<PAGE>
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________________
SCHEDULE 14D-1
AND
SCHEDULE 13D
(AMENDMENT NO. 1)
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(D)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
____________________
WLR FOODS, INC.
(Name of Subject Company)
____________________
WLR ACQUISITION CORP.
(Bidder)
____________________
Common Stock, no par value
(Title of Class of Securities)
____________________
929286 10 2
(CUSIP Number of Class of Securities)
____________________
James B. Blair
Tyson Foods, Inc.
2210 West Oaklawn Drive
Springdale, Arkansas 72762-6999
Telephone Number (501) 290-4000
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications on Behalf of Bidders)
Copies to:
Leslie A. Grandis, Esq. Lawrence Lederman, Esq.
McGuire, Woods, Battle & Boothe Michael W. Goroff, Esq.
One James Center Milbank, Tweed, Hadley & McCloy
901 East Cary Street 1 Chase Manhattan Plaza
Richmond, Virginia 23219 New York, New York 10005
Telephone: (804) 775-4322 Telephone: (212) 530-5000
<TABLE>
<CAPTION>
CALCULATION OF FILING FEE
===============================================================================
Transaction Value* Amount of Filing Fee**
- -------------------------------------------------------------------------------
<S> <C>
$311,013,900.00........... $62,202.78
<FN>
===============================================================================
* Pursuant to, and as provided by, Rule 0-11(d), this amount is based upon
the purchase, at $30.00 per share, net to the seller in cash, of 10,367,130
shares of Common Stock of WLR Foods, Inc., which is equal to (i) the number
of Shares (10,967,193) outstanding as reported in the Quarterly Report on
Form 10-Q of WLR Foods, Inc. for the fiscal quarter ended January 1, 1994,
minus (ii) the number of Shares (600,063) beneficially owned by WLR
Acquisition Corp. and its affiliates on the date hereof.
** 1/50 of 1% of the Transaction Valuation
</TABLE>
/ / Check box if any part of the fee is offset as provided by
Rule 0-11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
Amount Previously Paid: N/A
Form or Registration No.: N/A
Filing Party: N/A
Date Filed: N/A
Page 1 of __ Pages
The Exhibit Index is located on Page __
===============================================================================
<PAGE>
CUSIP No. 929286 10 2 14D-1 Page 2 of ____ Pages
- -------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
TYSON FOODS, INC.
- -------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE
INSTRUCTIONS) (A) / /
(B) /x/
- -------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
WC, BK
- -------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) OR 2(f) / /
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
- -------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
600,063 COMMON SHARES
- -------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES (SEE INSTRUCTIONS) / /
- -------------------------------------------------------------------------------
9 % OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
5.47%
- -------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
CO
- -------------------------------------------------------------------------------
<PAGE>
CUSIP No. 929286 10 2 14D-1 Page 3 of ____ Pages
- -------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
WLR ACQUISITION CORP.
- -------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE
INSTRUCTIONS) (A) / /
(B) /X/
- -------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
BK
- -------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) OR 2(f) / /
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
- -------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
600,000 COMMON SHARES
- -------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES (SEE INSTRUCTIONS) / /
- -------------------------------------------------------------------------------
9 % OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
5.47%
- -------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
CO
- -------------------------------------------------------------------------------
<PAGE>
CUSIP No. 929286 10 2 14D-1 Page 4 of ____ Pages
- -------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
TYSON LIMITED PARTNERSHIP
- -------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE
INSTRUCTIONS) (A) / /
(B) /X/
- -------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
NOT APPLICABLE
- -------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) OR 2(f) / /
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
- -------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
600,063 COMMON SHARES
- -------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES (SEE INSTRUCTIONS) / /
- -------------------------------------------------------------------------------
9 % OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
5.47%
- -------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
PN
- -------------------------------------------------------------------------------
<PAGE>
CUSIP No. 929286 10 2 14D-1 Page 5 of ____ Pages
- -------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
MR. DON TYSON
- -------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE
INSTRUCTIONS) (A) / /
(B) /X/
- -------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
NOT APPLICABLE
- -------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) OR 2(f) / /
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
- -------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
600,063 COMMON SHARES
- -------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES (SEE INSTRUCTIONS) / /
- -------------------------------------------------------------------------------
9 % OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
5.47%
- -------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IN
- -------------------------------------------------------------------------------
<PAGE>
This Statement on Schedule 14D-1 relates to the offer by WLR
Acquisition Corp., a Delaware corporation (the "Purchaser"), and a wholly-owned
subsidiary of Tyson Foods, Inc., a Delaware corporation ("Tyson"), to purchase
all outstanding shares of Common Stock, no par value (the "Shares"), of WLR
Foods, Inc., a Virginia corporation (the "Company"), at a price of $30.00 per
share, net to the seller in cash, upon the terms and subject to the conditions
set forth in the Offer to Purchase, dated March 9, 1994 (the "Offer to
Purchase") and in the related Letter of Transmittal, copies of which are
attached hereto as Exhibits 99.1 and 99.2, respectively (which collectively
constitute the "Offer").
This Statement also constitutes Amendment No. 1 to the Statement on
Schedule 13D, dated March 4, 1994, filed by the Purchaser, Tyson, Tyson Limited
Partnership and Mr. Don Tyson, relating to their beneficial ownership of Shares.
ITEM 1. SECURITY AND SUBJECT COMPANY.
(a) The name of the subject company is WLR Foods, Inc., a Virginia
corporation, and the address of its principal executive offices is P.O.
Box 7000, Broadway, Virginia 22815.
(b) The exact title of the class of equity securities being sought in
the Offer is Common Stock, no par value, of the Company. The information set
forth in the Introduction to the Offer to Purchase is incorporated herein by
reference.
(c) The information set forth in Section 6 ("Price Range of the
Shares; Dividends") of the Offer to Purchase is incorporated herein by
reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(d), (g) This Statement is filed by the Purchaser and Tyson. The
information set forth in the Introduction and Section 9 ("Certain Information
Concerning the Purchaser and Tyson") of, and Schedule I to, the Offer to
Purchase is incorporated herein by reference.
(e)-(f) Neither the Purchaser nor Tyson nor, to their knowledge, any
of the persons listed in Schedule I to the Offer to Purchase, has during the
last five years (i) been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors), or (ii) been a party to a civil proceeding
of a judicial or administrative body of competent jurisdiction and as a result
of such proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting activities subject to, federal or
state securities laws or finding any violation of such laws.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
(a) The information set forth in Section 9 ("Certain Information
Concerning the Purchaser and Tyson") of the Offer to Purchase is incorporated
herein by reference.
(b) The information set forth in the Introduction, Section 9
("Certain Information Concerning the Purchaser and Tyson") and Section 11
("Background of the Offer; Contacts with the Company") of the Offer to Purchase
is incorporated herein by reference. Except as set forth therein, since July 1,
1990 there have been no contacts, negotiations or transactions required to be
set forth in this item.
6
<PAGE>
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)-(b) The information set forth in Section 10 ("Source and Amount
of Funds") of the Offer to Purchase is incorporated herein by reference.
(c) Not applicable.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.
(a)-(e) The information set forth in the Introduction, Section 9
("Certain Information Concerning the Purchaser and Tyson"), Section 11
("Background of the Offer; Contacts with the Company") and Section 12 ("Purpose
of the Offer; Plans for the Company; Other Matters Relating to the Offer and the
Proposed Merger") of the Offer to Purchase are incorporated herein by reference.
Except as set forth therein, there are no plans or proposals required to be set
forth in this item.
(f)-(g) The information set forth in Section 7 ("Effect of the Offer
on the Market for the Shares; NASDAQ Quotation; Exchange Act Registration;
Margin Regulations") of the Offer to Purchase is incorporated herein by
reference.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a)-(b) The information set forth in the Introduction, Section 9
("Certain Information Concerning the Purchaser and Tyson"), Section 11
("Background of the Offer; Contacts with the Company") and Section 12 ("Purpose
of the Offer; Plans for the Company; Other Matters Relating to the Offer and the
Proposed Merger") of the Offer to Purchase is incorporated herein by reference.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE SUBJECT COMPANY'S SECURITIES.
The information in the Introduction, Section 9 ("Certain Information
Concerning the Purchaser and Tyson"), Section 12 ("Purpose of the Offer; Plans
for the Company; Other Matters Relating to the Offer and the Proposed Merger")
and Section 16 ("Fees and Expenses") of the Offer to Purchase is incorporated
herein by reference.
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth in the Introduction, Section 10 ("Source and
Amount of Funds") and Section 16 ("Fees and Expenses") of the Offer to Purchase
is incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS.
The information in Section 9 ("Certain Information Concerning the
Purchaser and Tyson") of the Offer to Purchase is incorporated herein by
reference.
ITEM 10. ADDITIONAL INFORMATION.
(a) None.
7
<PAGE>
(b)-(c) The information set forth in Section 15 ("Certain Legal
Matters; Regulatory Approvals") of the Offer to Purchase is incorporated herein
by reference.
(d) The information set forth in the Introduction, Section 6 ("Price
Range of the Shares; Dividends"), Section 7 ("Effect of the Offer on the Market
for the Shares; NASDAQ Quotation; Exchange Act Registration; Margin
Regulations"), Section 12 ("Source and Amount of Funds") and Section 15
("Certain Legal Matters; Regulatory Approvals") of the Offer to Purchase is
incorporated herein by reference.
(e) The information set forth in the Introduction, Section 12
("Purpose of the Offer; Plans for the Company; Other Matters Relating to the
Offer and the Proposed Merger") and Section 15 ("Certain Legal Matters;
Regulatory Approvals") of the Offer to Purchase is incorporated herein by
reference.
(f) The information set forth in the Offer to Purchase and the Letter
of Transmittal, copies of which are attached hereto as Exhibits 99.1 and 99.2,
respectively, is incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a) 99.1 -- Offer to Purchase, dated March 9, 1994.
99.2 -- Letter of Transmittal.
99.3 -- Notice of Guaranteed Delivery.
99.4 -- Letter from the Information Agent to Brokers, Dealers,
Commercial Banks, Trust Companies and Other Nominees.
99.5 -- Letter to Clients for use by Brokers, Dealers, Commercial
Banks, Trust Companies and Other Nominees.
99.6 -- Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9.
99.7 -- Text of Press Releases issued by Tyson Foods, Inc., dated
March 3, 1994 and March 9, 1994.
99.8 -- Summary Advertisement as published in THE WALL STREET
JOURNAL on March 9, 1994.
(b) 99.9 -- Commitment Letter, dated March 1, 1994 between Tyson Foods,
Inc., Bank of America National Trust and Savings Association
and BA Securities, Inc.
(c) -- Not applicable.
(d) -- Not applicable.
(e) -- Not applicable.
(f) -- Not applicable.
8
<PAGE>
(g) Other Material.
99.10 -- Amended Complaint of WLR Foods, Inc., filed February 9,
1994.
99.11 -- Answer, Affirmative Defenses and Counterclaims of
Tyson Foods, Inc., filed February 25, 1994.
9
<PAGE>
SIGNATURE
After due inquiry and to the best of their knowledge and belief, the
undersigned certify that the information set forth in this statement is true,
complete and correct.
WLR ACQUISITION CORP.
By /s/ Gerald Johnston
--------------------------------
Name: Gerald Johnston
Title: Vice President
Dated: March 9, 1994
TYSON FOODS, INC.
By /s/ Gerald Johnston
--------------------------------
Name: Gerald Johnston
Title: Executive Vice President,
Finance
Dated: March 9, 1994
10
<PAGE>
EXHIBIT INDEX
Exhibit Page No.
- ------- --------
99.1 Offer to Purchase, dated March 9, 1994
99.2 Letter of Transmittal
99.3 Notice of Guaranteed Delivery
99.4 Letter from the Information Agent to Brokers, Dealers,
Commercial Banks, Trust Companies
and Other Nominees
99.5 Letter to Clients for use by Brokers, Dealers, Commercial
Banks, Trust Companies and Other Nominees
99.6 Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9
99.7 Text of Press Releases issued by Tyson Foods, Inc.,
dated March 3, 1994 and March 9, 1994
99.8 Summary Advertisement as published in THE WALL STREET
JOURNAL on March 9, 1994
99.9 Commitment Letter, dated March 1, 1994, between Tyson Foods,
Inc., Bank of America National Trust and Savings Association
and BA Securities, Inc.
99.10 Amended Complaint of WLR Foods, Inc., filed February 9, 1994
99.11 Answer, Affirmative Defenses and Counterclaims of Tyson
Foods, Inc., filed Febtuary 25, 1994
11
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
WLR FOODS, INC.
AT
$30.00 NET PER SHARE
BY
WLR ACQUISITION CORP.
A WHOLLY-OWNED SUBSIDIARY OF
TYSON FOODS, INC.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON FRIDAY, APRIL 8, 1994, UNLESS THE OFFER IS EXTENDED.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED, AND NOT WITHDRAWN PRIOR TO THE EXPIRATION DATE, THAT NUMBER OF SHARES
WHICH, TOGETHER WITH THE SHARES BENEFICIALLY OWNED BY THE PURCHASER AND ITS
AFFILIATES, REPRESENTS AT LEAST A MAJORITY OF THE TOTAL NUMBER OF THE SHARES
OUTSTANDING ON A FULLY DILUTED BASIS ON THE DATE OF PURCHASE, (2) THE PREFERRED
SHARE PURCHASE RIGHTS HAVING BEEN REDEEMED BY THE BOARD OF DIRECTORS OF THE
COMPANY OR THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE
PREFERRED SHARE PURCHASE RIGHTS HAVE BEEN INVALIDATED OR ARE OTHERWISE
INAPPLICABLE TO THE OFFER AND TO THE PROPOSED MERGER, (3) THE PURCHASER BEING
SATISFIED, IN ITS SOLE DISCRETION, THAT AFTER CONSUMMATION OF THE OFFER, THE
RESTRICTIONS CONTAINED IN ARTICLE 14 OF THE VIRGINIA STOCK CORPORATION ACT WILL
NOT APPLY TO THE PROPOSED MERGER, AND (4) FULL VOTING RIGHTS FOR ALL SHARES
ACQUIRED BY THE PURCHASER OR TYSON OR ANY OF THEIR ASSOCIATES PURSUANT TO, OR IN
CONTEMPLATION OF, THE OFFER (WHICH WOULD OTHERWISE BE DENIED VOTING RIGHTS UNDER
ARTICLE 14.1 OF THE VIRGINIA STOCK CORPORATION ACT) HAVING BEEN APPROVED AT A
SPECIAL MEETING OF SHAREHOLDERS OF THE COMPANY OR THE PURCHASER BEING SATISFIED,
IN ITS SOLE DISCRETION, THAT ARTICLE 14.1 OF THE VIRGINIA STOCK CORPORATION ACT
IS INAPPLICABLE TO THE PURCHASER OR TYSON OR ANY OF THEIR ASSOCIATES OR THE
ACQUISITION OF SHARES BY ANY OF THEM. THE OFFER IS ALSO SUBJECT TO OTHER TERMS
AND CONDITIONS CONTAINED IN THIS OFFER TO PURCHASE. SEE THE INTRODUCTION AND
SECTIONS 1 AND 14.
------------------------
IMPORTANT
Any shareholder desiring to tender all or any portion of his Shares should
either (1) 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 it with the certificate(s) representing tendered Shares and any other
required documents to the Depositary or tender such Shares pursuant to the
procedure for book-entry transfer set forth in Section 3, or (2) request his
broker, dealer, commercial bank, trust company or other nominee to effect the
transaction for him. A shareholder whose Shares are registered in the name of a
broker, dealer, commercial bank, trust company or other nominee must contact
such broker, dealer, commercial bank, trust company or other nominee if he
desires to tender such Shares.
A shareholder who desires to tender Shares and whose certificates
representing such Shares are not immediately available, or who cannot comply in
a timely manner with the procedures for book-entry transfer, should tender such
Shares by following the procedures for guaranteed delivery set forth in Section
3.
Questions and requests for assistance or for additional copies of this Offer
to Purchase, the Letter of Transmittal and the Notice of Guaranteed Delivery may
be directed to MacKenzie Partners, Inc., the Information Agent, at its address
and telephone numbers set forth on the back cover of this Offer to Purchase.
Shareholders may also contact brokers, dealers, commercial banks or trust
companies for assistance concerning the Offer.
------------------------
March 9, 1994
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
INTRODUCTION........................................................................... 1
1. Terms of the Offer............................................................ 6
2. Acceptance for Payment and Payment............................................ 7
3. Procedures for Tendering Shares............................................... 8
4. Withdrawal Rights............................................................. 11
5. Certain Federal Income Tax Consequences....................................... 12
6. Price Range of the Shares; Dividends.......................................... 12
7. Effect of the Offer on the Market for the Shares; NASDAQ Quotation;
Exchange Act Registration; Margin Regulations................................. 13
8. Certain Information Concerning the Company.................................... 14
9. Certain Information Concerning the Purchaser and Tyson........................ 16
10. Source and Amount of Funds.................................................... 19
11. Background of the Offer; Contacts with the Company............................ 20
12. Purpose of the Offer; Plans for the Company; Other Matters Relating to
the Offer and the Proposed Merger............................................. 25
13. Dividends and Distributions................................................... 36
14. Certain Conditions of the Offer............................................... 36
15. Certain Legal Matters; Regulatory Approvals................................... 40
16. Fees and Expenses............................................................. 43
17. Miscellaneous................................................................. 44
SCHEDULE I............................................................................. 45
</TABLE>
i
<PAGE>
To the Holders of Shares of Common Stock of
WLR Foods, Inc.:
INTRODUCTION
WLR Acquisition Corp., a Delaware corporation (the "Purchaser") and a
wholly-owned subsidiary of Tyson Foods, Inc., a Delaware corporation ("Tyson"),
hereby offers to purchase all outstanding shares of common stock, no par value
(the "Shares" or "Common Stock"), of WLR Foods, Inc., a Virginia corporation
(the "Company"), at $30.00 per Share, net to the seller in cash, upon the terms
and subject to the conditions set forth in this Offer to Purchase and in the
related Letter of Transmittal (which together constitute the "Offer"). Tendering
shareholders will not be obligated to pay brokerage commissions or, except as
set forth in Instruction 6 of the Letter of Transmittal, transfer taxes on the
purchase of Shares by the Purchaser pursuant to the Offer. The Purchaser will
pay all charges and expenses of IBJ Schroder Bank & Trust Company, which is
acting as the Depositary (the "Depositary"), and MacKenzie Partners, Inc., which
is acting as the Information Agent (the "Information Agent"), incurred in
connection with the Offer. See Section 16.
According to the Company's Registration Statement on Form 8-A (the "Company
8-A") filed on February 7, 1994 with the Securities and Exchange Commission (the
"Commission"), on February 4, 1994, the Board of Directors of the Company
declared a dividend distribution of one preferred share purchase right (a
"Right") in respect of each outstanding Share, payable to shareholders of record
on February 14, 1994, pursuant to a Shareholder Protection Rights Agreement,
dated as of February 4, 1994 (the "Rights Agreement"), between the Company and
First Union National Bank of North Carolina, as Rights Agent. Except to the
extent that Rights are evidenced by certificates representing Shares ("Share
Certificates"), the Purchaser is not offering to purchase (nor will tenders be
accepted of) the Rights pursuant to the Offer. Accordingly, shareholders who
sell their Rights separately from their Shares or who acquire Shares without
acquiring the associated Rights will be able to effect a valid tender of Shares
without delivering certificates representing Rights ("Rights Certificates"), in
the event Rights Certificates are distributed by the Company.
The purpose of the Offer is for Tyson, through the Purchaser, to acquire
control of, and the entire equity interest in, the Company. Tyson currently
intends, as soon as practicable following consummation of the Offer, to propose
and seek to have the Company consummate a merger or similar business combination
(the "Proposed Merger") with the Purchaser or another direct or indirect
wholly-owned subsidiary of Tyson, pursuant to which each Share then outstanding
(other than Shares held by the Purchaser, Tyson or any of their affiliates,
Shares held by any subsidiary of the Company and Shares held by shareholders who
perfect their dissenters' rights under the Virginia Stock Corporation Act (the
"VSCA")) would be converted into the right to receive an amount in cash equal to
the price per Share paid pursuant to the Offer. See Section 12.
On January 24, 1994, the Chairman of Tyson proposed in writing to the Board
of Directors of the Company the acquisition of the Company by means of a merger
in which each Share would be exchanged for $30.00 per Share in cash and, in
addition, indicated that Tyson would be willing to negotiate other possible ways
of merging if a tax-free reorganization would be more desirable for a
significant number of the Company's shareholders. On the day following receipt
of Tyson's proposal, the President and Chief Executive Officer of the Company
sent a letter to the Company's shareholders which stated that, although the
Company's Board of Directors would meet to evaluate Tyson's proposal, the
proposal was "totally unsolicited, unwanted and out of line with [the Company's]
long-term business plans and corporate philosophy." Such letter also stated that
the Company is "not for sale." On February 6, 1994, the Company announced that
at a meeting of the Company's Board of Directors held on February 4, 1994 (the
"February 4 Board Meeting") the Company's Board of Directors rejected Tyson's
proposal. In a letter to shareholders, dated February 6, 1994, announcing such
rejection, it was stated that the Company's Board of Directors "believes it is
in the best long-term interests of [the Company] and its shareholders for the
Company to remain independent."
In connection with the Company's rejection of Tyson's proposal on February
4, 1994, the Company and its Board of Directors took a number of defensive
actions in apparent anticipation of the Offer. On February 6, 1994, the Company
announced that at the February 4 Board Meeting the
<PAGE>
Company's Board of Directors adopted a shareholder protection rights plan and
declared a dividend of the Rights. Also on February 6, 1994, the Company
commenced an action against Tyson in the United States District Court for the
Western District of Virginia (the "District Court") seeking declaratory and
injunctive relief (the "Virginia Action"). See Section 15. On February 15, 1994,
the Company disclosed in its Quarterly Report on Form 10-Q for the fiscal
quarter ended January 1, 1994 (the "January 10-Q") that certain additional
actions were taken at or in connection with the February 4 Board Meeting,
including the adoption of lucrative "golden parachute" severance agreements with
certain executives, as well as severance arrangements for all salaried and
hourly clerical employees of the Company, and, as more fully described below,
the implementation of a series of actions affecting four members of the
Company's Board of Directors pursuant to which the Company purports to be able
to take the position that these directors are not officers or employees of the
Company. In light of the Company's response to Tyson's proposal and its refusal
to enter into any discussions with Tyson, Tyson determined to commence the
Offer. See Section 11.
The Offer is conditioned upon, among other things, (1) there being validly
tendered, and not withdrawn prior to the Expiration Date (as hereinafter
defined), that number of Shares which, together with the Shares beneficially
owned by the Purchaser and its affiliates, represents at least a majority (the
"Minimum Number of Shares") of the total number of Shares outstanding on a fully
diluted basis on the date of purchase (the "Minimum Condition"), (2) the Rights
having been redeemed by the Board of Directors of the Company or the Purchaser
being satisfied, in its sole discretion, that the Rights have been invalidated
or are otherwise inapplicable to the Offer and to the Proposed Merger (the
"Rights Condition"), (3) the Purchaser being satisfied, in its sole discretion,
that after consummation of the Offer, the restrictions contained in Article 14
of the VSCA (the "Virginia Affiliated Transactions Law") will not apply to the
Proposed Merger (the "Affiliated Transaction Condition"), and (4) full voting
rights for all Shares acquired by the Purchaser or Tyson or any of their
associates pursuant to, or in contemplation of, the Offer (which would otherwise
be denied voting rights under Article 14.1 of the VSCA (the "Virginia Control
Share Act")) having been approved at a special meeting of shareholders of the
Company or the Purchaser being satisfied, in its sole discretion, that the
Virginia Control Share Act is inapplicable to the Purchaser or Tyson or any of
their associates or the acquisition of Shares by any of them (the "Control Share
Condition"). The Offer is also subject to other terms and conditions contained
in this Offer to Purchase. See Sections 1 and 14.
Tyson and the Purchaser beneficially own an aggregate of 600,063 Shares on
the date hereof. According to the January 10-Q, 10,967,193 Shares were
outstanding as of February 1, 1994. On the basis of this figure, the Shares
beneficially owned by Tyson and the Purchaser represent approximately 5.47% of
the Shares outstanding on a primary basis. 600,000 of such Shares were acquired
by Tyson in open-market transactions for prices not exceeding $29.375 per Share
(net of brokerage commissions), and were contributed by Tyson to the Purchaser
on March 1, 1994.
Apart from the requirements of the Virginia Affiliated Transactions Law
discussed below, consummation of the Proposed Merger in accordance with the VSCA
would require the approval of the Board of Directors of the Company and the
approval of the Company's shareholders by the affirmative vote of more than
two-thirds of all the votes entitled to be cast on such matter. Assuming that
the Purchaser's voting rights with respect to Shares purchased pursuant to, and
in contemplation of, the Offer are not limited by operation of the Virginia
Control Share Act, if the Offer is consummated the Purchaser believes that it
would be able to obtain majority representation on the Company's Board of
Directors at the next annual meeting of the Company's shareholders. See Section
12. The Purchaser also believes that if it were to so acquire control of the
Company but did not hold more than two-thirds of the outstanding Shares
following consummation of the Offer, the requisite approval of the Proposed
Merger by the Company's shareholders (apart from any approval required under the
Virginia Affiliated Transactions Law) could be obtained by means of the purchase
of additional Shares by the Purchaser and/or the solicitation of proxies in
favor of such approval from the shareholders of the Company.
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The Virginia Control Share Act would purport to deny voting rights to Shares
which are acquired by the Purchaser and its associates within 90 days before or
after the time that the Purchaser and its associates become the beneficial
owners of, and Shares which are acquired by them pursuant to a plan to acquire
beneficial ownership of, a number of Shares which is at or above any of three
thresholds (20%, 33 1/3% or a majority of the outstanding Shares) unless voting
rights for such Shares shall have been approved by the affirmative vote of the
holders of a majority of the outstanding Shares other than holders of Interested
Shares (as hereinafter defined) or, among other exceptions, such acquisition is
made by means of an offer made pursuant to an agreement to which the Company is
a party. The Virginia Control Share Act allows, but does not require, the
Purchaser to deliver to the Company a Control Share Acquisition Statement
relating to the Offer and request that a special shareholders meeting be called
pursuant to the Virginia Control Share Act at which shareholders (other than
holders of Interested Shares) would consider whether to accord voting rights to
Shares acquired by Tyson and the Purchaser in contemplation of, and proposed to
be acquired by the Purchaser pursuant to, the Offer. The term "Interested
Shares" means all Shares as to which the Purchaser or its associates or any
officer, or director who is an employee, of the Company is entitled to exercise
or direct voting power.
At or in connection with the February 4 Board Meeting, a series of actions
were taken affecting four members of the Company's Board of Directors pursuant
to which the Company purports to be able to take the position that these
directors are not officers or employees of the Company, notwithstanding the fact
that two of these directors had until such time served as Senior Vice Presidents
of the Company and that the other two of these directors had served and would
continue to serve as the Chairman and Vice Chairman of the Board of Directors of
the Company, respectively. Based upon information publicly available on the date
hereof, these four directors are the four largest shareholders on the Company's
Board of Directors and beneficially own in excess of 10% of the outstanding
Shares. Also at the February 4 Board Meeting, the Bylaws of the Company (the
"Bylaws") were amended to specify a record date for any special shareholders
meeting held pursuant to the Virginia Control Share Act, which amendment has the
effect of eliminating the advance notice which would otherwise be given with
respect to a record date for any meeting. Such advance notice of the record date
would, among other things, better enable all shareholders to have a full and
fair opportunity to vote their Shares. Tyson has asserted counterclaims in the
Virginia Action which challenge the propriety and validity of all these actions.
Tyson is also seeking in the Virginia Action to have the Virginia Control Share
Act declared unconstitutional and invalid as applied to the Offer and the
Proposed Merger. See Section 15.
The Company's Board of Directors rejected Tyson's proposal to acquire the
Company purportedly on the basis of its belief that such proposal would not be
in the "best long-term interests" of the Company's shareholders. The Purchaser
believes that the Company's disinterested shareholders should have an
opportunity to express independently their own views as to their own long-term
best interests, rather than having those views surmised and acted upon by the
Board of Directors. The Purchaser believes that acceptance of the Offer by
shareholders, if the Offer could be consummated unimpeded by the various
defensive measures and statutory provisions that are being relied upon by the
Company's Board of Directors, would be the best means of allowing shareholders
to express such views. Tyson is challenging the constitutionality and validity
of the Virginia Control Share Act on the basis that, among other things, it
impermissably impedes consummation of the Offer. The Purchaser believes that to
whatever extent the special shareholders meeting contemplated by the Virginia
Control Share Act could be useful by serving as a referendum of the
disinterested shareholders on the proposed acquisition of the Company by Tyson
contemplated by the Offer and the Proposed Merger, such a special meeting of
shareholders will not serve as a true referendum of disinterested shareholders
unless the actions of the Company's Board of Directors and management described
in the preceding paragraph are invalidated as requested by Tyson in the Virginia
Action and unless such special meeting and the related shareholder vote are
conducted in a manner which assures that all disinterested shareholders have a
full and fair opportunity to consider the views of the Purchaser and the Company
and then express their own views. Thus, depending on the timing and outcome of
the
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Virginia Action both with respect to the constitutionality and applicability of
the Virginia Control Share Act and with respect to the validity of the actions
taken by the Company's Board of Directors and management, the Purchaser intends,
at such time as it determines appropriate, to deliver a request to the Company
that it convene a special shareholders meeting in accordance with the
requirements of the Virginia Control Share Act. Pursuant to the Virginia Control
Share Act and the terms of the request for a special shareholders meeting to be
delivered by the Purchaser, the special shareholders meeting will be required to
be called within 10 days, and must be held no sooner than 30 days and no later
than 50 days, after receipt by the Company of the Purchaser's request that the
special shareholders meeting be held.
The Purchaser has not yet requested the Company to convene a special meeting
under the Virginia Control Share Act, and Tyson and the Purchaser are not
currently soliciting proxies with respect to the proposal that would be
considered by shareholders at such a special shareholders meeting. Any such
request would be made only pursuant to the specific requirements and procedures
set forth in the Virginia Control Share Act and any such solicitation would be
made only pursuant to separate proxy materials complying with the requirements
of Section 14 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the requirements of the Virginia Control Share Act.
The Virginia Affiliated Transactions Law purports to prohibit a Virginia
corporation, such as the Company, from engaging in any Affiliated Transaction
(defined to include a variety of transactions, including mergers) with any
Interested Shareholder (defined generally as any person that, directly or
indirectly, beneficially owns 10% or more of the outstanding voting shares of
the corporation), or any affiliate or associate of an Interested Shareholder,
for three years after the date on which the Interested Shareholder became an
Interested Shareholder unless the Affiliated Transaction is approved by a
majority (but not less than two) of the disinterested directors (which would not
include directors nominated by the Interested Shareholder and elected following
the time that such person becomes an Interested Shareholder), and by the
affirmative vote of two-thirds of the voting shares other than shares
beneficially owned by the Interested Shareholder. The three-year prohibition on
Affiliated Transactions with an Interested Shareholder (the "Affiliated
Transaction Prohibition") would not apply to a particular Affiliated Transaction
with a particular Interested Shareholder if a majority of the disinterested
directors approves the acquisition of voting shares making such person an
Interested Shareholder before such person becomes an Interested Shareholder. The
Purchaser's acquisition of Shares pursuant to the Offer would result in the
Purchaser becoming an Interested Shareholder for purposes of the Virginia
Affiliated Transactions Law and, absent the prior approval thereof by the
Company's disinterested directors, the Affiliated Transaction Prohibition would
apply to the Proposed Merger, as well as certain other transactions that the
Purchaser or Tyson could seek to effect following consummation of the Offer.
The impact of the Virginia Affiliated Transactions Law would be effectively
to deny the Purchaser the ability to assure the consummation of the Proposed
Merger even if the Purchaser acquires in excess of two-thirds of the outstanding
Shares pursuant to the Offer and thereafter obtains majority representation on
the Company's Board of Directors. Tyson is seeking in the Virginia Action to
have the Virginia Affiliated Transactions Law declared unconstitutional and
invalid as applied to the Offer and the Proposed Merger. See Sections 12 and 15.
In addition, the Purchaser is hereby requesting that the Company's Board of
Directors adopt a resolution approving the acquisition of Shares by the
Purchaser pursuant to the Offer, such that the Virginia Affiliated Transactions
Law would not be applicable to the Proposed Merger.
If Tyson fails to prevail in the Virginia Action regarding the
constitutionality and validity of the Virginia Affiliated Transactions Law and
the Company's Board of Directors does not accede to the Purchaser's request that
it approve the Purchaser's acquisition of Shares pursuant to the Offer, the
Purchaser may determine to abandon the Offer and instead attempt to obtain
majority representation on the Company's Board of Directors at the next annual
meeting of shareholders. If the Purchaser
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succeeded in obtaining such representation prior to the acquisition by it and
its affiliates and associates of beneficial ownership of more than 10% of the
outstanding Shares, the directors nominated by the Purchaser would constitute
disinterested directors for purposes of the Virginia Affiliated Transactions Law
and the Purchaser could cause the Virginia Affiliated Transactions Law to be
inapplicable to any merger or other transaction proposed by the Purchaser. See
Section 12. However, since under the Company's Bylaws the next annual meeting of
shareholders would not be held until October, 1994 and could be postponed
further, the Purchaser may determine that such an approach involves an
intolerable degree of delay and an intolerable degree of uncertainty with
respect to the conditions that may exist at the time of such meeting. Thus,
although the Purchaser would prefer to consummate the Offer and obtain control
of the Company under circumstances which would assure the prompt consummation of
the Proposed Merger, the Purchaser may determine to proceed on a basis whereby
the Purchaser obtains control of the Company through consummation of the Offer,
but is unable to consummate the Proposed Merger for an extended period of time.
If the Purchaser makes such a determination, the Purchaser would amend the Offer
to reduce the number of Shares sought pursuant to the Offer to that number of
Shares which, together with the Shares beneficially owned by the Purchaser and
its affiliates, represents a majority of the total number of Shares outstanding
on a fully diluted basis. Following the consummation of the Offer, as so
amended, the Purchaser would seek to obtain majority representation on the
Company's Board of Directors and thereafter would seek to obtain the approvals
by the disinterested directors (which at that time would not include directors
nominated by the Purchaser or Tyson) and the shareholders of the Company other
than the Purchaser which would be necessary to approve the Proposed Merger in
accordance with the Virginia Affiliated Transactions Law. No assurances could be
given as to whether such approvals could be obtained.
If the Offer were to be consummated at a time when the Rights remain
outstanding, the Rights would, among other things, purport to entitle each
holder thereof (other than the Purchaser and its affiliates) to purchase
additional Shares from the Company at a significant discount to the market value
of the Shares. The existence of the Rights, therefore, has the practical effect
of precluding the Purchaser from consummating the Offer, regardless of the
extent to which the Company's shareholders wish to sell their Shares pursuant to
the Offer. Prior to announcement that a person has acquired 15% or more of the
outstanding Shares, the Rights are redeemable at the option of the Company's
Board of Directors for $.01 per Right. The Purchaser believes that the issuance
of the Rights and the failure to redeem the Rights, insofar as the Rights
subvert the wishes of the Company's shareholders to those of the Company's Board
of Directors and deny the Company's shareholders the opportunity to accept the
Offer, constitute a breach of fiduciary duties on the part of the Company's
Board of Directors. The Purchaser hereby requests that the Company's Board of
Directors redeem the Rights. Tyson is seeking in the Virginia Action to cause
the Rights to be redeemed or rescinded or declared invalid as applied to the
Offer and the Proposed Merger. See Sections 12 and 15.
Tyson intends to continue to seek to negotiate with the Company with respect
to the acquisition of the Company by Tyson. If such negotiations result in a
definitive merger agreement between the Company and Tyson, the consideration to
be received by holders of Shares could include or consist of Tyson common stock,
other securities, cash, or any combination thereof. Accordingly, such
negotiations could result in, among other things, termination of the Offer (see
Section 14) and submission of a different acquisition proposal to the Company's
shareholders for their approval. IN THIS REGARD, TYSON REMAINS WILLING TO
NEGOTIATE A TRANSACTION WHICH WOULD PROVIDE SHAREHOLDERS WITH THE OPPORTUNITY TO
DISPOSE OF THEIR SHARES ON A TAX-FREE BASIS.
