transmittal must be
guaranteed by a financial institution (including most banks, savings and loan
associations and brokerage houses) that is a member of a recognized Medallion
Program approved by The Securities Transfer Association Inc., including the
Securities Transfer Agents Medallion Program (STAMP), the Stock Exchange
Medallion Program (SEMP) and the New York Stock Exchange, Inc. Medallion
Signature Program (MSP) or any other "eligible guarantor institution" (as such
term is defined in Rule 17Ad-15 under the Exchange Act) (each an "Eligible
Institution"), unless (i) the Letter of Transmittal is signed by the registered
holder of the Shares tendered therewith and such holder has not completed the
8
box entitled "Special Payment Instructions" on the Letter of Transmittal or (ii)
such Shares are tendered for the account of an Eligible Institution. See
Instructions 1 and 5 of the Letter of Transmittal.
GUARANTEED DELIVERY. If you wish to tender Shares pursuant to the Offer
and cannot deliver such Shares and all other required documents to the
Depositary by the Expiration Date or cannot complete the procedure for delivery
by book-entry transfer on a timely basis, you may nevertheless tender such
Shares if all of the following conditions are met:
o such tender is made by or through an Eligible Institution;
o a properly completed and duly executed Notice of Guaranteed
Delivery in the form provided by the Purchaser is received by the
Depositary (as provided below) by the Expiration Date; and
o the certificates for such Shares (or a confirmation of a
book-entry transfer of such Shares into the Depositary's account
at the Book-Entry Transfer Facility), together with a properly
completed and duly executed Letter of Transmittal (or facsimile
thereof) together with any required signature guarantee or an
Agent's Message and any other required documents, are received by
the Depositary within three business days after the date of
execution of the Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand or
transmitted by telegram, telex, facsimile transmission or mail to the Depositary
and must include a guarantee by an Eligible Institution in the form set forth in
such Notice.
BACKUP WITHHOLDING. Under the U.S. federal income tax laws, backup
withholding will apply to any payments made pursuant to the Offer unless you
provide the Depositary with your correct taxpayer identification number and
certify that you are not subject to such backup withholding by completing the
Substitute Form W-9 included in the Letter of Transmittal. If you are a
non-resident alien or foreign entity not subject to backup withholding, you must
give the Depositary a completed Form W-8BEN Certificate of Foreign Status before
receipt of any payment.
APPOINTMENT OF PROXY. By executing a Letter of Transmittal, you
irrevocably appoint our designees as your proxies in the manner set forth in the
Letter of Transmittal to the full extent of your rights with respect to the
Shares tendered and accepted for payment by us (and any and all other Shares or
other securities issued or issuable in respect of such Shares on or after
January 6, 2006). All such proxies are irrevocable and coupled with an interest
in the tendered Shares. Such appointment is effective only upon our acceptance
for payment of such Shares. Upon such acceptance for payment, all prior proxies
and consents granted by you with respect to such Shares and other securities
will, without further action, be revoked, and no subsequent proxies may be given
(and, if previously given, will cease to be effective). Our designees will be
empowered to exercise all your voting and other rights as they, in their
reasonable discretion, may deem proper at any annual, special or adjourned
meeting of the Company's stockholders. We reserve the right to require that, in
order for Shares to be deemed validly tendered, immediately upon our acceptance
for payment of such Shares, we or our designee must be able to exercise full
voting rights with respect to such Shares and other securities (including voting
at any meeting of stockholders).
The foregoing proxies are effective only upon acceptance for payment of
Shares pursuant to the Offer. The Offer does not constitute a solicitation of
proxies, absent a purchase of Shares, for any meeting of the Company's
stockholders.
DETERMINATION OF VALIDITY. We will determine, in our reasonable
discretion, all questions as to the form of documents and the validity,
eligibility (including time of receipt) and acceptance for payment of any tender
of Shares, and our determination shall be final and binding. We reserve the
absolute right to reject any or all tenders of Shares that we determine not to
be in proper form or the acceptance for payment of or payment for which may, in
the opinion of our counsel, be unlawful. We also reserve the absolute right to
waive any defect or irregularity in any tender of Shares. None of the Purchaser,
the Depositary, the Information Agent or any other person will be under any duty
to give notification of any defect or irregularity in tenders or waiver of any
such defect or irregularity or incur any liability for failure to give any such
notification.
9
4. WITHDRAWAL RIGHTS. You may withdraw tenders of Shares made pursuant
to the Offer at any time before the Expiration Date. Thereafter, such tenders
are irrevocable, except that they may be withdrawn after March 7, 2006, unless
such Shares have been accepted for payment as provided in this Offer to
Purchase. If we extend the period of time during which the Offer is open, are
delayed in accepting for payment or paying for Shares or are unable to accept
for payment or pay for Shares pursuant to the Offer for any reason, then,
without prejudice to our rights under the Offer, the Depositary may, on our
behalf, retain all Shares tendered, and such Shares may not be withdrawn except
as otherwise provided in this Section 4.
For your withdrawal to be effective, a written, telegraphic, telex or
facsimile transmission notice of withdrawal with respect to the Shares must be
timely received by the Depositary at one of its addresses set forth on the back
cover of this Offer to Purchase, and the notice of withdrawal must specify the
name of the person who tendered the Shares to be withdrawn, the number of Shares
to be withdrawn and the name of the registered holder of Shares, if different
from that of the person who tendered such Shares. If the Shares to be withdrawn
have been delivered to the Depositary, a signed notice of withdrawal with
(except in the case of Shares tendered by an Eligible Institution) signatures
guaranteed by an Eligible Institution must be submitted before the release of
such Shares. In addition, such notice must specify, in the case of Shares
tendered by delivery of certificates, the name of the registered holder (if
different from that of the tendering stockholder) and the serial numbers shown
on the particular certificates evidencing the Shares to be withdrawn or, in the
case of Shares tendered by book-entry transfer, the name and number of the
account at the Book-Entry Transfer Facility to be credited with the withdrawn
Shares. Withdrawals may not be rescinded, and Shares withdrawn will thereafter
be deemed not validly tendered. However, withdrawn Shares may be retendered by
again following one of the procedures described in "The Offer--Section 3" at any
time before the Expiration Date.
If we include a Subsequent Offering Period (as described in more detail
in "The Offer--Section 1") following the Offer, no withdrawal rights will apply
to Shares tendered in such Subsequent Offering Period and no withdrawal rights
apply during such Subsequent Offering Period with respect to Shares previously
tendered in the Offer and accepted for payment.
We will determine, in our reasonable discretion, all questions as to
the form and validity (including time of receipt) of any notice of withdrawal,
and our determination shall be final and binding. None of the Purchaser, the
Depositary, the Information Agent or any other person will be under any duty to
give notification of any defect or irregularity in any notice of withdrawal or
waiver of any such defect or irregularity or incur any liability for failure to
give any such notification.
5. CERTAIN TAX CONSIDERATIONS. THE U.S. FEDERAL INCOME TAX DISCUSSION
SET FORTH BELOW IS INCLUDED FOR GENERAL INFORMATION ONLY AND IS BASED UPON
PRESENT LAW. DUE TO THE INDIVIDUAL NATURE OF TAX CONSEQUENCES, YOU ARE URGED TO
CONSULT YOUR TAX ADVISORS AS TO THE SPECIFIC TAX CONSEQUENCES TO YOU OF THE
OFFER, INCLUDING THE EFFECTS OF APPLICABLE STATE, LOCAL AND OTHER TAX LAWS. The
following discussion may not apply to certain stockholders. For example, the
following discussion may not apply to you if you acquired your Shares pursuant
to the exercise of stock options or other compensation arrangements with the
Company, you are not a citizen or resident of the United States or you are
otherwise subject to special tax treatment under the Internal Revenue Code of
1986, as amended.
Your sale of Shares pursuant to the Offer will be a taxable transaction
for U.S. federal income tax purposes and may also be a taxable transaction under
applicable state, local and other tax laws. In general, if you tender Shares
pursuant to the Offer, you will recognize gain or loss equal to the difference
between the tax basis of your Shares and the amount of cash received in exchange
therefor. Such gain or loss will be capital gain or loss if you hold the Shares
as capital assets and will be long-term gain or loss if your holding period for
the Shares is more than one year as of the date of the sale of such Shares.
A stockholder whose shares are purchased in the Offer may be subject to
backup withholding unless certain information is provided to the Depositary or
an exemption applies. See "The Offer--Section 3--Backup Withholding".
