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Offer
to Purchase for Cash
Up
to 3,500,000 Shares of its Common Stock (including Associated Preferred Share
Purchase Rights) At a Purchase Price Not Greater Than $2.60
Nor
Less Than $1.80 Per Share
by
Aware,
Inc.
THE
TENDER OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT
5:00 P.M., NEW YORK CITY TIME, ON APRIL 2, 2009, UNLESS AWARE EXTENDS THE
TENDER OFFER.
March 5,
2009
To Our
Clients:
Enclosed for your consideration are the
offer to purchase, dated March 5, 2009, and the related letter of transmittal
(which, together with any supplements or amendments thereto, collectively
constitute the “tender offer”), in connection with the tender offer by Aware,
Inc., a Massachusetts corporation (“Aware”), to purchase up to 3,500,000 shares
of its common stock, par value $0.01 per share (the “shares”), including the
associated preferred share purchase rights issued under the Rights Agreement
dated as of October 2, 2001 between Aware and Computershare Trust Company, N.A.,
as Rights Agent, as amended on September 6, 2007, at a price per share not
greater than $2.60 nor less than $1.80, net to the seller in cash, without
interest, upon the terms and subject to the conditions of the tender offer.
Unless otherwise indicated, all references to the shares include the associated
preferred share purchase rights, and a tender of shares constitutes a tender of
these associated rights.
Given the prices specified by tendering
stockholders and the number of shares properly tendered and not properly
withdrawn, Aware will select the lowest price between (and including) $1.80 and
$2.60 per share (the “Purchase Price”) that will enable it to purchase 3,500,000
shares, or, if a lesser number of shares is properly tendered, all shares that
are properly tendered and not properly withdrawn. All shares purchased by Aware
under the tender offer will be purchased at the same per share
price.
All shares properly tendered before the
expiration date (as specified in Section 1 of the offer to purchase) at prices
at or below the Purchase Price and not properly withdrawn will be purchased by
Aware at the Purchase Price, net to the seller in cash, without interest, upon
the terms and subject to the conditions of the tender offer, including the “odd
lot,” proration and conditional tender provisions thereof. All shares tendered
at prices in excess of the Purchase Price and all shares that Aware does not
accept for purchase because of proration or conditional tenders will be returned
at Aware’s expense to the stockholders that tendered such shares as promptly as
practicable after the expiration date. Aware expressly reserves the right, in
its sole discretion, to purchase more than 3,500,000 shares under the tender
offer, subject to applicable law.
We are
the owner of record of shares held for your account. As such, we are the only
ones who can tender your shares, and then only pursuant to your instructions. We
are sending you the letter of transmittal for your information only. You cannot
use the letter of transmittal to tender shares we hold for your account. The
letter of transmittal must be completed and executed by us, according to your
instructions.
Please
instruct us as to whether you wish us to tender, on the terms and subject to the
conditions of the tender offer, any or all of the shares we hold for your
account, by completing and signing the Instruction Form enclosed
herein.
Please
note carefully the following:
1. You may
tender shares at prices not greater than $2.60 nor less than $1.80 per share as
indicated in the enclosed Instruction Form, net to you in cash, without
interest.
2. You
should consult with your broker and/or your tax advisor as to whether (and if
so, in what manner) you should designate the priority in which you want your
tendered shares to be purchased in the event of proration.
3. The
tender offer is not conditioned upon any minimum number of shares being
tendered. The tender offer is, however, subject to other conditions set forth in
Section 7 of the offer to purchase, which you should read
carefully.
4. The
tender offer, the proration period and the withdrawal rights will expire at 5:00
p.m., New York City time, on April 2, 2009, unless Aware extends the tender
offer.
5. The
tender offer is for up to 3,500,000 shares, constituting approximately 15% of
the shares of common stock outstanding as of February 24, 2009.
6. Tendering
stockholders who are registered stockholders or who tender their shares directly
to Computershare Trust Company, N.A., the depositary for the tender offer, will
not be obligated to pay any brokerage commissions or fees, solicitation fees, or
(except as set forth in the offer to purchase and Instruction 9 to the letter of
transmittal) stock transfer taxes on Aware’s purchase of shares under the tender
offer.