In the event that Tyson is unable to consummate the Offer or to negotiate a
definitive merger agreement with the Company, the Purchaser and Tyson may
determine to abandon the Offer and instead seek majority representation on the
Company's Board of Directors through a proxy contest at the Company's next
annual meeting of shareholders, which under the Bylaws would be held in October,
1994. The ability of the Purchaser to succeed in such a proxy context would
depend on events and conditions at that time. No assurance can be given as to
whether the Purchaser would proceed
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with such a contest at that time or, if it chooses to pursue such a contest,
whether the Purchaser would prevail. If the Purchaser succeeded in obtaining
majority representation on the Company's Board of Directors through such a proxy
contest, the Purchaser would then cause the Company to redeem the Rights and
enter into a definitive merger agreement with Tyson and the Purchaser providing
for an acquisition of the Company by Tyson, which merger agreement would render
the Virginia Affiliated Transactions Law and the Virginia Control Share Act
inapplicable. However, given the significant delay inherent in postponing action
until the Company's next annual meeting, no assurance can be given that any
merger transaction proposed by the Purchaser or Tyson at that time would be on
the same terms as the Proposed Merger. See Section 12.
As a result of the factors described above, no assurance can be given that
the Proposed Merger will be consummated or as to the timing thereof. If the
timing of the Proposed Merger is substantially delayed, no assurance can be
given as to the per Share consideration that would be paid. See Section 12. Such
assurances with respect to the Proposed Merger could be given if, prior to
consummation of the Offer, the Company's existing Board of Directors agrees to
enter into negotiations with Tyson and the Purchaser and such negotiations
result in an agreement between the Company, Tyson and the Purchaser providing
for the Proposed Merger. The Purchaser therefore reiterates its request that the
Company's Board of Directors enter into such negotiations.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE
WITH RESPECT TO THE OFFER.
THE TENDER OFFER
1. TERMS OF THE OFFER. Upon the terms and subject to the conditions of the
Offer (including, if the Offer is extended or amended, the terms and conditions
of any extension or amendment), the Purchaser will accept for payment and
thereby purchase all Shares which are validly tendered on or prior to the
Expiration Date and not withdrawn in accordance with the procedures set forth in
Section 4. The term "Expiration Date" means 12:00 Midnight, New York City time,
on Friday, April 8, 1994, unless and until the Purchaser, in its sole
discretion, shall have extended the period of time during which the Offer is
open, in which event the term "Expiration Date" shall refer to the latest time
and date on which the Offer, as so extended by the Purchaser, shall expire.
The Purchaser expressly reserves the right, in its sole discretion, at any
time and from time to time, to extend the period during which the Offer is open
for any reason, including the occurrence of any of the conditions specified in
Section 14, by giving oral or written notice of such extension to the
Depositary. During any such extension, all Shares previously tendered and not
withdrawn will remain subject to the Offer and subject to the right of a
tendering shareholder to withdraw such shareholder's Shares. See Section 4.
Subject to the applicable regulations of the Commission, the Purchaser also
expressly reserves the right, in its sole discretion, at any time or from time
to time, to (i) delay acceptance for payment of or, regardless of whether such
Shares were theretofore accepted for payment, payment for any Shares pending
receipt of any regulatory or governmental approvals specified in Section 15,
(ii) terminate the Offer (whether or not any Shares have theretofore been
accepted for payment) and not accept for payment any Shares if any of the
conditions referred to in Section 14 has not been satisfied or upon the
occurrence of any of the conditions specified in Section 14 and (iii) waive any
condition or otherwise amend the Offer in any respect, in each case, by giving
oral or written notice of such delay, termination, waiver or amendment to the
Depositary and by making a public announcement thereof. The Purchaser
acknowledges (i) that 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 and (ii) that the
Purchaser may not delay acceptance for payment of, or payment for (except as
provided in clause (i) of the preceding sentence), any Shares upon the
occurrence of any of the conditions specified in Section 14 without extending
the period of time during which the Offer is open.
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Any such extension, delay, termination, waiver or amendment will be followed
as promptly as practicable by public announcement thereof, and such announcement
in the case of an extension will be made no later than 9:00 A.M., New York City
time, on the next business day after the previously scheduled Expiration Date.
Without limiting the manner in which the Purchaser may choose to make any public
announcement, subject to applicable law (including Rules 14d-4(c) and 14d-6(d)
under the Exchange Act, which require that material changes be promptly
disseminated to holders of Shares), the Purchaser shall have no obligation to
publish, advertise or otherwise communicate any such public announcement other
than by issuing a release to the Dow Jones News Service.
If the Purchaser makes a material change in the terms of the Offer or waives
a material condition of the Offer, the Purchaser will extend the Offer to the
extent required by Rules 14d-4(c) and 14d-6(d) under the Exchange Act. The
minimum period during which an offer must remain open following material changes
in the terms of such offer, other than a change in price or a change in
percentage of securities sought or a change in any dealer's soliciting fee, will
depend upon the facts and circumstances, including the materiality of the
changes. With respect to a change in price or a change in percentage of
securities sought or a change in any dealer's soliciting fee, a minimum ten
business day period is generally required to allow for adequate dissemination to
shareholders. Accordingly, if prior to the Expiration Date, the Purchaser should
decrease the number of Shares being sought, or increase or decrease the
consideration offered pursuant to the Offer, and if the Offer is scheduled to
expire at any time earlier than the period ending on the tenth business day from
and including the date that notice of such increase or decrease is first
published, sent or given to holders of Shares, the Offer will be extended at
least until the expiration of such ten business day period. For purposes of the
Offer, a "business day" means any day other than a Saturday, Sunday or a federal
holiday and consists of the time period from 12:01 A.M. through 12:00 Midnight,
New York City time.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THE SATISFACTION OF THE
MINIMUM CONDITION. SEE SECTION 14. The Purchaser reserves the right (but shall
not be obligated), in accordance with applicable rules and regulations of the
Commission, to waive or reduce the Minimum Condition and to accept for payment
pursuant to the Offer less than the Minimum Number of Shares. The Purchaser has
no present intention of exercising such right. The Commission 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 the offer and that the waiver of a condition
such as the Minimum Condition is a material change in the terms of an offer. In
the Commission's view, 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 holders of Shares, and if material changes are made with respect to
information that approaches the significance of price and share levels, a
minimum of ten business days may be required to allow for adequate dissemination
and investor response. If, by the Expiration Date, the Minimum Condition has not
been satisfied, the Purchaser may, in its sole discretion, elect to (i) extend
the Offer and, subject to applicable withdrawal rights, retain all tendered
Shares until the expiration of the Offer, as extended, subject to the terms of
the Offer, (ii) subject to complying with applicable rules and regulations of
the Commission, accept for payment all Shares so tendered and not extend the
Offer or (iii) terminate the Offer and not accept for payment any Shares and
return all tendered Shares to tendering shareholders.
A request is being made to the Company for use of the Company's shareholder
lists and security position listings for the purpose of disseminating the Offer
to holders of Shares. Upon compliance by the Company with such request or the
election by the Company to disseminate the Offer in lieu of complying with such
request, this Offer to Purchase and the related Letter of Transmittal and other
relevant materials will be mailed to record holders of Shares and will be
furnished to brokers, dealers, commercial banks, trust companies and similar
persons whose names, or the names of whose nominees, appear on the shareholder
lists 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 (including, if the Offer is extended or amended, the
terms and conditions of any extension or amendment), the Purchaser will
purchase, by accepting for payment, and will pay for, all Shares
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<PAGE>
validly tendered on or prior to the Expiration Date (and not properly withdrawn
in accordance with Section 4) promptly after the later to occur of (i) the
Expiration Date and (ii) the satisfaction or waiver of the conditions to the
Offer set forth in Section 14. In addition, subject to applicable rules of the
Commission, the Purchaser expressly reserves the right to delay acceptance for
payment of, or payment for, Shares pending receipt of any regulatory or
governmental approvals specified in Section 15. Any determination concerning the
satisfaction of such terms and conditions shall be within the sole discretion of
the Purchaser. See Section 14. For information with respect to approvals
required prior to the consummation of the Offer under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended (the "HSR Act"), and certain
other regulatory approvals, see Section 15.
In all cases, payment for Shares purchased pursuant to the Offer will be
made only after timely receipt by the Depositary of (i) Share Certificates or
timely confirmation of a book-entry transfer (a "Book-Entry Confirmation") of
such Shares into the Depositary's account at The Depository Trust Company, the
Midwest Securities Trust Company or the Philadelphia Depository Trust Company
(collectively, the "Book-Entry Transfer Facilities"), pursuant to the procedures
set forth in Section 3, (ii) a properly completed and duly executed Letter of
Transmittal (or facsimile thereof) with any required signature guarantees, and
(iii) any other documents required by the Letter of Transmittal.
For purposes of the Offer, the Purchaser shall be deemed to have accepted
for payment, and thereby purchased, Shares validly tendered and not withdrawn
if, as and when the Purchaser gives oral or written notice to the Depositary of
the Purchaser's acceptance of such Shares for payment pursuant to the Offer. In
all cases, upon the terms and subject to the conditions of the Offer, payment
for Shares purchased pursuant to the Offer will be made by deposit of the
aggregate purchase price therefor with the Depositary, which will act as agent
for tendering shareholders for the purpose of receiving payment from the
Purchaser and transmitting payment to such validly tendering shareholders. UNDER
NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE FOR SHARES BE PAID BY THE
PURCHASER BY REASON OF ANY DELAY IN MAKING PAYMENT. Upon the deposit of funds
with the Depositary for the purpose of making payments to validly tendering
shareholders, the Purchaser's obligation to make such payment shall be satisfied
and such tendering shareholders must thereafter look solely to the Depositary
for payment of the amounts owed to them by reason of the acceptance for payment
of Shares pursuant to the Offer. The Purchaser will pay any stock transfer taxes
incident to the transfer of validly tendered Shares, except as otherwise
provided in Instruction 6 of the Letter of Transmittal, as well as any charges
and expenses of the Depositary and the Information Agent.
If any tendered Shares are not purchased pursuant to the Offer for any
reason, or if Share Certificates submitted represent more Shares than are
tendered, Share Certificates representing unpurchased or untendered Shares will
be returned, without expense to the tendering shareholder (or, in the case of
Shares delivered by book-entry transfer into the Depositary's account at a Book-
Entry Transfer Facility pursuant to the procedures set forth in Section 3, such
Shares will be credited to an account maintained at such Book-Entry Transfer
Facility), as promptly as practicable after the expiration, termination or
withdrawal of the Offer.
If, prior to the Expiration Date, the Purchaser shall increase the
consideration offered to holders of Shares pursuant to the Offer, such increased
consideration will be paid to all holders whose Shares are purchased pursuant to
the Offer, whether or not such Shares were tendered prior to such increase in
consideration.
The Purchaser reserves the right to transfer or assign, in whole at any time
or in part from time to time, to Tyson or to one or more direct or indirect
wholly-owned subsidiaries of Tyson, the right to purchase Shares tendered
pursuant to the Offer, but any such transfer or assignment will not relieve the
Purchaser of its obligations under the Offer or prejudice the rights of
tendering shareholders to receive payment for Shares validly tendered and
accepted for payment pursuant to the Offer.
3. PROCEDURES FOR TENDERING SHARES. Except as set forth below, for Shares
to be validly tendered pursuant to the Offer, the Letter of Transmittal or a
facsimile thereof, properly completed and duly
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executed, with any required signature guarantees and any other documents
required by the Letter of Transmittal, must be received by the Depositary at one
of its addresses set forth on the back cover of this Offer to Purchase on or
prior to the Expiration Date. In addition, either (i) Share Certificates
representing tendered Shares must be received by the Depositary along with the
Letter of Transmittal, or (ii) Shares must be tendered pursuant to the procedure
for book-entry transfer described below and a Book-Entry Confirmation must be
received by the Depositary, in each case prior to the Expiration Date, or (iii)
the tendering shareholder must comply with the guaranteed delivery procedures
described below.
The Depositary will make a request to establish an account with respect to
the Shares at each Book-Entry Transfer Facility for purposes of the Offer within
two business days after the date of this Offer to Purchase, and any financial
institution that is a participant in any of the Book-Entry Transfer Facilities'
systems may make book-entry delivery of Shares by causing a Book-Entry Transfer
Facility to transfer such Shares into the Depositary's account at a Book-Entry
Transfer Facility in accordance with such Book-Entry Transfer Facility's
procedures for transfer. However, although delivery of Shares may be effected
through book-entry transfer into the Depositary's account at a Book-Entry
Transfer Facility, the Letter of Transmittal or facsimile thereof, properly
completed and duly executed, with any required signature guarantees and any
other required documents, must, in any case, be transmitted to and received by
the Depositary at one of its addresses set forth on the back cover of this Offer
to Purchase on or prior to the Expiration Date or the guaranteed delivery
procedures described below must be complied with. DELIVERY OF DOCUMENTS TO A
BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH THE BOOK-ENTRY TRANSFER
FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
Signatures on all Letters of Transmittal must be guaranteed by a firm that
is a bank, broker, dealer, credit union, savings association or other entity
which is a member in good standing of the Securities Transfer Agent's Medallion
Program (an "Eligible Institution"), unless the Shares tendered thereby are
tendered (i) by a registered holder of Shares who has not completed either the
box entitled "Special Payment Instructions" or the box entitled "Special
Delivery Instructions" on the Letter of Transmittal or (ii) for the account of
an Eligible Institution. See Instruction 1 of the Letter of Transmittal. If the
Share Certificates are registered in the name of a person other than the signer
of the Letter of Transmittal, or if payment is to be made to, or Share
Certificates for any unpurchased Shares are to be issued or returned to, a
person other than the registered holder, then the tendered certificates must be
endorsed or accompanied by duly executed stock powers, in either case signed
exactly as the name or names of the registered holder or holders appear on the
certificates, with the signatures on the certificates or stock powers guaranteed
by an Eligible Institution as provided in the Letter of Transmittal. See
Instructions 1 and 5 of the Letter of Transmittal. If the Share Certificates are
forwarded separately to the Depositary, a properly completed and duly executed
Letter of Transmittal (or a facsimile thereof) must accompany each such
delivery.
If a shareholder desires to tender Shares pursuant to the Offer and such
shareholder's Share Certificates are not immediately available or time will not
permit all required documents to reach the Depositary on or prior to the
Expiration Date or the procedure for book-entry transfer cannot be completed on
a timely basis, such Shares may nevertheless be tendered if all of the following
conditions are satisfied:
(i) the tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form provided by the Purchaser herewith, is
received by the Depositary as provided below on or prior to the Expiration
Date; and
(iii) the Share Certificates or a Book-Entry Confirmation, representing
all tendered Shares, in proper form for transfer, together with a properly
completed and duly executed Letter of
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Transmittal (or facsimile thereof) with any required signature guarantees
and any other documents required by the Letter of Transmittal, are received
by the Depositary within five National Association of Securities Dealers
Automatic Quotation System ("NASDAQ") trading days after the date of
execution of the Notice of Guaranteed Delivery.
Any Notice of Guaranteed Delivery may be delivered by hand or transmitted by
facsimile transmission or mail to the Depositary and must include a signature
guarantee by an Eligible Institution in the form set forth in the Notice of
Guaranteed Delivery.
Notwithstanding any other provision hereof, payment for Shares purchased
pursuant to the Offer will, in all cases, be made only after timely receipt by
the Depositary of (i) Share Certificates or a Book-Entry Confirmation with
respect to such Shares, (ii) a properly completed and duly executed Letter of
Transmittal (or manually signed facsimile thereof), together with any required
signature guarantees, and (iii) any other documents required by the Letter of
Transmittal. Accordingly, payment might not be made to all tendering
shareholders at the same time depending upon when Share Certificates or
Book-Entry Confirmations of such Shares into the Depositary's account at a
Book-Entry Transfer Facility are actually received by the Depositary.
THE METHOD OF DELIVERY FOR SHARE CERTIFICATES, THE LETTER OF TRANSMITTAL AND
ANY OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING
SHAREHOLDER AND THE DELIVERY WILL BE DEEMED TO BE MADE ONLY WHEN ACTUALLY
RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN
RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT
TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
UNDER THE FEDERAL INCOME TAX LAWS, THE DEPOSITARY WILL BE REQUIRED TO
WITHHOLD 31 PERCENT OF THE AMOUNT OF ANY PAYMENTS MADE TO CERTAIN SHAREHOLDERS
PURSUANT TO THE OFFER. TO PREVENT BACKUP FEDERAL INCOME TAX WITHHOLDING WITH
RESPECT TO PAYMENT OF THE PURCHASE PRICE OF SHARES PURCHASED PURSUANT TO THE
OFFER, A TENDERING SHAREHOLDER MUST PROVIDE THE DEPOSITARY WITH HIS CORRECT
TAXPAYER IDENTIFICATION NUMBER OR CERTIFY THAT HE IS NOT SUBJECT TO BACKUP
FEDERAL INCOME TAX WITHHOLDING BY COMPLETING THE SUBSTITUTE FORM W-9 INCLUDED IN
THE LETTER OF TRANSMITTAL. SEE SECTION 5 HEREOF AND INSTRUCTION 10 OF THE LETTER
OF TRANSMITTAL.
Except to the extent set forth in the last sentence of this paragraph, by
executing a Letter of Transmittal as set forth above, a tendering shareholder
irrevocably appoints designees of the Purchaser, and each of them, as the
shareholder's attorneys-in-fact and proxies, in the manner set forth in the
Letter of Transmittal, each with full power of substitution, to the full extent
of the shareholder's rights with respect to the Shares tendered by the
shareholder and accepted for payment and paid for by the Purchaser (and any and
all other Shares and non-cash dividends, distributions, rights, other shares or
other securities issued or issuable in respect of such Shares on or after the
date of the Offer). All such proxies shall be considered coupled with an
interest in the tendered Shares. This appointment will be effective if, when and
only to the extent that the Purchaser pays for such Shares by depositing the
purchase price therefor with the Depositary. Upon such payment, all prior powers
of attorney and proxies given by the shareholder with respect to the Shares or
other securities or rights will, without further action, be revoked, and no
subsequent powers of attorney and proxies may be given by such shareholder (and
if given, will not be deemed effective). The designees of the Purchaser will,
with respect to the Shares so accepted and other securities for which such
appointment is effective, be empowered to exercise all voting and other rights
of such shareholder as they in their sole discretion may deem proper at any
annual, special, adjourned or postponed meeting of the Company's shareholders,
by written consent or otherwise. The Purchaser reserves the right to require, in
addition to satisfaction of the Control Share Condition, that, in order for
Shares to be deemed validly tendered, immediately upon the Purchaser's payment
for such Shares, the Purchaser or its designee must be able to exercise full
voting and other rights of a record and beneficial holder, including voting
10
<PAGE>
at a meeting of shareholders or acting by written consent with respect to such
Shares. The appointment of designees of the Purchaser as proxies as described
above will in no event constitute a proxy to vote on the granting of voting
rights to the Purchaser and its associates pursuant to the Virginia Control
Share Act.
All questions as to the validity, form, eligibility (including time of
receipt) and acceptance for payment of any tendered Shares pursuant to any of
the procedures described above will be determined by the Purchaser, in its sole
discretion, whose determination will be final and binding on all parties. The
Purchaser reserves the absolute right to reject any or all tenders of any Shares
determined by it not to be in proper form or if the acceptance for payment of,
or payment for, such Shares may, in the opinion of the Purchaser's counsel, be
unlawful. The Purchaser also reserves the absolute right, in its sole
discretion, to waive any of the conditions of the Offer or any defect or
irregularity in any tender with respect to Shares of any particular shareholder,
whether or not similar defects or irregularities are waived in the case of other
shareholders.
The Purchaser's interpretation of the terms and conditions of the Offer
(including the Letter of Transmittal and the instructions thereto) will be final
and binding. No tender of Shares will be deemed to have been validly made until
all defects and irregularities have been cured or waived. None of the Purchaser,
Tyson, any of their affiliates or assigns, if any, the Depositary, the
Information Agent or any other person will be under any duty to give
notification of any defects or irregularities in tenders or will incur any
liability for failure to give any such notification.
The Purchaser's acceptance for payment of Shares tendered pursuant to any of
the procedures described above will constitute a binding agreement between the
tendering shareholder and the Purchaser upon the terms and subject to the
conditions of the Offer.
4. WITHDRAWAL RIGHTS. Except as otherwise provided in this Section 4,
tenders of Shares made pursuant to the Offer are irrevocable. Shares tendered
pursuant to the Offer may be withdrawn at any time prior to the Expiration Date
and, unless theretofore accepted for payment by the Purchaser pursuant to the
Offer, may also be withdrawn at any time after May 7, 1994.
If, for any reason whatsoever, acceptance for payment of any Shares tendered
pursuant to the Offer is delayed, or the Purchaser is unable to accept for
payment or pay for Shares tendered pursuant to the Offer, then, without
prejudice to the Purchaser's rights set forth herein, the Depositary may,
nevertheless, on behalf of the Purchaser retain tendered Shares and such Shares
may not be withdrawn except to the extent that the tendering shareholder is
entitled to and duly exercises withdrawal rights as described in this Section 4.
Any such delay will be by an extension of the Offer to the extent required by
law.
For a withdrawal to be effective, a written or facsimile transmission notice
of withdrawal must be timely received by the Depositary at one of its addresses
set forth on the back cover of this Offer to Purchase. Any such 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 (if Share Certificates have
been tendered) the name of the registered holder of the Shares as set forth in
the Share Certificates, if different from that of the person who tendered such
Shares. If Share Certificates have been delivered or otherwise identified to the
Depositary, then, prior to the physical release of such certificates, the serial
numbers of the particular certificates evidencing the Shares to be withdrawn and
a signed notice of withdrawal with signatures guaranteed by an Eligible
Institution, except in the case of Shares tendered for the account of an
Eligible Institution, must also be furnished by the tendering shareholder to the
Depositary as described above. If Shares have been tendered pursuant to the
procedures for book-entry transfer as set forth in Section 3, any notice of
withdrawal must also specify the name and number of the account at the
appropriate Book-Entry Transfer Facility to be credited with the withdrawn
Shares and otherwise comply with the procedures of such facility, in which case
a notice of withdrawal will be effective if delivered to the Depositary by any
method of delivery described in the first sentence of this paragraph.
11
<PAGE>
All questions as to the form and validity (including time of receipt) of
notices of withdrawal will be determined by the Purchaser, in its sole
discretion, whose determination will be final and binding on all parties. None
of the Purchaser, Tyson, any of their affiliates or assigns, if any, the
Depositary, the Information Agent or any other person will be under any duty to
give notification of any defects or irregularities in any notice of withdrawal
or incur any liability for failure to give any such notification. Withdrawals of
Shares may not be rescinded. Any Shares properly withdrawn will be deemed to be
not validly tendered for purposes of the Offer. However, withdrawn Shares may be
retendered by again following one of the procedures described in Section 3 at
any time prior to the Expiration Date.
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES. The receipt of cash for Shares
pursuant to the Offer (or the Proposed Merger) will be a taxable transaction for
federal income tax purposes under the Internal Revenue Code of 1986, as amended
(the "Code"), and may also be a taxable transaction under applicable state,
local, foreign and other tax laws. The tax consequences of such receipt pursuant
to the Offer may vary depending upon, among other things, the particular
circumstances of the shareholder.
In general, for federal income tax purposes, a holder of Shares who tenders
Shares in the Offer or receives cash in exchange for Shares in the Proposed
Merger (including as a result of perfecting dissenter's rights under the VSCA)
will recognize gain or loss equal to the difference between the tax basis for
the Shares sold and the amount of cash received in exchange therefor. Such gain
or loss will be capital gain or loss if the Shares are capital assets in the
hands of the holder of Shares and will be long-term gain or loss if the holding
period for such Shares is more than 12 months. The maximum capital gains rate
for corporations is 35%; for individuals, short-term capital gains are subject
to a maximum marginal federal income tax rate of 39.6% and long-term capital
gains are subject to a maximum marginal federal income tax rate of 28%.
The foregoing discussion assumes that the holder of Shares is a
calendar-year taxpayer. The foregoing discussion may not apply to shareholders
who acquired their Shares pursuant to the exercise of employee stock options or
other compensation arrangements with the Company or who are not citizens or
residents of the United States, foreign corporations, or shareholders who are
otherwise subject to special tax treatment under the Code such as insurance
companies, tax-exempt entities and regulated investment companies.
THE DISCUSSION OF TAX CONSEQUENCES SET FORTH ABOVE IS INCLUDED FOR GENERAL
INFORMATION ONLY. DUE TO THE INDIVIDUAL NATURE OF TAX CONSEQUENCES, EACH HOLDER
OF SHARES IS URGED TO CONSULT HIS OWN TAX ADVISOR WITH RESPECT TO THE TAX
CONSEQUENCES OF THE OFFER, INCLUDING THE EFFECTS OF APPLICABLE FEDERAL, STATE,
LOCAL OR OTHER TAX LAWS.
6. PRICE RANGE OF THE SHARES; DIVIDENDS. Based upon publicly available
information, the Shares are traded in the over-the-counter market and quoted on
the NASDAQ National Market System under the symbol WLRF. The following table
sets forth, for the fiscal quarters of the Company indicated, the reported high
and low closing sales prices per Share as reported on the NASDAQ
12
<PAGE>
National Market System and the amounts of cash dividends paid per Share, as
reported in the Company's 1993 Annual Report to Shareholders (with respect to
the fiscal years ended June 27, 1992 and July 3, 1993) and published financial
sources (with respect to subsequent periods).
<TABLE>
<CAPTION>
MARKET PRICE
-------------- CASH
HIGH LOW DIVIDENDS
------ ------ ---------
<S> <C> <C> <C>
Fiscal Year Ended June 27, 1992
First Quarter....................................................... $18.25 $15.50 $ .08
Second Quarter...................................................... 17.00 14.50 .08
Third Quarter....................................................... 16.00 13.25 .08
Fourth Quarter...................................................... 15.00 12.50 .08
Fiscal Year Ended July 3, 1993
First Quarter....................................................... 18.00 14.00 .08
Second Quarter...................................................... 21.88 16.25 .08
Third Quarter....................................................... 25.25 20.25 .08
Fourth Quarter...................................................... 22.25 16.75 .08
Fiscal Year Ending July 2, 1994
First Quarter....................................................... 20.75 17.25 .08
Second Quarter...................................................... 19.75 17.50 .08
Third Quarter (through March 8, 1994)............................... 30.63 18.50 .08
</TABLE>
On January 24, 1994, the last full trading day prior to the public
announcement that Tyson had submitted to the Company's Board of Directors a
written proposal to acquire the Company at $30.00 per Share in cash, the
reported closing sale price per Share on the NASDAQ National Market System was
$19.00, according to published sources.
On March 2, 1994, the last full day of trading prior to Tyson's announcement
of its intention to commence the Offer, the reported closing sale price per
Share on the NASDAQ National Market System was $27.50, according to published
sources.
SHAREHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE SHARES.
7. EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES; NASDAQ QUOTATION;
EXCHANGE ACT REGISTRATION; MARGIN REGULATIONS.
EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES. The purchase of Shares by
the Purchaser pursuant to the Offer or following consummation of the Offer will
reduce the number of Shares that might otherwise trade publicly and the number
of holders of Shares and could, depending on the number of Shares so purchased,
adversely affect the liquidity and market value of the remaining Shares.
NASDAQ QUOTATION. Depending upon the aggregate market value and the number
of Shares not purchased pursuant to the Offer, as well as the identity of the
holders of such Shares, the Shares may no longer meet the quantitative
requirements of the National Association of Securities Dealers, Inc. ("NASD")
for continued inclusion in the NASDAQ National Market System, which require that
an issuer have at least 200,000 publicly held shares, held by at least 400
shareholders or 300 shareholders of round lots, with a market value of at least
$1 million and must have net tangible assets of at least $1 million, $2 million
or $4 million (depending on profitability levels during the issuer's four most
recent fiscal years) and a minimum bid price per Share of $1 (unless the issuer
has a public float of at least $3 million and at least $4 million of net
tangible assets). If these standards were not met, quotations might continue to
be published in the regular NASDAQ system, but (subject to certain exceptions
and other maintenance criteria) if the number of holders of the Shares were to
fall below 300, or if the number of publicly held Shares were to fall below
100,000, or the market value of the publicly held Shares were to fall below
$200,000, the NASD rules provide that the Shares would no longer be "qualified"
for NASDAQ reporting and NASDAQ could cease to provide quotations. Shares held
directly or indirectly by officers, directors or beneficial owners of more than
10% of the Shares will not be considered as being publicly held for this
purpose. According to the Company's Annual Report on Form 10-K for the fiscal
year ended July 3, 1993, as of September 20, 1993, there were
13
<PAGE>
approximately 2,264 holders of record of Shares. If, as a result of the purchase
of Shares by the Purchaser pursuant to the Offer or following consummation of
the Offer, the Shares no longer meet the requirements of the NASD for continued
inclusion in the NASDAQ National Market System and the Shares are no longer
included in the NASDAQ National Market System, the market for, and liquidity of,
Shares could be adversely affected. In the event that the Shares no longer meet
the requirements for NASDAQ quotation, quotation might still be available from
other sources. The extent of the public market for the Shares and the
availability of such quotations would, however, depend upon the number of
holders and/or the aggregate market value of such Shares remaining at such time,
the interest in maintaining a market in such Shares on the part of securities
firms, the possible termination of registration of such Shares under the
Exchange Act, as described below, and other factors.
The Purchaser cannot predict whether a 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 less than the price paid in the Offer.
EXCHANGE ACT REGISTRATION. The Shares are currently registered under the
Exchange Act. The purchase of Shares by the Purchaser pursuant to the Offer or
following consummation of the Offer may result in the Shares becoming eligible
for deregistration under the Exchange Act. Registration of the Shares under the
Exchange Act may be terminated upon application of the Company to the Commission
if the Shares are not listed on a national securities exchange or authorized to
be quoted in an inter-dealer quotation system of a registered national
securities association and there are fewer than 300 record holders of the
Shares. Termination of registration of the Shares under the Exchange Act,
assuming there are no other securities of the Company subject to registration,
would substantially reduce the information required to be furnished by the
Company to its shareholders and to the Commission and would make certain
provisions of the Exchange Act, such as the short-swing profit recovery
provisions of Section 16(b), the requirement of furnishing a proxy statement in
connection with shareholders' meetings pursuant to Section 14(a), and the
requirements of Rule 13e-3 under the Exchange Act with respect to "going
private" transactions, no longer applicable to the Company. Furthermore, the
ability of "affiliates" of the Company and persons holding "restricted
securities" of the Company to dispose of such securities pursuant to Rule 144
promulgated under the Securities Act of 1933, as amended, may be impaired or
eliminated. It is the present intention of the Purchaser to seek to cause the
Company to make an application for termination of registration of the Shares
under the Exchange Act as soon as possible following the consummation of the
Offer if, as a result of the purchase of Shares pursuant to the Offer, the
Company is no longer required to maintain registration of the Shares under the
Exchange Act.
If registration of the Shares under the Exchange Act is not terminated prior
to the Proposed Merger, the Shares will be deregistered from NASDAQ, and
registration of the Shares under the Exchange Act will be terminated, following
the consummation of the Proposed Merger.
MARGIN REGULATIONS. The Shares are currently "margin securities" under the
regulations of the Board of Governors of the Federal Reserve System (the
"Federal Reserve Board"), which has the effect, among other things, of allowing
brokers to extend credit on the collateral of the Shares for the purpose of
buying, carrying or trading in securities ("Purpose Loans"). Depending upon
factors such as the number of record holders of the Shares and the number and
market value of publicly held Shares, following the purchase of Shares by the
Purchaser pursuant to the Offer or following consummation of the Offer, it is
possible that the Shares would no longer constitute "margin securities" for the
purposes of the margin regulations of the Federal Reserve Board and therefore
could no longer be used as collateral for Purpose Loans made by brokers. If
registration of the Shares under the Exchange Act were terminated, the Shares
would no longer be "margin securities".
8. CERTAIN INFORMATION CONCERNING THE COMPANY. According to information
filed by the Company with the Commission, the Company is a Virginia corporation
with its principal executive office
14
<PAGE>
located at P.O. Box 7000, Broadway, Virginia 22815. The Company is a
fully-integrated poultry processing company involved in the production, further
processing and marketing of turkey and chicken products, and the distribution of
poultry and meat products. In addition, the Company manufactures ice for retail
distribution and is a provider of public refrigerated warehousing services.
Set forth below is a summary of certain consolidated financial information
with respect to the Company and its consolidated subsidiaries, excerpted or
derived from the information contained in the Company's 1993 Annual Report to
Shareholders, the Quarterly Report on Form 10-Q for the quarterly period ended
December 26, 1992 and the January 10-Q. More comprehensive financial information
is included in such reports and other documents filed by the Company with the
Commission. The financial information summary set forth below is qualified in
its entirety by reference to such reports and other documents filed with the
Commission and all of the financial information and related notes contained
therein. Such reports and other documents may be inspected and copies may be
obtained from the offices of the Commission or the NASD in the manner set forth
below.
WLR FOODS, INC.
SELECTED CONSOLIDATED FINANCIAL DATA
(DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
FISCAL YEAR ENDED
TWENTY-SIX WEEKS ENDED ----------------------------
--------------------------- JULY 3, JUNE 27, JUNE 29,
JAN. 1, 1994 DEC. 26, 1992 1993 1992 1991
------------ ------------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT:
Net Sales.................................. $ 361,343 $ 287,367 $616,702 $514,465 $502,238
Operating Income........................... 15,194 12,892 25,956 11,943 17,710
Earnings before income taxes and minority
interest.................................. 12,910 11,583 22,707 9,439 17,235
Net Earnings............................... 7,917 7,202 14,607 5,896 10,681
PER SHARE INFORMATION:
Net Earnings Per Common Share (Primary).... $ 0.72 $ 0.72 $ 1.42 $ 0.52 $ 1.02
Net Earnings Per Common Share (Fully
diluted).................................. $ 0.72 $ 0.71 $ 1.40 $ 0.52 $ 1.02
Dividends Declared Per Common Share........ $ 0.16 $ 0.16 $ .32 $ .32 $ .32
</TABLE>
<TABLE>
<CAPTION>
JULY 3, JUNE 27,
JAN. 1, 1994 DEC. 26, 1992 1993 1992
------------ ------------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C>
BALANCE SHEET
Current Assets............................................ $ 124,863 $ 99,081 $119,807 $90,569
Total Assets.............................................. 269,438 240,591 265,626 207,736
Current Liabilities....................................... 56,559 57,647 62,298 50,232
Long-term Debt............................................ 52,337 52,190 52,253 38,148
Total Liabilities......................................... 120,785 118,303 123,371 96,348
Shareholders' Equity...................................... 148,653 122,288 142,255 111,388
</TABLE>
The information concerning the Company contained herein has been taken from
or based upon publicly available documents on file with the Commission and other
publicly available information. Although neither Tyson nor the Purchaser has any
knowledge that would indicate that the statements contained herein which are
based on such documents are untrue, none of Tyson, the Purchaser, the Depositary
or the Information Agent takes any responsibility for the accuracy or
completeness of the information contained in such documents or for any failure
by the Company to disclose events that may have occurred and may affect the
significance or accuracy of any such information but which are unknown to any
such person.
15
<PAGE>
The Company is subject to the information and reporting requirements of the
Exchange Act and is required to file periodic reports, proxy statements and
other information with the Commission relating to its business, financial
condition and other matters. 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, any material interests
of such persons in transactions with the Company and other matters is required
to be disclosed in proxy statements and annual reports distributed to the
Company's shareholders and filed with the Commission. These reports, proxy
statements and other information should be available for inspection at the
public reference room at the Commission's office at Room 1024, 450 Fifth Street,
N.W., Washington, D.C. 20549, and also should be available for inspection and
copying at the following regional offices of the Commission: 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661; and 7 World Trade Center, New York,
New York 10048. Copies of this material may also be obtained by mail, upon
payment of the Commission's customary fees, from the Commission's principal
office at 450 Fifth Street, N.W., Washington, D.C. 20549. Reports, proxy
statements and other information concerning the Company should also be available
for inspection at the offices of the NASD, Reports Section, 1735 K Street, N.W.,
Washington, D.C. 20006.
9. CERTAIN INFORMATION CONCERNING THE PURCHASER AND TYSON.
THE PURCHASER. The Purchaser was recently incorporated in Delaware and has
not engaged in any business since its incorporation other than that incident to
its organization and in connection with the Offer. The Purchaser is a direct
wholly-owned subsidiary of Tyson. The principal executive offices of the
Purchaser are located at 2210 West Oaklawn Drive, Springdale, Arkansas
72762-6999. On March 1, 1994, Tyson transferred to the Purchaser, as a
contribution to the capital of the Purchaser, the 600,000 Shares theretofore
purchased by Tyson. Since the Purchaser is newly formed and has minimal assets
and capitalization (other than the Shares contributed by Tyson), no meaningful
financial information with respect to the Purchaser is available.