10
6. PRICE RANGE OF SHARES; DIVIDENDS. The Shares are traded on Nasdaq
under the symbol "FOXX." The following table sets forth for the periods
indicated the high and low sales prices per Share on Nasdaq during each quarter
presented:
Fiscal Year Ended
2003 HIGH LOW
----- -----
First Quarter $9.68 $7.10
Second Quarter 9.21 7.05
Third Quarter 10.95 9.10
Fourth Quarter 12.46 10.30
2004
First Quarter 14.40 11.19
Second Quarter 16.20 12.19
Third Quarter 14.37 9.47
Fourth Quarter 11.79 8.60
2005
First Quarter 12.36 10.51
Second Quarter 12.61 10.95
Third Quarter 13.26 11.18
Fourth Quarter 13.10 10.16
DIVIDENDS. According to the Company 10-K, the Company did not declare
any dividends in fiscal 2004 and 2003 and does not anticipate paying any cash
dividends in the foreseeable future. If we acquire control of the Company, we
currently intend that no dividends will be declared on the Shares prior to the
acquisition of the entire equity interest in the Company.
On December 9, 2005, the last full business day before the announcement
of our intention to commence the Offer, the last reported sales price of the
Common Stock reported on Nasdaq was $13.22 per share. Please obtain a recent
quotation for your shares prior to deciding whether or not to tender.
7. POSSIBLE EFFECTS OF THE OFFER ON THE MARKET FOR THE SHARES; STOCK
EXCHANGE LISTING; REGISTRATION UNDER THE EXCHANGE ACT.
POSSIBLE EFFECTS OF THE OFFER ON THE MARKET FOR THE SHARES. If the
merger of the Company and us (or one of our subsidiaries) is consummated,
stockholders not tendering their Shares in the Offer (other than those properly
exercising their appraisal rights) will receive cash in an amount equal to the
price per Share paid in the Offer. Therefore, if such merger takes place, the
only difference between tendering and not tendering Shares in the Offer is that
tendering stockholders will be paid earlier. If, however, the merger does not
take place and the Offer is consummated, the number of stockholders and Shares
that are still in the hands of the public may be so small that there will no
longer be an active or liquid public trading market (or possibly any public
trading market) for Shares held by stockholders other than the Purchaser. We
cannot predict whether the reduction in the number of Shares that might
otherwise trade publicly would have an adverse or beneficial effect on the
market price for, or marketability of, the Shares or whether such reduction
would cause future market prices to be greater or less than the price paid in
the Offer.
STOCK EXCHANGE LISTING. As stated above, the Company's Shares are
presently listed on Nasdaq. Depending upon the number of Shares purchased
pursuant to the Offer, the purchase of the Shares by the Purchaser pursuant to
the Offer will reduce the number of Shares that might otherwise trade publicly
and will reduce the number of holders of Shares, which could adversely affect
the liquidity and market value of the remaining Shares held by the public. Even
if the merger is not completed, depending upon the number of Shares tendered to
and purchased by Purchaser in the Offer, the Shares may no longer meet the
requirements of the National Association of Securities Dealers for continued
inclusion on Nasdaq.
If Nasdaq ceased publishing quotations for the Shares, it is
possible that the Shares would continue to trade in the over-the-counter market
and that price or other quotations would be reported by other sources. The
extent of the public market for the Shares and the availability of such
quotations would depend, however, upon such factors as the number of
11
stockholders and the aggregate market value of the Shares available in the
public market at such time, the interest in maintaining a market in the Shares
on the part of securities firms, the possible termination of registration under
the Exchange Act as described below, and other factors. We cannot predict
whether the reduction in the number of Shares that might otherwise trade
publicly would have an adverse or beneficial effect on the market price for, or
marketability of, the Shares, or whether it would cause future market prices to
be greater or lesser than the price Purchaser is currently offering.
REGISTRATION UNDER THE EXCHANGE ACT. The Shares are currently
registered under the Exchange Act. Such registration may be terminated upon
application of the Company to the SEC if the Shares are neither listed on a
national securities exchange nor held by 300 or more holders of record.
Termination of the registration of the Shares under the Exchange Act would
substantially reduce the information required to be furnished by the Company to
holders of Shares and to the SEC and would make certain of the provisions of the
Exchange Act, such as the short-swing profit recovery provisions of Section
16(b), the requirement to furnish a proxy statement pursuant to Section 14(a) in
connection with a stockholder's meeting and the related requirement to furnish
an annual report to stockholders and the requirements of Rule 13e-3 under the
Exchange Act with respect to "going private" transactions, no longer applicable
to the Shares. Furthermore, "affiliates" of the Company and persons holding
"restricted securities" of the Company may be deprived of the ability to dispose
of such securities pursuant to Rule 144 promulgated under the Securities Act of
1933 (the "Securities Act"). We intend to seek to cause the Company to terminate
registration of the Shares under the Exchange Act as soon after consummation of
the Offer as the requirements for termination of registration of the Shares are
met.
8. CERTAIN INFORMATION CONCERNING THE COMPANY. The information
concerning the Company contained in this Offer to Purchase has been taken from
or based upon publicly available documents and records on file with the SEC and
other public sources and is qualified in its entirety by reference thereto. None
of Parent, the Purchaser, the Sponsors, the Information Agent or the Depositary
can take responsibility for the accuracy or completeness of the information
contained in such documents and records or for any failure by the Company to
disclose events which may have occurred or may affect the significance or
accuracy of any such information but which are unknown to Parent, the Purchaser,
the Sponsors, the Information Agent or the Depositary.
According to the Company 10-K, the Company is a Delaware corporation
with its principal executive offices at 1551 North Waterfront Parkway, Suite
310, Wichita, Kansas 67206. The Company's telephone number is (316) 634-0505.
The Company owns and operates 77 restaurants under the "Fox and Hound" and
"Bailey's" brand names that each provide a social gathering place offering high
quality food, drinks and entertainment in an upscale, casual environment.
ADDITIONAL INFORMATION. The Company is subject to the informational
requirements of the Exchange Act and in accordance therewith files periodic
reports, proxy statements and other information with the SEC relating to its
business, financial condition and other matters. The Company is required to
disclose in such proxy statements certain information, as of particular dates,
concerning the Company's directors and officers, their remuneration, stock
options granted to them, the principal holders of the Company's securities and
any material interest of such persons in transactions with the Company. Such
reports, proxy statements and other information may be inspected at the public
reference room maintained by the SEC at 100 F Street, N.E., Washington, D.C.
20549. Copies of such material can also be obtained at prescribed rates from the
public reference room of the SEC at 100 F Street, N.E., Washington, D.C. 20549,
or free of charge at the Web site maintained by the SEC at http://www.sec.gov.
Please call the SEC at 1-800-SEC-0330 for further information on the operation
of the public reference room.
9. CERTAIN INFORMATION CONCERNING THE PURCHASER, PARENT AND SPONSORS.
We are a Delaware corporation incorporated on December 19, 2005, with principal
executive offices at 300 Crescent Court, Suite 1110, Dallas, Texas 75201. The
telephone number of our principal executive offices is (214) 661-7474. We were
formed to serve as an acquisition vehicle for Parent, with no current operations
other than those incident to the commencement of the Offer. The Purchaser is a
wholly owned subsidiary of Parent.
Parent is a Delaware corporation incorporated on December 12, 2005,
with principal executive offices at 300 Crescent Court, Suite 1110, Dallas,
Texas 75201. The telephone number of Parent's principal executive offices is
(214) 661-7474. Parent is owned by Newcastle Partners, L.P. ("Newcastle") and
Steel Partners II, L.P. ("Steel").
12
Newcastle is a private investment partnership that has been in business
for over twelve years. Newcastle specializes in identifying, researching,
analyzing and investing in under-valued securities. Newcastle's investment
approach employs the solid, proven principles of a disciplined, value-based
strategy focused primarily on smaller capitalization companies. As part of its
investment strategy, Newcastle has a demonstrated expertise in making active and
control investments.
Newcastle beneficially owns 836,049 Shares of the Company, representing
approximately 8.3% of the Company's outstanding Shares. As the general partner
of Newcastle, Newcastle Capital Management, L.P. ("Newcastle Capital") may be
deemed to beneficially own the 836,049 Shares, or approximately 8.3% of the
Company's outstanding Shares, beneficially owned by Newcastle. The principal
business of Newcastle Capital is acting as the general partner of Newcastle. As
the general partner of Newcastle Capital, Newcastle Capital Group, L.L.C.