7. If you
(i) own beneficially or of record an aggregate of fewer than 100 shares, (ii)
instruct us to tender on your behalf ALL of the shares you own at or below the
Purchase Price before the expiration date and (iii) check the box captioned “Odd
Lots” in the attached Instruction Form, then Aware, upon the terms and subject
to the conditions of the tender offer, will accept all of your tendered shares
for purchase regardless of any proration that may be applied to the purchase of
other shares properly tendered but not meeting the above
conditions.
8. If you
wish to condition your tender upon the purchase of all shares tendered or upon
Aware’s purchase of a specified minimum number of the shares that you tender,
you may elect to do so and thereby avoid (in full or in part) possible proration
of your tender. Aware’s purchase of shares from all tenders which are so
conditioned will be determined, to the extent necessary, by random lot. To elect
such a condition, complete the section captioned “Conditional Tender” in the
attached Instruction Form.
9. If you
wish to tender portions of your shares at different prices, you must complete a
SEPARATE Instruction Form for each price at which you wish to tender each such
portion of your shares. We must and will submit separate letters of transmittal
on your behalf for each price you will accept.
10. The Board
of Directors of Aware has approved the tender offer. However, none of Aware, its
Board of Directors, the dealer manager or the information agent makes any
recommendation to stockholders as to whether to tender or refrain from tendering
their shares for purchase, or as to the price or prices at which stockholders
should choose to tender their shares. Stockholders must make their own decisions
as to whether to tender their shares and, if so, how many shares to tender and
the price or prices at which they should tender such shares. Aware’s directors
and executive officers have advised Aware that they do not intend to tender any
shares in the tender offer.
If you wish to have us tender any or
all of your shares, please instruct us to that effect by completing, executing,
and returning to us the enclosed Instruction Form. A pre-addressed envelope is
enclosed for your convenience. If you authorize us to tender your shares, we
will tender all of the shares that we hold beneficially for your account unless
you specify otherwise on the enclosed Instruction Form.
Please forward your completed
Instruction Form to us in a timely manner to give us ample time to permit us to
submit the tender on your behalf before the expiration date of the tender offer.
The tender offer, proration period and withdrawal rights will expire at 5:00
p.m., New York City time, on April 2, 2009, unless Aware extends the tender
offer.
As described in the offer to purchase,
if more than 3,500,000 shares, or such greater number of shares as Aware may
elect to purchase in accordance with applicable law, are properly tendered at or
below the Purchase Price and not properly withdrawn before the expiration date,
then Aware will accept shares for purchase at the Purchase Price in the
following order of priority:
1. First,
Aware will purchase all shares properly tendered at or below the Purchase Price
and not properly withdrawn before the expiration date by any “odd lot” holder
who:
(a) tenders ALL of the
shares owned beneficially or of record by such odd lot holder at or below the
Purchase Price before the expiration date (partial tenders will not qualify for
this preference); AND
(b) completes the section captioned
“Odd Lots” on the letter of transmittal and, if applicable, on the notice of
guaranteed delivery, without regard to any proration that would otherwise be
applicable to such “odd lot” shares.
2. Second,
after Aware has purchased all properly tendered (and not properly withdrawn)
“odd lot” shares, Aware will purchase all other shares properly tendered at or
below the Purchase Price before the expiration date (and not properly withdrawn)
on a pro rata basis if necessary, subject to the conditional tender provisions
described in Section 6 of the offer to purchase, and with adjustments to
avoid purchases of fractional shares, all as provided in the offer to
purchase.
3. Third,
and only if necessary to permit Aware to purchase 3,500,000 shares (or such
greater number of shares as Aware may elect to purchase subject to applicable
law), Aware will purchase properly tendered shares from holders who have
tendered shares conditionally (and for whom the condition was not initially
satisfied) by random lot to the extent feasible. To be eligible for purchase by
random lot, stockholders whose shares are conditionally tendered (and for whom
the condition was not initially satisfied) must have tendered all of their
shares.