TYSON. Tyson and its various subsidiaries produce, market and distribute a
variety of food products consisting of value-enhanced poultry; fresh and frozen
poultry; value-enhanced beef and pork products; value-enhanced seafood products;
fresh and frozen seafood products; flour and corn tortillas, chips and other
Mexican food-based products. Additionally, Tyson has live swine and animal feed
and pet food operations. Tyson's integrated operations consist of breeding and
rearing chickens and hogs, harvesting seafood, as well as the processing,
further processing and marketing of these food products. Tyson's products are
marketed and sold to national and regional grocery chains, regional grocery
wholesalers, clubs or warehouse stores, military commissaries, industrial food
processing companies, national and regional chain restaurants or their
distributors, international export companies and distributors who service
restaurants, foodservice operations such as plant and school cafeterias,
convenience stores, hospitals and other vendors. Sales are made by Tyson's sales
staffs located in Springdale, Arkansas and in regions throughout the United
States, as well as through independent brokers selected by Tyson. Sales to the
military and a portion of sales to international markets are made through
independent brokers and trading companies. Tyson conducts the major portion of
its business activities on a vertically integrated basis and considers its
business to be one industry segment, that of "food products." Tyson commenced
business in 1935, was incorporated in Arkansas in 1947, and was reincorporated
in Delaware in 1986. Its principal executive offices are located at 2210 West
Oaklawn Drive, Springdale, Arkansas 72762-6999.
The name, citizenship, business address, present principal occupation or
employment and five-year employment history of each of the directors and
executive officers of the Purchaser and Tyson are set forth in Schedule I.
As of January 1, 1994, the outstanding shares of Tyson's capital stock
consisted of 79,047,440 shares of Class A Common Stock (the "Class A Shares")
and 68,455,438 shares of Class B Common Stock (the "Class B Shares"). The Class
A Shares and the Class B Shares vote together as a single class on substantially
all matters. Each Class A Share entitles the holder thereof to one vote and each
16
<PAGE>
Class B Share entitles the holder thereof to ten votes on all such matters. Mr.
Don Tyson, Chairman of the Board of Tyson, and the Tyson Limited Partnership, a
Delaware limited partnership (the "Partnership"), collectively own 1,021,145
Class A Shares (approximately 1.3% of the outstanding Class A Shares) and
68,399,040 Class B Shares (approximately 99.9% of the outstanding Class B
Shares), such Class A Shares and Class B Shares representing approximately 89.7%
of the aggregate voting power of all outstanding Tyson capital stock. The
68,399,040 Class B Shares referred to above includes 300,000 Class B Shares
owned of record by Mr. Don Tyson and 68,099,040 Class B Shares owned of record
by the Partnership. Mr. Don Tyson has a 54.4464 combined percentage interest as
a general and limited partner in the Partnership. The managing general partner
of the Partnership is Mr. Don Tyson. The other general partners are Leland E.
Tollett, Director, Chief Executive Officer and President of Tyson; Joe Fred
Starr, Director and Vice President of Tyson; John H. Tyson, Director and
President of the Beef and Pork Division of Tyson; James B. Blair, General
Counsel to Tyson and President of the Purchaser; and Harry C. Erwin, Jr.,
certified public accountant with Erwin & Company, C.P.A. Mr. Don Tyson, as
managing general partner, has the exclusive right, subject to certain
restrictions, to do all things on behalf of the Partnership necessary to manage,
conduct, control and operate the Partnership's business, including the right to
vote all shares or other securities held by the Partnership, as well as the
right to mortgage, pledge, or grant security interests in any assets of the
Partnership. The Partnership terminates December 31, 2040, unless it is earlier
dissolved in accordance with its terms. By reason of Mr. Don Tyson's beneficial
ownership of the Class A Shares and the Class B Shares, he is deemed to be a
controlling person of Tyson.
Tyson is subject to the information and reporting requirements of the
Exchange Act and is required to file periodic reports, proxy statements and
other information with the Commission relating to its business, financial
condition and other matters. Information, as of particular dates, concerning
Tyson's directors and officers, their remuneration, stock options granted to
them, the principal holders of Tyson's securities, any material interests of
such persons in transactions with Tyson and other matters is required to be
disclosed in proxy statements and annual reports distributed to Tyson's
shareholders and filed with the Commission. These reports, proxy statements and
other information should be available for inspection at the Commission in the
same manner as set forth with respect to information concerning the Company in
Section 8. In addition, such information should also be available for inspection
at the offices of the NASD, Reports Section, 1735 K Street, N.W., Washington,
D.C. 20006.
Set forth below is certain summary consolidated financial information with
respect to Tyson and its subsidiaries, excerpted or derived from financial
statements contained in Tyson's Annual Report on Form 10-K for the fiscal year
ended October 2, 1993, and unaudited financial statements contained in Tyson's
Quarterly Report on Form 10-Q for the fiscal quarters ended January 1, 1994 and
January 2, 1993. More comprehensive financial information and other information
is included in such reports and other documents, and the summary financial
information set forth below is qualified in its entirety by reference to such
reports and other documents filed by Tyson with the Commission, and the
financial information summary set forth below is qualified in its entirety by
reference to such reports, which are incorporated herein by reference, and all
the financial information and related notes contained therein.
17
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TYSON FOODS, INC.
SELECTED CONSOLIDATED FINANCIAL DATA
(DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
THREE MONTHS ENDED FISCAL YEAR ENDED
---------------------------- -------------------------------------------
JANUARY 1, JANUARY 2, OCTOBER 2, OCTOBER 3, SEPTEMBER 28,
1994 1993 1993 1992 1991
------------- ------------- ------------- ------------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT:
Sales............................... $ 1,152,790 $ 1,083,312 $ 4,707,396 $ 4,168,840 $ 3,922,054
Income before Taxes on Income....... 72,747 63,505 309,635 261,039 242,523
Net Income.......................... 44,379 39,396 180,334 160,534 145,498
PER SHARE INFORMATION:
Earnings Per Share.................. $ 0.30 $ 0.27 $ 1.22 $ 1.16 $ 1.05
Cash Dividends Per Share:
Class A........................... $ .0100 $ .0100 $ .0400 $ .0400 $ .0300
Class B........................... $ .0083 $ .0083 $ .0333 $ .0333 $ .0250
</TABLE>
<TABLE>
<CAPTION>
JANUARY 1, JANUARY 2, OCTOBER 2, OCTOBER 3,
1994 1993 1993 1992
------------- ------------- ------------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C>
BALANCE SHEET:
Current Assets..................................... $ 1,086,814 $ 769,452 $ 811,755 $ 679,895
Total Assets....................................... 3,525,624 3,169,865 3,253,504 2,617,679
Current Liabilities................................ 509,258 544,032 526,705 465,825
Long-term Debt..................................... 1,165,514 942,816 920,465 726,515
Total Liabilities.................................. 2,120,360 1,946,073 1,892,758 1,637,490
Shareholders' Equity............................... 1,405,264 1,223,792 1,360,746 980,189
</TABLE>
Except as set forth elsewhere in this Offer to Purchase or in Schedule I
hereto: (i) neither the Purchaser nor Tyson nor, to the knowledge of the
Purchaser and Tyson, any of the persons listed in Schedule I hereto or any
associate or majority-owned subsidiary or any pension, profit-sharing or similar
plan of the Purchaser, Tyson or 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) neither the Purchaser nor Tyson nor, to the knowledge of the
Purchaser and Tyson, any of the persons or entities referred to in clause (i)
above or any of their executive officers, directors or subsidiaries has effected
any transaction in the Shares or any other equity securities of the Company
during the past 60 days; (iii) neither the Purchaser nor Tyson nor, to the
knowledge of the Purchaser and Tyson, any of the persons listed in Schedule I
hereto 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 such contract, arrangement, understanding or relationship
concerning the transfer or voting thereof, joint ventures, loan or option
arrangements, puts or calls, guaranties of loans, guaranties against loss or the
giving or withholding of proxies; (iv) since July 1, 1990, there have been no
transactions which would require reporting under the rules and regulations of
the Commission between the Purchaser, Tyson or any of their respective
subsidiaries or, to the knowledge of the Purchaser and Tyson, any of the persons
listed in Schedule I hereto, on the one hand, and the Company or any of its
executive officers, directors or affiliates, on the other hand; and (v) since
July 1, 1990, there have been no contacts, negotiations or transactions between
the Purchaser, Tyson or any of their respective subsidiaries or, to the
knowledge of the Purchaser and Tyson, any of the persons listed in Schedule I
hereto, on the one hand, and the Company or its affiliates, on the other hand,
concerning a merger, consolidation or acquisition, tender offer or other
acquisition of securities, an election of directors or a sale or other transfer
of a material amount of assets of the Company.
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<PAGE>
Transactions in the Shares by Tyson and the Purchaser effected during the
past 60 days are described in Schedule I hereto. All such transactions were
effected by Tyson in the open market on the NASDAQ National Market System.
Shares owned by any person or entity referred to in clause (i) of the preceding
paragraph are described in Schedule I hereto.
10. SOURCE AND AMOUNT OF FUNDS. The total amount of funds required by the
Purchaser to purchase all outstanding Shares and to pay related costs and
expenses is estimated to be approximately $340 million. Tyson has received a
firm commitment from Bank of America National Trust and Savings Association
("Bank of America") to provide the total financing for the Offer and the
Proposed Merger (the "Financing") in the form of a credit facility of up to $340
million (the "Facility"). Bank of America has reserved the right, through BA
Securities, Inc. ("BA Securities"), to syndicate part of the Facility to a group
of financial institutions (together with Bank of America, the "Banks"). The
Financing would be utilized to pay for Shares purchased in the Offer and the
Proposed Merger and to pay all related fees and expenses.
On March 2, 1994, Tyson accepted the commitment letter from Bank of America
(the "Bank Commitment Letter") pursuant to which Bank of America has (a)
committed to provide the Financing and (b) reserved the right, through BA
Securities, to syndicate part of the Facility to the Banks, all upon the terms
and subject to the conditions set forth in the Bank Commitment Letter, including
the negotiation and execution of definitive financing and security agreements
(the "Credit Agreements").
The Bank Commitment Letter provides that the commitment of Bank of America
in respect of the Facility will terminate on May 10, 1994, if the Facility has
not closed on or before that date.
Tyson is expected, in the Credit Agreements, to make certain representations
and warranties, and to be bound by certain negative, affirmative and financial
covenants and by certain events of default, which are customarily required for
similar financings, in addition to other representations, warranties, covenants
and events of default appropriate to the specific transaction being effected
thereby.
Pursuant to the Bank Commitment Letter, Tyson also has agreed, regardless of
whether the Credit Agreement is executed or the Facility closes, to reimburse
Bank of America and BA Securities for their reasonable out-of-pocket costs and
expenses (including the allocated cost of in-house counsel) incurred in
connection with the Facility. Tyson also has agreed to indemnify Bank of America
and BA Securities and their respective directors, officers, employees and
affiliates from and against any and all losses, claims, damages, liabilities and
expenses arising out of the Offer, the Proposed Merger, the Bank Commitment
Letter or the Financing.
The Bank Commitment Letter provides for a Facility of up to $340 million.
Loans made pursuant to the Facility would be unsecured. The Facility will remain
available for 364 days from the closing of the Credit Agreement, and on such
364th day all indebtedness outstanding under the Facility will be due and
payable. Interest on indebtedness outstanding under the Facility will be payable
at a rate per annum, selected at the option of Tyson, equal to (i) LIBOR (as
hereinafter defined) plus an amount that will vary according to Tyson's credit
rating (which amount is currently 0.35%); and (ii) the Reference Rate (as
hereinafter defined) plus an amount that will vary according to Tyson's credit
rating (which amount is currently 0%). In addition, Tyson may from time to time
invite bids for uncommitted advances from the Banks through a competitive
auction mechanism. During the continuance of an event of default, additional
interest will be payable at a rate of 2% per annum over the then applicable
interest rate. "LIBOR" will be defined as the average London interbank offered
rate for Eurodollar deposits of varying maturities, as quoted by Bank of America
and two other banks to be designated, adjusted for certain reserve requirements
prescribed for eurocurrency liabilities. Interest payable based upon the LIBOR
rate will accrue based on a 360 day year and actual days elapsed and be paid at
the end of each interest period. "Reference Rate" will be defined as the higher
of (a) the rate on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, plus 1/2% and (b) the
rate of interest publicly announced from time to time by Bank of America in San
Francisco, California, as its reference rate. Interest payable based upon the
19
<PAGE>
Reference Rate will accrue based on a 365 day year and be paid quarterly in
arrears. The Facility may be prepaid, in part or in full and without penalty, on
any interest payment date, or on any other date with payment of certain breakage
costs.
The foregoing description of the Bank Commitment Letter is qualified in its
entirety by reference to the text of the Bank Commitment Letter filed as an
exhibit to the Tender Offer Statement on Schedule 14D-1 filed by the Purchaser
and Tyson with the Commission on the date hereof (the "Schedule 14D-1"), copies
of which may be obtained from the offices of the Commission in the manner set
forth in Section 8 with respect to information concerning the Company (except
that such information will not be available at the regional offices of the
Commission).
CONSUMMATION OF THE OFFER IS NOT CONDITIONED UPON THE RECEIPT BY THE
PURCHASER OR TYSON OF FINANCING FOR THE OFFER OR THE PROPOSED MERGER.
11. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY.
On January 3, 1994, Don Tyson, the Chairman of Tyson, contacted James L.
Keeler, the President and Chief Executive Officer of the Company, by telephone
and indicated Tyson's interest in discussing with the Company a business
combination involving Tyson and the Company. As a result of that discussion, on
January 10, 1994, Mr. Tyson received a letter from Mr. Keeler transmitted by
outside counsel to the Company enclosing a draft confidentiality agreement that
would govern the provision of confidential information regarding the Company to
Tyson in connection with Tyson's consideration of a potential business
combination or other transaction involving the Company and Tyson. On January 11,
1994, after transmitting to the Company's outside counsel certain proposed
revisions to the draft confidentiality agreement, including in particular the
deletion of certain "standstill" provisions contained in such draft, James B.
Blair, General Counsel of Tyson, and outside counsel to the Company discussed
the proposed confidentiality agreement by telephone and agreed that a
confidentiality agreement between Tyson and the Company would not be executed at
that time. Such standstill provisions would have precluded Tyson from, among
other things, acquiring or seeking to acquire the Company or any Shares for a
period of three years, unless requested to do so by the Company's Board of
Directors.
On January 12, 1994, Mr. Tyson and Mr. Keeler met in Washington, D.C. and
discussed the poultry business generally and the status of each of the Company
and Tyson. Mr. Tyson indicated that Tyson remained interested in a business
combination involving Tyson and the Company. Mr. Tyson stated that Tyson was
prepared to offer $30.00 per Share for all of the outstanding Shares. Mr. Tyson
stated that he was not seeking an immediate response to this offer, but wanted
Mr. Keeler to consider it. Mr. Tyson also discussed with Mr. Keeler the
possibility of structuring the proposed transaction in a manner that would be
tax-free to the Company's shareholders.
On January 19, 1994, Leland E. Tollett, Vice Chairman, Chief Executive
Officer and President of Tyson, and Mr. Keeler met in Richmond, Virginia and
discussed Tyson's proposal to acquire the Company. Mr. Keeler indicated at that
time that the Company was not interested in pursuing Tyson's proposal. Later
that day, Mr. Tyson and Mr. Keeler had a telephone conversation during which Mr.
Tyson stated that Tyson was prepared to deliver to the Company's Board of
Directors on that afternoon a written proposal to acquire all of the outstanding
Shares at a price of $30.00 per Share. Mr. Keeler indicated that he did not want
such a written proposal to be delivered at that time and requested more time to
consider Tyson's proposal. Mr. Tyson agreed that he would wait to deliver such a
written proposal until after 4 P.M. Eastern Standard Time on Monday, January 24,
1994.
On January 24, 1994, Mr. Tyson and Mr. Keeler had a further telephone
conversation during which Mr. Keeler indicated that the Company was not
interested in discussing further Tyson's proposal to acquire the Company.
20
<PAGE>
Following that telephone conversation, on January 24, 1994, Tyson delivered
the following letter to the Board of Directors of the Company:
Board of Directors
WLR Foods, Inc.
Gentlemen:
We at Tyson have long admired WLR Foods and the outstanding job you
and your management team have done for your stockholders. We believe now
is an ideal time for your stockholders to have the opportunity to
realize the tangible benefits of your efforts through a combination of
WLR Foods with Tyson on the very favorable basis which I will describe
in this letter.
We think that there are extremely attractive opportunities for
pursuing the continued growth and development of our two companies
through this combination in which it will be essential that you and
members of your management team play a significant role. Accordingly,
one of our top priorities is to negotiate mutually satisfactory
arrangements enabling the combined enterprise to have the benefit of
your experience and that of WLR's key managers.
I have discussed this matter thoroughly with our Board of Directors,
and we are pleased to propose a merger of WLR and Tyson or a subsidiary
of Tyson in which the stockholders of WLR would receive $30.00 in cash
for each of their WLR Foods shares.
We are confident that this proposal will be extremely attractive to
your stockholders. We also believe that a combination of WLR and Tyson
on the terms described below will prove to be the most advantageous
alternative to your stockholders, management, employees and other
important constituencies. This offer represents a 56% premium over last
Friday's closing market price of $19.25 per share. It also represents
approximately 2.26 times WLR book value per share, and a price to
earnings multiple of 21.4 times WLR's fiscal 1993 earnings. Accordingly,
we believe our offer is a full and fair one. We are willing to assure
the communities where your plants operate that they will benefit, not
suffer, from this proposed merger.
We recognize that you must consider what alternatives, if any, may
be available for WLR and its stockholders, including a sales transaction
with a third party, a leveraged buyout or leveraged recapitalization of
WLR. We believe that the combination of Tyson and WLR will quickly prove
to be the most attractive alternative to you. For that reason, we
believe it would be mutually desirable and advantageous if you would
give us the opportunity to negotiate with you and your Board of
Directors a definitive merger agreement embodying the terms of our
proposal. We are prepared to negotiate in good faith and to conclude a
transaction which we believe will be enthusiastically supported by your
Board, stockholders, management, employees and other constituencies.
Although we would prefer an all cash transaction, we would also be
willing to negotiate other possible ways of merging if a tax free
reorganization would be more desirable for a significant number of your
shareholders. A part stock, part cash merger would enable your
shareholders to participate in the future growth of the combined entity.
We would also be willing to attempt to time the closing of a transaction
such that your shareholders who purchased shares in your secondary
offering last year qualified on their capital gains holding period.
We respectfully request that any pertinent information which is
available to your management or is made available to your investment
bankers or third parties for the purpose of evaluating or pursuing
alternative transactions be made available to us as well, so that our
proposal and its terms may be formulated with the benefit of a level and
fully illuminated playing field.
21
<PAGE>
Although, as a board, you have apparently been unwilling to meet
with us we believe it would be mutually desirable to give us a chance to
meet with you to answer any of your questions and to negotiate in good
faith.
Our proposal is based upon and subject to the information we have
received to the effect that:
1. There are approximately 10,956,856 shares of WLR Foods common
stock outstanding;
2. That the disclosures in your 10-K's and 10-Q's are
substantially accurate and that there are no undisclosed matters that
would be financially material to the detriment of WLR Foods;
3. That the provisions of the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 will be complied with prior to the
consummation of a merger;
4. That your Board or management will not take any actions which
would materially reduce the value of WLR Foods to Tyson (normal
conduct of your business in the manner you have been conducting it in
the past will not constitute such a reduction);
5. That a majority of the disinterested Directors of WLR Foods
will make such approvals as necessary to prevent the Virginia Stock
Corporation Act from being an impediment to the proposed merger, and
that the Virginia Stock Corporation Act will not otherwise be used to
disadvantage Tyson in the purchase of WLR Foods stock, in the voting
of WLR Foods stock, or in any merger with Tyson or a subsidiary of
Tyson;
6. That no "Poison Pills" or other "Anti-Takeover" measures will
be used to obstruct a merger and that you will repeal any such
measures prior to the consummation of any transaction; and
7. The preparation, negotiation and execution of a definitive
merger agreement containing such terms (including but not limited to
representations, warranties and covenants) as are customary in
transactions of this nature.
We and our advisors are prepared to meet promptly with WLR
directors, management and advisors at their convenience in order to
answer any questions you or they may have about our offer and if
appropriate, in order to negotiate a mutually desirable and beneficial
transaction.
We believe that under the existing case law including U.S. Supreme
Court cases concerning disclosure of merger negotiations, it is likely
that you will be advised that this proposal must be disclosed to your
stockholders. Similarly, our counsel has advised us that this proposal
could be sufficiently material to our stockholders to require its
disclosure to them. In view of these concerns, we believe that prudence
requires that we make a public announcement of this proposal before the
opening of the market tomorrow morning.
Since this matter is of the utmost importance, we feel compelled to
ask for a response to our proposal from your Board of Directors no later
than the close of business on Thursday, February 4, 1994, after which
time our proposal will expire unless extended in writing.
We look forward to hearing from you at your earliest convenience.
Very truly yours,
Don Tyson
Chairman
22
<PAGE>
Shortly after delivery of the letter, Tyson released its contents to the Dow
Jones News Service, the Business Wire and certain other public media.
On January 25, 1994, the day following receipt of Tyson's proposal, the
Company issued the following letter:
Dear Fellow Shareholders:
As you are probably aware, WLR Foods, Inc. has received a proposal
from Tyson Foods, Inc. to merge the companies for $30 cash per share to
WLR Foods shareholders. Tyson's proposal was totally unsolicited,
unwanted and out of line with WLR Foods long-term business plans and
corporate philosophy.
We certainly understand why Tyson Foods is interested in us--the
problem is, we are not for sale. Since going public in 1988, we have
grown this Company's total turkey and chicken production by 84%. Our
gutsy commitment to growth during a period of low profit margin within
the poultry cycle has strategically positioned the company to enjoy an
upturn in this cyclical poultry market--an upturn that belongs to us. We
have worked too hard during this time, and, indeed in our 50-year
history, to let our competitors reap the benefits of our hard-earned
efforts. The improving national economy also makes this an exciting time
for WLR Foods.
As it must, WLR Foods Board will meet in the near future to evaluate
Tyson's offer. Be assured that your Board will listen carefully to its
advisors and management and make a decision it believes is in the best
interest of, and appropriately protects, our shareholders, employees and
producers. In this regard, the Board's historical commitment to the
continued independence of WLR Foods will be keenly important.
For management, employees, customers and suppliers, it's business as
usual. We will not back away from realizing our future--continued growth
internally and through acquisitions, aggressive marketing in key
domestic markets and abroad and maximizing our low cost production
capabilities. And, as always, we will keep you posted on important
corporate developments.
Sincerely,
James L. Keeler
President and Chief Executive Officer
23
<PAGE>
On February 6, 1994, the Company announced that on February 4, 1994, its
Board of Directors unanimously rejected Tyson's January 24 proposal. Also on
February 6, 1994, the Company delivered the following letter to Tyson:
Mr. Don Tyson
Chairman, Board of Directors
Tyson Foods, Inc.
2210 West Oaklawn Drive
Springdale, AR 72762-6999
Dear Mr. Tyson and Directors:
The Board of Directors of WLR Foods, Inc., along with management and
its professional advisors, has carefully considered your unsolicited
offer to negotiate the acquisition of WLR Foods, Inc. by Tyson Foods,
Inc. We decline your invitation to discuss your acquisition as we
strongly believe it is in the best long-term interests of WLR Foods,
Inc. and its shareholders for our company to remain independent. Our
decision to remain independent is unanimous.
Not only do we believe that WLR Foods and our shareholders are best
served by the continued independence of the company, we further believe
that now would be the wrong time to sell. We have made significant
capital expenditures and sizeable acquisitions in recent years to
strategically position this company to profit in a more favorable
poultry cycle and national economy. A sale at this time would deprive
our shareholders from realizing the benefits of the confluence of these
factors.
Our Board is committed to taking whatever action it deems necessary
and appropriate to protect the interests of WLR Foods, its shareholders
and other constituencies.
Sincerely,
Charles W. Wampler, Jr.
Chairman, Board of Directors
WLR Foods, Inc.
On February 6, 1994, the Company announced that at the February 4 Board
Meeting the Company's Board of Directors adopted a shareholder protection rights
plan and declared a dividend of the Rights pursuant thereto. In a letter to the
Company's shareholders issued on February 6, 1994, which accompanied a separate
letter informing shareholders of the Board of Directors' rejection of Tyson's
January 24 proposal, the Company explained the Board of Directors' reasons for
adopting the rights plan as follows:
The Rights Plan was adopted to give WLR Foods sufficient time to
consider appropriate responses to unsolicited tender offers, as well as
to protect shareholders against attempts to acquire control of the
Company by means of "creeping" accumulation of shares in the open
market, a two-tier tender offer, an offer at less than a full and fair
price or other prevalent takeover tactics which the Board believes are
not in your best interests.
. . .The Rights Plan is not intended to and will not prevent a
takeover of the Company at a full and fair price. However, it may cause
substantial dilution to a person or group that acquires 15% or more of
the Company's common stock unless the Rights are first redeemed by the
Board of Directors.
24
<PAGE>
. . .The Rights should not interfere with any merger or other
business combination that is in the best interests of the Company and
its shareholders, since the Rights generally may be redeemed by the
Company at $0.01 per Right in cash prior to the day after it is
announced that a person or group has acquired 15% or more of the
Company's common stock.
. . .In adopting the Rights Plan, the Board has expressed its
confidence in the Company's future and the Board's determination that
you, the shareholders, be given every opportunity to participate fully
in that future.
Also on February 6, 1994, the Company commenced the Virginia Action. See
Section 15. On February 15, 1994, the Company disclosed in its January 10-Q that
certain additional actions were taken at or in connection with the February 4
Board Meeting. Such actions included the adoption of lucrative "golden
parachute" severance agreements with certain executives, as well as severance
arrangements for all salaried and hourly clerical employees of the Company, and,
as more fully described in Section 12, the implementation of a series of actions
affecting four members of the Board of Directors pursuant to which the Company
purports to be able to take the position that these directors are not officers
or employees of the Company.
In light of the Company's response to Tyson's January 24 proposal and its
commencement of the Virginia Action, on February 7, 1994, Tyson commenced a
program of purchasing Shares in open market transactions with a view towards
acquiring in excess of 5% of the outstanding Shares so as to enable the
Purchaser to satisfy the requirements of the Virginia Control Share Act for
requiring the Company, in connection with the Offer, to call a special meeting
of shareholders pursuant to such Act. On February 24, 1994, Tyson completed such
program, having purchased an aggregate of 600,000 Shares in open market
transactions. On March 1, 1994 such Shares were contributed by Tyson to the
capital of the Purchaser.
On February 25, 1994, Tyson filed counterclaims against the Company and its
directors in the Virginia Action. See Section 15. On March 3, 1994, Tyson
announced its intention to cause the Purchaser to commence the Offer on March 9,
1994. Also on March 3, 1994, a request pursuant to the VSCA for access to
information concerning the identity and holdings of the Company's shareholders
was delivered to the Company on behalf of the Purchaser.
Except as described above, there have been no contacts, negotiations or
transactions between the Purchaser, Tyson or their subsidiaries or, to the best
knowledge of the Purchaser and Tyson, any of the persons listed on Schedule I,
and the Company or its affiliates, concerning a merger, consolidation or
acquisition, tender offer or other acquisition of securities, election of
directors or a sale or other transfer of a material amount of assets.
12. PURPOSE OF THE OFFER; PLANS FOR THE COMPANY; OTHER MATTERS
RELATING TO THE OFFER AND THE PROPOSED MERGER.
PURPOSE OF THE OFFER. The purpose of the Offer is for Tyson, through the
Purchaser, to acquire control of, and the entire equity interest in, the
Company. The Offer, as a first step in the acquisition of the Company, is
intended to facilitate the acquisition of all Shares. The Purchaser currently
intends, as soon as practicable following consummation of the Offer, to seek to
consummate the Proposed Merger. The purpose of the Proposed Merger is to acquire
all Shares not tendered and purchased pursuant to the Offer or otherwise.
Pursuant to the Proposed Merger, each Share then outstanding (other than Shares
held by the Purchaser, Tyson or any of their affiliates, Shares held by any
subsidiary of the Company and Shares held by shareholders who perfect their
dissenters' rights under the VSCA) would be converted into the right to receive
an amount in cash equal to the price per Share paid pursuant to the Offer.
Consummation of the Proposed Merger would require the adoption of a resolution
by the Company's Board of Directors that the Proposed Merger is advisable and
the affirmative vote of the holders of more than two-thirds of the Shares.
Consummation of the Proposed Merger may also be subject to the requirements of
the Virginia Affiliated Transactions Law, as described below.
25
<PAGE>
If the Offer is consummated and the voting rights of the Purchaser are not
limited by operation of the Virginia Control Share Act, the Purchaser presently
intends to seek to obtain at least majority representation on the Company's
Board of Directors, to cause the Company to enter into a definitive merger
agreement with Tyson and the Purchaser providing for the Proposed Merger, and to
submit the Proposed Merger to the Company's shareholders for approval. If the
Proposed Merger is submitted to the Company's shareholders, Tyson and Purchaser
intend to vote all Shares acquired pursuant to the Offer and otherwise owned by
them in favor of the Proposed Merger.
If the Offer cannot be consummated by reason of the Rights, the
applicability of the Virginia Affiliated Transactions Law or the Virginia
Control Share Act or otherwise, the Purchaser and Tyson may determine to abandon
the Offer and instead seek majority representation on the Company's Board of
Directors through a proxy contest at the Company's next annual meeting of
shareholders, which under the Bylaws would be held in October, 1994. The ability
of the Purchaser to succeed in such a proxy context would depend on events and
conditions at that time. No assurance can be given as to whether the Purchaser
would proceed with such a contest at that time or, if it chooses to pursue such
a contest, whether the Purchaser would prevail. If the Purchaser succeeded in
obtaining majority representation on the Company's Board of Directors through
such a proxy contest, the Purchaser would then cause the Company to redeem the
Rights and enter into a definitive merger agreement with Tyson and the Purchaser
providing for an acquisition of the Company by Tyson, which merger agreement
would render the Virginia Affiliated Transactions Law and the Virginia Control
Share Act inapplicable. However, given the significant delay inherent in
postponing action until the Company's next annual meeting, no assurance can be
given that any merger transaction proposed by the Purchaser or Tyson at that
time would be on the same terms as the Proposed Merger.
If the Purchaser obtains majority representation on the Company's Board of
Directors and the Purchaser is unable for any reason to consummate the Proposed
Merger, the Purchaser would nonetheless seek to exercise control over the
business and affairs of the Company.
AS A RESULT OF THE FACTORS DESCRIBED IN THIS OFFER TO PURCHASE,
SUBSTANTIALLY ALL OF WHICH ARE CURRENTLY WITHIN THE CONTROL OF THE COMPANY'S
BOARD OF DIRECTORS, NO ASSURANCE CAN BE GIVEN THAT THE PROPOSED MERGER WILL BE
CONSUMMATED OR AS TO THE TIMING THEREOF. IF THE TIMING OF THE PROPOSED MERGER IS
SUBSTANTIALLY DELAYED, NO ASSURANCE CAN BE GIVEN AS TO THE PER SHARE
CONSIDERATION THAT WOULD BE PAID. IF FOR ANY REASON THE PROPOSED MERGER IS NOT
CONSUMMATED, THE PURCHASER RESERVES THE RIGHT TO ACQUIRE ADDITIONAL SHARES
FOLLOWING THE EXPIRATION OF THE OFFER THROUGH PRIVATE PURCHASES, MARKET
TRANSACTIONS, TENDER OR EXCHANGE OFFERS OR OTHERWISE ON TERMS AND AT PRICES THAT
MAY BE MORE OR LESS FAVORABLE THAN THOSE OF THE OFFER OR, SUBJECT TO ANY
APPLICABLE LEGAL RESTRICTIONS, TO DISPOSE OF ANY OR ALL SHARES ACQUIRED BY THE
PURCHASER. ASSURANCES WITH RESPECT TO THE PROPOSED MERGER COULD BE GIVEN IF,
PRIOR TO CONSUMMATION OF THE OFFER, THE COMPANY'S BOARD OF DIRECTORS AGREES TO
ENTER INTO NEGOTIATIONS WITH TYSON AND THE PURCHASER AND SUCH NEGOTIATIONS
RESULT IN AN AGREEMENT BETWEEN THE COMPANY, TYSON AND THE PURCHASER PROVIDING
FOR THE PROPOSED MERGER. THE PURCHASER THEREFORE REITERATES ITS REQUEST THAT THE
COMPANY'S BOARD OF DIRECTORS ENTER INTO SUCH NEGOTIATIONS.
Tyson intends to continue to seek to negotiate with the Company with respect
to the acquisition of the Company by Tyson. If such negotiations result in a
definitive merger agreement between the Company and Tyson, the consideration to
be received by holders of Shares could include or consist of Tyson common stock,
other securities, cash, or any combination thereof. Accordingly, such
negotiations could result in, among other things, termination of the Offer (see
Section 14) and submission of a different acquisition proposal to the Company's
shareholders for their approval. IN THIS REGARD, TYSON REMAINS WILLING TO
NEGOTIATE A TRANSACTION WHICH WOULD PROVIDE SHAREHOLDERS WITH AN OPPORTUNITY TO
DISPOSE OF THEIR SHARES ON A TAX-FREE BASIS.
PLANS FOR THE COMPANY. In connection with the Offer, Tyson and the
Purchaser have reviewed, and will continue to review, on the basis of publicly
available information, various possible business strategies involving the
Company and its operations that they might consider in the event that they
acquire control of the Company. If and to the extent that Tyson and the
Purchaser acquire control of
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the Company or otherwise obtain access to the books and records of the Company,
Tyson and the Purchaser intend to conduct a detailed review of the Company and
its assets, corporate structure, dividend policy, capitalization, operations,
properties, policies, management and personnel, and may on the basis of such
review propose or seek to effect changes or transactions with respect to or
affecting any of such matters. Based on their review of the information
available to them at this time, Tyson and the Purchaser do not currently intend
or contemplate seeking to effect any material changes in the operations or
structure of the Company or in its relationships with employees, suppliers or
customers.
Except as described in this Offer to Purchase, Tyson and the Purchaser have
no present plans or proposals that would result in (i) an extraordinary
corporate transaction, such as a merger, consolidation, reorganization or
liquidation involving the Company or any of its subsidiaries, (ii) a sale or
transfer of a material amount of assets of the Company or any of its
subsidiaries, (iii) any change in the present board of directors or management
of the Company, (iv) any material change in the present capitalization or
dividend policy of the Company, (v) any other material change in the Company's
corporate structure or business, (vi) causing a class of securities of the
Company to be delisted from a national securities exchange or to cease to be
authorized to be quoted in an inter-dealer quotation system of a registered
national securities association or (vii) a class of equity securities of the
Company becoming eligible for termination of registration pursuant to Section
12(g)(4) of the Exchange Act.
CERTAIN REQUIREMENTS WITH RESPECT TO SHAREHOLDERS MEETINGS AND THE BOARD OF
DIRECTORS. The Articles of Restatement of the Company (the "Restated Articles")
provide that the Company's Board of Directors is divided into three classes,
with each class elected for a term of three years. The terms of the classes are
staggered so that at each annual meeting of shareholders one class of directors
is elected for a three year term. The Bylaws provide that the number of
directors may be fixed from time to time by the Board of Directors, but shall be
not less than nine and no more than 21. Based upon publicly available
information, there are currently 10 members of the Company's Board of Directors,
of which three are in the class that will be up for election at the Company's
next annual meeting of shareholders. The VSCA provides that the size of the
Board of Directors may be fixed or changed from time to time, within the minimum
of nine and the maximum of 21 specified in the Bylaws, by the shareholders or by
the Board of Directors, provided that the range for the size of the Board of
Directors may only be changed by the shareholders. The VSCA further provides
that if any vacancy occurs on the Board of Directors (including any vacancy
resulting from an increase in the number of directors) such vacancy may be
filled by the Board of Directors or by the shareholders, provided that the term
of any director elected by the Board of Directors to fill a vacancy will expire
at the next shareholders' meeting at which directors are elected.
If the current members of the Board of Directors refuse to approve actions
proposed or requested by the Purchaser, the Purchaser could seek to obtain
majority representation on the Board of Directors. The Purchaser would seek such
majority representation in any event if the Offer is consummated, assuming that
the Purchaser's voting rights are not limited by operation of the Virginia
Control Share Act. Such majority representation could be obtained at the next
annual meeting of the Company's shareholders, notwithstanding the classification
of the Company's Board of Directors. At such annual meeting, the Purchaser could
submit to the Company's shareholders a proposal to increase the size of the
Board of Directors from ten to 15, a proposal to elect designees of the
Purchaser to replace the three existing directors who are up for election at
such meeting, and a proposal to elect designees of the Purchaser to fill the
five vacancies created by the increase in the size of the Board. If all such
proposals were approved by the Company's shareholders, the Purchaser's designees
would constitute eight out of the 15 directors who would then comprise the
Board. The Purchaser believes that, assuming a quorum were present at such
meeting, adoption of the proposal to increase the size of the Board of Directors
would require the affirmative vote of a majority of the Shares voted on such
proposal and the election of the Purchaser's nominees as directors would require
the affirmative vote of a plurality of the Shares voted on the election of
directors. The Bylaws generally require that if a shareholder desires to
nominate one or more persons for election as directors at a
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meeting of shareholders, such shareholder must provide written notice thereof to
the Company not less than 90 days prior to the meeting. The Bylaws do not
otherwise regulate the submission by a shareholder of proposals to be voted on
at the Company's annual meeting.