("Newcastle Capital Group") may be deemed to beneficially own the 836,049
Shares, or approximately 8.3% of the Company's outstanding Shares, beneficially
owned by Newcastle. The principal business of Newcastle Capital Group is acting
as the general partner of Newcastle Capital. Mark E. Schwarz, as the managing
member of Newcastle Capital Group, the general partner of Newcastle Capital,
which in turn is the general partner of Newcastle, may also be deemed to
beneficially own the 836,049 Shares, or approximately 8.3% of the Company's
outstanding Shares, beneficially owned by Newcastle. Collectively, Newcastle,
Newcastle Capital and Newcastle Capital Group are referred to herein as the
"Newcastle Entities." Each of the Newcastle Entities are organized under the
laws of the State of Texas. The business address for each of the Newcastle
Entities is 300 Crescent Court, Suite 1110, Dallas, Texas 75201. The business
telephone number for each of the Newcastle Entities is (214) 661-7474.
Steel is a Delaware limited partnership that invests in the securities
of small cap companies. Warren G. Lichtenstein is Chairman of the Board,
Secretary and the Managing Member of Steel Partners, L.L.C., a Delaware limited
liability company ("Partners LLC"), which in turn is the general partner of
Steel. The principal business of Partners LLC is acting as the general partner
of Steel. The principal occupation of Mr. Lichtenstein is investing in the
securities of small cap companies. The principal business address of Mr.
Lichtenstein, Partners LLC and Steel is 590 Madison Avenue, 32nd Floor, New
York, New York 10022. As of the date hereof, Steel does not beneficially own any
Shares. Collectively, Steel and Partners LLC are referred to herein as the
"Steel Entities." The business telephone number for each of the Steel Entities
is (212) 520-2300.
The name, business address, principal occupation or employment,
five-year employment history and citizenship of each director and executive
officer of the Newcastle Entities, the Steel Entities, Parent and the Purchaser
and certain other information are set forth on Schedule I hereto.
Except as set forth elsewhere in this Offer to Purchase or Schedule I
or Schedule II to this Offer to Purchase: (i) none of the Newcastle Entities,
the Steel Entities, Parent or the Purchaser and, to the Newcastle Entities', the
Steel Entities', Parent's and the Purchaser's knowledge, the persons listed in
Schedule I hereto or any associate or majority owned subsidiary of the Newcastle
Entities, the Steel Entities, Parent, the Purchaser or of any of the persons so
listed, beneficially owns or has a right to acquire any Shares or any other
equity securities of the Company; (ii) none of the Newcastle Entities, the Steel
Entities, Parent, the Purchaser and, to the Newcastle Entities', the Steel
Entities', Parent's and the Purchaser's knowledge, the persons or entities
referred to in clause (i) above has effected any transaction in the Shares or
any other equity securities of the Company during the past 60 days; (iii) none
of the Newcastle Entities, the Steel Entities, Parent, the Purchaser and, to the
Newcastle Entities', the Steel Entities', Parent's and the Purchaser's
knowledge, the persons listed in Schedule I to this Offer to Purchase, has any
contract, arrangement, understanding or relationship with any other person with
respect to any securities of the Company (including, but not limited to, any
contract, arrangement, understanding or relationship concerning the transfer or
the voting of any such securities, joint ventures, loan or option arrangements,
puts or calls, guaranties of loans, guaranties against loss or the giving or
withholding of proxies, consents or authorizations); (iv) during the two years
before the date of this Offer to Purchase, there have been no transactions
between the Newcastle Entities, the Steel Entities, Parent, the Purchaser, their
subsidiaries or, to the Newcastle Entities', the Steel Entities', Parent's and
the Purchaser's knowledge, any of the persons listed in Schedule I to this Offer
to Purchase, on the one hand, and the Company or any of its executive officers,
directors or affiliates, on the other hand, that would require reporting under
SEC rules and regulations; and (v) during the two years before the date of this
Offer to Purchase, there have been no contracts, negotiations or transactions
between the Newcastle Entities, the Steel Entities, Parent, the Purchaser, their
subsidiaries or, to the Newcastle Entities', the Steel Entities', Parent's and
the Purchaser's knowledge, any of the persons listed in Schedule I to this Offer
to Purchase, on the one hand, and the Company or any of its subsidiaries or
13
affiliates, on the other hand, concerning a merger, consolidation or
acquisition, a tender offer or other acquisition of securities, an election of
directors or a sale or other transfer of a material amount of assets.
10. SOURCE AND AMOUNT OF FUNDS. We will need approximately $142.7
million to purchase all of the outstanding Shares pursuant to the Offer and to
pay related fees and expenses. As of January 5, 2006, Newcastle and Steel had
aggregate cash and cash equivalents and short-term investments substantially in
excess of the approximately $142.7 million required to acquire the Shares. The
Purchaser intends to obtain all funds needed for the Offer through a capital
contribution or a loan from Newcastle and Steel. Newcastle and Steel plan to
provide the funds for such capital contribution from their available cash, cash
equivalents and working capital. The Offer is not subject to any financing
condition.
11. BACKGROUND OF THE OFFER. Below is a background description of
Parent's involvement with the Company.
On October 4, 2005, the Company announced that it signed a letter of
intent with Levine Leichtman Capital Partners ("LLCP") for the acquisition of
all of the Company's outstanding Common Stock for an all cash price of $14.00
per share, other than shares held by certain stockholders and members of
management. The Company's Board created a Special Committee of independent
directors to consider the proposal. The Special Committee unanimously approved
the letter of intent and recommended its approval by the Board. The Board
unanimously approved the Company entering into the letter of intent dated
October 4, 2005, which has an exclusivity agreement with LLCP that extends
through January 31, 2006. The Company agreed not to solicit alternative
transactions but may respond to certain unsolicited proposals and may terminate
the exclusivity agreement prior to January 31, 2006 upon receipt of a superior
proposal for an alternative transaction. Under certain circumstances, if the
Company terminates the exclusivity agreement for a superior proposal or the
Company enters into an agreement with respect to an alternative transaction
before May 1, 2006, the Company will be required to pay LLCP a fee of $5
million. In addition, the Company has agreed to reimburse LLCP for its expenses
in certain circumstances.
On November 21, 2005, Newcastle and its affiliates filed a Schedule 13G
with the SEC indicating that Newcastle beneficially owned 675,400 Shares as of
November 18, 2005, representing 6.7% of the Company's outstanding Shares.
On December 12, 2005, Parent issued a press release announcing (i) its
intention to commence a cash tender offer to purchase all Shares of the Company
not already owned by it for $14.75 per Share and (ii) that Newcastle and Steel
expect to commence the tender offer on or before December 23, 2005. Also on
December 12, 2005, Parent, Newcastle and Steel sent a letter to the Special
Committee of the Company's Board expressing Parent's willingness to negotiate
and enter into a definitive tender offer/merger agreement prior to commencement
of the Offer. In the letter, Parent, Newcastle and Steel expressed their belief
that its all-cash offer is superior to the $14.00 proposal made in the letter of
intent, dated October 4, 2005, executed by the Company with LLCP, as it will
provide stockholders and optionholders with immediate liquidity at a premium to
market and an immediate opportunity to maximize their investment in the Company.
On December 13, 2005, Parent and its affiliates filed a Schedule 13D
with the SEC indicating that the Newcastle Entities and Parent beneficially
owned 836,049 Shares as of December 12, 2005, representing 8.3% of the Company's
outstanding Shares.
On December 14, 2005, Parent entered into discussions with the Company
on the terms of a tender offer/merger agreement. Between December 15, 2005 and
December 19, 2005, Parent and Company and their representatives engaged in
negotiations on the terms of the tender offer/merger agreement. The Company also
provided the Parent with financial and legal due diligence during such period.
On December 17, 2005, representatives of Newcastle and Steel met with
certain members of management of the Company and discussed possible terms for a
negotiated and definitive tender offer/merger agreement.
14
On December 19, 2005, Parent issued a press release announcing that as
a result of its due diligence review of information provided to it by the
Company that it has revised the purchase price per Share of the cash tender
offer it has previously announced that it intends to commence to purchase all of
the outstanding Shares of the Company not owned by it for $14.75 per share to
$14.50 per share. Parent also announced in the press release that it has entered
into discussions with the Company on the terms of a tender offer/merger
agreement.
On December 20, 2005, Parent announced that it had signed and delivered
in escrow a definitive tender offer/merger agreement (the "Merger Agreement") to
acquire all of the outstanding Shares of the Company not already owned by it for
$14.50 per share. The Merger Agreement was held in escrow pursuant to a letter
agreement (the "Escrow Letter") with the Company, pursuant to which the Company
agreed to execute and deliver the Merger Agreement before January 6, 2006,
unless prior to such time the Company's Board determined that the proposal
contemplated by the Merger Agreement does not constitute a superior offer or the
Company gave notice to Parent that the Company is unable to make the
representations and warranties or perform its obligations under the Merger
Agreement.