The
tender offer is being made solely under the offer to purchase and the letter of
transmittal and is being made to all record holders of shares. The tender offer
is not being made to, nor will tenders be accepted from or on behalf of, holders
of shares residing in any jurisdiction in which the making of the tender offer
or acceptance thereof would not be in compliance with the securities, blue sky
or other laws of such jurisdiction.
YOUR
PROMPT ACTION IS REQUESTED. PLEASE FORWARD YOUR COMPLETED INSTRUCTION
FORM TO US IN AMPLE TIME TO PERMIT US TO SUBMIT THE TENDER ON YOUR BEHALF
BEFORE THE EXPIRATION OF THE TENDER OFFER.
Instruction
Form with Respect to
Aware,
Inc.
Offer
to Purchase for Cash
Up
to 3,500,000 Shares of its Common Stock
(including
Associated Preferred Share Purchase Rights)
At
a Purchase Price Not Greater Than $2.60
Nor
Less Than $1.80 Per Share
The undersigned acknowledge(s) receipt
of your letter in connection with the tender offer by Aware, Inc., a
Massachusetts corporation (“Aware”), to purchase up to 3,500,000 shares of its
common stock, par value $0.01 per share (the “shares”), including the associated
preferred share purchase rights issued under the Rights Agreement dated as of
October 2, 2001 between Aware and Computershare Trust Company, N.A., as Rights
Agent, as amended on September 6, 2007, at a price per share not greater than
$2.60 nor less than $1.80, net to the seller in cash, without interest, upon the
terms and subject to the conditions set forth in the offer to purchase, dated
March 5, 2009, and the related letter of transmittal (which, together with any
supplements or amendments thereto, collectively constitute the “tender offer”).
Unless otherwise indicated, all references to the shares include the associated
preferred share purchase rights, and a tender of shares includes a tender of the
associated rights.
The undersigned understands that, given
the prices specified by tendering stockholders and the number of shares properly
tendered and not properly withdrawn, Aware will select the lowest price between
(and including) $1.80 and $2.60 per share (the “Purchase Price”) that will
enable it to purchase 3,500,000 shares, or, if a lesser number of shares is
properly tendered, all shares that are properly tendered and not properly
withdrawn. All shares purchased by Aware under the tender offer will be
purchased at the same per share price. Aware will purchase all shares properly
tendered at prices at or below the Purchase Price (and not properly withdrawn)
at the Purchase Price, net to the seller in cash, without interest, upon the
terms and subject to the conditions of the tender offer, including the odd lot,
proration and conditional tender provisions described in the offer to purchase.
All other shares, including shares tendered at prices in excess of the Purchase
Price and shares that Aware does not accept for purchase because of proration or
conditional tenders will be returned at Aware’s expense to the stockholders that
tendered such shares as promptly as practicable after the expiration
date.
The undersigned hereby instruct(s) you
to tender to Aware the number of shares indicated below or, if no number is
indicated, all shares you hold for the account of the undersigned, at the price
per share indicated below, in accordance with the terms and subject to the
conditions of the tender offer.
NUMBER
OF SHARES TO BE TENDERED BY YOU FOR THE ACCOUNT OF THE UNDERSIGNED:
_______________________SHARES*
* Unless
you indicate otherwise, we will assume that you are instructing us to tender all
of the shares that we hold for your account.
CHECK
ONE AND ONLY ONE BOX ON
THIS PAGE. IF YOU CHECK MORE THAN ONE BOX, OR IF YOU DO NOT CHECK ANY BOX, YOU
WILL HAVE FAILED TO VALIDLY TENDER ANY SHARES.
PRICE
AT WHICH YOU ARE TENDERING
(See
Instruction 5 of the letter of transmittal)
SHARES
TENDERED AT PRICE DETERMINED PURSUANT TO THE TENDER OFFER: (See Instruction 5 of
the letter of transmittal)
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The
undersigned wants to maximize the chance of having Aware purchase all
shares the undersigned is tendering (subject to the possibility of
proration). Accordingly, by checking this ONE box INSTEAD OF ONE OF THE PRICE
BOXES BELOW, the undersigned hereby tenders shares and is willing
to accept the purchase price determined by Aware pursuant to the tender
offer (the “Purchase Price”). This action could result in receiving a
price per shares as low as $1.80 per
share.