The Bylaws provide that special meetings of shareholders may be called only
by the Company's Chairman, President or Board of Directors. Accordingly, the
Purchaser would not be able to convene a special meeting of shareholders for
purposes of effecting the actions described above, and instead would only be
able to take such actions at the next annual meeting of shareholders. The Bylaws
provide that the annual meeting of shareholders will be held in October of each
year, although the Board of Directors may be able to accelerate or postpone the
next annual meeting by waiving or amending this provision. The VSCA provides
that the circuit court of the city or county where a corporation's principal
office is located may, after notice to the corporation, order an annual meeting
of shareholders on petition of any shareholder entitled to participate in an
annual meeting if an annual meeting was not held within 15 months after the
corporation's last annual meeting. The Company's last annual meeting of
shareholders was held on October 23, 1993.
The Bylaws provide that the Bylaws may be amended by a two-thirds vote of
the Board of Directors or by a two-thirds vote of all Shares entitled to vote,
and that bylaws made or amended by the Board of Directors may be altered,
amended or repealed by the shareholders, but shall remain in effect unless or
until such action is taken by the shareholders. The Purchaser believes that,
because the two-thirds vote requirement with respect to amendments to the Bylaws
by shareholders is contained in the Bylaws rather than in the Restated Articles,
such requirement is not valid under the VSCA and that shareholder action to
amend the Bylaws would only require the affirmative vote of a majority of the
Shares voted on the proposed amendment at a meeting at which a quorum is
present.
The foregoing description of the Restated Articles and the Bylaws is
qualified in its entirety by reference to the text of the Restated Articles and
Bylaws, copies of which have been filed by the Company as exhibits to documents
filed with the Commission and may be obtained in the manner described in Section
8.
NEITHER THE PURCHASER NOR TYSON IS SOLICITING PROXIES BY MEANS OF THIS OFFER
TO PURCHASE WITH RESPECT TO THE ELECTION OF DIRECTORS OR ANY PROPOSAL TO BE
CONSIDERED BY SHAREHOLDERS OF THE COMPANY.
VIRGINIA AFFILIATED TRANSACTIONS LAW. The Virginia Affiliated Transactions
Law purports to prohibit a Virginia corporation, such as the Company, from
engaging in any Affiliated Transaction (defined to include a variety of
transactions, including mergers) with any Interested Shareholder (defined
generally as any person that, directly or indirectly, beneficially owns 10% or
more of the outstanding voting shares of the corporation), or any affiliate of
an Interested Shareholder, for three years after the date on which the
Interested Shareholder became an Interested Shareholder unless the Affiliated
Transaction is approved by a majority (but not less than two) of the
disinterested directors and by the affirmative vote of two-thirds of the voting
shares other than shares beneficially owned by the Interested Shareholder. The
three-year prohibition on Affiliated Transactions with Interested Shareholders
(the "Affiliated Transaction Prohibition") does not apply if certain conditions,
described below, are satisfied. After the expiration of the Affiliated
Transaction Prohibition period, an Affiliated Transaction with an Interested
Shareholder requires the affirmative vote of at least two-thirds of the voting
shares not beneficially owned by the Interested Shareholder (the "Supermajority
Vote"), except under certain conditions described below. Under the Virginia
Affiliated Transactions Law, the "disinterested directors" with respect to any
particular Interested Shareholder means the members of the board of directors of
the corporation who were members prior to the date on which the Interested
Shareholder became an Interested Shareholder. The Virginia Affiliated
Transactions Law provides that a person is deemed to be the "beneficial owner"
of voting shares as to which such person and such person's affiliates and
associates, individually or in the aggregate, have or share directly, or
indirectly through any contract, arrangement, understanding, relationship or
otherwise (i) the power to vote voting shares pursuant to any agreement,
arrangement or understanding other than solely by virtue of revocable proxies
given in response to a proxy solicitation made to ten or more persons and in
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accordance with the Exchange Act, (ii) investment power, or (iii) the right to
acquire voting or investment power (whether such right is exercisable
immediately or only after the passage of time) pursuant to any contract,
arrangement or understanding, upon the exercise of conversion rights, exchange
rights, warrants or options.
The Affiliated Transaction Prohibition does not apply to a particular
Affiliated Transaction with a particular Interested Shareholder if (i) a
majority of the disinterested directors approves the acquisition of voting
shares making such person an Interested Shareholder before such person becomes
an Interested Shareholder; or (ii) the corporation, by action of its
shareholders, adopts an amendment to its articles of incorporation or bylaws, by
an affirmative vote of more than two-thirds of the votes entitled to be cast by
each voting group entitled to vote on the proposed amendment and a majority of
the shares entitled to vote that are not owned by Interested Shareholders or
affiliates and associates of any Interested Shareholders, expressly electing not
to be governed by the Virginia Affiliated Transactions Law; provided that the
amendment shall not be effective until 18 months after the vote of shareholders
and shall not apply to any Affiliated Transaction of the corporation with an
Interested Shareholder who became an Interested Shareholder on or before the
date of the vote. There are certain other exemptions to the Affiliated
Transaction Prohibition which the Purchaser does not believe are relevant with
respect to the Company.
The Supermajority Vote (which becomes applicable after the three-year
Affiliated Transaction Prohibition period has expired) would not apply to an
Affiliated Transaction taking the form of a merger (such as the Proposed
Merger), consolidation or share exchange after the end of the Affiliated
Transaction Prohibition period if either (i) the Affiliated Transaction is
approved by a majority of the disinterested directors or (ii) in addition to
certain other conditions, certain "fair price" provisions are met, which "fair
price" provisions could result in a price higher than the purchase price per
Share pursuant to the Offer. In substance, the "fair price" provisions require
that all holders of voting shares receive in the Affiliated Transaction cash
and/or property having a fair market value per share equal to the highest of (i)
if applicable, the highest per share price (including brokerage commissions,
transfer taxes and soliciting dealer fees) paid by the Interested Shareholder
for any shares acquired by it (A) in the transaction pursuant to which it became
an Interested Shareholder or (B) within the two-year period immediately prior
thereto, plus interest (minus dividends paid, but not in excess of the amount of
interest); (ii) the fair market value per share, plus interest (minus dividends
paid, but not in excess of the amount of interest); (iii) if applicable, the
price determined pursuant to clause (ii) multiplied by the ratio of the highest
price per share paid by the Interested Shareholder during the two-year period
immediately prior to its becoming an Interested Shareholder to the fair market
value of the shares on the first day of such two-year period on which the
Interested Shareholder purchased any shares; and (iv) it applicable, the highest
preferential amount to which a share is entitled upon dissolution of the
corporation.
The foregoing summary of the Virginia Affiliated Transactions Law does not
purport to be complete and is qualified in its entirety by reference to the
provisions of the Virginia Affiliated Transactions Law.
The Purchaser's acquisition of Shares pursuant to the Offer would result in
the Purchaser becoming an Interested Shareholder for purposes of the Virginia
Affiliated Transactions Law and, absent the prior approval thereof by the
Company's disinterested directors, the Affiliated Transaction Prohibition would
apply to the Proposed Merger, as well as certain other transactions that the
Purchaser or Tyson could seek to effect following consummation of the Offer. If
the Purchaser were to obtain majority representation on the Company's Board of
Directors prior to the acquisition by it and its affiliates and associates of
beneficial ownership of more than 10% of the outstanding Shares, the directors
nominated by the Purchaser would be disinterested directors for purposes of the
Virginia Affiliated Transactions Law. Such directors could then approve a merger
or other acquisition transaction proposed by the Purchaser and the Purchaser's
acquisition of Shares pursuant thereto, in which event the Virginia Affiliated
Transactions Law would be rendered inapplicable to such merger or other
transaction. However, to the extent that the Purchaser were not to obtain
representation on the
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Company's Board of Directors until following consummation of the Offer, the
directors nominated by the Purchaser would not be disinterested directors and
actions taken by such directors could not be used to satisfy the requirements of
the Virginia Affiliated Transactions Law or to render such requirements
inapplicable to the Proposed Merger.
The impact of the Virginia Affiliated Transactions Law would be effectively
to deny the Purchaser the ability to assure the consummation of the Proposed
Merger even if the Purchaser acquires in excess of two-thirds of the outstanding
Shares pursuant to the Offer and thereafter obtains majority representation on
the Company's Board of Directors. Tyson is seeking in the Virginia Action to
have the Virginia Affiliated Transactions Law declared unconstitutional and
invalid as applied to the Offer and the Proposed Merger. In addition, the
Purchaser is hereby requesting that the Company's Board of Directors adopt a
resolution approving the acquisition of Shares by the Purchaser pursuant to the
Offer, such that the Virginia Affiliated Transactions Law would not be
applicable to the Proposed Merger.
If Tyson fails to prevail in the Virginia Action regarding the
constitutionality and validity of the Virginia Affiliated Transactions Law and
the Company's Board of Directors does not accede to the Purchaser's request that
it approve the Purchaser's acquisition of Shares pursuant to the Offer, the
Purchaser may determine to abandon the Offer and instead attempt to obtain
majority representation on the Company's Board of Directors at the next annual
meeting of shareholders, as described above. However, since under the Company's
Bylaws the next annual meeting of shareholders would not be held until October,
1994 and could be postponed further, the Purchaser may determine that such an
approach involves an intolerable degree of delay and an intolerable degree of
uncertainty with respect to the conditions that may exist at the time of such
meeting. Thus, although the Purchaser would prefer to consummate the Offer and
obtain control of the Company under circumstances which would assure the prompt
consummation of the Proposed Merger, the Purchaser may determine to proceed on a
basis whereby the Purchaser obtains control of the Company through consummation
of the Offer, but is unable to consummate the Proposed Merger for an extended
period of time. If the Purchaser makes such a determination, the Purchaser would
amend the Offer to reduce the number of Shares sought pursuant to the Offer to
that number of Shares which, together with the Shares beneficially owned by the
Purchaser and its affiliates, represents a majority of the total number of
Shares outstanding on a fully diluted basis. The acquisition by the Purchaser of
only that number of Shares which would increase its holdings to a majority of
the outstanding Shares would maximize the number of Shares which would not be
beneficially owned by the Purchaser and could therefore be voted in favor of the
Proposed Merger in accordance with the Virginia Affiliated Transactions Law.
Following the consummation of the Offer, as so amended, the Purchaser would seek
to obtain majority representation on the Company's Board of Directors and
thereafter would seek to obtain the approvals by the disinterested directors
(which would not include directors nominated by the Purchaser or Tyson and
elected following consummation of the Offer) and the shareholders of the Company
other than the Purchaser which would be necessary to approve the Proposed Merger
in accordance with the Virginia Affiliated Transactions Law. No assurances could
be given as to whether such approvals could be obtained.
VIRGINIA CONTROL SHARE ACT. The Virginia Control Share Act provides that
Control Shares (as hereinafter defined) of a Virginia corporation, such as the
Company, which are acquired in a Control Share Acquisition (as hereinafter
defined) have no voting rights unless (i) voting rights are granted by
resolution approved by a majority of all votes which could be cast in a vote on
the election of directors, excluding all Interested Shares (as hereinafter
defined), or (ii) by midnight on the fourth day following (A) the receipt by the
secretary of the corporation of a notice expressly and specifically describing a
proposed Control Share Acquisition or (B) the public announcement of a tender
offer which would result in a Control Share Acquisition, the corporation's
articles of incorporation or bylaws provide that the Virginia Control Share Act
does not apply. Neither the Company's Restated Articles nor the
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Company's Bylaws have been amended to provide that the Virginia Control Share
Act does not apply, and can no longer be so amended pursuant to the Virginia
Control Share Act with respect to the Control Share Acquisition contemplated by
the Offer.
"Control Shares" generally means shares of a corporation acquired by a
person within any of the following ranges of voting power: (i) one-fifth or
more, but less than one-third of all voting power; (ii) one-third or more, but
less than a majority of all voting power; or (iii) a majority or more of all
voting power. "Control Share Acquisition" generally means the direct or indirect
acquisition of beneficial ownership of, or the right to direct the exercise of
voting power with respect to, Control Shares, but does not include the
acquisition of shares in a merger, plan of share exchange, tender offer or
exchange offer, in each case, pursuant to an agreement to which the issuing
corporation is a party.
"Interested Shares" generally means shares of a corporation in respect of
which an acquiring person, an officer of the corporation or an employee of the
corporation who is also a director of the corporation is entitled to exercise or
direct voting power.
Any person who proposes to make or has made a Control Share Acquisition may
deliver a Control Share Acquisition Statement to the corporation at its
principal office (a "Control Share Acquisition Statement"). A Control Share
Acquisition Statement generally identifies the acquiring person, the number of
shares of the corporation beneficially owned by the acquiring person, a
description of the terms of the Control Share Acquisition, including the source
of funds for the acquisition, proposals to liquidate the corporation, sell
substantially all its assets or merge it with any other person, plans to change
the location of the corporation's principal executive offices or a material
portion of its business activities, to change materially its management or
employment policies, to alter materially its relations with suppliers or
customers or the communities in which it operates, or to make other material
changes in its business, corporate structure, management or personnel, and plans
for additional purchases of the corporation's shares. In addition, the acquiring
person must represent that it has the financial capacity to make the proposed
Control Share Acquisition and, unless the acquiring person has adequate cash and
cash equivalents in excess of its working capital requirements to fund the
Control Share Acquisition, must accompany the Control Share Acquisition
Statement with complete copies of legally binding commitments from financial
institutions.
If the acquiring person complies with the requirement for delivery of a
Control Share Acquisition Statement, so requests at the time of delivery thereof
and undertakes to pay the corporation's expenses of a special meeting, the Board
of Directors of the corporation is required to call a special meeting of
shareholders for the purpose of considering the voting rights to be accorded the
shares acquired or to be acquired within 10 days after the corporation receives
the request. Unless the acquiring person otherwise agrees, the meeting must be
held within 50 days after the request has been received, and if the acquiring
person so requests, the special meeting shall not be held sooner than 30 days
after the date of the request. Notwithstanding the foregoing, the directors of
the corporation may decline to call a special meeting of shareholders if they
determine that at the time of such request the acquiring person does not
beneficially own shares having at least five percent of the votes entitled to be
cast at an election of directors. In such event, the issue of granting voting
rights to the shares to be acquired in a Control Share Acquisition shall be
considered at the next annual meeting of shareholders.
The Virginia Control Share Act further provides that any proxy that confers
authority to vote on the granting of voting rights pursuant thereto shall be
solicited separately from any offer to purchase shares of the corporation, and
may not be solicited sooner than thirty days before the meeting unless otherwise
agreed by the acquiring person and the corporation. Any such proxy must
expressly provide that it is revocable at all times until completion of the
vote.
Unless otherwise provided in the corporation's articles of incorporation or
bylaws before a Control Share Acquisition has occurred, if voting rights are
granted to shares acquired in a Control Share Acquisition resulting in the
acquiring person having beneficial ownership of shares entitled to cast a
majority of the votes in an election of directors, a shareholder who did not
vote in favor of
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granting such voting rights and followed certain procedures set forth in the
VSCA, would be entitled to demand the payment of fair value for his shares,
which would in no event be lower than the highest price paid in the Control
Share Acquisition.
The foregoing summary of the Virginia Control Share Act does not purport to
be complete and is qualified in its entirety by reference to the provisions of
the Virginia Control Share Act.
At or in connection with the February 4 Board Meeting, a series of actions
were taken affecting four members of the Company's Board of Directors pursuant
to which the Company purports to be able to take the position that these
directors are not officers or employees of the Company and that therefore the
Shares as to which these directors have voting power are not Interested Shares
for purposes of the Virginia Control Share Act. Specifically, according to the
January 10-Q, (i) Charles W. Wampler, Jr., Chairman of the Board of the Company,
and Herman D. Mason, Vice Chairman of the Board of the Company, agreed to
terminate their compensation from the Company effective February 4, 1994; (ii)
directors William D. Wampler and George E. Bryan resigned in their capacity as
Senior Vice Presidents of the Company and likewise terminated their compensation
from the Company effective February 4, 1994; (iii) in connection with these
resignations, all four of such directors were provided individual deferred
compensation agreements which provide post-retirement health insurance coverage;
and (iv) the Company's Board of Directors amended the Bylaws to clarify that the
roles of the Chairman of the Board and the Vice Chairman of the Board are as
officers of the Board, rather than the Company. Based upon information publicly
available on the date hereof, these four directors are the four largest
shareholders on the Company's Board of Directors and beneficially own in excess
of 10% of the outstanding Shares. Also at the February 4 Board Meeting, the
Bylaws were amended to specify that the record date for a special shareholders
meeting held pursuant to the Virginia Control Share Act will be the date upon
which a Control Share Acquisition Statement relating to such meeting is
delivered to the Company. Such amendment has the effect of eliminating the
advance notice which would otherwise be given with respect to the record date
for any meeting. Such advance notice of the record date would, among other
things, better enable all shareholders to have a full and fair opportunity to
vote their Shares. Tyson has asserted counterclaims in the Virginia Action which
challenge the propriety and validity of all these actions. Tyson is also seeking
in the Virginia Action to have the Virginia Control Share Act declared
unconstitutional and invalid as applied to the Offer and the Proposed Merger.
See Section 15.
The Company's Board of Directors rejected Tyson's proposal to acquire the
Company purportedly on the basis of its belief that such proposal would not be
in the "best long-term interests" of the Company's shareholders. See Section 11.
The Purchaser believes that the Company's disinterested shareholders should have
an opportunity to express independently their own views as to their own
long-term best interests, rather than having those views surmised and acted upon
by the Board of Directors. The Purchaser believes that acceptance of the Offer
by shareholders, if the Offer could be consummated unimpeded by the various
defensive measures and statutory provisions that are being relied upon by the
Company's Board of Directors, would be the best means of allowing shareholders
to express such views. Tyson is challenging the constitutionality and validity
of the Virginia Control Share Act on the basis that, among other things, it
impermissably impedes consummation of the Offer. The Purchaser also believes
that to whatever extent the special shareholders meeting contemplated by the
Virginia Control Share Act could be useful by effectively serving as a
referendum of the disinterested shareholders on the proposed acquisition of the
Company by Tyson contemplated by the Offer and the Proposed Merger, such a
special meeting of shareholders will not serve as a true referendum of
disinterested shareholders unless the actions of the Company's Board of
Directors and management described in the preceding paragraph are invalidated as
requested by Tyson in the Virginia Action and unless such special meeting and
the related shareholder vote are conducted in a manner which assures that all
disinterested shareholders have a full and fair opportunity to consider the
views of the Purchaser and the Company and then to express their own views.
Thus, depending on the timing and outcome of the Virginia Action both with
respect to the constitutionality and applicability of the Virginia Control Share
Act and with respect to the validity of the actions taken by the
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Company's Board of Directors and management, the Purchaser intends, at such time
as it determines appropriate, to deliver a request to the Company that it
convene a special shareholders meeting in accordance with the requirements of
the Virginia Control Share Act. Pursuant to the Virginia Control Share Act and
the terms of the request for a special shareholders meeting to be delivered by
the Purchaser, the special shareholders meeting will be required to be called
within 10 days, and must be held no sooner than 30 days and no later than 50
days, after receipt by the Company of the Purchaser's request that the special
shareholders meeting be held.
The Purchaser has not yet requested the Company to convene a special meeting
under the Virginia Control Share Act, and Tyson and the Purchaser are not
currently soliciting proxies with respect to the proposal that would be
considered by shareholders at such a special shareholders meeting. Any such
request would be made only in accordance with the specific requirements of the
Virginia Control Share Act and any such solicitation would be made only pursuant
to separate proxy materials complying with the requirements of Section 14 of the
Exchange Act and the requirements of the Virginia Control Share Act.
THE RIGHTS. According to the Company 8-A, on February 4, 1994, the Board of
Directors of the Company declared a dividend payable February 14, 1994 of one
Right for each outstanding Share held of record at the close of business on
February 14, 1994 (the "Record Time"), or issued thereafter and prior to the
Separation Time (as hereinafter defined) and thereafter pursuant to options and
convertible securities outstanding at the Separation Time. Each Right entitles
its registered holder to purchase from the Company, after the Separation Time,
one one-hundredth of a share of Participating Preferred Stock, no par value, of
the Company ("Participating Preferred Stock"), for $68 (the "Exercise Price"),
subject to adjustment.
According to the Company 8-A, the Rights will be evidenced by the Common
Stock certificates until the close of business on the earlier of (either, the
"Separation Time") (i) the tenth business day (or such later date as the Board
of Directors of the Company may from time to time fix by resolution adopted
prior to the Separation Time that would otherwise have occurred) after the date
on which any Person (as defined in the Rights Agreement) commences a tender or
exchange offer which, if consummated, would result in such Person becoming an
Acquiring Person (as hereinafter defined) and (ii) the first date (the "Flip-in
Date") of public announcement by the Company or any Person that such Person has
become an Acquiring Person, other than as a result of a Flip-over Transaction or
Event (as hereinafter defined). "Acquiring Person" generally means any Person
having Beneficial Ownership (as defined in the Rights Agreement) of 15% or more
of the outstanding shares of Common Stock, subject to certain exceptions
contained in the Rights Agreement.
According to the Company 8-A, until the Separation Time, the Rights will be
transferred with and only with the Common Stock. The Rights will not be
exercisable until the Business Day (as defined in the Rights Agreement)
following the Separation Time.
According to the Company 8-A, the Rights will expire on the earliest of (i)
the Exchange Time (as hereinafter defined), (ii) the close of business on
February 14, 2004, (iii) the date on which the Rights are redeemed and (iv) upon
the merger of the Company into another corporation pursuant to an agreement
entered into when there is no Acquiring Person (in any such case, the
"Expiration Time").
According to the Company 8-A, in the event that prior to the Expiration Time
a Flip-in Date occurs, each Right (other than Rights Beneficially Owned by the
Acquiring Person or any affiliate or associate thereof, which Rights shall
become void) shall constitute the right to purchase from the Company, upon the
exercise thereof in accordance with the terms of the Rights Agreement, that
number of shares of Common Stock or Participating Preferred Stock of the Company
having an aggregate Market Price (as defined in the Rights Agreement), on the
date of the public announcement of an Acquiring Person's becoming such (the
"Stock Acquisition Date") that gave rise to the Flip-in Date, equal to twice the
Exercise Price for an amount in cash equal to the then current Exercise Price.
In addition, the Board of Directors of the Company may, at its option, at any
time after a Flip-in Date and prior to the time that an Acquiring Person becomes
the Beneficial Owner of more than 50% of the
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outstanding shares of Common Stock, elect to exchange all (but not less than
all) of the then outstanding Rights (other than Rights beneficially owned by the
Acquiring Person or any affiliate or associate thereof, which Rights shall
become void) for shares of Common Stock at an exchange ratio of one share of
Common Stock per Right, appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date of the Separation Time
(the "Exchange Ratio"). Immediately upon such action by the Board of Directors
(the "Exchange Time"), the right to exercise the Rights will terminate and each
Right will thereafter represent only the right to receive a number of shares of
Common Stock equal to the Exchange Ratio.
According to the Company 8-A, in the event that prior to the Expiration Time
the Company enters into, consummates or permits to occur a transaction or series
of transactions after the time an Acquiring Person has become such in which,
directly or indirectly, (i) the Company shall consolidate or merge or
participate in a binding share exchange with any person if, at the time of the
consolidation, merger or share exchange or at the time the Company enters into
an agreement with respect to such consolidation, merger or share exchange, the
Acquiring Person controls the Board of Directors of the Company and any term of
or arrangement concerning the treatment of shares of capital stock in such
merger, consolidation or share exchange relating to the Acquiring Person is not
identical to the terms and arrangements relating to other holders of Common
Stock or (ii) the Company shall sell or otherwise transfer (or one or more of
its subsidiaries shall sell or otherwise transfer) assets (A) aggregating more
than 50% of the assets (measured by either book value or fair market value) or
(B) generating more than 50% of the operating income or cash flow, of the
Company and its subsidiaries (taken as a whole) to any other Person (other than
the Company or one or more of its wholly owned subsidiaries) or to two or more
such Persons which are affiliated or otherwise acting in concert, if, at the
time of such sale or transfer of assets or at the time the Company (or any such
subsidiary) enters into an agreement with respect to such sale or transfer, the
Acquiring Person controls the Board of Directors of the Company (a "Flip-over
Transaction or Event"), the Company shall take such action as shall be necessary
to ensure, and shall not enter into, consummate or permit to occur such
Flip-over Transaction or Event until it shall have entered into a supplemental
agreement with the Person engaging in such Flip-over Transaction or Event or the
parent corporation thereof (the "Flip-over Entity"), for the benefit of the
holders of the Rights, providing, that upon consummation or occurrence of the
Flip-over Transaction or Event (i) each Right shall thereafter constitute the
right to purchase from the Flip-over Entity, upon exercise thereof in accordance
with the terms of the Rights Agreement, that number of shares of common stock of
the Flip-over Entity having an aggregate Market Price on the date of
consummation or occurrence of such Flip-over Transaction or Event equal to twice
the Exercise Price for an amount in cash equal to the then current Exercise
Price and (ii) the Flip-over Entity shall thereafter be liable for, and shall
assume, by virtue of such Flip-over Transaction or Event and such supplemental
agreement, all the obligations and duties of the Company pursuant to the Rights
Agreement.
According to the Company 8-A, the Board of Directors of the Company may, at
its option, at any time prior to the Flip-in Date, redeem all (but not less than
all) of the then outstanding Rights at a price of $0.01 per Right (the
"Redemption Price"), as provided in the Rights Agreement. Immediately upon the
action of the Board of Directors of the Company electing to redeem the Rights,
without any further action and without any notice, the right to exercise the
Rights will terminate and each Right will thereafter represent only the right to
receive the Redemption Price in cash for each Right so held.
The foregoing summary of the Rights Agreement and the Rights does not
purport to be complete and is qualified in its entirety by reference to the
Company 8-A and the text of the Rights Agreement as set forth as an exhibit
thereto, filed with the Commission, copies of which may be obtained in the
manner set forth in Section 8.
If the Offer were to be consummated at a time when the Rights remain
outstanding, the Purchaser would become an Acquiring Person, a Flip-in Date
would occur, the Rights would cease to be redeemable and the Rights would, among
other things, purport to entitle each holder thereof (other than the Purchaser
and its affiliates) to purchase additional Shares from the Company at a
significant
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discount to the market value of the Shares. The existence of the Rights,
therefore, has the practical effect of precluding the Purchaser from
consummating the Offer, regardless of the extent to which the Company's
shareholders wish to sell their Shares pursuant to the Offer. The Purchaser
believes that the issuance of the Rights and the failure to redeem the Rights,
insofar as the Rights subvert the wishes of the Company's shareholders to those
of the Company's Board of Directors and deny the Company's shareholders the
opportunity to accept the Offer, constitute a breach of fiduciary duties on the
part of the Company's Board of Directors. The Purchaser hereby requests that the
Company's Board of Directors redeem the Rights. Tyson is seeking in the Virginia
Action to cause the Rights to be redeemed or rescinded or declared invalid as
applied to the Offer and the Proposed Merger. See Section 15.
DISSENTERS' RIGHTS. If the Proposed Merger is consummated, each holder of
Shares will have the right to receive fair value for his Shares if he does not
vote in favor of the Proposed Merger and otherwise properly exercises his
dissenters' rights (the "Proposed Merger Dissenter"), except that Proposed
Merger Dissenters will not have the right to receive fair value for their Shares
in connection with the Proposed Merger if, among other things, the Shares are
listed on a national securities exchange or held by at least 2,000 record
shareholders on the record date for determining shareholders entitled to vote on
the transaction objected to. See Section 7. If the right to receive fair value
is applicable and the statutory procedures for exercising or perfecting
dissenters' rights are complied with in accordance with the VSCA, then the
Company must pay to the Proposed Merger Dissenter the fair value of his Shares,
if such Shares were beneficially owned on the date of the first publication by
news media or announcement of the Proposed Merger to shareholders generally,
and, if not so owned, the Company may elect to withhold such payment and, after
consummation of the Proposed Merger, estimate the fair value of such Shares and
offer such amount to the Proposed Merger Dissenter. The Proposed Merger
Dissenter may then make his own estimate of the fair value of his Shares, reject
the Company's payment or offer, and demand payment of such estimate. If such a
demand for payment remains unsettled, then a judicial determination will be made
of the fair value required to be paid in cash to the Proposed Merger Dissenter
for his Shares. Any such judicial determination of the fair value of Shares
could be based upon considerations other than or in addition to the price paid
in the Offer or the market value of the Shares. Fair value may be less than the
price paid for Shares pursuant to the Offer.
If the Virginia Control Share Act is applicable to the purchase of Shares
pursuant to the Offer, certain additional dissenters' rights would, under
certain circumstances, be available. (See "Virginia Control Share Act" above).
The foregoing summary of the rights of objecting shareholders does not
purport to be a complete statement of the procedures to be followed by
shareholders desiring to exercise their dissenters' rights. The preservation and
exercise of dissenters' rights are conditioned on strict adherence to the
applicable provisions of the VSCA.
OTHER MATTERS. The Proposed Merger would have to comply with any applicable
federal law operative at the time of its consummation. The Commission has
adopted Rule 13e-3 under the Exchange Act which is applicable to certain "going
private" transactions and which may under certain circumstances be applicable to
the Proposed Merger. However, Rule 13e-3 would be inapplicable if (i) the Shares
are deregistered under the Exchange Act prior to the Proposed Merger or other
business combination or (ii) the Proposed Merger or other business combination
is consummated within one year after the purchase of the Shares pursuant the
Offer and the amount paid per Share in the Proposed Merger or other business
combination is at least equal to the amount paid per Share in the Offer. 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 Merger and the consideration offered to minority
shareholders be filed with the Commission and disclosed to minority shareholders
prior to consummation of the Proposed Merger.
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13. DIVIDENDS AND DISTRIBUTIONS. If, on or after March 8, 1994, the
Company should (i) split, combine or otherwise change the Shares or its
capitalization, (ii) acquire presently outstanding Shares or otherwise cause a
reduction in the number of outstanding Shares, or (iii) issue or sell additional
Shares (other than the issuance of Shares reserved for issuance as of July 3,
1993, under option and employee stock purchase plans in accordance with their
terms as publicly disclosed as of March 8, 1994) or any shares of any other
class of capital stock, other voting securities or any securities convertible
into or exchangeable for, or rights, warrants or options, conditional or
otherwise, to acquire, any of the foregoing, or (iv) disclose that it has taken
such action, then, without prejudice to the Purchaser's rights under Sections 1
and 14, the Purchaser, in its sole discretion, may make such adjustment as it
deems appropriate in the purchase price and other terms of the Offer and the
Proposed Merger to reflect such split, combination or other change, including,
without limitation, the number or type of securities offered to be purchased and
the consideration to be paid therefor.
If Shares are purchased pursuant to the Offer, and, on or after March 8,
1994, the Company should declare, pay or distribute any cash or stock dividend
on the Shares (other than regular quarterly dividends on the Shares, not in
excess of $.08 per Share, having a customary and usual record date) or any other
distribution (including, without limitation, the issuance of additional Shares
pursuant to a stock dividend or stock split, the issuance of other securities or
the issuance of rights (other than the Rights ) for the purchase of any
securities) with respect to the Shares that is payable or distributable to
shareholders of record on a date prior to the transfer to the name of the
Purchaser or its nominees or transferees on the Company's stock transfer records
of the Shares purchased pursuant to the Offer, then, without prejudice to the
Purchaser's rights under Sections 1 and 14, (i) the purchase price per Share
payable by the Purchaser pursuant to the Offer shall be reduced by the amount of
any such cash dividend or cash distribution and (ii) the whole of any such
non-cash dividend, distribution, issuance, proceeds or right to be received by a
tendering shareholder will (a) be received and held by the tendering shareholder
for the account of the Purchaser and will be required to be promptly remitted
and transferred by the tendering shareholder to the Depositary for the account
of the Purchaser, accompanied by appropriate documentation of transfer or (b) at
the direction of the Purchaser, be exercised for the benefit of the Purchaser,
in which case the proceeds of such exercise shall promptly be remitted to the
Purchaser. Pending such remittance and subject to applicable law, the Purchaser
shall be entitled to all rights and privileges as owner of any such non-cash
dividend, distribution, issuance, proceeds or right and may withhold the entire
purchase price or deduct from the purchase price the amount or value thereof, as
determined by the Purchaser in its sole discretion.