On December 20, 2005, the Company announced that its Board has
determined that Parent's offer to enter into a negotiated tender offer/merger
for $14.50 per share in cash is a superior offer to the existing $14.00 per
share offer of LLCP.
On December 22, 2005, Parent issued a press release announcing that it
has deferred the date it intends to commence the $14.50 per share cash tender
offer to acquire all of the outstanding Shares of the Company not already owned
by it and that it intends to commence the cash tender offer on or before
December 30, 2005. The deferral was made in light of the previous announcement
on December 20, 2005 by Parent that it has signed and delivered in escrow a
fully-negotiated Merger Agreement and the announcement on December 20, 2005 by
the Company that Parent's $14.50 per share offer is a superior offer to the
existing $14.00 per share offer of LLCP.
From December 22, 2005 to December 28, 2005, Parent continued its due
diligence review and discussions with the Company on the terms and timing of the
tender offer/merger agreement. On December 28, 2005, Parent issued a press
release announcing that it has increased the tender offer price to $15.50 per
share for its cash tender offer and that it intends to commence the cash tender
offer on or before January 6, 2006. Also on December 28, 2005, Parent delivered
to the Company an amendment to the Merger Agreement pursuant to which the
Company agreed to execute and deliver the Merger Agreement before January 13,
2006, unless prior to such time the Company's Board determined that the proposal
contemplated by the Merger Agreement does not constitute a superior offer or the
Company gave notice to Parent that the Company is unable to make the
representations and warranties or perform its obligations under the Merger
Agreement.
On December 30, 2005, the Company announced that it signed an Agreement
and Plan of Merger with an affiliate of LLCP for the acquisition of all of the
Company's outstanding Shares for an all cash price of $15.50 per Share. Under
the terms of the Agreement and Plan of Merger, the affiliate of LLCP has agreed
to commence a tender offer not later than January 6, 2006 to acquire all of the
Company's outstanding Shares at such price. The Company has agreed in the merger
agreement not to solicit alternative transactions. The Company is permitted to
respond to certain unsolicited proposals and may terminate the Agreement and
Plan of Merger upon receipt of a superior proposal for an alternative
transaction. Under certain circumstances, if the Company terminates the
Agreement and Plan of Merger for a superior proposal, the Company enters into an
agreement with respect to an alternative transaction within twelve months
following the termination of the Agreement and Plan of Merger, or the Company
withdraws or adversely modifies its recommendation of the offer, the Company
will be required to pay a $5 million fee to LLCP. In addition, the Company has
agreed to reimburse LLCP for its expenses in certain circumstances of up to $1
million. In connection with the execution of the Agreement and Plan of Merger
with LLCP, the Company notified Newcastle and Steel that their offer was no
longer a superior proposal and that the Company will not enter into the
previously announced proposed transaction.
15
12. PURPOSE OF THE OFFER; PLANS FOR THE COMPANY; STATUTORY
REQUIREMENTS; APPROVAL OF THE MERGER; APPRAISAL RIGHTS.
PURPOSE OF THE OFFER; PLANS FOR THE COMPANY. The purpose of the Offer
is to acquire control of, and the entire equity interest in, the Company. We
currently intend, as soon as practicable after consummation of the Offer, to
seek maximum representation on the Company Board and to seek to have the Company
consummate a merger or other business combination with us (or one of our
subsidiaries). Pursuant to such merger, the outstanding Shares not owned by
Parent or its subsidiaries (including us) would be converted into the right to
receive cash in an amount equal to the price per Share provided pursuant to the
Offer.
If we acquire Shares pursuant to the Offer and depending upon the
number of Shares so acquired and other factors relevant to our equity ownership
in the Company, we may, subsequent to the consummation of the Offer, seek to
acquire additional Shares through open market purchases, privately negotiated
transactions, a tender or exchange offer or other transactions or a combination
of the foregoing on such terms and at such prices as we shall determine, which
may be different from the price paid in the Offer. We also reserve the right to
dispose of Shares that we have acquired or may acquire.
Whether or not we propose a merger or other similar business
combination with the Company, we currently intend, as soon as practicable after
consummation of the Offer, to seek maximum representation on the Company Board.
We intend, promptly after the consummation of the Offer, to request that some or
all of the current members of the Company Board resign and that our designees be
elected to fill the vacancies so created. Should such request be refused, we
intend to take such action as may be necessary and lawful to secure control of
the Company Board.
In connection with this Offer, Parent has reviewed and will continue to
review various possible business strategies that it might consider in the event
that the Purchaser acquires control of the Company, whether pursuant to the
Offer or otherwise. Following a review of additional information regarding the
Company, such changes could include, among other things, changes in the
Company's business, operations, personnel, employee benefit plans, corporate
structure, capitalization and management.
Except as described above or elsewhere in this Offer to Purchase, the
Purchaser has no present plans or proposals that would relate to or result in an
extraordinary corporate transaction involving the Company or any of its
subsidiaries (such as a merger, reorganization, liquidation, relocation of any
operations or sale or other transfer of a material amount of assets), any change
in the Company Board or management, any material change in the Company's
capitalization or dividend policy or any other material change in the Company's
corporate structure or business.
STATUTORY REQUIREMENTS; APPROVAL OF THE MERGER. Under the Delaware Law
and the Company's Certificate of Incorporation, if the Section 203 Condition is
satisfied, a merger of the Company would require the approval of the Company
Board and the holders of a majority of the outstanding Shares. If we acquire,
pursuant to the Offer or otherwise, at least a majority of the outstanding
Shares we would have sufficient voting power to approve a merger of the Company
without the affirmative vote of any other stockholder of the Company. In
addition, under the Delaware Law, if we acquire, pursuant to the Offer or
otherwise, at least 90% of the outstanding Shares, we believe we would be able
to approve the merger of the Company without a vote of the Company Board or
other stockholders. If we acquire control of the Company, we currently intend
that, prior to the acquisition of the entire equity interest in the Company, no
dividends will be declared on the Shares.
Section 203 could significantly delay our ability to acquire the entire
equity interest in the Company. In general, Section 203 prevents an "interested
stockholder" (generally, a stockholder owning 15% or more of a corporation's
outstanding voting stock or an affiliate or associate thereof) from engaging in
a "business combination" (defined to include a merger or consolidation and
certain other transactions) with a Delaware corporation for a period of three
years following the time on which such stockholder became an interested
stockholder unless (i) prior to such time the corporation's board of directors
approved either the business combination or the transaction which resulted in
such stockholder becoming an interested stockholder, (ii) upon consummation of
the transaction which resulted in such stockholder becoming an interested
stockholder, the interested stockholder owned at least 85% of the corporation's
voting stock outstanding at the time the transaction commenced (excluding shares
owned by certain employee stock plans and persons who are directors and also
16
officers of the corporation) or (iii) at or subsequent to such time the business
combination is approved by the corporation's board of directors and authorized
at an annual or special meeting of stockholders, and not by written consent, by
the affirmative vote of at least 66 2/3% of the outstanding voting stock not
owned by the interested stockholder.
The provisions of Section 203 do not apply to a Delaware corporation
if, among other things, (i) such corporation amends its certificate of
incorporation or bylaws to elect not to be governed by Section 203 by (in
addition to any other required vote) the affirmative vote of a majority of the
shares entitled to vote; provided that such amendment would not be effective
until 12 months after its adoption and would not apply to any business
combination between such corporation and any person who became an interested
stockholder on or prior to its adoption, (ii) such corporation does not have a
class of voting stock that is listed on a national securities exchange,
authorized for quotation on Nasdaq or held of record by more than 2,000
stockholders, unless any of the foregoing results from action taken, directly or
indirectly, by an interested stockholder or from a transaction in which a person
becomes an interested stockholder, or (iii) the business combination is proposed
by an interested stockholder prior to the consummation or abandonment of, and
subsequent to the earlier of the public announcement or the notice required
under Section 203 of, any one of certain proposed transactions which is with or
by a person who was not an interested stockholder during the previous three
years or who became an interested stockholder with the approval of the
corporation's board of directors and is approved or not opposed by a majority of
the board of directors then in office who were directors prior to any person
becoming an interested stockholder during the previous three years or were
recommended for election to succeed such directors by a majority of such
directors.