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–
OR –
SHARES
TENDERED AT PRICE DETERMINED BY STOCKHOLDER: (See Instruction 5 of the letter of
transmittal)
By checking ONE of the boxes below INSTEAD OF THE BOX ABOVE, the
undersigned hereby tenders shares at the price checked. This action could result
in none of the shares being purchased if the Purchase Price is less than the
price checked below. A
stockholder who desires to tender shares at more than one price must complete a
separate letter of transmittal for each price at which the stockholder tenders
shares. You cannot tender the same shares at more than one price, unless
you have previously validly withdrawn those shares tendered at a different price
in accordance with Section 4 of the offer to purchase.
Price
(in Dollars) Per Share at Which Shares Are Being Tendered
¨ $1.80 ¨ $1.90 ¨ $2.00
¨ $2.10 ¨ $2.20 ¨ $2.30
¨ $2.40 ¨ $2.50 ¨ $2.60
You
WILL NOT have validly tendered your shares
unless
you check ONE AND ONLY ONE BOX ON THIS PAGE
ODD
LOTS
(See
Instruction 6 of the letter of transmittal)
To be
completed only if shares
are being tendered by or on behalf of a person owning, beneficially or of
record, an aggregate of fewer than 100 shares.
On the
date hereof, the undersigned either (check ONE box):
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is
the beneficial or record owner of an aggregate of fewer than 100 shares
and is tendering all of those
shares.
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In addition, the undersigned is
tendering shares (check ONE box):
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at
the Purchase Price, which will be determined by Aware in accordance with
the terms of the tender offer (persons checking this box should check the
first box on the previous page, under the heading “Shares Tendered at
Price Determined Pursuant to the Tender Offer”);
or
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at
the price per share indicated under the heading “Shares Tendered at Price
Determined by Stockholder.”
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CONDITIONAL
TENDER
(See
Instruction 11 of the letter of transmittal)
A tendering stockholder may condition
his or her tender of shares upon Aware purchasing a specified minimum number of
the shares tendered, as described in Section 6 of the offer to
purchase. Unless Aware purchases at least the minimum number of
shares you indicate below pursuant to the terms of the tender offer, Aware will
not purchase any of the shares tendered below. It is the tendering stockholder’s
responsibility to calculate that minimum number, and each stockholder should
consult his or her own tax advisor in doing so. Unless you check the box
immediately below and specify, in the space provided, a minimum number of shares
that Aware must purchase from you if Aware purchases any shares from you, Aware
will deem your tender offer unconditional.
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The
minimum number of shares that Aware must purchase from me, if Aware
purchases any shares, is:____________________________ shares.
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If, because of proration, Aware will
not purchase the minimum number of shares from you that you designate, Aware may
accept conditional tenders by random lot, if necessary. However, to be eligible
for purchase by random lot, the tendering stockholder must have tendered all of
his or her shares. To certify that you are tendering all of your shares, check
the box below.
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The
tendered shares represent all shares held by the
undersigned.
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THE METHOD OF DELIVERY OF THIS DOCUMENT
IS AT THE OPTION AND RISK OF THE TENDERING STOCKHOLDER. IF DELIVERY IS BY MAIL,
WE RECOMMEND REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED. IN
ALL CASES, PLEASE ALLOW SUFFICIENT TIME TO ASSURE DELIVERY.
–PLEASE
SIGN ON THE NEXT PAGE –
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SIGNATURE
Please
Print
Signature(s): ______________________________________________________________________________________________________
______________________________________________________________________________________________________
Name(s):
______________________________________________________________________________________________________
Taxpayer
Identification or
Social
Security Number:
___________________________________________________________________________________________
Addresses):
______________________________________________________________________________________________________
(include
zip code)
Area
Code & Phone Number(s):
________________________________________________________________________________________
Date: ____________________________________________________________________________________________________________
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