14. CERTAIN CONDITIONS OF THE OFFER. Notwithstanding any other provisions
of the Offer, and in addition to (and not in limitation of) the Purchaser's
rights to extend and amend the Offer at any time in its sole discretion, the
Purchaser shall not be required to accept for payment or, subject to any
applicable rules and regulations of the Commission, 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 withdrawal of the Offer),
pay for, and may delay the acceptance for payment of or, subject to the
restriction referred to above, the payment for, any tendered Shares, and may
terminate the Offer (whether or not any Shares have theretofore been purchased
or paid for), if (i) any of the conditions to consummation of the Offer set
forth in the Introduction to this Offer to Purchase (relating to the Minimum
Condition, the Rights Condition, the Affiliated Transaction Condition or the
Control Share Condition) has not been satisfied, or (ii) at any time on or after
March 8, 1994 and before acceptance for payment of, or payment for, such Shares
any of the following events shall occur or shall be determined by Tyson or the
Purchaser to have occurred:
(a) any change (or any condition, event or development involving a
prospective change) shall have occurred or be threatened in the business,
properties, assets, liabilities, capitalization, shareholders' equity,
condition (financial or otherwise), operations, licenses or franchises,
results of operations, performance or prospects of the Company or any of its
subsidiaries or affiliates or in general economic or financial markets in
the United States or abroad, which, in the sole judgment
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of Tyson or the Purchaser, is or may be materially adverse to the Company or
any of such subsidiaries or affiliates or its shareholders, or the market
price of, or trading in, the Shares, or the Purchaser shall have become
aware of any facts which, in the sole judgment of Tyson or the Purchaser, as
the case may be, are or may be materially adverse with respect to the value
of the Company or any of its subsidiaries or affiliates or the value of the
Shares to Tyson or the Purchaser or any of their affiliates; or
(b) (i) any general suspension of trading in, or limitation on prices
for, securities on any national securities exchange or in the
over-the-counter market in the United States, (ii) a declaration of a
banking moratorium or any suspension of payments in respect of banks in the
United States (whether or not mandatory), (iii) a commencement of a war,
armed hostilities or other national or international crisis directly or
indirectly involving the United States, (iv) any material adverse change (or
any existing or threatened condition, event or development involving a
prospective material adverse change) in the United States or any other
currency exchange rates or a suspension of, or limitation on, the markets
therefor (whether or not mandatory), (v) any limitation (whether or not
mandatory) imposed by any governmental authority on, or any other event
which might have material adverse significance with respect to the nature or
extension of credit or further extension of credit by banks or other lending
institutions, (vi) any significant adverse change in securities or financial
markets in the United States or abroad, including, without limitation, a
decline of at least 15 percent in either the Dow Jones Average of Industrial
Stocks or the Standard & Poor's 500 Index from that existing at the close of
business on March 8, 1994 or (vii) in the case of the foregoing existing at
the time of the commencement of the Offer, in the sole judgment of Tyson or
the Purchaser, a material acceleration or worsening thereof; or
(c) there shall have been threatened, instituted, or pending any action,
proceeding, application or counterclaim by or before any court or
governmental, regulatory or administrative authority, agency or tribunal,
domestic, foreign or supranational (other than actions, proceedings,
applications or counterclaims filed or initiated by Tyson or the Purchaser),
or by any other person, domestic or foreign (whether brought by the Company,
an affiliate of the Company or any other person), which (i) challenges or
seeks to challenge the acquisition by Tyson or the Purchaser or any other
affiliate of Tyson of the Shares, restrains, delays or prohibits or seeks to
restrain, delay or prohibit the making or consummation of the Offer or the
Proposed Merger or other merger or business combination involving the
Purchaser or any of its affiliates and the Company or any of its
subsidiaries, restrains or prohibits or seeks to restrain or prohibit the
performance of any of the contracts or other arrangements entered into by
Tyson or any of its affiliates in connection with the acquisition of the
Company, or obtains or seeks to obtain any damages or otherwise directly or
indirectly relating to the transactions contemplated in connection with any
of the foregoing, (ii) makes or seeks to make the purchase of, or payment
for, some or all of the Shares pursuant to the Offer or the Proposed Merger
or otherwise illegal or results in a delay in the ability of the Purchaser
to accept for payment or pay for some or all of the Shares or to consummate
the Proposed Merger, (iii) prohibits or limits or seeks to prohibit or limit
the ownership or operation by Tyson, the Purchaser or any other affiliate of
Tyson of all or any portion of the business or assets of the Company and its
subsidiaries or of Tyson and its affiliates or to compel or seeks to compel
Tyson, the Purchaser or the Company or any of their affiliates to dispose of
or to hold separately all or any portion of the business or assets of Tyson
or any of its affiliates or of the Company or any of its affiliates, or
imposes or seeks to impose any limitation on the ability of Tyson, the
Purchaser or the Company or any of their respective affiliates or
subsidiaries to continue to conduct, own or operate all or any portion of
their businesses and assets as heretofore conducted, owned or operated, (iv)
imposes or seeks to impose or may result in material limitations on the
ability of Tyson or the Purchaser or any other affiliate of Tyson to acquire
or hold or to exercise full rights of ownership of the Shares purchased by
them, including, but not limited to, the right to vote the Shares purchased
by them, on all matters properly presented to the shareholders of the
Company, or the right to vote any shares of capital stock of any subsidiary
directly or indirectly owned by the Company, (v) in the sole judgment of
Tyson or
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the Purchaser might result in a material diminution in the benefits expected
to be derived by the Purchaser or Tyson as a result of the transactions
contemplated by the Offer, including the Proposed Merger, or the value of
the Shares to the Purchaser, (vi) seeks to impose voting, procedural, price
or other requirements in addition to those under the VSCA and federal
securities laws (each as in effect on the date of this Offer to Purchase) or
any material condition to the Offer that is unacceptable to the Purchaser or
Tyson, (vii) challenges or adversely affects the financing of the Offer or
the Proposed Merger, or (viii) otherwise directly or indirectly relates to
the Offer, the Proposed Merger or any other business combination with the
Company or which otherwise, in the sole judgment of Tyson or the Purchaser,
might adversely affect the Company or any of its subsidiaries or affiliates,
or Tyson, the Purchaser or any of their respective affiliates or
subsidiaries or the value of the Shares; or
(d) other than the application of any waiting periods under the HSR Act,
and the necessity for approvals and other actions by any domestic, foreign
or supranational governmental, administrative or regulatory agency,
authority or tribunal described in paragraph (k) below, there shall have
been proposed, sought, promulgated, enacted, entered, enforced or deemed
applicable to the Offer or the Proposed Merger by any domestic, foreign or
supranational government or any governmental, administrative or regulatory
authority or agency or by any court or tribunal, domestic, foreign or
supranational, any statute, rule, regulation, judgment, decree, order or
injunction that might, directly or indirectly, result in any of the
consequences referred to in clauses (i) through (viii) of paragraph (c)
above; or
(e) the Company or any of its subsidiaries shall have (i) issued,
distributed, pledged or sold, or authorized, proposed or announced the
issuance, distribution, pledge or sale of (A) any shares of capital stock or
any class (including, without limitation, the Shares), or securities
convertible into or exchangeable for any such shares, or any rights (other
than the Rights), warrants, or options to acquire any such shares or
convertible or exchangeable securities, other than the issuance of Shares
reserved for issuance on July 3, 1993 pursuant to the exercise of then
outstanding stock options or the employee stock purchase plan of the Company
(in each case in accordance with the terms thereof publicly disclosed on
March 8, 1994) or (B) any other securities in respect of, in lieu of, or in
substitution for, Shares outstanding on February 1, 1994, (ii) purchased or
otherwise acquired or caused a reduction in, or proposed or offered to
purchase or otherwise acquire, any Shares or other securities of the Company
(except for redemption of the Rights in accordance with the terms of the
Rights Agreement), (iii) declared or paid any dividend or distribution on
any shares of capital stock (other than regular quarterly dividends on the
Shares, not in excess of $.08 per Share, having a customary and usual record
date and a distribution of the Rights Certificates in accordance with the
terms of the Rights Agreement and, in the event the Rights are redeemed, the
Redemption Price), or issued, or authorized, recommended or proposed the
issuance of, or any other distribution in respect of, any share of capital
stock, whether payable in cash, securities or other property, or altered or
proposed to alter any material term of any outstanding security, (iv)
issued, distributed or sold, or authorized or proposed the issuance,
distribution or sale of any debt securities or any securities convertible
into or exchangeable for debt securities or any rights, warrants or options
entitling the holder thereof to purchase or otherwise acquire any debt
securities, or incurred, or authorized or proposed the incurrence of, any
debt other than in the ordinary course of business and consistent with past
practice, or any debt containing burdensome covenants, (v) authorized,
recommended, proposed or publicly announced its intention to enter into or
cause (A) any merger (other than the Proposed Merger), consolidation,
liquidation, dissolution, business combination, joint venture, acquisition
of assets or securities (other than a redemption of the Rights) or
disposition of assets or securities other than in the ordinary course of
business, (B) any material change in its capitalization, (C) any release or
relinquishment of any material contract rights or (D) any comparable event
not in the ordinary course of business, (vi) authorized, recommended or
proposed or announced its intention to authorize, recommend or propose any
transaction which could adversely affect the value of the Shares, (vii)
proposed, adopted or authorized any amendment (other than any amendment
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which delays the Separation Time) to its Restated Articles or Bylaws or
similar organization documents or the Rights Agreement or (viii) agreed in
writing or otherwise to take any of the foregoing actions, or the Purchaser
or Tyson shall have learned about any such action which shall not have been
previously publicly disclosed by the Company; or
(f) the Purchaser or Tyson shall become aware (i) that any material
contractual right of the Company or any of its subsidiaries or affiliates
shall be impaired or otherwise adversely affected or that any material
amount of indebtedness of the Company or any of its subsidiaries shall
become accelerated or otherwise become due or become subject to acceleration
prior to its stated due date, in either case with or without notice or the
lapse of time or both, as a result of or in connection with the transactions
contemplated by the Offer or the Proposed Merger, or (ii) of any covenant,
term or condition in any of the Company's or any of its subsidiaries'
instruments or agreements that has or may have (whether considered alone or
in the aggregate with other covenants, terms or conditions) a material
adverse effect on (A) the business, properties, assets, liabilities,
capitalization, shareholders' equity, condition (financial or otherwise),
operations, licenses or franchises, results of operations or prospects of
the Company or any of its subsidiaries (including, but not limited to, any
event of default that may ensue as a result of the consummation of the Offer
or the acquisition of control of the Company or any of its subsidiaries or
the Proposed Merger), (B) the value of the Shares in the hands of Tyson, the
Purchaser or any of their affiliates or (C) the consummation by the
Purchaser or any of its affiliates of the Proposed Merger or any other
business combination involving the Company; or
(g) a tender or exchange offer for some portion or all of any
outstanding securities of the Company or any of its subsidiaries (including
the Shares or Rights) shall have been commenced or publicly proposed to be
made or shall have been made by another person (including the Company or any
of its subsidiaries or affiliates), or it shall have been publicly disclosed
or Tyson or the Purchaser shall have otherwise learned that (i) any person,
entity (including the Company or its subsidiaries or affiliates) or "group"
(as defined in Section 13(d)(3) of the Exchange Act) shall have acquired or
proposed or be attempting to acquire beneficial ownership of more than five
percent of any class or series of capital stock of the Company (including
the Shares or Rights) or its subsidiaries, or shall have been granted any
option, warrant or right, conditional or otherwise, to acquire beneficial
ownership of more than five percent of any class or series of capital stock
of the Company (including the Shares or Rights), other than acquisitions for
bona fide arbitrage positions, (ii) any such person, entity or group which
prior to March 8, 1994 has publicly disclosed any such ownership of more
than five percent of any class or series of capital stock of the Company
(including the Shares or Rights) or its subsidiaries shall have acquired or
proposed to acquire additional shares of any class or series of capital
stock of the Company (including the Shares or Rights) or its subsidiaries
constituting more than one percent of such class or series or shall have
been granted any option or right to acquire more than one percent of such
class or series of capital stock of the Company (including the Shares or
Rights) or its subsidiaries, (iii) any new group was, or is, formed which
beneficially owns more than five percent of any class or series of capital
stock of the Company (including the Shares or Rights) or its subsidiaries,
(iv) any person, entity or group shall have entered into a definitive
agreement or an agreement in principle or made a proposal with respect to a
tender offer or exchange offer for some portion or all of the Shares or
Rights or a merger, consolidation or other business combination with or
involving the Company or its subsidiaries, or (v) any person, entity or
group shall have filed a Premerger Notification and Report Form under the
HSR Act in order to, or made a public announcement reflecting an intent to,
acquire the Company or assets or securities of the Company or its
subsidiaries; or
(h) the Company and Tyson or the Purchaser shall have reached an
agreement or understanding that the Offer be terminated or amended or the
payment for Shares be postponed pursuant thereto or Tyson or the Purchaser
(or one of their affiliates) shall have entered into a definitive agreement
or announced an agreement in principle with respect to the Proposed
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Merger or any other business combination with the Company or any of its
affiliates or the purchase of any material portion of the securities or
assets of the Company or any of its subsidiaries; or
(i) the Company or any of its subsidiaries shall have entered into any
employment, severance or similar agreement, arrangement or plan with or for
the benefit of any of its employees or entered into or amended any
agreements, arrangements or plans so as to provide for increased or
accelerated payment or funding of the benefits to any such employees as a
result of or in connection with the transactions contemplated by the Offer
or the Proposed Merger or otherwise amended any such agreement, arrangement
or plan to make the same more favorable to any such employee, or the
Purchaser or Tyson shall have learned about any such action which shall not
have been previously publicly disclosed by the Company; or
(j) except as may be required by law, the Company or any of its
subsidiaries shall have taken any action to terminate or amend any employee
benefit plan (as defined in Section 3(2) of the Employment Retirement Income
Security Act of 1974, as amended) of the Company or any of its subsidiaries,
or the Purchaser or Tyson shall have learned of any such action or possible
action which shall not have been previously publicly disclosed by the
Company; or
(k) any waiting periods under the HSR Act applicable to the purchase of
the Shares pursuant to the Offer shall not have expired or been terminated,
or any other approval, permit, authorization, consent or other action of any
domestic (federal or state), foreign or supranational governmental,
administrative or regulatory agency, authority or tribunal (including those
described in Section 15) shall not have been obtained on terms satisfactory
to Tyson in its sole discretion;
which, in the sole judgment of Tyson and the Purchaser, in any case, and
regardless of the circumstances (including any action or inaction by Tyson or
the Purchaser or their affiliates) giving rise to any such condition, makes it
inadvisable to proceed with the Offer or with such acceptance for payment or
payment for Shares.
The foregoing conditions are for the sole benefit of the Purchaser, Tyson
and their affiliates and may be asserted by the Purchaser or Tyson regardless of
the circumstances giving rise to any such condition (including, without
limitation, any action or inaction by the Purchaser or Tyson or their
affiliates) and may be waived by Tyson or the Purchaser, in whole or in part, at
any time and from time to time, in their sole discretion. The failure by the
Purchaser or Tyson at any time to exercise any of the foregoing rights will not
be deemed a waiver of any such right or any other right and each right will be
deemed an ongoing right which may be asserted at any time and from time to time.
Any determination by the Purchaser concerning the events described in this
Section 14 will be final and binding on all parties.
15. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS.
GENERAL. Except as described in this Offer to Purchase, based on a review
of publicly available filings by the Company with the Commission and other
publicly available information concerning the Company, Tyson and the Purchaser
are not aware of any licenses or regulatory permits that appear to be material
to the business of the Company and its subsidiaries, taken as whole, that might
be adversely affected by the acquisition of Shares (and the indirect acquisition
of the stock of the Company's subsidiaries) by the Purchaser as contemplated
herein or, except as set forth below, of any filing, approval or other action by
or with any domestic, foreign or supranational governmental, administrative or
regulatory agency or authority that would be required prior to the acquisition
of Shares (and the indirect acquisition of the stock of the Company's
subsidiaries) by the Purchaser pursuant to the Offer as contemplated herein.
Should any such approval or other action be required, there can be no assurance
that any such additional approval or action, if needed, would be obtained
without substantial conditions or that adverse consequences might not result to
the Company's business, or that certain parts of the Company's or Tyson's
business might not have to be disposed of
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or held separate or other substantial conditions complied with in order to
obtain such approval or action or in the event that such approvals were not
obtained or such actions were not taken. The Purchaser's obligation to purchase
and pay for Shares is subject to certain conditions, including conditions with
respect to litigation and governmental actions. See the Introduction and Section
14 for certain conditions to the Offer, including with respect to litigation and
governmental actions.
STATE TAKEOVER STATUTES. A number of states (including Virginia, where the
Company is incorporated) have adopted "takeover" laws and regulations which
purport, in varying degrees, to apply to attempts to acquire securities of
corporations which are incorporated in such states, or which have substantial
assets, security holders, principal executive offices or principal places of
business in such states. To the extent that certain provisions of certain of
these state takeover statutes purport to apply to the Offer or the Proposed
Merger, the Purchaser believes that such laws conflict with federal law and
constitute an unconstitutional burden on interstate commerce. In 1982, the
Supreme Court of the United States, in EDGAR V. MITE CORP., invalidated on
constitutional grounds the Illinois Business Takeovers Statute, which as a
matter of state securities law, made takeovers of corporations meeting certain
requirements more difficult, and the reasoning in such decision is likely to
apply to certain other state takeover statutes. In 1987, however, in CTS CORP.
V. DYNAMICS CORP. OF AMERICA, the Supreme Court of the United States held that
the State of Indiana could, as a matter of corporate law and, in particular,
those aspects of corporate law concerning corporate governance, constitutionally
disqualify a potential acquiror from voting on the affairs of a target
corporation without the prior approval of the remaining shareholders, provided
that such laws were applicable only under certain conditions. Subsequently, in
TLX ACQUISITION CORP. V. TELEX CORP., a Federal district court in Oklahoma ruled
that the Oklahoma statutes were unconstitutional insofar as they apply to
corporations incorporated outside Oklahoma in that they would subject such
corporations to inconsistent regulations. Similarly, in TYSON FOODS, INC. V.
MCREYNOLDS, a Federal district court in Tennessee ruled that four Tennessee
takeover statutes are unconstitutional as applied to corporations incorporated
outside Tennessee. This decision was affirmed by the United States Court of
Appeals for the Sixth Circuit. In December, 1988, a Federal district court in
Florida held in GRAND METROPOLITAN PLC V. BUTTERWORTH, that the provisions of
the Florida Affiliated Transactions Act and the Florida Control Share
Acquisition Act were unconstitutional as applied to corporations incorporated
outside of Florida.
The Company, directly or through subsidiaries, conducts business in a number
of states throughout the United States, some of which have enacted "takeover"
laws. Except as described herein, the Purchaser has not attempted to comply with
any state takeover statutes in connection with the Offer. The Purchaser reserves
the right to challenge the validity or applicability of any state law allegedly
applicable to the Offer or the Proposed Merger and nothing in this Offer to
Purchase nor any action taken in connection herewith is intended as a waiver of
that right. In the event that any state takeover statute is found applicable to
the Offer or the Proposed Merger, the Purchaser might be unable to accept for
payment or purchase Shares tendered pursuant to the Offer or be delayed in
continuing or consummating the Offer or in consummating the Proposed Merger. In
such case, the Purchaser may not be obligated to accept for payment or pay for
Shares tendered pursuant to the Offer. See Section 14.
VIRGINIA ACTION. On February 6, 1994, the Company commenced the Virginia
Action in the District Court naming Tyson as a defendant. In the Virginia Action
the Company is seeking a declaratory judgment that the Rights Agreement adopted
on February 4, 1994, is valid and was duly adopted and that any Rights issued
thereunder are valid, binding and legally enforceable under state and federal
law. The Company also seeks in the Virginia Action a declaration that the
Virginia Control Share Act and the Virginia Affiliated Transactions Law are
constitutional under the Virginia and United States Constitutions and valid
under any other applicable law, as well as a temporary, preliminary and
permanent injunction enjoining Tyson from bringing any action in any other court
relating to Tyson's proposal to acquire the Company.
41
<PAGE>
On February 25, 1994, Tyson answered the Company's complaint in the Virginia
Action, and filed counterclaims against the Company and all of its directors.
Tyson's counterclaims allege, among other things, that on February 4, 1994, the
Company's Board of Directors took a series of actions designed to erect numerous
barriers that would insulate the Company from any acquisition not approved by
the Company's Board of Directors. Tyson's counterclaims allege that through its
actions, the Company's Board of Directors attempted to impose its will on the
Company's shareholders and deprive them of the benefits of an acquisition
proposal from Tyson or any other third party not endorsed by the Company's Board
of Directors.
Specifically, Tyson's counterclaims allege, among other things, that on
February 4, 1994, the Company's directors breached their fiduciary duties to the
Company's shareholders by: (a) adopting the Rights Agreement and issuing the
Rights pursuant thereto; (b) adopting certain executive severance arrangements;
(c) adopting certain severance packages for all salaried and hourly clerical
employees; (d) amending the Bylaws relating to the status of the Chairman and
Vice Chairman of the Company as officers in an effort to enhance management's
voting power to block Tyson's merger proposal; (e) taking actions which denied
the Company's disinterested shareholders a full and fair opportunity to consider
Tyson's proposal; and (f) purporting to terminate the employment by the Company,
and/or status as officers of the Company, of certain of the Company's directors,
while at the same time continuing their engagement as directors and promising to
expend substantial sums for the benefit of those directors in the future, again
to enhance management's voting power to block Tyson's merger proposal.
Tyson's counterclaims further allege that the Virginia Affiliated
Transactions Law and the Virginia Control Share Act are unconstitutional and
should be declared invalid. Tyson alleges that the Virginia statutory scheme is
unconstitutional because, among other things, it conflicts with federal law
regulating tender offers.
In its counterclaims, Tyson seeks a declaration that: (1) both of the
Virginia statutes referred to above, as well as Section 13.1-646 of the VSCA,
are unconstitutional; (2) that the Rights and the various severance arrangements
adopted by the Company's Board of Directors are invalid; (3) that none of the
Company's directors whose status was purported to be affected by the actions
taken on February 4, 1994 will be permitted to vote their shares in any
shareholder referendum that might be held under the Virginia Control Share Act;
and (4) that the Company's directors breached their fiduciary duties to the
Company's shareholders in taking the actions described in Tyson's counterclaims.
The foregoing description of the Company's amended complaint and Tyson's
answer, affirmative defenses and counterclaims is qualified in its entirety by
reference to the text of such documents filed as exhibits to the Schedule 14D-1,
copies of which may be obtained from the offices of the Commission in the manner
set forth in Section 8 with respect to information concerning the Company
(except that such information will not be available at the regional offices of
the Commission).
ANTITRUST. Under the HSR Act, and the rules and regulations that have been
promulgated thereunder 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 of
the Department of Justice (the "Antitrust Division") and the FTC and certain
waiting period requirements have been satisfied. The acquisition of Shares
pursuant to the Offer is, and the Proposed Merger may be, subject to such
requirements. Tyson has filed on March 4, 1994 a Premerger Notification and
Report Form with the Antitrust Division and the FTC in connection with the
purchase of Shares pursuant to the Offer and the Proposed Merger.
Under the provisions of the HSR Act applicable to the Offer, the purchase of
Shares pursuant to the Offer may not be consummated until the expiration of a
15-calendar day waiting period following the filing by Tyson, unless such
waiting period is earlier terminated by the FTC and the Antitrust Division.
Accordingly, the waiting period with respect to the Offer will expire at 11:59
P.M., New York City time, on Saturday, March 19, 1994, unless Tyson receives a
request for additional information or
42
<PAGE>
documentary material. If, within such 15-day waiting period, either the
Antitrust Division or the FTC requests additional information or material from
Tyson concerning the Offer, the waiting period would expire at 11:59 P.M., New
York City time, on the tenth calendar day after the date of substantial
compliance with such request. Thereafter, the waiting period could be extended
only by court order or with the consent of Tyson. 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 such filings nor a request from the
Antitrust Division or the FTC for additional information or documentary material
made to the Company will extend the waiting period with respect to the Offer.
The Purchaser will not accept for payment Shares tendered pursuant to the
Offer unless and until the waiting period requirements imposed by the HSR Act
with respect to the Offer have been satisfied. See Section 14.
Pursuant to the HSR Act, Tyson has requested early termination of the
waiting period applicable to the Offer. There can be no assurance, however, that
such waiting period will be terminated early.
The Antitrust Division, the FTC and state antitrust enforcement agencies
frequently scrutinize the legality under the antitrust laws of transactions such
as the Purchaser's acquisition of Shares pursuant to the Offer and the Proposed
Merger. At any time before or after the Purchaser's acquisition of Shares, any
such agency could take such action under the antitrust laws as it deems
necessary or desirable in the public interest, including seeking to enjoin the
acquisition of Shares pursuant to the Offer or otherwise or seeking divestiture
of Shares acquired by the Purchaser or divestiture of substantial assets of the
Purchaser, Tyson and/or the Company. Private parties may also bring legal action
under the antitrust laws under certain circumstances.
Based upon an examination of publicly available information relating to the
businesses in which the Company is each engaged, Tyson and the Purchaser believe
that the acquisition of Shares pursuant to the Offer and the Proposed Merger
would not violate the antitrust laws. The Purchaser and Tyson believe that
retention of all of the operations of the Company and Tyson should be permitted
under the antitrust laws. Nevertheless, there can be no assurance that a
challenge to the Offer on antitrust grounds will not be made or, if such a
challenge is made, what the result will be. See Section 14.
FEDERAL RESERVE BOARD REGULATIONS. Federal Reserve Board Regulations G, T,
U and X (the "Margin Regulations") promulgated by the Federal Reserve Board
place restrictions on the amount of credit that may be extended for the purpose
of purchasing margin stock (including the Shares) if such credit is secured
directly or indirectly by margin stock. The Purchaser and Tyson believe that the
financing of the acquisition of the Shares will be in compliance with or not
subject to the Margin Regulations.
16. FEES AND EXPENSES.
MacKenzie Partners, Inc. has been retained by the Purchaser as Information
Agent in connection with the Offer. The Information Agent may contact holders of
Shares by mail, telephone, telex, telegraph and personal interview and may
request brokers, dealers and other nominee shareholders to forward material
relating to the Offer to beneficial owners. Customary compensation will be paid
for all such services in addition to reimbursement of reasonable out-of-pocket
expenses. The Purchaser has agreed to indemnify the Information Agent against
certain liabilities and expenses, including liabilities under the federal
securities laws.
In addition, IBJ Schroder Bank & Trust Company has been retained as the
Depositary. The Depositary has not been retained to make solicitations or
recommendations in its role as Depositary. The Depositary will receive
reasonable and customary compensation for its services in connection with the
Offer, will be reimbursed for its reasonable out-of-pocket expenses and will be
indemnified against certain liabilities and expenses in connection therewith.
43
<PAGE>
Except as set forth above, neither the Purchaser nor Tyson will pay any fees
or commissions to any broker, dealer or other person for soliciting tenders of
Shares pursuant to the Offer. Brokers, dealers, commercial banks and trust
companies and other nominees will, upon request, be reimbursed by the Purchaser
for customary clerical and mailing 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 residing in any jurisdiction in
which the making of the Offer or the acceptance thereof would not be in
compliance with the securities, blue sky or other laws of such jurisdiction.
However, the Purchaser may, in its discretion, take such action as it may deem
necessary to make the Offer in any such jurisdiction and extend the Offer to
holders of Shares in such jurisdiction. In any jurisdiction where the
securities, blue sky or other laws require the Offer to be made by a licensed
broker or dealer, the Offer will be deemed to be made on behalf of the Purchaser
by one or more registered brokers or dealers that are licensed under the laws of
such jurisdiction.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION ON BEHALF OF THE PURCHASER OR TYSON 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.
NEITHER THE DELIVERY OF THE OFFER TO PURCHASE NOR ANY PURCHASE PURSUANT TO THE
OFFER, SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF TYSON, THE PURCHASER OR THE COMPANY SINCE THE
DATE AS OF WHICH INFORMATION IS FURNISHED OR THE DATE OF THIS OFFER TO PURCHASE.
The Purchaser and Tyson have filed with the Commission a Tender Offer
Statement on Schedule 14D-1, together with exhibits, pursuant to Rule 14d-3
under the Exchange Act, furnishing certain additional information with respect
to the Offer, and may file amendments thereto. Such Schedule 14D-1 and any
amendments thereto, including exhibits, may be inspected and copies may be
obtained at the same places and in the same manner as set forth in Section 8
with respect to information concerning the Company (except that they will not be
available at the regional offices of the Commission).
WLR ACQUISITION CORP.
March 9, 1994
44
<PAGE>
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS
OF TYSON AND THE PURCHASER
1. DIRECTORS AND EXECUTIVE OFFICERS OF TYSON. The following table sets
forth the name, business address and present principal occupation or employment,
and material occupations, positions, offices or employments for the past five
years of each director and executive officer of Tyson. Unless otherwise
indicated, each such person is a citizen of the United States and the business
address of each such person is 2210 West Oaklawn Drive, Springdale, Arkansas
72762-6999. Unless otherwise indicated, each occupation set forth opposite an
individual's name refers to employment with Tyson and each individual has held
such occupation for at least the past five years.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
NAME MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
- ------------------------------------- ---------------------------------------------------------------------------
<S> <C>
Don Tyson............................ Chairman of the Board of Directors of Tyson since 1966; Chief Executive
Officer of Tyson until March 1991; Director of Tyson since 1952.
Leland E. Tollett.................... Vice Chairman of the Board of Directors of Tyson since 1993; President and
Chief Executive Officer of Tyson since March 1991 and prior thereto
President and Chief Operating Officer of Tyson since 1981; Director of
Tyson since 1984.
Neely Cassady ....................... Chairman of the Board and Chief Executive Officer of Sunmark and Chairman
Cassady Associates, Inc. of the Board of Cassady Associates, Inc. and its affiliate, H.K. Brewer
P.O. Box 1810 Electric in Little Rock, Arkansas; Arkansas State Senator since 1983;
121 West College Director of Tyson since 1974.
Nashville, Arkansas 71852
Lloyd V. Hackley .................... Chancellor and Tenured Professor of Political Science at Fayetteville State
Fayetteville State University University, Fayetteville, North Carolina since 1988. Director of Tyson
1200 Murchison Road since 1992.
Fayetteville, North Carolina
28301-4298
Shelby Massey ....................... Farmer and private investor; Senior Vice Chairman of the Board of Directors
Sparks Commodities Brokerage of Tyson from 1985 to 1988; Director of Tyson since 1985.
House
889 Ridgelake Boulevard
Suite 30
Memphis, Tennessee 38120
Joe F. Starr......................... Vice President of Tyson since 1993; Vice Chairman-Administration of the
Board of Directors of Tyson until 1993; Member of the Board of Directors of
Worthen National Bank of Northwest Arkansas, Fayetteville, Arkansas from
1980 to 1991; Director of Tyson since 1969.
Barbara Tyson........................ Vice President of Tyson since prior to 1989; Director of Tyson since 1988.
John H. Tyson........................ President, Beef and Pork Division and Director of Governmental, Media and
Public Relations of Tyson since 1993; Vice Chairman-Operations of the Board
of Directors of Tyson from 1989-1993; Vice President and Director of
Engineering/Environmental/Capital Spending of Tyson from 1992 to 1993; Vice
President, Marketing/Corporate Accounts of Tyson from 1985 to 1992;
Director of Tyson since 1984.
</TABLE>
45
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
NAME MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
- ------------------------------------- ---------------------------------------------------------------------------
<S> <C>
Fred S. Vorsanger ................... Private business consultant, Walton Arena Manager and Vice President
University of Arkansas (Emeritus) of the University of Arkansas; former mayor and director of the
P.O. Box 7777 City of Fayetteville, Arkansas; Director of McIlroy Bank & Trust Co. of
Fayetteville, Arkansas 72701 Fayetteville, Arkansas; Vice President, University of Arkansas Foundation,
Inc. from 1968 until 1988; Director of Tyson since 1977.
Donald E. Wray....................... Chief Operating Officer of Tyson since 1991; Senior Vice President-Sales
and Marketing from 1981 to 1991; Director of Tyson since January 14, 1994.
Ellis Brunton........................ Group Vice President, Research and Quality Assurance of Tyson since 1993;
joined Tyson in 1989 upon acquisition of Holly Farms Corporation in 1989;
Vice President, Technical Services of Holly Farms Corporation from 1986 to
1989.
Wayne Britt.......................... Vice President, International Sales of Tyson since 1994 and Vice President,
Wholesale Club Division of Tyson since 1992; Vice President and Treasurer
of Tyson since 1982; Secretary of Tyson from 1982 to 1992.
William Jaycox....................... Group Vice President, Human Resources of Tyson since 1990; Vice President
of Personnel for Harker's, Inc. from 1986 to 1989.
Gary Johnson......................... Controller of Tyson since 1982.
Gerald Johnston...................... Executive Vice President, Finance of Tyson since 1981.
Greg Lee............................. Senior Vice President, Sales and Marketing of Tyson since 1993; Division
Vice President of Food Service Sales and Marketing of Tyson from 1988 to
1993.
Bill Moeller......................... Group Vice President, Swine Division of Tyson since 1981.
David S. Purtle...................... Senior Vice President, Operations of Tyson since 1991; Group Vice
President, Operations of Tyson from 1985 to 1991.
Mary Rush............................ Secretary and Director of Investor Relations of Tyson since 1992; Assistant
Secretary/Treasurer of Tyson from 1982 to 1992.
</TABLE>
2. DIRECTORS AND EXECUTIVE OFFICERS OF THE PURCHASER. The following table
sets forth the name and present principal occupation or employment, and material
occupations, positions, offices or employment for the past five years of each
director and executive officer of the Purchaser. Each such person is a citizen
of the United States and the business address of each such person is 2210 West
Oaklawn Drive, Springdale, Arkansas 72762-6999.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
NAME MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
- ------------------------------------- ---------------------------------------------------------------------------
<S> <C>
James B. Blair....................... President, Secretary and a Director of the Purchaser; General Counsel of
Tyson since 1982.
Gerald Johnston...................... Vice President and a Director of the Purchaser; Executive Vice President,
Finance of Tyson since 1981.
</TABLE>
46
<PAGE>
3. TRANSACTIONS IN SHARES.
Purchases by Tyson:
<TABLE>
<CAPTION>
NO. OF
SHARES PRICE PER
DATE PURCHASED SHARE*
- ---------------------------------------------------------- ------------ ---------
<S> <C> <C>
2/07/94................................................... 196,700 $ 28.788
2/08/94................................................... 103,500 28.877
2/09/94................................................... 73,000 28.933
2/14/94................................................... 22,000 28.892
2/15/94................................................... 25,000 29.125
2/16/94................................................... 25,000 29.375
2/22/94................................................... 80,200 28.151
2/23/94................................................... 54,100 28.185
2/24/94................................................... 20,500 28.125
------------
600,000
------------
------------
<FN>
- ------------------------
*Net of brokerage commissions.
</TABLE>
On March 1, 1994, Tyson contributed 600,000 Shares to the Purchaser as a
contribution to the capital of the Purchaser.
4. SHARE OWNERSHIP.
Tyson acquired 63 Shares through the acquisition of two corporate entities
in the 1980's.
James B. Blair, the President and a director of the Purchaser and the
General Counsel of Tyson, owns 100 Shares (constituting less than 1% of the
Shares) jointly with his wife, which Shares were purchased for investment
purposes in June, 1991.
Wayne Britt, Vice President and Treasurer of Tyson, owns 1,000 Shares
(constituting less than 1% of the Shares), which Shares were purchased for
investment purposes in November, 1992.
47
<PAGE>
Facsimile copies of the Letter of Transmittal, properly completed and duly
executed, will be accepted. The Letter of Transmittal, certificates for Shares
and any other required documents should be sent or delivered by each shareholder
of the Company or his broker, dealer, commercial bank or other nominee to the
Depositary at one of its addresses set forth below.
THE DEPOSITARY FOR THE OFFER IS:
IBJ SCHRODER BANK & TRUST COMPANY
For Information Telephone:
(212) 858-2103
BY MAIL: FACSIMILE TRANSMISSION: BY HAND OR OVERNIGHT DELIVERY:
P. O. Box 84 (212) 858-2611 One State Street
Bowling Green Station To Confirm Facsimile New York, New York 10004
New York, New York Transmissions Attn: Securities Processing
10274-0084 call: (212) 858-2103 Window, Subcellar One
Attn: Reorganization
Operations Department
Questions and requests for assistance or for additional copies of the Offer
to Purchase, the Letter of Transmittal and the Notice of Guaranteed Delivery may
be directed to the Information Agent at its address and telephone numbers set
forth below. Shareholders may also contact brokers, dealers, commercial banks or
trust companies for assistance concerning the Offer.
THE INFORMATION AGENT FOR THE OFFER IS:
MACKENZIE PARTNERS, INC.
156 Fifth Avenue, 9th Floor
New York, New York 10010
(212) 929-5500 (call collect)
or
Call Toll-Free (800) 322-2885
48
<PAGE>
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK
OF
WLR FOODS, INC.
PURSUANT TO THE OFFER TO PURCHASE DATED MARCH 9, 1994
BY
WLR ACQUISITION CORP.
A WHOLLY-OWNED SUBSIDIARY OF
TYSON FOODS, INC.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON FRIDAY, APRIL 8, 1994, UNLESS THE OFFER IS EXTENDED.
THE DEPOSITARY FOR THE OFFER IS:
IBJ SCHRODER BANK & TRUST COMPANY
For Information Telephone:
(212) 858-2103
<TABLE>
<S> <C> <C>
FACSIMILE BY HAND OR
BY MAIL: TRANSMISSION: OVERNIGHT DELIVERY:
P. O. Box 84 (212) 858-2611 One State Street
Bowling Green Station To Confirm Facsimile New York, New York 10004
New York, New York 10274-0084 Transmissions call: Attn: Securities Processing
Attn: Reorganization (212) 858-2103 Window, Subcellar One
Operations Department (for Eligible Institutions
only)
</TABLE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE TRANSMISSION TO A NUMBER
OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be completed by shareholders either if
certificates for Shares (as defined below) are to be forwarded herewith or if
tenders of Shares are to be made by book-entry transfer to an account maintained
by IBJ Schroder Bank & Trust Company (the "Depositary") at The Depository Trust
Company, the Midwest Securities Trust Company or the Philadelphia Depository
Trust Company (each a "Book-Entry Transfer Facility" and collectively referred
to as the "Book-Entry Transfer Facilities") pursuant to the procedures set forth
in Section 3 of the Offer to Purchase (as defined below). Shareholders who
tender Shares by book-entry transfer are referred to herein as "Book-Entry
Shareholders."
Holders of Shares whose certificates for such Shares (the "Share
Certificates") are not immediately available or who cannot deliver their Share
Certificates and all other required documents to the
1
<PAGE>
Depositary prior to the Expiration Date (as defined in Section 1 of the Offer to
Purchase) or who cannot complete the procedures for book-entry transfer on a
timely basis, must tender their Shares according to the guaranteed delivery
procedures set forth in Section 3 of the Offer to Purchase. See Instruction 2.
Delivery of documents to a Book-Entry Transfer Facility does not constitute
delivery to the Depositary.
<TABLE>
<S> <C>
/ / CHECK HERE IF SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER MADE TO AN ACCOUNT
MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER FACILITY AND COMPLETE THE
FOLLOWING:
Name of Tendering Institution:
Check Box of Book-Entry Transfer Facility:
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account Number: Transaction Code Number:
/ / CHECK HERE IF SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY
PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING. PLEASE ENCLOSE A
PHOTOCOPY OF SUCH NOTICE OF GUARANTEED DELIVERY.
</TABLE>
Name(s) of Registered Holder(s): _______________________________________________
Window Ticket Number (if any): _________________________________________________
Date of Execution of Notice of Guaranteed Delivery: ____________________________
Name of Institution which Guaranteed Delivery: _________________________________
<TABLE>
<S> <C> <C> <C>
DESCRIPTION OF SHARES TENDERED
NAME(S) AND ADDRESS(ES) OF
REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) SHARE CERTIFICATE(S) AND SHARE(S) TENDERED
APPEAR(S) ON SHARE CERTIFICATE(S) (ATTACH ADDITIONAL LIST, IF NECESSARY)
TOTAL NUMBER OF SHARES
SHARE CERTIFICATE REPRESENTED BY SHARE NUMBER OF SHARES
NUMBER(S)* CERTIFICATE(S)* TENDERED**
Total Shares
* Need not be completed by Book-Entry Shareholders.
** Unless otherwise indicated, it will be assumed that all Shares represented by certificates delivered
to the Depositary are being tendered. See Instruction 4.