The Offer is subject to satisfaction of the Section 203 Condition,
which will be satisfied if, among other things, (i) prior to the acceptance for
payment of Shares pursuant to the Offer, the Company Board approves the Offer or
the proposed merger or (ii) there are validly tendered prior to the Expiration
Date and not withdrawn a number of Shares which, together with the Shares then
owned by us, would represent at least 85% of the Shares outstanding on the date
hereof (excluding Shares owned by certain employee stock plans and persons who
are directors and also officers of the Company).
We reserve the right to waive the Section 203 Condition, although there
can be no assurance that we will do so, and we have not determined whether we
would be willing to do so under any circumstances. If we waive such condition
and purchase Shares pursuant to the Offer or otherwise and Section 203 is
applicable, we may nevertheless seek to consummate a merger or other business
combination with the Company. We believe we would be able to cause the
consummation of such a merger or other business combination if we own a majority
of the outstanding Shares and (i) such merger or other business combination is
approved by the Company Board and authorized at an annual or special meeting of
stockholders of the Company, and not by written consent, by the affirmative vote
of at least 66 2/3% of the outstanding Shares not owned by us or our affiliates
and associates; or (ii) such merger or other business combination occurs after
the expiration of three years following the date we became an interested
stockholder.
On the other hand, if we waive the Section 203 Condition and purchase
Shares pursuant to the Offer or otherwise and are prevented by Section 203 from
consummating a merger or other business combination with the Company, we may (i)
determine not to seek to consummate such a merger or other business combination,
(ii) seek to acquire additional Shares in the open market, pursuant to privately
negotiated transactions or otherwise, at prices that may be higher, lower or the
same as the price paid in the Offer or (iii) seek to effect one or more
alternative transactions with or by the Company. We have not determined whether
we would take any of the actions described above under such circumstances.
Parent believes, among other things, that the Company's Board should
approve the Offer and take any other action necessary to render Section 203
inapplicable to a merger or other business combination with the Company. There
can be no assurance that the Company's Board will grant such approval or take
such other action.
The exact timing and details of any merger or other similar business
combination involving the Company will necessarily depend upon a variety of
factors, including the number of Shares we acquire pursuant to the Offer. We
currently intend to propose a merger or similar business combination generally
on the terms described above promptly following the Offer.
17
APPRAISAL RIGHTS. You do not have appraisal rights as a result of the
Offer. However, if a merger involving the Company is consummated, stockholders
of the Company who have neither voted in favor of the merger nor consented
thereto in writing, and who otherwise under the Delaware Law comply with the
applicable statutory procedures will be entitled to receive a judicial
determination of the fair value of their Shares (exclusive of any element of
value arising from the accomplishment or expectation of such merger) and to
receive payment of such fair value in cash, together with a fair rate of
interest, if any (all such Shares collectively, the "Dissenting Shares"). Any
such judicial determination of the fair value of the Dissenting Shares could be
based upon considerations other than or in addition to the price paid in the
Offer and the market value of the Shares. Stockholders should recognize that the
value so determined could be higher or lower than the price per Share paid
pursuant to the Offer or the consideration paid in such a merger. Moreover, we
may argue in an appraisal proceeding that, for purposes of such a proceeding,
the fair value of the Dissenting Shares is less than the price paid in the
Offer.
If any holder of Shares who demands appraisal under Section 262 of the
Delaware Law fails to perfect, or effectively withdraws or loses his rights to
appraisal as provided in the Delaware Law, the Shares of such stockholder will
be converted into the right to receive the price per Share paid in the Offer. A
stockholder may withdraw his demand for appraisal by delivering to us a written
withdrawal of his demand for appraisal and acceptance of the merger.
Failure to follow the steps required by Section 262 of the Delaware Law
for perfecting appraisal rights may result in the loss of such rights.
The foregoing discussion is not a complete statement of the Delaware
Law or U.S. federal law and is qualified in its entirety by reference to the
Delaware Law and applicable U.S. federal law.
13. DIVIDENDS AND DISTRIBUTIONS. If, on or after January 6, 2006, the
Company should split, combine or otherwise change the Shares or its
capitalization, acquire or otherwise cause a reduction in the number of
outstanding Shares or issue or sell any additional Shares (other than Shares
issued pursuant to and in accordance with the terms in effect on January 5,
2006, of employee stock options outstanding prior to such date), shares of any
other class or series of capital stock, other voting securities or any
securities convertible into, or options, rights, or warrants, conditional or
otherwise, to acquire, any of the foregoing, then, without prejudice to our
rights under "The Offer--Section 14", we may, in our reasonable discretion, make
such adjustments in the purchase price and other terms of the Offer as we deem
appropriate including the number or type of securities to be purchased.
If, on or after January 6, 2006, the Company should declare or pay any
dividend on the Shares or any distribution with respect to the Shares (including
the issuance of additional Shares or other securities or rights to purchase of
any securities) that is payable or distributable to stockholders of record on a
date prior to the transfer to the name of the Purchaser or its nominee or
transferee on the Company's stock transfer records of the Shares purchased
pursuant to the Offer, then, without prejudice to our rights under "The
Offer--Section 14", (i) the purchase price per Share payable by us pursuant to
the Offer will be reduced to the extent of any such cash dividend or
distribution and (ii) the whole of any such non-cash dividend or distribution to
be received by the tendering stockholders will (a) be received and held by the
tendering stockholders for our account and will be required to be promptly
remitted and transferred by each tendering stockholder to the Depositary for our
account, accompanied by appropriate documentation of transfer or (b) be
exercised for our benefit at our direction, in which case the proceeds of such
exercise will promptly be remitted to us. Pending such remittance and subject to
applicable law, we will be entitled to all rights and privileges as owner of any
such non-cash dividend or distribution or proceeds thereof and may withhold the
entire purchase price or deduct from the purchase price the amount or value
thereof, as we determine in our reasonable discretion.
14. CONDITIONS OF THE OFFER. Notwithstanding any other provision of the
Offer, we are not required to accept for payment or, subject to any applicable
rules and regulations of the SEC, including Rule 14e-1(c) under the Exchange Act
(relating to the Purchaser's obligation to pay for or return tendered Shares
promptly after termination or expiration of the Offer), pay for any Shares, and
may terminate or amend the Offer, if before the Expiration Date the Minimum
Tender Condition, the HSR Condition, the Liquor Condition or the Section 203
Condition shall not have been satisfied, or if, at any time on or after January
6, 2006, and before expiration of the Offer (or thereafter in relation to any
condition dependent upon the receipt of government approvals), any of the
following conditions exist:
18
(i) there is threatened, instituted or pending any action or
proceeding by any government, governmental authority or agency or any other
person, domestic, foreign, or supranational, before any court or governmental
authority or agency, domestic, foreign or supranational, (a) challenging or
seeking to make illegal, to delay or otherwise, directly or indirectly, to
restrain or prohibit the making of the Offer, the acceptance for payment of or
payment for some or all of the Shares by us or any of our subsidiaries or
affiliates or the consummation by us or any of our subsidiaries or affiliates of
a merger or other similar business combination involving the Company, (b)
seeking to obtain material damages or otherwise directly or indirectly relating
to the transactions contemplated by the Offer or any such merger or other
similar business combination, (c) seeking to restrain or prohibit the exercise
of our full rights of ownership or operation by us or any of our subsidiaries or
affiliates of all or any portion of our business or assets or that of the
Company or any of our and the Company's respective subsidiaries or affiliates or
to compel us or any of our subsidiaries or affiliates to dispose of or hold
separate all or any portion of our business or assets or that of the Company or
any of our or the Company's respective subsidiaries or affiliates, (d) seeking
to impose or confirm limitations on our ability or that of any of our
subsidiaries or affiliates effectively to exercise full rights of ownership of
the Shares, including, without limitation, the right to vote any Shares acquired
or owned by us or any of our subsidiaries or affiliates on all matters properly
presented to the Company's stockholders, (e) seeking to require divestiture by
us or any of our subsidiaries or affiliates of any Shares, (f) seeking any
material diminution in the benefits expected to be derived by us or any of our
subsidiaries or affiliates as a result of the transactions contemplated by the
Offer or any merger or other business combination involving the Company, (g)
adversely affecting the financing of the Offer or any merger or other business
combination involving the Company or (h) that otherwise, in our reasonable
judgment, has or may have material adverse significance with respect to either
the value of the Company or any of its subsidiaries or affiliates or the value
of the Shares to us or any of our subsidiaries or affiliates; or
(ii) any action is taken, or any statute, rule, regulation, injunction,
order or decree is proposed, enacted, enforced, promulgated, issued or deemed
applicable to the Offer, the acceptance for payment of or payment for Shares, or
any merger or other business combination involving the Company, by any court,
government or governmental authority or agency, domestic, foreign or
supranational, or of any applicable foreign statutes or regulations (as in
effect as of January 5, 2006), to the Offer or to any such merger or other
business combination that, in our reasonable judgment, might, directly or
indirectly, result in any of the consequences referred to in clauses (a) through
(h) of paragraph (i) above; or
(iii) any change occurs or is threatened (or any development occurs or
is threatened involving a prospective change) in the business, assets,
liabilities, financial condition, capitalization, operations, results of
operations or prospects of the Company or any of its affiliates that, in our
reasonable judgment, is or may be materially adverse to the Company or any of
its affiliates, or we become aware of any facts that, in our reasonable
judgment, have or may have material adverse significance with respect to either
the value of the Company or any of its affiliates or the value of the Shares to
us or any of our affiliates; or
(iv) there occurs (a) any general suspension of trading in, or
limitation on prices for, securities on any national securities exchange or in
the over-the-counter market, (b) any decline in either the Dow Jones Industrial
Average, the Standard and Poor's Index of 500 Industrial Companies or the
NASDAQ-100 Index by an amount in excess of 15%, measured from the business day
immediately preceding the commencement date of the Offer or any change in the
general political, market, economic or financial conditions in the United States
or abroad that, in our reasonable judgment, could have a material adverse effect
on the business, financial condition or results of operations or prospects of
the Company and its subsidiaries, taken as a whole, (c) the declaration of a
banking moratorium or any suspension of payments in respect of banks in the
United States, (d) any material adverse change (or development or threatened
development involving a prospective material adverse change) in U.S. or any
other currency exchange rates or a suspension of, or a limitation on, the
markets therefor, (e) any material adverse change in the market price of the
Shares or in the U.S. securities or financial markets, (f) the commencement of a
war, armed hostilities or other international or national calamity directly or
indirectly involving the United States or any attack on, outbreak or act of
terrorism involving the United States, (g) any limitation (whether or not
mandatory) by any governmental authority or agency on, or any other event that,
in our reasonable judgment, may adversely affect, the extension of credit by
banks or other financial institutions or (h) in the case of any of the foregoing
existing at the time of the commencement of the Offer, a material acceleration
or worsening thereof; or
19
(v) (a) a tender or exchange offer for some or all of the Shares has
been publicly proposed to be made or has been made by another person (including
the Company or any of its subsidiaries or affiliates), or has been publicly
disclosed, or we otherwise learn that any person or "group" (as defined in
Section 13(d)(3) of the Exchange Act) has acquired or proposes to acquire
beneficial ownership of more than 5% of any class or series of capital stock of
the Company (including the Shares), through the acquisition of stock, the
formation of a group or otherwise, or is granted any option, right or warrant,
conditional or otherwise, to acquire beneficial ownership of more than 5% of any
class or series of capital stock of the Company (including the Shares) other
than acquisitions for bona fide arbitrage purposes only and other than as
disclosed in a Schedule 13D or 13G on file with the SEC on January 5, 2006, (b)
any such person or group which, prior to January 6, 2006, had filed such a
Schedule with the SEC has acquired or proposes to acquire beneficial ownership
of additional shares of any class or series of capital stock of the Company,
through the acquisition of stock, the formation of a group or otherwise,
constituting 1% or more of any such class or series, or is granted any option,
right or warrant, conditional or otherwise, to acquire beneficial ownership of
additional shares of any class or series of capital stock of the Company
constituting 1% or more of any such class or series, (c) any person or group has
entered into a definitive agreement or an agreement in principle or made a
proposal with respect to a tender or exchange offer or a merger, consolidation
or other business combination with or involving the Company or (d) any person
has filed a Notification and Report Form under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 or made a public announcement reflecting an intent to
acquire the Company or any assets or securities of the Company; or
(vi) the Company or any of its subsidiaries has (a) split, combined or
otherwise changed, or authorized or proposed the split, combination or other
change of, the Shares or its capitalization, (b) acquired or otherwise caused a
reduction in the number of, or authorized or proposed the acquisition or other
reduction in the number of, outstanding Shares or other securities, (c) issued
or sold, or authorized or proposed the issuance or sale of, any additional
Shares, shares of any other class or series of capital stock, other voting
securities or any securities convertible into, or options, rights or warrants,
conditional or otherwise, to acquire, any of the foregoing (other than the
issuance of Shares pursuant to and in accordance with the terms in effect on
January 5, 2006, of employee stock options outstanding prior to such date), or
any other securities or rights in respect of, in lieu of, or in substitution or
exchange for any shares of its capital stock, (d) permitted the issuance or sale
of any shares of any class of capital stock or other securities of any
subsidiary of the Company, (e) declared, paid or proposed to declare or pay any
dividend or other distribution on any shares of capital stock of the Company,
(f) altered or proposed to alter any material term of any outstanding security,
issued or sold, or authorized or proposed the issuance or sale of, any debt
securities or otherwise incurred or authorized or proposed the incurrence of any
debt other than in the ordinary course of business, (g) authorized, recommended,
proposed, announced its intent to enter into or entered into an agreement with
respect to or effected any merger, consolidation, liquidation, dissolution,
business combination, acquisition of assets, disposition of assets or
relinquishment of any material contract or other right of the Company or any of
its subsidiaries or any comparable event not in the ordinary course of business,
(h) authorized, recommended, proposed, announced its intent to enter into or
entered into any agreement or arrangement with any person or group that, in our
reasonable judgment, has or may have material adverse significance with respect
to either the value of the Company or any of its subsidiaries or affiliates or
the value of the Shares to us or any of our subsidiaries or affiliates, (i)
entered into or amended any employment, severance or similar agreement,
arrangement or plan with any of its employees other than in the ordinary course
of business or entered into or amended any such agreements, arrangements or
plans so as to provide for increased benefits to employees as a result of or in
connection with the making of the Offer, the acceptance for payment of or
payment for some of or all the Shares by us or our consummation of any merger or
other similar business combination involving the Company, (j) except as may be
required by law, taken any action to terminate or amend any employee benefit
plan (as defined in Section 3(2) of the Employee Retirement Income Security Act
of 1974) of the Company or any of its subsidiaries, or we shall have become
aware of any such action which was not previously announced or (k) amended, or
authorized or proposed any amendment to, its certificate of incorporation or
bylaws (or other similar constituent documents) or we become aware that the
Company or any of its subsidiaries shall have amended, or authorized or proposed
any amendment to, its certificate of incorporation or bylaws (or other similar
constituent documents) which has not been previously disclosed; or
(vii) we become aware (a) that any material contractual right of the
Company or any of its subsidiaries has been impaired or otherwise adversely
affected or that any material amount of indebtedness of the Company or any of
its subsidiaries has been accelerated or has otherwise become due or become
subject to acceleration prior to its stated due date, in each case with or
without notice or the lapse of time or both, as a result of or in connection
with the Offer or the consummation by us or any of our subsidiaries or
20
affiliates of a merger or other similar business combination involving the
Company or (b) of any covenant, term or condition in any instrument or agreement
of the Company or any of its subsidiaries that, in our reasonable judgment, has
or may have material adverse significance with respect to either the value of
the Company or any of its affiliates or the value of the Shares to us or any of
our affiliates (including, without limitation, any event of default that may
ensue as a result of or in connection with the Offer, the acceptance for payment
of or payment for some or all of the Shares by us or our consummation of a
merger or other similar business combination involving the Company); or
(viii) we or any of our affiliates enters into a definitive agreement
or announces an agreement in principle with the Company providing for a merger
or other similar business combination with the Company or any of its
subsidiaries or the purchase of securities or assets of the Company or any of
its subsidiaries, or we and the Company reach any other agreement or
understanding pursuant to which it is agreed that the Offer will be terminated;
or
(ix) the Company or any of its subsidiaries shall have (a) granted to
any person proposing a merger or other business combination with or involving
the Company or any of its subsidiaries or the purchase of securities or assets
of the Company or any of its subsidiaries any type of option, warrant or right
which, in our reasonable judgment, constitutes a "lock-up" device (including,
without limitation, a right to acquire or receive any Shares or other
securities, assets or business of the Company or any of its subsidiaries) or (b)
paid or agreed to pay any cash or other consideration to any party in connection
with or in any way related to any such business combination or purchase; which,
in Parent's or the Purchaser's reasonable judgment, in any such case, and
regardless of the circumstances (including any action or omission by Parent or
the Purchaser) giving rise to any such condition, makes it inadvisable to
proceed with such acceptance for payment or payment.