</TABLE>
2
<PAGE>
NOTE: SIGNATURE(S) MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
LADIES AND GENTLEMEN:
The undersigned hereby tenders to WLR Acquisition Corp., a Delaware
corporation (the "Purchaser") and a wholly-owned subsidiary of Tyson Foods,
Inc., a Delaware corporation ("Tyson"), the above-described shares of Common
Stock, no par value (the "Shares"), of WLR Foods, Inc., a Virginia corporation
(the "Company"), at $30.00 per Share, net to the seller in cash upon the terms
and subject to the conditions set forth in the Offer to Purchase, dated March 9,
1994 (the "Offer to Purchase"), receipt of which is hereby acknowledged, and in
this Letter of Transmittal (which together constitute the "Offer"). The
undersigned understands that the Purchaser reserves the right to transfer or
assign, in whole or from time to time in part, to one or more of its or Tyson's
affiliates, the right to purchase all or any portion of the Shares tendered
pursuant to the Offer.
Subject to, and effective upon, acceptance for payment of, or payment for,
Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms or conditions of any extension or amendment), the undersigned hereby
sells, assigns and transfers to, or upon the order of, the Purchaser all right,
title and interest in and to all of the Shares that are being tendered hereby
and any and all dividends (other than regular quarterly cash dividends on the
Shares, not in excess of $.08 per Share, having a customary and usual record
date prior to the Purchaser purchasing and becoming a record holder of such
Shares), rights (other than the preferred share purchase rights (the "Rights")
issued pursuant to the Shareholder Protection Rights Agreement, dated as of
February 4, 1994 (the "Rights Agreement"), between the Company and First Union
National Bank of North Carolina, as Rights Agent), distributions, other Shares
or other securities issued or issuable in respect thereof on or after March 8,
1994 and payable or distributable to the undersigned on a date prior to the
transfer to the name of the Purchaser or nominee or transferee of the Purchaser
on the Company's stock transfer records of the Shares tendered herewith (a
"Distribution"), and constitutes and appoints the Depositary the true and lawful
agent and attorney-in-fact of the undersigned with respect to such Shares (and
any Distributions), with full power of substitution (such power of attorney
being deemed to be an irrevocable power coupled with an interest), to (i)
deliver Share Certificates (and any Distributions), or transfer ownership of
such Shares (and any Distributions) on the account books maintained by a
Book-Entry Transfer Facility, together, in any such case, with all accompanying
evidences of transfer and authenticity to, or upon the order of, the Purchaser,
upon receipt by the Depositary, as the undersigned's agent, of the purchase
price (adjusted, if appropriate, as provided in the Offer to Purchase), (ii)
present such Shares (and any Distributions) for transfer on the books of the
Company and (iii) receive all benefits and otherwise exercise all rights of
beneficial ownership of such Shares (and any Distributions), all in accordance
with the terms and subject to the conditions of the Offer.
All authority conferred or agreed to be conferred in this Letter of
Transmittal shall be binding upon successors, assigns, heirs, executors,
administrators and legal representatives of the undersigned and shall not be
affected by, and shall survive, the death or incapacity of the undersigned.
Except as stated in the Offer to Purchase, this tender is irrevocable.
Except to the extent set forth in the last sentence of this paragraph, the
undersigned hereby irrevocably appoints designees of the Purchaser, and each of
them, the attorney-in-fact and proxy of the undersigned, with full power of
substitution, to the full extent of the undersigned's rights with respect to all
Shares tendered hereby and accepted for payment and paid for by the Purchaser
(and any Distributions). All such proxies shall be considered coupled with an
interest in the Shares tendered herewith. Such appointment will be effective if,
when, and only to the extent that the Purchaser pays for such Shares by
depositing the purchase price therefor with the Depositary. Upon such payment,
all prior powers of attorney and proxies given by the undersigned with respect
to such Shares and such other securities or rights will, without further action,
be revoked, and no subsequent powers of attorneys and proxies may be given by
the undersigned (and if given, will not be deemed
3
<PAGE>
effective). The designees of the Purchaser will, with respect to the Shares so
accepted and other securities for which such appointment is effective, be
empowered to exercise all voting and other rights of the undersigned as they in
their sole discretion may deem proper at any annual, special, adjourned or
postponed meeting of the Company's shareholders. The Purchaser reserves the
right to require, in addition to satisfaction of the Control Share Condition (as
defined in the Offer to Purchase), that, in order for Shares to be deemed
validly tendered, immediately upon the Purchaser's payment for such Shares, the
Purchaser or its designee must be able to exercise full voting and other rights
of a record and beneficial holder, including voting at any meeting of
shareholders or acting by written consent with respect to such Shares. The
foregoing appointment of designees of the Purchaser as proxies shall in no event
constitute a proxy to vote on the granting of voting rights to the Purchaser and
its associates pursuant to the Article 14.1 of the Virginia Stock Corporation
Act.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby (and any Distributions) and that, when the same are accepted for payment
and paid for by the Purchaser, the Purchaser will acquire good, marketable and
unencumbered title thereto, free and clear of all liens, restrictions, charges
and encumbrances and that the Shares tendered hereby (and any Distributions)
will not be subject to any adverse claim. The undersigned, upon request, will
execute and deliver any additional documents deemed by the Depositary or the
Purchaser to be necessary or desirable to complete the sale, assignment and
transfer of Shares tendered hereby (and any Distributions). In addition, the
undersigned shall promptly remit and transfer to the Depositary for the account
of the Purchaser any and all other Distributions in respect of the Shares
tendered hereby, accompanied by appropriate documentation of transfer, and,
pending such remittance or appropriate assurance thereof, the Purchaser shall
be, subject to applicable law, entitled to all rights and privileges as owner of
any such Distributions, and may withhold the entire purchase price of Shares
tendered hereby, or deduct from such purchase price the amount or value thereof,
as determined by the Purchaser in its sole discretion.
Tenders of Shares made pursuant to the Offer are irrevocable, except that
Shares tendered pursuant to the Offer may be withdrawn at any time prior to the
Expiration Date (as defined in the Offer to Purchase) and, unless theretofore
accepted for payment by the Purchaser pursuant to the Offer, may also be
withdrawn at any time after May 7, 1994. See Section 4 of the Offer to Purchase.
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the purchase price and/or return any Share
Certificates not tendered or not accepted for payment in the name(s) of the
registered holder(s) appearing under "Description of Shares Tendered."
Similarly, unless otherwise indicated under "Special Delivery Instructions,"
please mail the check for the purchase price and/or return any Share
Certificates not tendered or not accepted for payment (and accompanying
documents, as appropriate) to the address(es) of the registered holder(s)
appearing under "Description of Shares Tendered." In the event that both the
Special Payment Instructions and the Special Delivery Instructions are
completed, please issue the check for the purchase price and/or return any Share
Certificates not tendered or not accepted for payment in the name of, and
deliver such check and/or return such Share Certificates to, the person(s) so
indicated. The undersigned recognizes that the Purchaser has no obligation
pursuant to the Special Payment Instructions to transfer any Shares from the
name of the registered holder thereof if the Purchaser does not accept for
payment any of the Shares tendered hereby.
4
<PAGE>
<TABLE>
<S> <C>
SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7) (SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if Share Certifi- To be completed ONLY if Share Certifi-
cates not tendered or not accepted for cates not tendered or not accepted for
payment and/or the check for the purchase payment and/or the check for the purchase
price of Shares accepted for payment are price of Shares accepted for payment are
to be issued in the name of someone other to be sent to someone other than the
than the undersigned. undersigned or to the undersigned at an
address other than that shown above.
Issue / / check / / certificates to: Mail / / check / / certificates to:
Name: Name:
(Please Type or (Please Type or Print)
Print) Address:
Address:
(Include Zip Code)
(Include Zip
Code)
(Taxpayer Identification or Social Security
No.)
(See Substitute Form W-9 on reverse side)
</TABLE>
5
<PAGE>
IMPORTANT
SHAREHOLDER: SIGN HERE AND COMPLETE SUBSTITUTE FORM W-9 ON REVERSE
(Signature(s) of Shareholder(s))
Dated: , 19
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on
the Share Certificates or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by trustees, executors, administrators,
guardians, attorneys-in-fact, agents, officers of corporations or others
acting in a fiduciary or representative capacity, please provide the following
information. See instruction 5.)
Name(s):
(Please Type or Print)
Capacity (Full Title):
(See Instruction 5)
Area Codes and Telephone Numbers:
Home
Business
Taxpayer Identification or Social Security No.:
(Complete Substitute Form W-9 on Reverse)
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 1 AND 5)
Authorized Signature:
Name:
(Please Type or Print)
Title:
Name of Firm:
Address:
(Include Zip Code)
(Area Code and Tel. No.) Dated:
6
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, signatures
on this Letter of Transmittal must be guaranteed by a firm that is a bank,
broker, dealer, credit union, savings association or other entity which is a
member in good standing of the Securities Transfer Agent's Medallion Program (an
"Eligible Institution"), unless the Shares tendered hereby are tendered (i) by
the registered holder of such Shares who has completed neither the box entitled
"Special Payment Instructions" nor the box entitled "Special Delivery
Instructions" herein or (ii) for the account of an Eligible Institution. See
Instruction 5. If the Share Certificates are registered in the name of a person
other than the signer of this Letter of Transmittal, or if payment is to be made
to, or Share Certificates for any unpurchased Shares are to be issued or
returned to, a person other than the registered holder, then the tendered
certificates must be endorsed or accompanied by duly executed stock powers, in
either case signed exactly as the name or names of the registered holder or
holders appear on the certificates, with the signatures on the certificates or
stock powers guaranteed by an Eligible Institution as provided herein. See
Instruction 5.
2. REQUIREMENTS OF TENDER. This Letter of Transmittal is to be used either
if Share Certificates are to be forwarded herewith or if tenders are to be made
pursuant to the procedures for tender by book-entry transfer set forth in
Section 3 of the Offer to Purchase. Share Certificates, or timely confirmation
of a book-entry transfer (a "Book-Entry Confirmation") of such Shares into the
Depositary's account at a Book-Entry Transfer Facility, as well as this Letter
of Transmittal (or facsimile hereof), properly completed and duly executed, with
any required signature guarantees and any other documents required by this
Letter of Transmittal, must be received by the Depositary at one of its
addresses set forth herein prior to the Expiration Date. Shareholders whose
Share Certificates are not immediately available or who cannot deliver their
Share Certificates and all other required documents to the Depositary prior to
the Expiration Date or who cannot complete the procedures for delivery by
book-entry transfer on a timely basis may tender their Shares by properly
completing and duly executing a Notice of Guaranteed Delivery pursuant to the
guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase.
Pursuant to such procedure: (i) such tender must be made by or through an
Eligible Institution, (ii) a properly completed and duly executed Notice of
Guaranteed Delivery, substantially in the form made available by the Purchaser,
must be received by the Depositary prior to the Expiration Date, and (iii) the
Share Certificates (or a Book-Entry Confirmation) representing all tendered
Shares, in proper form for transfer, together with a properly completed and duly
executed Letter of Transmittal (or facsimile thereof), with any required
signature guarantees and any other documents required by this Letter of
Transmittal, must be received by the Depositary within five National Association
of Securities Dealers Automated Quotation System trading days after the date of
execution of such Notice of Guaranteed Delivery, all as provided in Section 3 of
the Offer to Purchase. If Share Certificates are forwarded separately to the
Depositary, a properly completed and duly executed Letter of Transmittal (or a
facsimile thereof) must accompany each such delivery.
THE METHOD OF DELIVERY OF SHARE CERTIFICATES, THIS LETTER OF TRANSMITTAL AND
ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER
FACILITY, IS AT THE OPTION AND SOLE RISK OF THE TENDERING SHAREHOLDER AND THE
DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF
DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted and no
fractional Shares will be purchased. All tendering shareholders, by execution of
this Letter of Transmittal (or a facsimile thereof), waive any right to receive
any notice of the acceptance of their Shares for payment.
3. INADEQUATE SPACE. If the space provided herein under "Description of
Shares Tendered" is inadequate, the certificate numbers and/or the number of
Shares should be listed on a separate signed schedule attached hereto.
7
<PAGE>
4. PARTIAL TENDERS (NOT APPLICABLE TO BOOK-ENTRY SHAREHOLDERS). If fewer
than all the Shares represented by any Share Certificates delivered to the
Depositary herewith are to be tendered hereby, fill in the number of Shares
which are to be tendered in the box entitled "Number of Shares Tendered." In
such case, a new Share Certificate for the untendered Shares will be sent,
without expense, to the person(s) signing this Letter of Transmittal, unless
otherwise provided in the box entitled "Special Delivery Instructions" on this
Letter of Transmittal, as soon as practicable after the Expiration Date. All
Shares represented by certificate(s) delivered to the Depositary will be deemed
to have been tendered unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL, STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the Shares
tendered hereby, the signature(s) must correspond with the name(s) as written on
the face of the certificate(s) without alteration, enlargement or any change
whatsoever.
If any of the Shares tendered hereby are owned of record by two or more
joint owners, all such owners must sign this Letter of Transmittal.
If any of the tendered Shares are registered in different names on several
certificates, it will be necessary to complete, sign and submit as many separate
Letters of Transmittal as there are different registrations of certificates.
If this Letter of Transmittal or any certificates or stock powers are signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
the Purchaser of such person's authority so to act must be submitted.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares listed and transmitted hereby, no endorsements of certificates or
separate stock powers are required unless payment is to be made, or Share
Certificates not tendered or not purchased are to be issued or returned, to a
person other than the registered holder(s). Signatures on such certificates or
stock powers must be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares evidenced by the certificate(s) listed and
transmitted hereby, the certificate(s) must be endorsed or accompanied by
appropriate stock powers, in either case signed exactly as the name(s) of the
registered holder(s) appear on the certificate(s). Signatures on such
certificate(s) or stock powers must be guaranteed by an Eligible Institution.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, the
Purchaser will pay or cause to be paid any stock transfer taxes with respect to
the transfer and sale of purchased Shares to it or its order pursuant to the
Offer. If, however, payment of the purchase price is to be made to, or (in the
circumstances permitted hereby) if Share Certificates not tendered or not
purchased are to be registered in the name of, any person other than the
registered holder(s), or if tendered Share Certificates are registered in the
name of any person other than the person(s) signing this Letter of Transmittal,
the amount of any stock transfer taxes (whether imposed on the registered
holder(s) or such other person) payable on account of the transfer to such
person will be deducted from the purchase price unless satisfactory evidence of
the payment of such taxes or exemption therefrom is submitted.
EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY FOR
TRANSFER TAX STAMPS TO BE AFFIXED TO THE CERTIFICATE(S) LISTED IN THIS LETTER OF
TRANSMITTAL.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check and/or Share
Certificates for unpurchased Shares are to be issued in the name of a person
other than the signer of this Letter of Transmittal or if a check is to be sent
and/or such Share Certificates are to be returned to someone other than the
signer of this Letter of Transmittal or to an address other than that shown
above, the appropriate boxes on this Letter of Transmittal should be completed.
8
<PAGE>
8. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions and requests
for assistance may be directed to the Information Agent at its address or
telephone numbers set forth below and additional copies of the Offer to
Purchase, this Letter of Transmittal and the Notice of Guaranteed Delivery may
be obtained at the Purchaser's expense from the Information Agent at its address
set forth below or from a broker, dealer, commercial bank or trust company.
9. WAIVER OF CONDITIONS. The conditions of the Offer may be waived by the
Purchaser, in whole or in part, at any time or from time to time in the
Purchaser's sole discretion.
10. BACKUP WITHHOLDING TAX. Each tendering shareholder is required to
provide the Depositary with a correct Taxpayer Identification Number ("TIN") on
Substitute Form W-9, which is provided under "Important Tax Information" below.
FAILURE TO PROVIDE THE INFORMATION ON THE SUBSTITUTE FORM W-9 MAY SUBJECT THE
TENDERING SHAREHOLDER TO 31% FEDERAL INCOME TAX BACKUP WITHHOLDING ON THE
PAYMENT OF THE PURCHASE PRICE. The box in Part 3 of the form may be checked if
the tendering shareholder has not been issued a TIN and has applied for a number
or intends to apply for a number in the near future. If the box in Part 3 is
checked and the Depositary is not provided with a TIN within 60 days, the
Depositary will withhold 31% of all payments of the purchase price, if any, made
thereafter pursuant to the Offer until a TIN is provided to the Depositary.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A FACSIMILE HEREOF), PROPERLY
COMPLETED AND DULY EXECUTED, TOGETHER WITH ANY REQUIRED SIGNATURE GUARANTEES AND
CERTIFICATES OR BOOK-ENTRY CONFIRMATION AND ALL OTHER REQUIRED DOCUMENTS, MUST
BE RECEIVED BY THE DEPOSITARY, OR A PROPERLY COMPLETED AND DULY EXECUTED NOTICE
OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, PRIOR TO THE
EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under federal income tax law, a shareholder whose tendered Shares are
accepted for payment is required to provide the Depositary (as payer) with the
shareholder's correct TIN on Substitute Form W-9 below. If the shareholder is an
individual, the TIN is his or her social security number. The Certificate of
Awaiting Taxpayer Identification Number should be completed if the tendering
shareholder has not been issued a TIN and has applied for a number or intends to
apply for a number in the near future. Failure to furnish timely a correct TIN
or include all required information will subject the taxpayer to a $50 penalty
for each failure. There are civil and criminal penalties for giving false
information to avoid backup withholding. A shareholder who provides false
information may be subject to a civil penalty of up to $500 and a criminal
penalty, upon conviction, of a fine up to $1,000 or imprisonment of up to one
year, or both.
Certain shareholders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and reporting
requirements. For a foreign individual to qualify as an exempt recipient, that
shareholder must submit a statement, signed under penalties of perjury,
attesting to that individual's exempt status. Forms for such statements can be
obtained from the Depositary. See the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional
instructions.
If (i) the shareholder does not furnish the Depositary with a TIN in the
required manner; (ii) the IRS notifies the Depositary the TIN provided is
incorrect; or (iii) the shareholder is required, but fails, to certify it is not
subject to backup withholding, backup withholding will apply. If backup
withholding applies, the Depositary is required to withhold 31% of any payments
made to the shareholder. Backup withholding is not an additional tax. Rather,
the tax liability of persons subject to backup withholding will be credited by
the amount of tax withheld. If withholding results in an overpayment of taxes, a
refund may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup federal income tax withholding with respect to payment of
the purchase price for Shares purchased pursuant to the Offer, a shareholder
must provide the Depositary with his or her correct TIN by completing the
Substitute Form W-9 below certifying that the TIN provided on
9
<PAGE>
Substitute Form W-9 is correct (or that the shareholder is awaiting a TIN) and
that (1) the shareholder has not been notified by the Internal Revenue Service
that he or she is subject to backup withholding as a result of failure to report
all interest or dividends or (2) the Internal Revenue Service has notified the
shareholder that he or she is no longer subject to backup withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The shareholder is required to give the Depositary the social security
number or employer identification number of the record holder of the Shares
tendered. If the Shares are in more than one name or are not in the name of the
actual owner, consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidance on which
number to report.
PAYER'S NAME: IBJ SCHRODER BANK & TRUST COMPANY
<TABLE>
<S> <C> <C>
Social Security Number
PART 1 -- PLEASE PROVIDE YOUR TIN OR
IN THE BOX AT RIGHT AND CERTIFY BY Employer Identification
SIGNING AND DATING BELOW. Number
SUBSTITUTE
PART 2 -- Check the box if you are NOT subject to backup
withholding under the provisions of section 3406(a)(1)(C) of the
Form W-9 Internal Revenue Code because (1) you have not been notified that
Department of the you are subject to backup withholding as a result of failure to
Treasury report all interest or dividends or (2) the Internal Revenue
Internal Revenue Service has notified you that you are no longer subject to backup
Service withholding. / /
</TABLE>
<TABLE>
<S> <C> <C>
PAYER'S REQUEST FOR TAXPAYER
IDENTIFICATION NUMBER (TIN) CERTIFICATION -- UNDER PENALTIES OF PERJURY, I CERTIFY THAT
THE INFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT, AND
COMPLETE. PART 3
SIGNATURE DATE Awaiting TIN / /
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE
IF YOU CHECKED THE BOX IN PART 3 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number
has not been issued to me, and either (a) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (b)
I intend to mail or deliver an application in the near future. I understand that
if I do not provide a taxpayer identification number within sixty (60) days, 31%
of all reportable payments made to me thereafter will be withheld until I
provide a number.
<TABLE>
<S> <C>
Signature Date
</TABLE>
10
<PAGE>
(DO NOT WRITE IN BOX IMMEDIATELY BELOW)
Date Received: _____________ Accepted By: _____________ Checked By: ____________
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
AMOUNT
SHARES SHARES SHARES CHECK OF SHARES CERTIFICATE
SURRENDERED TENDERED ACCEPTED NO. CHECK RETURNED NO.
</TABLE>
Delivery Prepared By: _____________ Checked By: _____________ Date: ____________
THE INFORMATION AGENT FOR THE OFFER IS:
MACKENZIE PARTNERS, INC.
156 Fifth Avenue, 9th Floor
New York, New York 10010
(212) 929-5500 (Call Collect)
1-800-322-2885
(Toll-Free)
11
<PAGE>
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF SHARES OF COMMON STOCK
OF
WLR FOODS, INC.
This Notice of Guaranteed Delivery or one substantially equivalent hereto
must be used to accept the Offer (as defined below) if certificates representing
shares of Common Stock, no par value (the "Shares"), of WLR Foods, Inc., a
Virginia corporation (the "Company"), are not immediately available or time will
not permit all required documents to reach IBJ Schroder Bank & Trust Company
(the "Depositary") on or prior to the Expiration Date (as defined in Section 1
of the Offer to Purchase (as defined below)), or the procedure for delivery by
book-entry transfer cannot be completed on a timely basis. This Notice of
Guaranteed Delivery may be delivered by hand or sent by facsimile transmission
or mail to the Depositary. See Section 3 of the Offer to Purchase.
THE DEPOSITARY FOR THE OFFER IS:
IBJ SCHRODER BANK & TRUST COMPANY
For Information Telephone:
(212) 858-2103
<TABLE>
<S> <C> <C>
FACSIMILE BY HAND OR
BY MAIL: TRANSMISSION: OVERNIGHT DELIVERY:
P. O. Box 84 (212) 858-2611 One State Street
Bowling Green Station To Confirm Facsimile New York, New York 10004
New York, New York Transmissions call: Attn: Securities Processing
10274-0084 (212) 858-2103 Window, Subcellar One
Attn: Reorganization (for Eligible Institutions
Operations Department only)
</TABLE>
Delivery of this Notice of Guaranteed Delivery to an address other than as
set forth above or transmission of instructions via a facsimile transmission to
a number other than as set forth above will not constitute a valid delivery.
This Notice of Guaranteed Delivery is not to be used to guarantee
signatures. If a signature on a Letter of Transmittal is required to be
guaranteed by an Eligible Institution under the instructions thereto, such
signature guarantee must appear in the applicable space provided in the
signature box on the Letter of Transmittal.
Ladies and Gentlemen:
The undersigned hereby tenders to WLR Acquisition Corp., a Delaware
corporation (the "Purchaser") and a wholly-owned subsidiary of Tyson Foods,
Inc., a Delaware corporation, upon the terms and subject to the conditions set
forth in the Offer to Purchase, dated March 9, 1994 (the "Offer to
1
<PAGE>
Purchase"), and in the related Letter of Transmittal (which together constitute
the "Offer"), receipt of each of which is hereby acknowledged, the number of
Shares indicated below pursuant to the guaranteed delivery procedures set forth
in Section 3 of the Offer to Purchase.
Number of Shares: Name(s) of
Account Number: Record Holder(s):
Certificate No(s).
(if available): Address(es):
If Share(s) will be tendered by Area Code and
book-entry transfer, check one box Telephone Number(s):
/ / The Depository Trust Company
/ / Midwest Securities Trust Company Signature(s):
/ / Philadelphia Depository Trust
Company
Account Number:
Date:
THE GUARANTEE ON THE REVERSE SIDE MUST BE COMPLETED
2
<PAGE>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm that is a bank, broker, dealer, credit union,
savings association or other entity which is a member in good standing of the
Securities Transfer Agent's Medallion Program, hereby guarantees to deliver to
the Depositary, at one of its addresses set forth above, the certificates
representing all tendered Shares, in proper form for transfer, or a Book-Entry
Confirmation (as defined in the Offer to Purchase), together with a properly
completed and duly executed Letter of Transmittal (or facsimile thereof), with
any required signature guarantees, and any other documents required by the
Letter of Transmittal within five National Association of Securities Dealers
Automated Quotation System trading days after the date of execution of this
Notice of Guaranteed Delivery.
Name of Firm:
Address: (Authorized Signature)
Title:
(Zip Code) Name:
Area Code and (Please type or print)
Telephone Number: Date:
NOTE: DO NOT SEND CERTIFICATES FOR SHARES WITH THIS NOTICE OF GUARANTEED
DELIVERY. CERTIFICATES FOR SHARES SHOULD BE SENT WITH YOUR LETTER OF
TRANSMITTAL.
3
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
WLR FOODS, INC.
AT
$30.00 NET PER SHARE
BY
WLR ACQUISITION CORP.
A WHOLLY-OWNED SUBSIDIARY OF
TYSON FOODS, INC.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON FRIDAY, APRIL 8, 1994 UNLESS THE OFFER IS EXTENDED.
March 9, 1994
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We have been appointed by WLR Acquisition Corp., a Delaware corporation (the
"Purchaser") and a wholly-owned subsidiary of Tyson Foods, Inc., a Delaware
corporation ("Tyson"), to act as Information Agent in connection with the
Purchaser's offer to purchase for cash all of the outstanding shares of Common
Stock, no par value (the "Shares"), of WLR Foods, Inc., a Virginia corporation
(the "Company"), at $30.00 per Share, net to the seller in cash, upon the terms
and subject to the conditions set forth in the Offer to Purchase, dated March 9,
1994 (the "Offer to Purchase"), and in the related Letter of Transmittal (which
together constitute the "Offer") enclosed herewith. Holders of Shares whose
certificates for such Shares (the "Share Certificates") are not immediately
available or who cannot deliver their Share Certificates and all other required
documents to the Depositary (as defined below) prior to the Expiration Date (as
defined in the Offer to Purchase), or who cannot complete the procedures for
book-entry transfer on a timely basis, must tender their Shares according to the
guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase.
Please furnish copies of the enclosed materials to those of your clients for
whose accounts you hold Shares registered in your name or in the name of your
nominee.
The Offer is conditioned upon, among other things, (1) there being validly
tendered, and not withdrawn prior to the Expiration Date, that number of Shares
which, together with the Shares beneficially owned by the Purchaser and its
affiliates, represents at least a majority of the total number of the Shares
outstanding on a fully diluted basis on the date of purchase, (2) the Rights (as
defined in the Offer to Purchase) having been redeemed by the Board of Directors
of the Company or the Purchaser being satisfied, in its sole discretion, that
the Rights have been invalidated or are otherwise inapplicable to the Offer and
to the Proposed Merger (as defined in the Offer to Purchase), (3) the Purchaser
being satisfied, in its sole discretion, that after consummation of the Offer,
the restrictions contained in Article 14 of the Virginia Stock Corporation Act
will not apply to the Proposed Merger, and (4) full voting rights for all Shares
acquired by the Purchaser or Tyson or any of their associates pursuant to, or in
contemplation of, the Offer (which would otherwise be denied voting rights under
Article 14.1 of the Virginia Stock Corporation Act) having been approved at a
special meeting of shareholders of the Company or the Purchaser being satisfied,
in its sole discretion, that Article 14.1 of the Virginia Stock Corporation Act
is inapplicable to the Purchaser or Tyson or any of their associates or the
acquisition of Shares by any of them. The Offer is also subject to other terms
and conditions contained in the Offer to Purchase. See the Introduction and
Sections 1 and 14 of the Offer to Purchase.
<PAGE>
Enclosed herewith for your information and forwarding to your clients are
copies of the following documents:
1. The Offer to Purchase, dated March 9, 1994.
2. The blue Letter of Transmittal to tender Shares for your use and for
the information of your clients. Facsimile copies of the Letter of
Transmittal may be used to tender Shares.
3. The gray Notice of Guaranteed Delivery for Shares, to be used to
accept the Offer if Share Certificates are not immediately available or if
such certificates and all other required documents cannot be delivered to
IBJ Schroder Bank & Trust Company (the "Depositary") by the Expiration Date
or if the procedure for book-entry transfer cannot be completed by the
Expiration Date.
4. A green printed form of letter which may be sent to your clients for
whose accounts you hold Shares registered in your name or in the name of
your nominee, with space provided for obtaining such clients' instructions
with regard to the Offer.
5. Guidelines of the Internal Revenue Service for Certification of
Taxpayer Identification Number on Substitute Form W-9.
6. A return envelope addressed to IBJ Schroder Bank & Trust Company,
the Depositary.
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS
PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, APRIL 8, 1994 UNLESS THE OFFER IS
EXTENDED.
In order to take advantage of the Offer, (i) a duly executed and properly
completed Letter of Transmittal and any required signature guarantees or other
required documents should be sent to the Depositary, and (ii) either Share
Certificates representing the tendered Shares should be delivered to the
Depositary, or such Shares should be tendered by book-entry transfer into the
Depositary's account maintained at one of the Book Entry Transfer Facilities (as
described in the Offer to Purchase), all in accordance with the instructions set
forth in the Letter of Transmittal and the Offer to Purchase.
If holders of Shares wish to tender, but it is impracticable for them to
forward their Share Certificates or other required documents on or prior to the
Expiration Date or to comply with the book-entry transfer procedures on a timely
basis, a tender may be effected by following the guaranteed delivery procedures
specified in Section 3 of the Offer to Purchase.
Neither the Purchaser nor Tyson will pay any commissions or fees to any
broker, dealer or other person (other than the Information Agent, as described
in the Offer to Purchase) for soliciting tenders of Shares pursuant to the
Offer. The Purchaser will, however, upon request, reimburse you for customary
clerical and mailing expenses incurred by you in forwarding any of the enclosed
materials to your clients. The Purchaser will pay or cause to be paid any stock
transfer taxes payable on the transfer of Shares to it, except as otherwise
provided in Instruction 6 of the Letter of Transmittal.
Any inquiries you may have with respect to the Offer should be addressed to,
and additional copies of the enclosed material may be obtained from, the
Information Agent at its address and telephone numbers set forth on the back
cover of the Offer to Purchase.
Very truly yours,
MACKENZIE PARTNERS, INC.
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON THE AGENT OF THE PURCHASER, TYSON, THE COMPANY, THE
DEPOSITARY OR THE INFORMATION AGENT, OR ANY AFFILIATE OF ANY OF THEM, OR
AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENT OR USE ANY DOCUMENT ON
BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE ENCLOSED
DOCUMENTS AND THE STATEMENTS CONTAINED THEREIN.
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
WLR FOODS, INC.
AT
$30.00 NET PER SHARE
BY
WLR ACQUISITION CORP.
A WHOLLY-OWNED SUBSIDIARY OF
TYSON FOODS, INC.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON FRIDAY, APRIL 8, 1994, UNLESS THE OFFER IS EXTENDED.
To Our Clients:
Enclosed for your consideration are the Offer to Purchase, dated March 9,
1994 (the "Offer to Purchase"), and the related Letter of Transmittal (the
"Letter of Transmittal") relating to the offer by WLR Acquisition Corp., a
Delaware corporation (the "Purchaser") and wholly-owned subsidiary of Tyson
Foods, Inc., a Delaware corporation ("Tyson"), to purchase all outstanding
shares of Common Stock, no par value (the "Shares"), of WLR Foods, Inc., a
Virginia corporation (the "Company"), at $30.00 per Share, net to the seller in
cash upon the terms and subject to the conditions set forth in the Offer to
Purchase and the Letter of Transmittal (which together constitute the "Offer").
Holders of Shares whose certificates for such Shares (the "Share Certificates")
are not immediately available or who cannot deliver their Share Certificates,
and all other required documents to the Depositary (as defined below) prior to
the Expiration Date (as defined in the Offer to Purchase), or who cannot
complete the procedures for book-entry transfer on a timely basis, must tender
their Shares according to the guaranteed delivery procedures set forth in
Section 3 of the Offer to Purchase.
WE ARE THE HOLDER OF RECORD OF SHARES HELD BY US FOR YOUR ACCOUNT. A TENDER
OF SUCH SHARES CAN BE MADE ONLY BY US AS THE HOLDER OF RECORD AND PURSUANT TO
YOUR INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR YOUR
INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER SHARES HELD BY US FOR YOUR
ACCOUNT.
Accordingly, we request instructions as to whether you wish to have us
tender on your behalf any or all Shares held by us for your account pursuant to
the terms and conditions set forth in the Offer.
Please note the following:
1. The tender price is $30.00 per Share net to you in cash upon the
terms and subject to the conditions set forth in the Offer.
2. The Offer is being made for all outstanding Shares.
3. The Offer is conditioned upon, among other things, (1) there being
validly tendered, and not withdrawn prior to the Expiration Date (as defined
in the Offer to Purchase), that number of Shares which, together with the
Shares beneficially owned by the Purchaser and its affiliates, represents at
least a majority of the total number of the Shares outstanding on a fully
diluted basis on the date of purchase, (2) the Rights (as defined in the
Offer to Purchase) having been redeemed by the Board of Directors of the
Company or the Purchaser being satisfied, in its sole
1
<PAGE>
discretion, that the Rights have been invalidated or are otherwise
inapplicable to the Offer and to the Proposed Merger (as defined in the
Offer to Purchase), (3) the Purchaser being satisfied, in its sole
discretion, that after consummation of the Offer, the restrictions contained
in Article 14 of the Virginia Stock Corporation Act will not apply to the
Proposed Merger, and (4) full voting rights for all Shares acquired by the
Purchaser or Tyson or any of their associates pursuant to, or in
contemplation of, the Offer (which would otherwise be denied voting rights
under Article 14.1 of the Virginia Stock Corporation Act) having been
approved at a special meeting of shareholders of the Company or the
Purchaser being satisfied, in its sole discretion, that Article 14.1 of the
Virginia Stock Corporation Act is inapplicable to the Purchaser or Tyson or
any of their associates and the acquisition of Shares by any of them. The
Offer is also subject to other terms and conditions contained in the Offer
to Purchase. See the Introduction and Sections 1 and 14 of the Offer to
Purchase.
4. Tendering shareholders will not be obligated to pay brokerage fees
or commissions or, except as otherwise provided in Instruction 6 of the
Letter of Transmittal, stock transfer taxes on the purchase of Shares by
Purchaser pursuant to the Offer.
5. The Offer and withdrawal rights will expire at 12:00 Midnight, New
York City time, on Friday, April 8, 1994, unless the Offer is extended.
6. Notwithstanding any other provision of the Offer, payment for Shares
purchased pursuant to the Offer will in all cases be made only after timely
receipt by the Depositary of (a) Share Certificates, or timely confirmation
of the book-entry transfer of such Shares into the account maintained by IBJ
Schroder Bank & Trust Company (the "Depositary") at The Depository Trust
Company, the Midwest Securities Trust Company or the Philadelphia Depository
Trust Company (collectively, the "Book-Entry Transfer Facilities"), pursuant
to the procedures set forth in Section 3 of the Offer to Purchase, (b) the
Letter of Transmittal (or a facsimile thereof), properly completed and duly
executed, with any required signature guarantees, and (c) any other
documents required by the Letter of Transmittal. Accordingly, payment may
not be made to all tendering shareholders at the same time depending upon
when Share Certificates or confirmations of book-entry transfer of such
Shares into the Depositary's account at a Book-Entry Transfer Facility are
actually received by the Depositary.
If you wish to have us tender any or all of the Shares held by us for your
account, please so instruct us by completing, executing, detaching and returning
to us the instruction form set forth on the next page of this letter. If you
authorize the tender of your Shares, all such Shares will be tendered unless
otherwise specified on the next page of this letter. An envelope to return your
instructions to us is enclosed. Your instructions should be forwarded to us in
ample time to permit us to submit a tender on your behalf prior to the
expiration of the Offer.
The 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 Offer or the acceptance thereof would not be in compliance with the
securities, blue sky or other laws of such jurisdiction. However, the Purchaser
may, in its discretion, take such action as it may deem necessary to make the
Offer in any such jurisdiction and extend the Offer to holders of Shares in such
jurisdiction.
In any jurisdiction where the securities, blue sky or other laws require the
Offer to be made by a licensed broker or dealer, the Offer will be deemed to be
made on behalf of the Purchaser by one or more registered brokers or dealers
that are licensed under the laws of such jurisdiction.
2
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE OFFER TO PURCHASE
FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK
OF
WLR FOODS, INC.