The foregoing conditions are for the sole benefit of Parent, the
Purchaser and their affiliates and may be asserted by us or Parent in our
reasonable discretion regardless of the circumstances (excluding any affirmative
action or omission by Parent or us) giving rise to any such conditions or may be
waived by us in our reasonable discretion in whole or in part at any time or
from time to time before the Expiration Date (provided that all conditions to
the Offer must be satisfied or waived prior to expiration of the Offer). We
expressly reserve the right to waive any of the conditions to the Offer and to
make any change in the terms of or conditions to the Offer. Our failure at any
time to exercise our rights under any of the foregoing conditions shall not be
deemed a waiver of any such right. The waiver of any such right with respect to
particular facts and circumstances shall not be deemed a waiver with respect to
any other facts and circumstances. Each such right shall be deemed an ongoing
right which may be asserted at any time or from time to time. Any determination
made by us concerning the events described in this Section 14 shall be final and
binding upon all parties.
15. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS.
GENERAL. Based on our examination of publicly available information
filed by the Company with the SEC and other publicly available information
concerning the Company, other than any consents, approvals and authorizations
associated with either the HSR Condition or the Liquor Condition, we are not
aware of any governmental license or regulatory permit that appears to be
material to the Company's business that might be adversely affected by our
acquisition of Shares pursuant to the Offer or, except as set forth below, of
any approval or other action by any government or governmental administrative or
regulatory authority or agency, domestic or foreign, that would be required for
our acquisition or ownership of Shares pursuant to the Offer. Should any such
approval or other action be required or desirable, we currently contemplate
that, except as described below under "State Takeover Statutes", such approval
or other action will be sought. There is, however, no current intent to delay
the purchase of Shares tendered pursuant to the Offer pending the outcome of any
such matter. There can be no assurance that any such approval or other action,
if needed, would be obtained (with or without substantial conditions) or that if
such approvals were not obtained or such other actions were not taken adverse
consequences might not result to the Company's business or certain parts of the
Company's business might not have to be disposed of, any of which could cause us
to elect to terminate the Offer without the purchase of Shares thereunder. Our
obligation under the Offer to accept for payment and pay for Shares is subject
to the conditions set forth in "The Offer--Section 14".
21
ANTITRUST. Under the HSR Act and the rules and regulations that have
been issued by the Federal Trade Commission (the "FTC"), certain acquisition
transactions may not be consummated until certain information and documentary
material has been furnished for review by the Antitrust Division and the FTC and
certain waiting period requirements have been satisfied. The acquisition of
Shares pursuant to the Offer is subject to these requirements. Purchaser will
file a Premerger Notification and Report Form with the Antitrust Division and
the FTC in connection with the purchase of Shares pursuant to the Offer.
Under the HSR Act, the purchase of Shares in the Offer may not be
completed until the expiration of a 15-calendar-day waiting period following the
filing by the Purchaser of the Premerger Notification and Report Form with the
FTC and Antitrust Division, unless the waiting period is earlier terminated by
the FTC and the Antitrust Division or we receive a Request for Additional
Information and Documentary Material from the Antitrust Division or the FTC
prior to that time. If either the FTC or the Antitrust Division were to issue a
Request for Additional Information and Documentary Material to us, the waiting
period with respect to the Offer would expire at 11:59 p.m., Eastern time, on
the tenth calendar day after the date of our substantial compliance with that
request. Thereafter, the waiting period could be extended only by court order or
with our consent. The additional 10-calendar-day waiting period may be
terminated sooner by the FTC and the Antitrust Division. Although the Company is
required to file certain information and documentary material with the Antitrust
Division and the FTC in connection with the Offer, neither the Company's failure
to make those filings nor the issuance to the Company by the FTC or the
Antitrust Division of a Request for Additional Information and Documentary
Material will extend the waiting period with respect to the Offer.
The Antitrust Division and the FTC frequently scrutinize the legality
under the antitrust laws of transactions, such as our acquisition of Shares in
the Offer and any merger between us and the Company. At any time before or after
our purchase of Shares, the Antitrust Division or the FTC could take such action
under the antitrust laws that either deems necessary or desirable in the public
interest, including seeking to enjoin the purchase of Shares in the Offer, the
divestiture of Shares purchased pursuant to the Offer or the divestiture of
substantial assets of the Company or any of its subsidiaries. Private parties as
well as state attorneys general may also bring legal actions under the antitrust
laws under certain circumstances. See Section 14.
State antitrust authorities and private parties in certain
circumstances may bring legal action under the antitrust laws seeking to enjoin
the Offer or to impose conditions on the Offer.
STATE TAKEOVER STATUTES. A number of states have adopted laws which
purport, to varying degrees, to apply to attempts to acquire corporations that
are incorporated in, or which have substantial assets, stockholders, principal
executive offices or principal places of business or whose business operations
otherwise have substantial economic effects in, such states. The Company,
directly or through subsidiaries, conducts business in a number of states
throughout the United States, some of which have enacted such laws. Except as
described herein, we do not know whether any of these laws will, by their terms,
apply to the Offer or any merger or other business combination between us or any
of our affiliates and the Company, and we have not complied with any such laws.
To the extent that certain provisions of these laws purport to apply to the
Offer or any such merger or other business combination, we believe that there
are reasonable bases for contesting such laws.
If any government official or third party seeks to apply any state
takeover law to the Offer or any merger or other business combination between us
or any of our affiliates and the Company, we will take such action as then
appears desirable, which action may include challenging the applicability or
validity of such statute in appropriate court proceedings. If it is asserted
that one or more state takeover statutes is applicable to the Offer or any such
merger or other business combination and an appropriate court does not determine
that it is inapplicable or invalid as applied to the Offer or any such merger or
other business combination, we might be required to file certain information
with, or to receive approvals from, the relevant state authorities or holders of
Shares, and we may be unable to accept for payment or pay for Shares tendered
pursuant to the Offer, or be delayed in continuing or consummating the Offer or
any such merger or other business combination. In such case, we may not be
obligated to accept for payment or pay for any tendered Shares. See "The
Offer--Section 14".
OTHER. Any merger or other similar business combination that we propose
would also have to comply with any applicable U.S. federal law. In particular,
unless the Shares were deregistered under the Exchange Act prior to such
transaction, if such merger or other business combination were consummated more
than one year after termination of the Offer or did not provide for stockholders
to receive cash for their Shares in an amount at least equal to the price paid
22
in the Offer, we may be required to comply with Rule 13e-3 under the Exchange
Act. If applicable, Rule 13e-3 would require, among other things, that certain
financial information concerning the Company and certain information relating to
the fairness of the proposed transaction and the consideration offered to
minority stockholders in such a transaction be filed with the SEC and
distributed to such stockholders prior to consummation of the transaction.
LIQUOR APPROVALS. The Purchaser is required to obtain consents,
approvals or authorizations from the state, city and/or local liquor licensing
boards or agencies in certain states in which the Company holds liquor licenses
for the operation of its businesses. Certain of these approvals are required to
be obtained prior to a change in control being effected, and it is a condition
to the Purchaser's obligation to consummate the Offer that these approvals be
obtained prior to the Expiration Date. In addition, the surviving corporation
will be required to make filings or send notices to certain additional liquor
licensing agencies following consummation of the Offer and any merger.
16. FEES AND EXPENSES. We have retained MacKenzie Partners, Inc. to act
as the information agent and American Stock Transfer & Trust Company to act as
the depositary in connection with the Offer. The Information Agent may contact
holders of Shares by mail, telephone, telex, telegraph and personal interviews
and may request brokers, dealers, banks, trust companies and other nominees to
forward materials relating to the Offer to beneficial owners. The Information
Agent and the Depositary each will receive reasonable and customary compensation
for their respective services, will be reimbursed for certain reasonable
out-of-pocket expenses and will be indemnified against certain liabilities in
connection therewith, including certain liabilities under the U.S. federal
securities laws.
We will not pay any fees or commissions to any broker or dealer or any
other person (other than the Information Agent and the Depositary) for
soliciting tenders of Shares pursuant to the Offer. Brokers, dealers, banks,
trust companies and other nominees will, upon request, be reimbursed by us for
reasonable and necessary costs and expenses incurred by them in forwarding
materials to their customers.
17. MISCELLANEOUS. The Offer is not being made to, nor will tenders be
accepted from or on behalf of, holders of Shares in any jurisdiction in which
the making of the Offer or acceptance thereof would not be in compliance with
the laws of such jurisdiction. However, we may, in our reasonable discretion,
take such action as we may deem necessary to make the Offer in any such
jurisdiction and extend the Offer to holders of Shares in such jurisdiction.
No person has been authorized to give any information or make any
representation on behalf of Parent or the Purchaser not contained in this Offer
to Purchase or in the Letter of Transmittal and, if given or made, such
information or representation must not be relied upon as having been authorized.
We have filed with the SEC a Tender Offer Statement on Schedule TO,
together with exhibits, pursuant to Rule 14d-3 under the Exchange Act,
furnishing certain additional information with respect to the Offer. The
Schedule TO and any amendments thereto, including exhibits, may be examined and
copies may be obtained from the offices of the SEC in the manner described in
"The Offer--Section 9" of this Offer to Purchase.
NPSP ACQUISITION CORP.
January 6, 2006
23
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF THE NEWCASTLE ENTITIES, THE STEEL ENTITIES,
PARENT AND PURCHASER
Mark E. Schwarz, Steven J. Pully and John P. Murray are the sole
officers of the Newcastle Entities which currently have no directors. Mr.
Schwarz is the President, Chief Executive Officer and sole director of Parent
and the Purchaser. Mr. Pully is the Secretary and Treasurer of Parent and the
Purchaser. Warren G. Lichtenstein is the sole executive officer and director of
the Steel Entities.
The Newcastle Entities, the Steel Entities, Parent, the Purchaser, Mark
E. Schwarz and Warren G. Lichtenstein are parties to a Joint Filing Agreement,
dated December 22, 2005, pursuant to which they have agreed to the joint filing
on behalf of each of them of a Statement on Schedule 13D dated December 22, 2005
(including amendments thereto) with respect to the Shares of the Company.
The name, current principal occupation or employment and material
occupations, positions, offices or employment for the past five years of each
director and executive officer of the Newcastle Entities, the Steel Entities,
Parent and the Purchaser are set forth below. The business address of each
director and officer of the Newcastle Entities is care of Newcastle Partners,
L.P., 300 Crescent Court, Suite 1110, Dallas, Texas 75201. The business address
of the sole director and officer of the Steel Entities is care of Steel Partners
II, L.P., 590 Madison Avenue, 32nd Floor, New York, New York 10022. Except as
provided in the Offer to Purchase, none of the directors and officers listed
below has, during the past five years, (i) been convicted in a criminal
proceeding or (ii) been a party to any judicial or administrative proceeding
that resulted in a judgment, decree or final order enjoining the person from
future violations of, or prohibiting activities subject to, U.S. federal or
state securities laws, or a finding of any violation of U.S. federal or state
securities laws. All directors and officers listed below are citizens of the
United States.
Current Principal Occupation or
Name Age Employment and Five-year Employment History
- ---- --- -------------------------------------------
Mark E. Schwarz 44 Mark E. Schwarz is the Chairman, Chief Executive Officer and Portfolio
Manager of Newcastle Capital Management, L.P., a private investment
management firm he founded in 1993 that is the general partner of Parent.
Mr. Schwarz is Chairman of the Board and Chief Executive Officer of
Hallmark Financial Services, Inc., a property and casualty insurance
company, Chairman of the Board of Bell Industries, Inc., a computer
systems integrator, Pizza Inn, Inc., a franchisor and food and supply
distributor, and New Century Equity Holdings Corp., an asset management
company, and a director of Nashua Corporation, a specialty paper, label
and printing supplies manufacturer, SL Industries, Inc., a power and data
quality products manufacturer, WebFinancial Corporation, a specialty bank
and finance company, and Vesta Insurance Group, Inc., a holding company
for a group of insurance companies.
Warren G. Lichtenstein 39 Mr. Lichtenstein is the Chairman of the Board, Secretary and the Managing
Member of Steel Partners, L.L.C., the general partner of Steel Partners
II, L.P., a private investment partnership, and the President, Chief
Executive Officer and a director of Steel Partners, Ltd., a management
and advisory company that provides management services to Steel Partners
II, L.P. and its affiliates. Mr. Lichtenstein has been a director
(currently Chairman of the Board) of United Industrial Corporation, a
company principally focused on the design, production and support of
defense systems and a manufacturer of combustion equipment for biomass
and refuse fuels, since May 2001. Mr. Lichtenstein served as a director
of WebFinancial Corporation ("WebFinancial"), a consumer and commercial
lender, from 1996 to 2005 and served as Chairman and Chief Executive
Officer of WebFinancial from December 1997 to June 2005. He also served
S-1
as President of WebFinancial from December 1997 through December 2003.
Mr. Lichtenstein has been a director of Layne Christensen Company, a
provider of products and services for the water, mineral, construction
and energy markets, since January 2004 and has been a director of BKF
Capital Group, Inc., a publicly-traded investment firm, since June 2005.
Steven J. Pully 45 Mr. Pully is the President of Newcastle Capital Management, L.P., the
general partner of Parent. Mr. Pully is also Chief Executive Officer and
a director of New Century Equity Holdings Corp., an asset management
company, a director of Pizza Inn, Inc., a franchisor and food and supply
distributor and was Chief Executive Officer of Pinnacle Frames and
Accents, Inc. from January 2003 through June 2004, a private company
engaged in mass production of picture frame products. Prior to joining
Newcastle Capital Management, L.P. in late 2001, from May 2000 to
December 2001, he was a managing director in the mergers and acquisitions
department of Banc of America Securities, Inc. and from January 1997 to
May 2000 he was a member of the investment banking department of Bear
Stearns where he became a senior managing director in 1999. Prior to
becoming an investment banker, Mr. Pully practiced securities and
corporate law at the law firm of Baker & Botts. Mr. Pully is a CPA, a
CFA and a member of the Texas Bar.
John P. Murray 35 Mr. Murray is the Chief Financial Officer of Newcastle Capital
Management, L.P., the general partner of Parent. Prior to joining
Newcastle Capital Management, L.P. in January 2002, Mr. Murray was a
partner with Speer & Murray, Ltd., an accounting firm specializing in
tax planning and compliance, estate planning, asset protection and
investment management. Mr. Murray was also previously employed by Ernst
& Young, LLP as a member of the audit staff.
S-2
SCHEDULE II
TRANSACTIONS IN THE SHARES BY THE NEWCASTLE ENTITIES, THE STEEL ENTITIES,
PARENT AND PURCHASER DURING THE PAST 60 DAYS
Shares of Common Stock Price Per Date of
Purchased Share ($) Purchase
--------- --------- --------
NEWCASTLE PARTNERS, L.P.
------------------------
29,900 13.1003 11/07/05
37,500 13.0658 11/08/05
36,600 13.0530 11/09/05
48,000 12.9981 11/10/05
6,360 12.9939 11/11/05
25,525 13.0019 11/14/05
38,229 13.0014 11/15/05
61,800 12.9996 11/18/05
33,599 13.0122 11/21/05
45,800 13.0601 11/22/05
2,500 13.0460 11/22/05
12,700 13.0405 11/25/05
3,600 13.0500 12/06/05
250 13.1100 12/07/05
62,200 13.3081 12/12/05
NEWCASTLE CAPITAL MANAGEMENT, L.P.
----------------------------------
None
NEWCASTLE CAPITAL GROUP, L.L.C.
-------------------------------
None
STEEL PARTNERS II, L.P.
-----------------------
None
STEEL PARTNERS, L.L.C.
----------------------
None
F&H ACQUISITION CORP.
-------------------------
None
NPSP ACQUISITION CORP.
----------------------
None
S-3
Facsimile copies of the Letter of Transmittal will be accepted. The
Letter of Transmittal and certificates for Shares and any other required
documents should be sent to the Depositary at one of the addresses set forth
below:
The Depositary for the Offer is
[LOGO] American Stock Transfer
& Trust Company
BY MAIL OR OVERNIGHT COURIER: BY HAND:
American Stock Transfer & Trust Company American Stock Transfer & Trust Company
Operations Center Attn: Reorganization Department
Attn: Reorganization Department 59 Maiden Lane
6201 15th Avenue Concourse Level
Brooklyn, NY 11219 New York, NY 10038
By Facsimile
(718) 234-5001
Confirm Facsimile Transmission
(By Telephone Only)
Toll Free (877) 248-6417
If you have questions or need additional copies of this Offer to
Purchase and the Letter of Transmittal, you can call the Information Agent at
its address and telephone numbers set forth below. You may also contact your
broker, dealer, bank, trust company or other nominee for assistance concerning
the Offer.
The Information Agent for the Offer is:
[LOGO] MACKENZIE
PARTNERS, INC.
105 Madison Avenue
New York, New York
(212) 929-5500 (call collect)
or
Call Toll-Free (800) 322-2885