The undersigned acknowledge(s) receipt of your letter and the enclosed Offer
to Purchase dated March 9, 1994 and the related Letter of Transmittal in
connection with the offer by WLR Acquisition Corp., a Delaware corporation (the
"Purchaser") and a wholly-owned subsidiary of Tyson Foods, Inc., a Delaware
corporation, to purchase all outstanding shares of Common Stock, no par value
(the "Shares"), of WLR Foods, Inc., a Virginia corporation.
This will instruct you to tender to the Purchaser the number of Shares
indicated below (or if no number is indicated below, all Shares) which are held
by you for the account of the undersigned, upon the terms and subject to the
conditions set forth in the Offer.
Number of Shares to Be Tendered Shares
Date:
SIGN HERE
Signature(s)
(Print Name(s))
(Print Address(es))
(Area Code and
Telephone Number(s))
(Taxpayer Identification or
Social Security Number(s))
3
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER INDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYER.--Social Security numbers have nine digits separated by two hyphens: i.e.
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen: i.e. 00-0000000. The table below will help determine the number to
give the payer.
<TABLE>
<S> <C> <C> <C>
- -------------------------------------------------- ---------------------------------------------------
GIVE THE GIVE THE EMPLOYER
FOR THIS TYPE OF ACCOUNT: SOCIAL SECURITY FOR THIS TYPE OF ACCOUNT: IDENTIFICATION
NUMBER OF -- NUMBER OF --
- -------------------------------------------------- ---------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C>
1. An individual's The individual
account
2. Two or more The actual owner of
individuals (joint the account or, if
account) combined funds, the
first individual on
the account(1)
3. Husband and wife The actual owner of
(joint account) the account or, if
joint funds, either
person(1)
4. Custodian account The minor (2)
of a minor (Uniform
Gift to Minors Act)
5. Adult and minor The adult or, if the
(joint account) minor is the only
contributor, the
minor(1)
6. Account in the name The ward, minor, or
of guardian or incompetent person(3)
committee for a
designated ward,
minor, or
incompetent person
7. A. The usual The grantor-trustee(1)
revocable
savings trust
account (grantor
is also trustee)
B. So-called trust The actual owner(1)
account that is
not a legal or
valid trust
under State law
8. Sole proprietorship The owner(4)
account
9. A valid trust, The legal entity (Do
estate, or pension not furnish the
trust identifying number of
the personal
representative or
trustee unless the
legal entity itself is
not designated in the
account title.)(5)
10. Corporate account The corporation
11. Religious, The organization
charitable, or
educational
organization
account
12. Partnership account The partnership
held in the name of
the business
13. Association, club, The organization
or other tax-exempt
organization
14. A broker or The broker or nominee
registered nominee
15. Account with the The public entity
Department of
Agriculture in the
name of a public
entity (such as a
State or local
government, school
district, or
prison) that
receives
agricultural
program payments
</TABLE>
- --------------------------------------------------------------------------------
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) List first and circle the name of the legal trust, estate or pension trust.
NOTE: If no name is circled when there is more than one name, the number will be
considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
PAGE 2
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEES AND PAYMENTS EXEMPT FROM BACKUP
WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include the
following:
- A corporation.
- A financial institution.
- An organization exempt from tax under
Section 501(a) of the Internal Revenue Code of 1986, as amended (the "Code"), or
an individual retirement plan.
- The United States or any agency or
instrumentality thereof.
- A State, the District of Columbia, a possession of
the United States, or any subdivision or instrumentality thereof.
- A foreign government, a political subdivision of a
foreign government, or any agency or instrumentality thereof.
- An international organization or any agency or
instrumentality thereof.
- A registered dealer in securities or commodities
registered in the United States or a possession of the United States.
- A real estate investment trust.
- A common trust fund operated by a bank under
Section 584(a) of the Code.
- An exempt charitable remainder trust, or a non-
exempt trust described in Section 4947(a)(1) of the Code.
- An entity registered at all times under the
Investment Company Act of 1940.
- A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to backup
withholding include the following:
- Payments to nonresident aliens subject to
withholding under Section 1441 of the Code.
- Payments to partnerships not engaged in a trade
or business in the United States and which have at least one nonresident
partner.
- Payments of patronage dividends where the
amount received is not paid in money.
- Payments made by certain foreign organizations.
- Payments made to a nominee.
Payments of interest not generally subject to backup withholding include the
following:
- Payments of interest on obligations issued by
individuals. Note: You may be subject to backup withholding if this interest is
$600 or more and is paid in the course of the payer's trade or business and
you have not provided your correct taxpayer identification number to the
payer.
- Payments of tax-exempt interest (including
exempt-interest dividends under Section 852 of the Code).
- Payments described in Section 6049(b)(5) of the
Code to nonresident aliens.
- Payments on tax-free covenant bonds under
Section 1451 of the Code.
- Payments made by certain foreign organizations.
- Payments made to a nominee.
Exempt payees described above should file Substitute Form W-9 to avoid possible
erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR
TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, SIGN AND
DATE THE FORM AND RETURN IT TO THE PAYER. IF YOU ARE A NONRESIDENT ALIEN OR A
FOREIGN ENTITY NOT SUBJECT TO BACKUP WITHHOLDING, FILE WITH PAYER A COMPLETED
INTERNAL REVENUE FORM W-8 (CERTIFICATE OF FOREIGN STATUS).
Certain payments other than interest, dividends, and patronage dividends, that
are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under Sections 6041, 6041A(a),
6045, and 6050A of the Code.
PRIVACY ACT NOTICE.--Section 6109 of the Code requires most recipients of
dividends, interest, or other payments to give taxpayer identification numbers
to payers who must report the payments to IRS. IRS uses the numbers for
identification purposes. Payers must be given the numbers whether or not
recipients are required to file tax returns. Beginning January 1, 1993, payers
must generally withhold 31% of taxable interest, dividends, and certain other
payments to a payee who does not furnish a taxpayer identification number to a
payer. Certain penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER.--If you fail
to furnish your taxpayer identification number to a payer, you are subject to a
penalty of $50 for each such failure unless your failure is due to reasonable
cause and not to willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.--If you
make a false statement with no reasonable basis which results in no imposition
of backup withholding, you are subject to a penalty of $500.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.-- Falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION, CONTACT YOUR TAX
CONSULTANT OR THE INTERNAL REVENUE SERVICE.
<PAGE>
EXHIBIT 99.7
NEWS RELEASE
TYSON ANNOUNCES TENDER OFFER FOR ALL
SHARES OF WLR FOODS AT $30 PER SHARE
SPRINGDALE, ARKANSAS (MARCH 3, 1994) - Tyson Foods, Inc.
(NASDAQ: TYSNA), today announced that it will commence a tender offer on
March 9, 1994 to purchase all outstanding shares of common stock of WLR Foods,
Inc. (NASDAQ: WLRF), at $30 per share in cash. Tyson stated that it
beneficially owns in excess of 5% of the outstanding shares of WLR common
stock.
WLR Foods has approximately 11 million shares outstanding. The
tender offer will be subject to certain conditions, including the tender of at
least a majority of the shares. The tender offer however, will not be subject
to a financing condition.
On January 24, 1994, Tyson delivered to WLR Foods a proposal to
merge WLR Foods into Tyson in which WLR shareholders would receive $30 per
share in cash. On February 6, 1994, WLR Foods announced that its Board of
Directors had rejected Tyson's proposal.
Tyson stated that it intends to request a special meeting of WLR
Foods shareholders pursuant to the Virginia Control Share Acquisitions Act.
At such meeting WLR Foods shareholders will be asked to vote on a proposal to
accord full voting rights to the WLR Foods shares acquired by Tyson pursuant
to the tender offer. The Act provides that, unless such proposal is adopted,
Tyson will not have any voting rights with respect to shares purchased by it
in the tender offer. Approval of the proposal requires the affirmative vote
of the holders of a majority of the WLR Foods shares, other than those shares
held by Tyson and its associates or by officers of the Company or directors of
the Company who are employees. The purpose of the Control Share Acquisitions
Act is, in effect, to allow the disinterested shareholders of WLR Foods to
express a view on Tyson's tender offer.
On February 4, 1994, the WLR Foods Board of Directors took a
series of actions aimed at changing the status of four of its directors to
purportedly allow them to vote their shares of WLR Foods common stock on
Tyson's proposal under the Virginia Control Share Acquisitions Act. These
four directors hold in excess of 10% of the outstanding shares. The WLR Foods
Board of Directors also changed the record date provisions of WLR Foods'
Bylaws with respect to special shareholders meeting called under the Act,
effectively eliminating advance notice of the record date.
<PAGE>
"As a result of these actions," Mr. Don Tyson, Chairman of the
Board of Directors of Tyson, stated, "WLR Foods has attempted to frustrate the
voting rights of their own shareholders under the Act and to entrench
management."
Tyson has filed claims against WLR Foods and its directors in
federal district court in Virginia in response to the actions taken by WLR
Foods and its Board of Directors. Tyson's claims ask the court to negate the
improper actions taken by the Board and thereby allow a fair vote by the
disinterested shareholders of WLR Foods under the Virginia Control Share
Acquisitions Act.
Also in connection with its rejection of Tyson's proposal, the WLR
Foods Board of Directors adopted a poison pill rights plan and lucrative
golden parachute severance arrangements for WLR Foods executives as further
defensive and entrenchment tactics. The claims filed by Tyson also request
that the poison pill rights plan and lucrative golden parachute arrangements
adopted by WLR Foods after its receipt of Tyson's original merger proposal be
invalidated.
Tyson's claims also challenge the Virginia statutory scheme
regulating take-overs as an unconstitutional barrier to Tyson's ability to
acquire shares pursuant to the tender offer.
In addition to the tender of a majority of the outstanding shares,
the tender offer will be certain other conditions, including WLR Foods'
recently issued poison pill rights having been redeemed or invalidated or
otherwise found to be inapplicable to the tender offer; Tyson's satisfaction
that the restrictions contained in the Virginia Affiliated Transactions
Statute Act will not apply to the proposed merger between Tyson and WLR Foods;
and full voting rights for all shares of WLR Foods common stock acquired by
Tyson pursuant to the tender offer having been approved at a special meeting
of WLR Foods' shareholders, or Tyson's being satisfied that the Virginia
Control Share Acquisitions Act is inapplicable to Tyson or its acquisition of
shares of WLR Foods common stock.
Notwithstanding its commencement of the tender offer, Tyson stated
that it remains willing to enter into negotiations at any time with WLR Foods
regarding its proposal.
The Information Agent for the tender offer will be MacKenzie
Partners, Inc.
For further information, contact Tyson's Director of Media, Public
and Government Affair, Archie Shaffer, III at 501-290-7232.
<PAGE>
NEWS RELEASE
TYSON FOODS COMMENCES $30 CASH TENDER OFFER FOR WLR FOODS
SPRINGDALE, ARKANSAS (MARCH 9, 1994) - Tyson Foods, Inc.
(NASDAQ: TYSNA), announced today that its subsidiary, WLR Acquisition Corp.,
has commenced its previously announced tender offer to purchase all outstanding
shares of common stock of WLR Foods, Inc. (NASDAQ: WLRF) at $30 net per share
in cash.
The offer will expire at 12:00 midnight, New York City time, on
Friday, April 8, 1994, unless extended.
The Information Agent for the Offer is MacKenzie Partners, Inc.
The tender offer materials are being filed with the U.S. Securities
and Exchange Commission. Copies of these materials may be obtained by calling
MacKenzie Partners, Inc. toll-free at (800) 322-2885.
For further information, contact Tyson's Director of Media, Public
and Governmental Affairs, Archie Schaffer, III at 501-290-7232.
<PAGE>
This announcement is neither an offer to purchase nor a solicitation of an offer
to sell Shares. The Offer is made solely by the Offer to Purchase dated March 9,
1994 and the related Letter of Transmittal, and is being made to all holders of
Shares. The Purchaser is not aware of any state where the making of the Offer is
prohibited by administrative or judicial action pursuant to any valid state
statute. If the Purchaser becomes aware of any valid state statute prohibiting
the making of the Offer or the acceptance of Shares pursuant thereto, the
Purchaser will make a good faith effort to comply with such state statute. If,
after such good faith effort, the Purchaser cannot comply with such state
statute, the Offer will not be made to (nor will tenders be accepted from or on
behalf of) the holders of Shares in such state. In any jurisdiction where the
securities, blue sky or other laws require the Offer to be made by a licensed
broker or dealer, the Offer will be deemed to be made on behalf of the Purchaser
by one or more registered brokers or dealers that are licensed under the laws of
such jurisdiction.
Notice of Offer to Purchase for Cash
All Outstanding Shares of Common Stock
of
WLR Foods, Inc.
at
$30.00 Net Per Share
by
WLR Acquisition Corp.
A Wholly-Owned Subsidiary of
Tyson Foods, Inc.
WLR Acquisition Corp., a Delaware corporation (the "Purchaser") and a
wholly-owned subsidiary of Tyson Foods, Inc., a Delaware corporation ("Tyson"),
hereby offers to purchase all outstanding shares of Common Stock, no par value
(the
<PAGE>
"Shares"), of WLR Foods, Inc., a Virginia corporation (the "Company"), at $30.00
per Share, net to the seller in cash, upon the terms and subject to the
conditions set forth in the Offer to Purchase, dated March 9, 1994 (the "Offer
to Purchase"), and in the related Letter of Transmittal (which together
constitute the "Offer").
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON FRIDAY, APRIL 8, 1994, UNLESS THE OFFER IS EXTENDED.
The Offer is conditioned upon, among other things, (1) there being validly
tendered, and not withdrawn prior to the Expiration Date, that number of Shares
which, together with the Shares beneficially owned by the Purchaser and its
affiliates, represents at least a majority of the total number of the Shares
outstanding on a fully diluted basis on the date of purchase, (2) the Rights (as
defined in the Offer to Purchase) having been redeemed by the Board of Directors
of the Company or the Purchaser being satisfied, in its sole discretion, that
the Rights have been invalidated or are otherwise inapplicable to the Offer and
to the Proposed Merger (as defined below), (3) the Purchaser being satisfied, in
its sole discretion, that after consummation of the Offer, the restrictions
contained in Article 14 of the Virginia Stock Corporation Act will not apply to
the Proposed Merger, and (4) full voting rights for all Shares acquired by the
Purchaser or Tyson or any of their associates pursuant to, or in contemplation
of, the Offer (which would otherwise be denied voting rights under Article 14.1
of the Virginia Stock Corporation Act) having been approved at a special meeting
of shareholders of the Company or the Purchaser being satisfied, in its sole
discretion, that Article 14.1 of the Virginia Stock Corporation Act is
inapplicable to the Purchaser or Tyson or any of their associates or the
acquisition of Shares by any of them. The Offer is also subject to other terms
and conditions contained in the Offer to Purchase. See the Introduction and
Sections 1 and 14 of the Offer to Purchase.
The purpose of the Offer is for Tyson, through the Purchaser, to acquire
control of, and the entire equity interest in, the
<PAGE>
Company. Tyson currently intends, as soon as practicable following consummation
of the Offer, to propose and seek to have the Company consummate a merger or
similar business combination (the "Proposed Merger") with the Purchaser or
another direct or indirect wholly-owned subsidiary of Tyson, pursuant to which
each Share then outstanding (other than Shares held by the Purchaser, Tyson or
any of their affiliates, Shares held by any subsidiary of the Company and Shares
held by shareholders who perfect their dissenters' rights under the Virginia
Stock Corporation Act) would be converted into the right to receive an amount in
cash equal to the price per Share paid pursuant to the Offer.
The term "Expiration Date" means 12:00 Midnight, New York City time, on
Friday, April 8, 1994, unless and until the Purchaser, in its sole discretion,
shall have extended the period of time during which the Offer is open, in which
event the term "Expiration Date" shall refer to the latest time and date on
which the Offer, as so extended by the Purchaser, shall expire.
For purposes of the Offer, the Purchaser shall be deemed to have accepted
for payment, and thereby purchased, Shares validly tendered and not withdrawn
if, as and when the Purchaser gives oral or written notice to IBJ Schroder Bank
& Trust Company (the "Depositary") of the Purchaser's acceptance of such Shares
for payment pursuant to the Offer. In all cases, upon the terms and subject to
the conditions of the Offer, payment for Shares purchased pursuant to the Offer
will be made by deposit of the aggregate purchase price therefor with the
Depositary, which will act as agent for tendering shareholders for the purpose
of receiving payment from the Purchaser and transmitting payment to such validly
tendering shareholders. Under no circumstances will interest on the purchase
price for Shares be paid by the Purchaser by reason of any delay in making such
payment. In all cases, payment for Shares purchased pursuant to the Offer will
be made only after timely receipt by the Depositary of (a) certificates
representing Shares ("Share Certificates") or timely confirmation of a
book-entry transfer (a "Book-Entry Confirmation") of such Shares into the
Depositary's account at The Depository Trust Company, the Midwest Securities
Trust Company or the Philadelphia Depository Trust Company (collectively, the
"Book-Entry Transfer Facilities"), pursuant to the procedures set forth in
Section 3 of the Offer to Purchase, (b) a properly completed and duly executed
Letter of Transmittal (or facsimile thereof) with any required signature
guarantees, and
<PAGE>
(c) any other documents required by the Letter of Transmittal.
If, for any reason whatsoever, acceptance for payment of any Shares
tendered pursuant to the Offer is delayed, or the Purchaser is unable to accept
for payment or pay for Shares tendered pursuant to the Offer, then, without
prejudice to the Purchaser's rights set forth in the Offer to Purchase, the
Depositary may, nevertheless, on behalf of the Purchaser retain tendered Shares
and such Shares may not be withdrawn except to the extent that the tendering
shareholder is entitled to and duly exercises withdrawal rights as described in
Section 4 of the Offer to Purchase. Any such delay will be by an extension of
the Offer to the extent required by law.
If any tendered Shares are not purchased pursuant to the Offer for any
reason, or if Share Certificates submitted represent more Shares than are
tendered, Share Certificates representing unpurchased or untendered Shares will
be returned, without expense to the tendering shareholder (or, in the case of
Shares delivered by book-entry transfer into the Depositary's account at a
Book-Entry Transfer Facility pursuant to the procedures set forth in Section 3
of the Offer to Purchase, such Shares will be credited to an account maintained
at such Book-Entry Transfer Facility), as promptly as practicable after the
expiration, termination or withdrawal of the Offer.
The Purchaser expressly reserves the right, in its sole discretion, at any
time and from time to time, to extend the period during which the Offer is open
for any reason, including the occurrence of any of the conditions specified in
Section 14 of the Offer to Purchase, by giving oral or written notice of such
extension to the Depositary. Any such extension will be followed as promptly as
practicable by public announcement thereof, and such announcement will be made
no later than 9:00 A.M., New York City time, on the next business day after the
previously scheduled Expiration Date. During any such extension, all Shares
previously tendered and not withdrawn will remain subject to the Offer and
subject to the right of a tendering shareholder to withdraw such shareholder's
Shares.
Except as otherwise provided in Section 4 of the Offer to Purchase, tenders
of Shares made pursuant to the Offer are irrevocable. Shares tendered pursuant
to the Offer may be withdrawn at any time prior to the Expiration Date and,
unless theretofore accepted for payment by the Purchaser pursuant to the Offer,
may also be withdrawn at any time after May
<PAGE>
7, 1994. For a withdrawal to be effective, a written or facsimile transmission
notice of withdrawal must be timely received by the Depositary at one of its
addresses set forth on the back cover of the Offer to Purchase. Any such 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 (if Share Certificates have
been tendered) the name of the registered holder of the Shares as set forth in
the Share Certificates, if different from that of the person who tendered such
Shares. If Share Certificates have been delivered or otherwise identified to the
Depositary, then, prior to the physical release of such certificates, the serial
numbers of the particular certificates evidencing the Shares to be withdrawn and
a signed notice of withdrawal with signatures guaranteed by an Eligible
Institution (as defined in the Offer to Purchase), except in the case of Shares
tendered for the account of the Eligible Institution, must also be furnished by
the tendering shareholder to the Depositary as described above. If Shares have
been tendered pursuant to the procedures for book-entry transfer as set forth in
Section 3 of the Offer to Purchase, any notice of withdrawal must also specify
the name and number of the account at the appropriate Book-Entry Transfer
Facility to be credited with the withdrawn Shares and otherwise comply with the
procedures of such facility, in which case a notice of withdrawal will be
effective if delivered to the Depositary by any method of delivery described in
the third sentence of this paragraph. Withdrawals of Shares may not be
rescinded. Any Shares properly withdrawn will be deemed not validly tendered for
purposes of the Offer. However, withdrawn Shares may be retendered by again
following one of the procedures described in Section 3 of the Offer to Purchase
at any time prior to the Expiration Date. All questions as to the form and
validity (including time of receipt) of notices of withdrawal will be determined
by the Purchaser, in its sole discretion, whose determination will be final and
binding on all parties.
The information required to be disclosed by Rule 14d-6(e)(1)(vii) of the
General Rules and Regulations under the Securities Exchange Act of 1934, as
amended, is contained in the Offer to Purchase and is incorporated herein by
reference.
A request is being made to the Company for use of the Company's shareholder
list and security position listings for the purpose of disseminating the Offer
to holders of Shares. Upon compliance by the Company with such request or the
<PAGE>
election by the Company to disseminate the Offer in lieu of complying with such
request, the Offer to Purchase and the related Letter of Transmittal and other
relevant materials will be mailed to record holders of Shares and will be
furnished to brokers, dealers, commercial banks, trust companies and similar
persons whose names, or the names of whose nominees, appear on the shareholder
lists or, if applicable, who are listed as participants in a clearing agency's
security position listing, for subsequent transmittal to beneficial owners of
Shares.
The Offer to Purchase and the related Letter of Transmittal contain
important information which should be read carefully before any decision is made
with respect to the Offer.
Questions and requests for assistance or for copies of the Offer to
Purchase, the Letter of Transmittal and other related materials may be directed
to the Information Agent at its address and telephone numbers set forth below.
Neither the Purchaser nor Tyson will pay any fees or commissions to brokers,
dealers or other persons for soliciting tenders of Shares pursuant to the Offer.
The Information Agent for the Offer is:
MacKenzie Partners, Inc.
156 Fifth Avenue, 9th Floor
New York, New York 10010
(212) 929-5500 (Call Collect)
or
CALL TOLL-FREE (800) 322-2885
March 9, 1994
<PAGE>
EXHIBIT 99.9
March 1, 1994
Mr. Gerald Johnston
Executive Vice President-Finance
Tyson Foods, Inc.
2210 Oaklawn, Drawer E
Springdale, AR 72765-2020
Re: ACQUISITION OF WLR FOODS, INC.
-------------------------------
Dear Gerald:
Tyson Foods, Inc. (the "COMPANY") has advised Bank of America National Trust
and Savings Association ("BANK OF AMERICA") and BA Securities, Inc. ("BA
SECURITIES") that the Company, through WLR Acquisition Corp., a newly-formed
corporation ("ACQUISITION CORP."), will offer to acquire all of the
outstanding shares of common stock (the "SHARES") of WLR Foods, Inc.
("WLR"), a Virginia corporation, pursuant to a cash tender offer (the
"TENDER OFFER"). We understand that the Tender Offer would contemplate
that, following consummation of the Tender Offer, the Company would propose
and seek to have WLR consummate a merger of Acquisition Corp. with WLR (the
"MERGER").
The Tender Offer would be made upon the terms and subject to the conditions of
an Offer to Purchase satisfactory in form and substance to Bank of America.
All material changes or waivers in or to the terms of the Offer to Purchase
shall be satisfactory to Bank of America. We understand that the Tender Offer
will be conditional upon the purchase of at least that number of Shares which
when aggregated with the number of Shares of WLR owned by the Company and to
be contributed to Acquisition Corp. would constitute a majority of the Shares
on a fully diluted basis and upon Acquisition Corp. having full voting rights
with respect to all Shares acquired by it. We understand that, even if such
conditions are satisfied and the Tender Offer is consummated, the Company and
Acquisition Corp. may be unable to assure that the Merger will be consummated
following the consummation of the Tender Offer. Bank of America shall be
satisfied that the Shareholder Protection Rights associated with the Shares
shall be invalidated or inapplicable to the transactions contemplated hereby
or redeemed for a nominal amount.
You have also advised Bank of America and BA Securities that in order to
finance the Tender Offer and the Merger and related costs and expenses, the
Company will require a credit facility (the "FACILITY") of up to
$340,000,000. Neither the purchase of the Shares pursuant to the Tender Offer
nor the Merger shall require any external financing or funding other than the
Facility.
<PAGE>
Page 2
Bank of America is pleased to advise you that it is willing, subject to the
terms and conditions contained in this letter and in the attached Summary of
Indicative Terms (the "TERM SHEET") to provide the total financing for the
acquisition (the "FINANCING"). Upon your acceptance of this commitment,
however, Bank of America, through BA Securities, reserves the right to
syndicate part of the Facility to a group of financial institutions (together
with Bank of America, the "BANKS") acceptable to the Company and to Bank of
America as agent for the Facility (in such capacity, the "AGENT").
As previously discussed, BA Securities is a wholly-owned, direct subsidiary of
BankAmerica Corporation, the parent company of Bank of America, and is a
registered broker-dealer. You hereby authorize Bank of America to share
credit and other information regarding you with BA Securities.
The fees payable to BA Securities and to Agent in connection with the Facility
are set forth in a separate letter of even date herewith (the "FEE LETTER").
To assist BA Securities in its syndication efforts, you agree to provide upon
its request all information reasonably deemed necessary by it to successfully
complete the syndication of the Facility including, but not limited to,
information relating to the transactions contemplated hereby. Bank of America
and BA Securities acknowledge that they may be exposed to certain information
with respect to the Company, Acquisition Corp., WLR and the Tender Offer which
is of a confidential and proprietary nature ("CONFIDENTIAL INFORMATION") and
each agrees that the Confidential Information will be held in confidence by
Bank of America and BA Securities and will be divulged only to those
employees, agents, and representatives and controlled affiliates that have an
actual need to know said information and that have been informed of the
nondisclosure obligations hereunder; PROVIDED, HOWEVER, that these
restrictions do not apply to information which is disclosed pursuant to a
requirement of a judicial or administrative order or as is otherwise required
by law (provided no disclosure will be made without first giving the Company
the opportunity to oppose the disclosure by appropriate judicial or
administrative proceedings). You hereby authorize BA Securities to commence
syndication efforts immediately and agree actively to assist BA Securities in
achieving a syndication that is satisfactory to BA Securities, Bank of America
and you. BA Securities, as arranger, reserves the right (in consultation with
the Company and Bank of America) to allocate the commitments offered by the
Banks.
In addition to the conditions to funding or closing set forth in the Term
Sheet, Bank of America's commitment to provide the
<PAGE>
Page 3
financing is subject to (i) the accuracy and completeness of the information
concerning WLR that is publicly available or that has been or will be provided
by you; (ii) the negotiation and execution of a definitive bank loan agreement
and other related documentation, satisfactory to Bank of America; and (iii)
there being no material adverse change in the financial condition, business,
operations, properties or prospects of the Company or WLR and its consolidated
subsidiaries from the date of the audited financial statements most recently
provided prior to the date hereof.
The Term Sheet is intended only as an outline of principal terms and
conditions, and does not purport to summarize all of the terms, conditions,
covenants, representations and warranties, defaults, and other provisions that
will be contained in the definitive legal documentation for the Facility and
the transactions contemplated thereby. Such definitive legal documentation
will include other provisions customary for this type of financing transaction
or otherwise appropriate, in the view of the Banks, to the Financing.
The Company hereby agrees to indemnify and hold harmless each of Bank of
America and BA Securities, and their respective directors, officers, employees
and affiliates (each, an "INDEMNIFIED PERSON") from and against any and all
losses, claims, damages, liabilities (or actions or other proceedings
commenced or threatened in respect thereof) and expenses that arise out of,
result from or in any way relate to the purchase of the Shares, the proposed
Merger, the Tender Offer, this commitment letter, or the providing or
syndication of the Facility, and to reimburse each indemnified person, upon
its demand, for any legal or other expenses (including the allocated cost of
in-house counsel) incurred in connection with investigating, defending or
participating in any such loss, claim, damage, liability or action or other
proceeding (whether or not such indemnified person is a party to any action or
proceeding out of which any such expenses arise), other than any of the
foregoing claimed by any indemnified person to the extent incurred by reason
of the gross negligence or willful misconduct of such person. Neither Bank of
America nor BA Securities shall be responsible or liable to the Company or any
other person for any consequential damages which may be alleged.
In addition, the Company hereby agrees to reimburse Bank of America and BA
Securities from time to time upon demand for their reasonable out-of-pocket
costs and expenses (including the allocated cost of in-house counsel) incurred
by Bank of America or BA Securities in connection with the Facility,
regardless of whether the credit agreement is executed or the Facility closes.
<PAGE>
Page 4
If the foregoing is satisfactory to you, please indicate your agreement and
acceptance below and return the enclosed counterpart of this letter to us.
Upon your delivery to us of a signed copy of this letter and the Fee Letter,
this letter agreement shall become a binding agreement, under New York law, as
of the date so accepted. This letter will survive the closing of the
Facility.
This letter and the Term Sheet are confidential and, except for disclosure to
your board of directors, officers and employees, to professional advisors
retained by you in connection with this transaction, to WLR or as may be
required by law (in connection with the Tender Offer, the Merger, or
otherwise), may not be disclosed in whole or in part to any other person or
entity without our prior written consent. No such consent shall give rise to
any third-party beneficiary as to our commitment.
This offer will terminate on March 11, 1994 unless on or before that date you
sign and return the enclosed counterpart of this letter and the Fee Letter.
This commitment will expire on May 10, 1994 if the Facility has not closed on
or before that date.
We are pleased to have this opportunity and look forward to working with you.
Very truly yours,
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION
By: /S/ J. STEPHEN MERNICK
-------------------------
J. Stephen Mernick
Senior Vice President
BA SECURITIES, INC.,
as Arranger
By: /S/ JOHN A. FINAN
-------------------------
John A. Finan
Vice President
ACCEPTED AND AGREED TO:
this 2nd day of March, 1994
TYSON FOODS, INC.
By: /S/ GERALD JOHNSTON
-------------------------
Title: EVP FINANCE
----------------------
<PAGE>
SUMMARY OF INDICATIVE TERMS
$400,000,000 Acquisition Facility
BORROWER: Tyson Foods, Inc. (the "Borrower")
ARRANGER: BA Securities, Inc. (the "Arranger")
AGENT: Bank of America National Trust and Savings
Association (the "Agent")
PURPOSE: General corporate purposes including the
purchase of the stock of WLR Foods, Inc.
and related expenses.
AMOUNT: Up to $340,000,000. The aggregate of Bid
Loans and advances shall not exceed
$340,000,000.
FACILITY: A 364-day revolving credit facility (the
"Facility") providing for short-term
advances with interest periods of up to
six months/180 days. Amounts borrowed and
repaid may be subsequently reborrowed and
repaid during the commitment availability
period.
In addition to drawing committed advances,
commitments may be utilized by inviting
Banks to bid for advances ("Bid Loans")
during the commitment availability period.
Total committed advances and Bid Loan
outstandings under the Facility may not
exceed the Facility Amount.
TERM OPTION: At a predetermined time prior to maturing,
Borrower may elect to convert the
outstanding amount of the Facility to a
one year term loan.
COMMITMENT AVAILABILITY: 364-days from the closing of the credit
agreement.
AVAILABILITY: Committed advances shall be in a minimum
principal amounts of $5,000,000 and in
multiples of $1,000,000 in excess thereof
and subject to three days' prior written
notice in the case of LIBOR advances and
two days' prior
<PAGE>
2
written notice in the case of CD Rate
advances. Same day advances may be made
on a Reference Rate basis.
BID OPTION: The Bid Loan Option will be available on
an uncommitted basis through a competitive
auction mechanism. The Borrower may from
time to time invite bids for advances.
Requests for such bids shall be for
minimum principal amounts of $5,000,000
and in multiples of $1,000,000 in excess
thereof. The Borrower shall be under no
obligation to accept any of the bids
received. Each Bank may (but shall not be
required to) bid for advances in excess of
its respective commitment.
VOLUNTARY REDUCTION OR
CANCELLATION: Upon three business days' prior written
notice, the Borrower may reduce without
penalty all or a portion of the Facility
unutilized for advances, in minimum
amounts of $5,000,000 and in multiples of
$1,000,000 in excess thereof.
VOLUNTARY PREPAYMENT: The Borrower may prepay at any time
without penalty committed advances minimum
amounts of $5,000,000 subject to three
days' prior written notice in the case of
LIBOR advances provided that LIBOR or CD
Rate advances prepaid at any time other
than at maturity shall be subject to
reimbursement of break-funding costs and
related expenses, if any.
COMMITMENT FEE: A per annum fee, payable quarterly in
arrears and upon termination of the
Facility, calculated on a 360-day basis on
a the daily unused portion of the Facility
in accordance with the attached Pricing
Matrix. Bid Loans will not
<PAGE>
3
count as usage in the calculation of their
fee.
INTEREST ON COMMITTED
ADVANCES: The Borrower shall have the option to
choose between domestic dollar and
eurodollar funding, at per annum interest
margins that will vary according to credit
ratings of the Borrower as outlined in the
attached Pricing Matrix.
DEFAULT INTEREST RATE: Interest will accrue at an agreed upon
premium of two percent (2%) above the
prevailing rate if an Event of Default
exists.
DOCUMENTATION: Documentation shall include but not be
limited to: representations and warranties,
covenants and events of default customary
in credit agreements.
INDEMNITIES: Those customary in credit agreements of
this type, including but not limited to
increased costs, capital adequacy, taxes
and duties, and break funding.
REPRESENTATION
AND WARRANTIES: Those customary in credit agreements of
this type, including but not limited to:
corporate existence; corporate
authorization; enforceability; financial
information; environmental matters;
compliance with laws; no material
litigation; payment of taxes; and full
disclosure.
COVENANTS: Those customary in credit agreements of
this type including, but not limited to,
the following financial covenants (which
will mirror the covenant definitions and
levels in the existing $350 million and
$500 million credit facilities):
1. Consolidated Net Worth
2. Interest Coverage Test Ratio
<PAGE>
4
3. Debt Ratio
EVENTS OF DEFAULT: Those customary in credit agreements of
this type, including, but not limited to:
failure to pay any interest, principal, or
fees payable under the credit agreement;
failure to meet covenants; cross default
to other debt of the Borrower.
GOVERNING LAW: State of New York
<PAGE>
TYSON FOODS, INC.
$340,000,000 ACQUISITION FACILITY
Pricing Grid*
(in basis points)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Senior Unsecured Pricing Level Pricing Level Pricing Level Pricing Level Pricing Level
Debt Rating I: II: III: IV: Level V:
A-/A and BBB+/Baa BBB/Baa BBB-/Baa Below
Above BBB-/Baa
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Commitment Fee:
- ---------------------------------------------------------------------------------------------------------------------
Total Undrawn Cost:
- ---------------------------------------------------------------------------------------------------------------------
Libor Margin:
- ---------------------------------------------------------------------------------------------------------------------
Base Rate Margin:
- ---------------------------------------------------------------------------------------------------------------------
Total Drawn Cost:
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
<FN>
* Intentionally left blank for filing and exhibit purposes.
</TABLE>
NOTES:
- -----------------------
1. Senior unsecured debt ratings as assigned by Standard & Poor's or
Moody's rating agencies. In the event of a split rating, the higher
rating will determine the applicable pricing level.
2. In the event of a material adverse change in the loan syndication or
capital markets which would have a substantial negative impact on the
ability to syndicate the Facility, the Borrower and Agent agree to
renegotiate the above pricing and/or other terms and conditions in order
to successfully syndicate the Facility.
<PAGE>
EXHIBIT 99.10
UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF VIRGINIA
HARRISONBURG DIVISION
WLR FOODS, INC.,
Plaintiff,
v. CIVIL ACTION NO. 94-0012(H)
TYSON FOODS, INC.,
Defendant.
AMENDED COMPLAINT FOR
DECLARATORY AND INJUNCTIVE RELIEF
Plaintiff WLR Foods, Inc. ("WLR"), by its undersigned attorneys,
for its complaint, upon knowledge with respect to itself and its own acts and
upon information and belief as to all other matters, alleges:
I. NATURE OF ACTION
1. This Action seeks a declaration that WLR's Shareholder
Protection Rights Agreement (the "Rights Plan"), adopted on February 4, 1994,
is valid and was duly adopted in full conformance with applicable law and that
any rights to be issued pursuant to the Rights Plan (the "Right(s)") are
valid, binding and legally enforceable under state and federal law.
2. This action also seeks a declaration that Article 14, Va. Code
Sections 13.1-1-725, ET SEQ., and Article 14.1, Va. Code Sections 13.1 1-728.1,
ET SEQ., of Virginia's Stock Corporation Act (collectively the "Articles") are
constitutional under the Virginia and the United States Constitutions and
valid under any other applicable law. The Articles were adopted by the
<PAGE>
Commonwealth of Virginia as a means of protecting Virginia corporations and
their shareholders.
II. JURISDICTION
3. This Court has jurisdiction over this matter pursuant to 28
U.S.C. Section1331, 28 U.S.C. Section1332 (a) (1) and 28 U.S.C. Section2201.
III. PARTIES
4. WLR is a Virginia corporation with its principal executive
offices in Rockingham County, Virginia. Shares of WLR's common stock are
publicly traded on the NASDAQ National Market System.
5. Defendant Tyson Foods, Inc. ("Tyson") is a Delaware
corporation with its principal executive offices in Springdale, Arkansas.
IV. CLAIMS
6. By letter dated January 24, 1994, Tyson proposed to WLR's
board of directors a merger of WLR and Tyson (or a subsidiary of Tyson)
pursuant to which the shareholders of WLR would receive $30.00 in cash for
each of their WLR shares (a copy of the letter is attached hereto as EXHIBIT
A and is incorporated by reference). In that letter, Tyson stated, among
other things, that the proposal was contingent upon WLR's board of directors
not using what Tyson termed any "Poison Pills" or other "Anti-Takeover"
measures to "obstruct a merger." This language indicates that Tyson believes
a basis may exist for challenging the validity of measures such as the Rights
Plan.
7. Tyson's January 24, 1994 letter also made its acquisition
proposal contingent upon the WLR board of directors
<PAGE>
taking necessary action to prevent the Virginia Stock Corporation Act from
being an "impediment" to the proposed merger. This condition to Tyson's
proposed acquisition indicates that Tyson believes a basis may exist for
challenging the validity of provisions of Virginia's Stock Corporation Act
("Stock Corporation Act"), including the Articles.
8. By letter dated February 6, 1994, WLR rejected Tyson's January
24, 1994 acquisition proposal (a copy of the letter is attached hereto as
EXHIBIT B and is incorporated by reference).
A. ARTICLES 14 AND 14.1 OF VIRGINIA'S STOCK
CORPORATION ACT ARE CONSTITUTIONAL
9. Article 14 of the Stock Corporation Act ("Article 14")
prohibits a corporation from engaging in certain transactions including
mergers, with an "interested shareholder" for three years from the date that
the person is determined by the corporation's board of directors to be an
"interested shareholder." An "interested shareholder" is defined by Article
14 to be, among other things, the beneficial owner of more than ten percent of
any class of outstanding voting shares of the corporation.
10. Article 14 provides for certain exceptions from the
requirements of the Article, including an exception for transactions approved
by a majority of the disinterested directors of the corporation and two-thirds
of the voting shares (other than those shares beneficially owned by the
interested shareholder).
<PAGE>
11. Article 14.1 of the Stock Corporation Act ("Article 14.1")
limits the voting rights of the shares of a corporation acquired, in a
"control share acquisition." A "control share acquisition" is defined by
Article 14.1 to be the direct or indirect acquisition of sufficient shares to
give the owner various specified levels of voting power in connection with the
election of directors of the corporation.
12. Article 14.1 provides for certain exceptions from its
requirements. For instance, the corporation's board of directors may take
certain actions, under specified procedures and conditions, that will remove
the acquisition from the limitations imposed by Article 14.1. In addition,
any acquiring person may request that the corporation call a special meeting
of the shareholders for the purpose of considering the voting rights to be
granted shares acquired or to be acquired in the control share acquisition.
13. Articles 14 and 14.1 were adopted by the Commonwealth of
Virginia as a means of protecting Virginia corporations and their shareholders
and do not conflict with either the Virginia or the United States
Constitutions or any other applicable law.
14. In its January 24, 1994 letter, Tyson states that its
proposal is contingent on WLR's board of directors taking action "necessary to
prevent the Virginia Corporation Act from being an impediment to the proposed
merger" and the board of directors not using the Act to "disadvantage Tyson in
the purchase of" WLR's stock. Thus, rather than viewing and respecting the
Articles as a measure by the Commonwealth of
<PAGE>
Virginia to protect Virginia corporations and their shareholders, Tyson
apparently believes them to be an "impediment" and "disadvantage" to its
acquisition efforts.
B. WLR'S SHAREHOLDER RIGHTS PLAN IS VALID
15. At a meeting held on February 4, 1994, WLR's board of
directors adopted the Rights Plan. In adopting the plan, the board of
directors and each of its members acted in good faith, in conformity with
fiduciary and other duties, and conducted a reasonable investigation which
included receiving the advice of the company's management and legal and
financial advisors.
16. Pursuant to the Rights Plan, among other provisions, the
board of directors declared a dividend distribution of one Right for each
outstanding share of the Company's common stock (the "Common Stock"). The
occurrence of certain events, including commencement of a tender offer for
acquisition of at least 15% of WLR's common stock, entitles the holder of each
Right to purchase one-hundredth of a share of WLR Participating Preferred
Stock at a price set by the board of directors in consultation with the
Company's financial advisers (the "Exercise Price"). The Participating
Preferred Stock would be designed so that each one-hundredth of a share has
economic and voting terms similar to those of one share of Common Stock.
17. If any person acquires 15% or more of the outstanding Common
Stock (the "Flip-in trigger"), then:
(i) Rights owned by the person acquiring such stock or
transferees thereof will automatically be void; and
<PAGE>
(ii) each other Right will automatically became a right to buy,
for the Exercise Price, that number of shares of Common
Stock or Participating Preferred Stock having a market value
of twice the Exercise Price.
The Rights may be redeemed by the board of directors, at any time until a
Flip-in trigger has occurred, at a Redemption Price of $0.01 per Right.
18. WLR believes and alleges that the Rights Plan is valid and
lawful and was duly adopted in full conformance with applicable law, and that
its adoption was a legitimate exercise of business judgment by WLR's board of
directors, and not otherwise contrary to Virginia state law and federal laws.
The Rights Plan is binding in all respects, valid and enforceable.
19. Based on the language of Tyson's January 24, 1994 letter, WLR
believes and alleges that the defendant or persons or entities acting in
concert with them or on their behalf will contest (a) the constitutionality or
validity otherwise of Articles 14 and 14.1 and (b) the validity of the Rights
Plan and the Rights. Thus, an actual controversy exists between the parties
to this action which is within the power of this Court to determine pursuant
to 28 U.S.C. Sections 2201-2202. This Court's determination of the issues
presented herein will afford relief from uncertainty and insecurity with respect
to rights, status, and legal relations between the parties.
20. Without a declaratory judgment, WLR and its shareholders will
be deprived of the assurance that (a) Articles 14 and 14.1 are applicable to
Tyson's efforts to acquire the
<PAGE>
corporation and (b) the Rights Plan was validly adopted and the Rights
thereunder exercisable.
21. WLR has no adequate remedy at law as to matters which require
injunctive relief.
WHEREFORE, plaintiff hereby requests that the Court enter a
judgment:
a. Declaring that Articles 14 and 14.1 of the Virginia Stock
Corporation Act, are valid, lawful and binding under both the Virginia and the
United States Constitutions and any other applicable laws.
b. Declaring that:
(i) the Rights Plan and the
Rights are valid, lawful
and binding;
(ii) the Rights Plan was
adopted in full compliance
with the laws of the
Commonwealth of Virginia
and any other applicable
law; and
(iii) the Rights distributed
pursuant thereto will be
valid and enforceable.
c. Temporarily, preliminarily and permanently enjoining
defendant, its affiliates, subsidiaries, officers, directors, and all others
acting in concert with them or on their behalf, from bringing any action in
any other court (a) challenging the constitutionality and validity of Articles
14 and 14.1 of the Virginia Stock Corporation Act; (b) attacking any aspect of
the Rights Plan, including the Plan's adoption under Virginia or in regard to
any other applicable law; and/or (c) otherwise relating to or involving
Tyson's proposal to acquire
<PAGE>
WLR and the response to that proposal by WLR and/or its directors, officers or
agents, under state law and/or federal law.
d. Awarding to WLR and against defendant, costs and disbursements
of this action, including reasonable attorneys fees, if permitted by law; and
e. Granting such further relief to WLR as may be just and proper
under the circumstances.
____________________________
Douglas L. Guynn
VSB No. 19748
Wharton, Aldhizer & Weaver
A Professional Limited
Liability Company
100 South Mason Street
Harrisonburg, Virginia 22801
(703) 434-0316
Attorneys for Plaintiff
OF COUNSEL:
William R. Norfolk
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
(212) 558-4000
Dated: February 9, 1994
<PAGE>
EXHIBIT 99.11
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF VIRGINIA
HARRISONBURG DIVISION
______________________________
)
WLR FOODS, INC. )
)
Plaintiff, )
)
v. )
)
TYSON FOODS, INC., )
)
Defendant. )
)
and )
)
TYSON FOODS, INC., )
) Civil Action No. 94-0012(H)
Counterclaimant, )
)
v. )
)
WLR FOODS, INC., )
)
Counterclaim- )
Defendant, )
)
and )
)
GEORGE E. BRYAN, )
CHARLES L. CAMPBELL, )
STEPHEN W. CUSTER, )
CALVIN G. GERMROTH, )
WILLIAM H. GROSECLOSE, )
J. CRAIG HOTT, )
JAMES L. KEELER, )
HERMAN D. MASON, )
CHARLES W. WAMPLER, JR., )
WILLIAM D. WAMPLER, )
)
Additional Counter- )
Claim Defendants. )
____________________________________)
ANSWER, AFFIRMATIVE DEFENSES
AND COUNTERCLAIMS OF TYSON FOODS, INC.
--------------------------------------
<PAGE>
ANSWER
Defendant Tyson Foods, Inc. ("Tyson"), by counsel, answers WLR Foods,
Inc.'s ("WLR") Amended Complaint as follows:
1. Admits that the Amended Complaint purports to seek a declaratory
judgment regarding the "Rights Plan" as that term is defined in the Amended
Complaint. The remaining allegations are legal conclusions which do not
require a response. To the extent a response is required, Tyson denies them.
2. Admits that the Amended Complaint purports to seek a declaration
that Article 14, Va. Code Sections 13.1-725 ET SEQ. and Article 14.1, Va. Code
Sections 13.1-728.1 ET SEQ. of Virginia's Stock Corporation Act are
constitutional under the Virginia and United States Constitutions. The
remaining allegations are legal conclusions which do not require a response.
To the extent a response is required, Tyson denies them.
3. Denies, except to the extent the allegations constitute legal
conclusions which require no response.
4. Admits.
5. Admits.
6. Admits that Tyson believes a basis may exist for challenging the
validity of measures such as the Rights Plan. Tyson denies the remaining
allegations, except to the extent that the letter dated January 24, 1994 is
quoted accurately.
7. Admits that Tyson believes a basis may exist for challenging the
validity of provisions of Virginia's Stock Corporation Act. Tyson denies the
remaining allegations, except to the extent the letter dated January 24, 1994
is quoted accurately.
<PAGE>
8. Admits.
9. Denies, except to the extent that the allegations constitute legal
conclusions to which no response is required.
10. Denies, except to the extent that the allegations constitute legal
conclusions to which no response is required.
11. Denies, except to the extent that the allegations constitute legal
conclusions to which no response is required.
12. Denies, except to the extent that the allegations constitute legal
conclusions to which no response is required.
13. Denies, except to the extent that the allegations constitute legal
conclusions to which no response is required.
14. Denies, except to the extent that the letter dated January 24,
1994 is quoted accurately.
15. Admits that Tyson is aware that the Board of Directors of WLR
adopted a "Shareholders Rights Plan." Tyson is without sufficient information
to admit or deny the remaining allegations and therefore denies them.
16. Admits that Tyson is aware that the WLR Board of Directors adopted
a "Shareholders Rights Plan." Tyson refers to the full text of the
"Shareholders Rights Plan" for its content.
17. Admits that Tyson is aware that the WLR Board of Directors adopted
a "Shareholders Rights Plan." Tyson refers to the full text of the
"Shareholders Rights Plan" for its content.
18. Denies, except to the extent that the allegations constitute legal
conclusions to which no response is required.
19. Tyson is without knowledge or information sufficient to form a
belief as to the truth of the allegations relating to WLR's belief. Tyson
denies the remaining allegations except to
<PAGE>
the extent that the allegations constitute legal conclusions to which no
response is required.
20. Denies, except to the extent that the allegations constitute legal
conclusions to which no response is required.
21. Denies, except to the extent that the allegations constitute legal
conclusions to which no response is required.
22. The remaining allegations are a demand for relief to which no
response is required. To the extent a response is required; Tyson denies
them.
23. Tyson denies every allegation not specifically admitted.
AFFIRMATIVE DEFENSES
1. The Amended Complaint fails to state a claim upon which relief may
be granted.
2. WLR is guilty of unclean hands.
3. The claims pleaded are barred by the doctrine of estoppel.
4. The claims pleaded are barred by the doctrine of illegality.
5. The claims pleaded are barred by WLR's fraud, which is set forth
in the Counterclaims.
COUNTERCLAIMS
Counterclaim plaintiff Tyson, by counsel, states as its counterclaims:
<PAGE>
THE PARTIES
1. Tyson is a Delaware corporation with its principal place of
business in Arkansas. Tyson has operations throughout the United States,
including facilities in the Commonwealth of Virginia. At all relevant times,
Tyson owned shares of WLR. Tyson purchased additional shares at times during
the relevant period.
2. WLR is a Virginia corporation with its principal place of business
in Rockingham County, Virginia. Shares of WLR's common stock are publicly
traded on the NASDAQ National Market System.
3. George E. Bryan, Charles L. Campbell, Stephen W. Custer, Calvin G.
Germroth, William H. Groseclose, J. Craig Hott, James L. Keeler, Herman D.
Mason, Charles W. Wampler, Jr., and William D. Wampler "("Directors") are
members of the WLR Board of Directors.
JURISDICTION AND VENUE
4. This Court has subject matter jurisdiction over these
counterclaims pursuant to:
(a) 28 U.S.C. Section 1331 because the matter in controversy
arises under the United States Constitution and the laws of the United States;
(b) 28 U.S.C. Section 1332 because there is complete diversity of
citizenship between the counterclaim plaintiff and the counterclaim defendants
and the amount in controversy, exclusive of interest and costs, exceeds
$50,000;
(c) 28 U.S.C. Section 1337(a) because the action arises under an
act of Congress regulating commerce;
<PAGE>
(e) 28 U.S.C. Section 1367 under the principles of supplemental
jurisdiction.
FACTUAL BACKGROUND
5. On January 24, 1994, Tyson sent a letter to the Board of Directors
of WLR proposing a merger of WLR with Tyson (or a subsidiary of Tyson).
Tyson's merger offer proposed to pay WLR shareholders $30.00 per share in cash
for each of their shares. This offer represented a premium to WLR
shareholders of approximately $110 million or 56% over the pre-offer market
share price for WLR stock. Tyson requested a response to its January 24th
letter by close of business on February 4, 1994. No response from WLR was
received by that time.
6. On January 25, 1994, James L. Keeler sent a letter on behalf of
the Directors to WLR shareholders in which WLR promised to "keep you posted on
important corporate developments."
7. On February 4, 1994, the WLR Board held a meeting in which they
rejected Tyson's proposal. At that February 4 meeting, WLR's board took a
series of actions designed to erect numerous barriers that would insulate WLR
from any acquisition not approved by the WLR board. Through its actions,
WLR's board attempted to impose its will on WLR's shareholders, by eliminating
any opportunity for those shareholders to exercise their shareholder rights
thereby attempting to deprive them of the benefits of an acquisition proposal
from Tyson or any other third party not endorsed by the Board of Directors.
8. Specifically, at the February 4, 1994 Board meeting, the
Directors:
<PAGE>
(a) adopted a Shareholder Rights Agreement ("Poison Pill");
(b) adopted certain executive severance arrangements ("Golden
Parachutes");
(c) adopted certain severance packages for salaried and hourly
employees ("Other Parachutes");
(d) amended the corporate bylaws of WLR relating to the roles
that the Chairman and Vice Chairman of WLR play as officers to enhance
management's voting power to block Tyson's merger proposal;
(e) took actions which denied WLR's disinterested shareholders
the opportunities to consider Tyson's proposal; and
(f) purported to terminate the employment of a number of WLR
officers, while at the same time promising to expend substantial sums for the
benefit of those officers in the future, again to enhance management's voting
power to block Tyson's merger proposal.
These actions are described in WLR's Form 10-Q for the quarterly period
ending January 1, 1994, which was filed with the Securities and Exchange
Commission on February 15, 1994 ("Form 10-Q").
9. Pursuant to the Poison Pill, the Board of Directors of WLR
declared, among other provisions, that a dividend of one "Right" per
outstanding share of WLR stock be issued to WLR stockholders.
10. The Poison Pill provides that it is triggered, or "flips-in," when
any person acquires voting control of 15% or more of the outstanding Common
Stock of WLR. Once triggered, the
<PAGE>
Poison Pill provides that the Rights owned by the acquiring person are
automatically void, and all other Rights holders automatically may purchase
for shares of Common Stock in WLR at half the market price. The Board of
Directors of WLR may redeem the Rights at anytime before the flip-in trigger
occurs for $0.01 per Right.
11. The Poison Pill adopted by the Board of Directors of WLR makes any
acquisition of more than 15% of the shares of WLR prohibitively expensive to
any prospective acquirors. In addition to imposing a severe financial penalty
on a potential acquiror, the "flip-in" of the Poison Pill would cut that
potential acquiror's voting rights almost in half. As a result, the adoption
of the Poison Pill has the effect of deterring any takeover offers for WLR
except those that are approved by the Board of Directors of WLR. Through
their adoption of the Poison Pill, the Board of Directors of WLR have
entrenched themselves and the present officers of WLR in their positions, and
at the same time have deprived WLR's shareholders of the opportunity to
consider lucrative offers for their shares.
12. The Golden Parachutes fall into at least three categories. In the
first category is James L. Keeler, President and Chief Executive Officer of
WLR. If Keeler decides to leave WLR during a specified period after a "Change
of Control" (as that term is defined in the Golden Parachutes) in WLR, Keeler
will receive three times his total compensation, including base salary,
bonuses, and deferred compensation. In addition, Keeler would receive a cash
payment equivalent to the value of his stock options which are not vested at
the time of the Change of
<PAGE>
Control, and his fringe benefits such as health insurance will be extended for
three years. The Board provided that Keeler's compensation will be "grossed
up" if necessary to ensure this level of compensation is received by Keeler as
a net amount and any taxes ordinarily paid by Keeler will be borne by WLR.
Under Federal tax law, however, a substantial portion of those payments may
not be deducted by WLR for federal income tax purposes.
13. In the second category of Golden Parachutes are Delbert L. Seitz,
Chief Financial Officer, Secretary, and Treasurer of WLR, and James L. Mason,
President of Wampler-Longacre, Inc., a subsidiary of WLR. The terms of
Messrs. Seitz' and Mason's Golden Parachutes are identical to those of Mr.
Keeler's Golden Parachute, including the "gross up" provision, except that
they do not include deferred compensation.
14. The third category of Golden Parachutes provide certain executives
with a payment equal to 150% of their annual compensation (base salary plus
bonuses) if the individual is terminated after a "Change in Control." The
individuals in the third category will also receive a cash payment equivalent
to the value of their stock options which are not vested at the time of the
Change of Control and their fringe benefits, such as health insurance, will be
extended for one and one-half years. Again, where applicable, these benefits
will be "grossed up" at WLR's expense.
15. The terms of the Other Parachutes are not disclosed in the 10Q,
thereby depriving Tyson and the other shareholders from learning the true cost
to WLR of these precipitous acts by the Directors. Also, because of the
gross-up provisions of the
<PAGE>
Golden Parachutes, the shareholders are further deprived of learning
information about the true cost to WLR caused by the Directors' self-serving
actions.
16. The Golden Parachutes adopted by the Board of Directors of WLR
provide for extremely lucrative financial benefits to WLR's present
management, a number of whom presently are members of WLR's Board of
Directors. At the same time, the Golden Parachutes and Other Parachutes
adopted by the Board of Directors make any acquisition of WLR considerably
more expensive, and thereby reduce the likelihood of any such acquisition, or
at the least reduce the price that WLR's shareholders might receive as a
result of any such acquisition. WLR has never disclosed the true financial
cost of the Golden Parachutes and Other Parachutes that it has conferred on
its officers and employees. These costs, which cannot be calculated based on
available information run into an undeterminable number of millions of
dollars.
17. In addition, the WLR Board adopted a bylaw that provides that the
record date for any special meeting held pursuant to the Virginia Control
Share Acquisitions statute will be the day on which an Acquiring Person (as
defined by the statute) requests such a meeting. Other provisions of the
Virginia Control Share Acquisitions statute regarding the timing of such a
meeting, and the solicitations that may precede such a meeting, make it
extremely difficult for any third party to prevail against management at such
a meeting. The bylaw adopted by the Board compounds any such third party's
problems because it maintains voting rights for numerous shareholders who will
have sold their shares to purchasers who will not have had advance
<PAGE>
knowledge of a record date. Accordingly, the purchasing shareholders will be
disenfranchised at a special meeting held pursuant to the Control Share
Acquisitions statute. On the other hand, the selling shareholders who will
maintain their voting rights will have little incentive to vote at all. Such
non-voters would be counted against the third party, and in favor of
management. The bylaw, in combination with other provisions of the Virginia
Control Share Acquisitions statute, make it extremely unlikely that a third
party could effectively make its case to WLR's shareholders in connection with
a meeting, and thereby eliminates the possibility that WLR's shareholders will
have the opportunity to participate in a fair referendum with respect to a
third party's participation in WLR's future. Moreover, in light of the bylaw
adopted by WLR, the operation of the Virginia Control Share Acquisitions
statute would conflict with the operation of federal law regarding the
solicitation of proxies.
18. Also on February 4, 1994, the Directors amended the corporate
Bylaws purporting to "clarify" that the roles of the Chairman of the Board and
the Vice Chairman of the Board are officers of the Board, not of WLR.
Notwithstanding this supposed "clarification", in truth and in fact, both the
Chairman and the Vice Chairman of the Board have always acted as officers of
WLR, as well as to WLR's Board. Simultaneously, two members of the Board,
William D. Wampler and George E. Bryan resigned as Senior Vice Presidents; and
Charles W. Wampler, Jr., Herman D. Mason, William D. Wampler, and George E.
Bryan, the four of whom who
<PAGE>
control well in excess of 10% of the shares of WLR, resigned as employees of
WLR but remained as directors.
19. The sole motive for the actions described in paragraph 18 was to
circumvent the fundamental purpose of the Control Share Acquisitions statute
which is to leave solely to the disinterested shareholders the decision
whether "interested" shareholders will have a right to vote on a transaction.
These cynical acts by the Directors are intended directly to dilute the voting
power of the disinterested shareholders, allowing these four directors the
opportunity to vote their shares, totalling well in excess of 10% of the
outstanding voting shares of WLR, while at the same time barring Tyson from
exercising its voting rights, all in direct violation of the plain intent of
the statute. The effect of the Board's actions is compounded by the fact that
under the Control Share Acquisitions statute, Tyson will be unable to vote its
shares, thereby enhancing the voting rights of the remaining shareholders.
Thus, unless the Board's actions are rescinded, its own officers who have a
plain interest in the outcome of a special meeting called pursuant to the
Control Share Acquisitions Act, will have enhanced voting power because of the
statute's provision that Tyson will not be able to vote its own shares at such
a meeting.
20. On February 6, 1994, defendant Charles W. Wampler, Jr., Chairman
of WLR, sent a letter to the Chairman of the Board of Directors of Tyson
reporting that the WLR Board unanimously rejected Tyson's offer of merger.
<PAGE>
21. By letter dated February 6, 1994, WLR announced to the public that
on February 4, 1994 the Directors rejected Tyson's January 24, 1994 merger
proposal.
22. Also on February 6, 1994, the Directors sent a letter to WLR's
shareholders describing the Poison Pill.
23. None of the February 6, 1994 letters nor any other voluntary
communication revealed the actions taken by the Board of Directors of WLR that
are described in paragraphs 8 (b)-(e), 12-14 or 17-18.
24. These actions were only made public through the compulsory filing
of the Form 10-Q, eleven days after the fact.
COUNT I
25. Tyson realleges paragraphs 1-24.
26. In its Amended Complaint, WLR seeks a declaration that the
Virginia Affiliated Transactions Statute is constitutional.
27. On its face and as applied, the Virginia Affiliated Transactions
Statute essentially gives a Virginia corporation's pre-existing board of
directors DE FACTO veto power over mergers and therefore thwarts
shareholder democracy and burdens interstate commerce.
28. By denying a meaningful opportunity for success by any possibly
interested merger partner other than one receiving the pre-existing board's
approval, the Virginia Affiliated Transactions statute on its face and as
applied:
(a) is preempted by the Williams Act and therefore violates the
Supremacy Clause of the United States Constitution;
<PAGE>
(b) violates the Commerce Clause of the United States
Constitution.
29. The unconstitutionality of the Virginia Affiliated Transactions
Statute has injured and continues to injure Tyson because it:
(a) diminishes the value of Tyson's shares in WLR; and
(b) may affect Tyson's ability to merge with WLR.
COUNT II
30. Tyson incorporates paragraphs 1-24.
31. The Virginia Control Share Acquisitions statute defines
"interested shares" in pertinent part as the shares of a corporation subject
to the statute, the voting of which may be exercised or directed by (a) an
acquiror with respect to a control share acquisition; (b) any officer of a
corporation subject to the statute; and (c) any employee of a corporation
subject to the statute who is also a director of the corporation. Va. Code
Section 13.1-728.1.
32. Among other things, the Virginia Control Share Acquisitions
statute provides that shares acquired in a control share acquisition, as that
term is defined by the statute, shall have no voting rights unless voting
rights are granted by resolution adopted by a majority of all the votes which
could be cast in an election of directors by all outstanding shares, other
than "interested shares," which are not entitled to vote on the matter. Va.
Code Section13.1-728.3(A)-(B).
33. The actions taken by the WLR Board of Directors on February 4,
1994, including (a) the amendments made to the WLR
<PAGE>
corporate bylaws relating to the roles that the Chairman and Vice Chairman
play as officers of the corporation; (b) the resignations of Additional
Counterclaim Defendants William D. Wampler and George E. Bryan as Senior
Vice-Presidents; and (c) the termination of compensation from WLR to
Additional Counterclaim Defendants Charles W. Wampler, Jr., Herman D. Mason,
William D. Wampler, and George E. Bryan, were intended to circumvent the clear
purpose of the statute by allowing "interested shares" owned by "management"
to vote in a manner prohibited by Va. Code Section13.1-728.3(B).
34. Notwithstanding the actions taken by the WLR Board described in
paragraph 18, the shares owned or controlled by Additional Counterclaim
Defendants W. Wampler, C. Wampler, Bryan and Mason are "interested shares"
under the Virginia Control Share Acquisitions statute.
35. An actual controversy exists concerning whether the shares owned
or controlled by Additional Counterclaim Defendants W. Wampler, C. Wampler,
Bryan and Mason are "interested shares" prohibited from voting on a resolution
to extend voting rights to shares acquired in a control share acquisition as
provided by Va. Code Section13.1-728.3(A).
36. Similarly, if the Court determines that the bylaw described above
in paragraph 18 is not rescinded, then such statute as applied:
(a) is preempted by federal proxy law developed under Section 14
of the Securities Exchange Act of 1934 and thereby violates the Supremacy
Clause of the United States Constitution; and,
<PAGE>
(b) violates the Commerce Clause of the United States
Constitution.
37. In the event the Directors' actions described in paragraph 15 are
not rescinded, Tyson is entitled to a declaratory judgment, pursuant to 28
U.S.C. Section 2201, that all WLR shares owned directly, indirectly or
beneficially, by Additional Counterclaim Defendants W. Wampler, C. Wampler,
Bryan and Mason, are "interested shares" under the Virginia Control Share
Acquisitions statute and accordingly may not be voted in the referendum
provided by the statute.
38. Alternatively, if the Court determines that the shares owned
directly, indirectly or beneficially, by Additional Counterclaim Defendants W.
Wampler, C. Wampler, Bryan and Mason, are not "interested shares" under the
Virginia Control Share Acquisitions statute, then such statute as applied:
(a) is preempted by the Williams Act and therefore violates the
Supremacy Clause of the United States Constitution;
(b) violates the Commerce Clause of the United States
Constitution.
39. The unconstitutionality of the Virginia Control Share Acquisitions
statute as applied has injured and continues to injure Tyson because it:
(a) diminishes the value of Tyson's shares in WLR; and
(b) may affect Tyson's ability to merge with WLR.
COUNT III
40. Tyson realleges paragraphs 1-24.
<PAGE>
41. The operation of the Virginia Affiliated Transactions Statute, the
Virginia Control Share Acquisitions statute, and Va. Code Section 13.1-646,
taken together, on their face and as applied, gives a Virginia corporation's
pre-existing board of directors a DE FACTO veto power over mergers, and
therefore thwarts shareholder democracy and burden interstate commerce by,
among other things:
(a) allowing intransigent management to manipulate the record
date for determining stock ownership to deprive shareholders of the ability to
vote their shares in a fully informed and meaningful way;
(b) discouraging shareholders from voting their stock by
permitting a discriminatory poison pill to be adopted in the face of a
noncoercive proposal, particularly when combined with the manipulation of
these statutes by the Board as in this case;
(c) frustrating the full purposes and objectives of Congress in
enacting the Williams Act by giving intransigent management the ability to
impede a noncoercive proposal without consulting shareholders; and
(d) impermissibly tilting the balance between management and an
acquiror in the context of a noncoercive proposal.
42. By denying a meaningful opportunity for success by any possibly
interested merger partner in the face of intransigent management, the
operation of the Virginia Affiliated Transaction statute, the Virginia Control
Share Acquisitions statute, and Va. Code Section13.1-646, taken together, on
their face and as applied,
<PAGE>
(a) are preempted by the Williams Act and therefore violate the
Supremacy Clause of the United States Constitution;
(b) violate the Commerce Clause of the United States
Constitution.
43. The unconstitutionality of these Virginia statutes have injured
and continue to injure Tyson because they:
(a) diminish the value of Tyson's shares in WLR; and
(b) may affect Tyson's ability to merge with WLR.
COUNT IV
44. Tyson realleges paragraphs 1-24.
45. The Directors have fiduciary duties and a duty of loyalty to WLR's
shareholders and others.
46. The actions described in paragraphs 7-18 violate these fiduciary
duties; are contrary to the interests of WLR's shareholders; and are intended
to entrench WLR's present management in its positions at WLR by making an
acquisition by Tyson or any other third party practically impossible, all for
the purpose of protecting existing management and depriving shareholders the
opportunity to consider a non-coercive proposal.
Specifically, the actions taken by the Board of Directors of WLR:
(a) allow intransigent management to manipulate the Record Date
of stock ownership to deprive shareholders of the ability to vote their stock;
(b) discourage shareholders from voting their shares by
permitting a discriminatory poison pill to be adopted in the face of a
noncoercive proposal;
<PAGE>
(c) frustrate the full purposes and objectives of Congress in
enacting the Williams Act by giving intransigent management the ability to
defeat a noncoercive proposal without consulting shareholders;
(d) impermissibly tilt the balance between management and a
potential acquiror in the context of a noncoercive proposal;
(e) burden WLR with increased and undisclosed costs through
operation of the Golden and Other Parachutes;
(f) manipulate WLR's Bylaws and the status of WLR's officers
solely for the purpose of entrenching existing management;
(g) fail to disclose Board action to the shareholders in a
timely and meaningful way; and
(h) establish a series of corporate artifices in an attempt to
deprive the shareholders of the opportunity to consider the Tyson proposal in
a fully-informed manner.
47. These violations have injured and continue to injure Tyson because
they:
(a) diminish the value of Tyson's shares in WLR; and
(b) may affect Tyson's ability to merge with WLR.
IRREPARABLE INJURY
48. Unless preliminary and permanent injunctive relief is granted,
Tyson will be irreparably harmed because it will be denied the opportunity to
have its proposal freely and fairly considered by WLR's shareholders, and
WLR's shareholders will be
<PAGE>
irreparably harmed because they will be denied the opportunity to consider
and, if they so choose, to accept Tyson's proposal.
49. Unless preliminary and permanent injunctive relief is granted,
Tyson will be irreparably harmed in at least the following additional
respects:
(a) Tyson will be denied a meaningful opportunity to consummate the
proposal;
(b) WLR's management will hold a decided and unlawful advantage in
opposing Tyson's proposal;
(c) Tyson will be compelled to terminate its efforts to acquire
control of WLR due to the economic and financial uncertainties posed by the
Virginia statutes, the Poison Pill, the Golden Parachutes, the Other
Parachutes, and the Board's other actions described above;
(d) WLR's shareholders will be discouraged from tendering their shares
to Tyson because of the economic and financial uncertainty created by the
Virginia statutes, the Poison Pill, the Golden Parachutes, the Other
Parachutes, and the Board's other actions described above;
(e) Tyson will be deprived of the opportunity to acquire control of
WLR, a unique business;
(f) Tyson will suffer a massive dilution of its equity and voting
interest in WLR, pursuant to a discriminatory, unlawful, and ULTRA VIRES
Poison Pill; and
(g) Tyson will be subjected to unnecessary and unreasonable delay in
obtaining the approval of any business combination by the incumbent Board of
Directors and management, which could prevent it from consummating an
acquisition of WLR.
<PAGE>
50. Unless preliminary and permanent injunctive relief is granted,
WLR's shareholders, including any residing in the Commonwealth of Virginia,
will be irreparably harmed by losing their right to sell their shares to Tyson
at a premium.
51. The foregoing circumstances constitute a deprivation of Tyson's
rights under the Williams Act, the United States Constitution, and the laws of
the Commonwealth of Virginia, and will result in irreparable injury to Tyson,
to WLR shareholders, and to the investing public.
RELIEF SOUGHT
52. Tyson has no adequate remedy at law.
53. Tyson seeks a declaration that:
(a) the Virginia Affiliated Transactions statute (Va. Code Section
13.1-725 ET SEQ.) on its face and as applied is unconstitutional;
(b) the Control Share Acquisitions Statute (Va. Code Section
13.1-728.1, ET. SEQ.) as applied is unconstitutional;
(c) Section 13.1-646 of the Virginia Stock Corporation Act as
applied is unconstitutional;
(d) the Directors breached their fiduciary duties and duty of
loyalty in taking the actions described in the Counterclaims;
(e) the Poison Pill, Golden Parachutes and Other Parachutes are
invalid;
(f) notwithstanding the actions taken by the WLR Board described
in paragraph 18, the shares owned by Additional Counterclaim Defendants W.
Wampler, C. Wampler, Bryan and Mason
<PAGE>
are "interested shares" under the Virginia Control Share Acquisitions Statute.
54. Tyson seeks to temporarily, preliminarily and permanently:
(a) enjoin defendants from taking any action invoking the terms
of the Virginia Affiliated Transactions and Control Share Acquisitions
statutes;
(b) enjoin defendants from taking any action in furtherance of
the Poison Pill, Golden Parachutes or Other Parachutes;
(c) directing the Directors to rescind the actions described in
paragraphs 8-18;
(d) directing the Directors to redeem the Poison Pill;
(e) directing the individuals identified in paragraph
18 to rescind the transactions described in paragraph 18.
(f) directing the Directors to rescind the bylaw described above in
paragraph 18, or in the alternative enjoin the operation of such bylaw.
55. Tyson seeks such other and further relief as this Court may deem
just and proper, including its costs and attorney's fees.
Respectfully submitted,
TYSON FOODS, INC.
BY: /S/ R. CRAIG WOOD
------------------
Of Counsel
<PAGE>
James L. Sanderlin (VSB #05878)
Thomas E. Spahn (VSB #17411)
Thomas F. Farrell, II (VSB #19109)
R. Craig Wood (VSB #24264)
McGUIRE, WOODS, BATTLE & BOOTHE
One James Center
901 East Cary Street
Richmond, VA 23219
(804) 775-1000
Russell E. Brooks
MILBANK, TWEED, HADLEY & McCLOY
1 Chase Manhattan Plaza
New York, NY 10005-1413
(212) 530-5000
James R. Sipe, Esq. (VSB #3742)
LITTEN & SIPE
Post Office Box 712
410 Neff Avenue
Harrisonburg, VA 22801
(703) 434-5353
Attorneys for Defendant and
Counterclaimant, Tyson Foods, Inc.
CERTIFICATE OF SERVICE
A copy of this document was mailed on February 25, 1994, to:
William R. Norfolk, Esq.
SULLIVAN & CROMWELL
125 Broad Street
New York, NY 10004
Douglas L. Guynn, Esq.
WHARTON, ALDHIZER & WEAVER
100 S. Main Street
Harrisonburg, VA 22801
/S/ R. CRAIG WOOD
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