<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant To Section 14(a) of The
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
TRIAD PARK, LLC
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ ] No fee required.
[X] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
membership interests, no par value
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(2) Aggregate number of securities to which transaction applies:
17,695,965 shares
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
$1.32 per share purchased ($23,358,673)
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(4) Proposed maximum aggregate value of transaction:
$23,358,673
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(5) Total fee paid:
$4,672
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[ ] Fee paid previously with preliminary materials.
[X] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
$4,672
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(2) Form, Schedule or Registration Statement No.:
Schedule 13E-3
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(3) Filing Party:
Joint-Triad Park, LLC, TPL Acquisition, LLC, and Richard C. Blum
& Associates, LP
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(4) Date Filed:
October 14, 1997
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<PAGE> 2
TRIAD PARK, LLC
3055 TRIAD DRIVE
LIVERMORE, CA 94550
NOVEMBER , 1997
DEAR SHAREHOLDER:
You are cordially invited to attend a special meeting of shareholders of
Triad Park, LLC (the "Company") to be held at the offices of the Company, 3055
Triad Drive, Livermore, California, on , December , 1997 at 9:00
a.m. local time (the "Special Meeting"). A Notice of the Special Meeting, a
Proxy Statement, related information about the Company and a proxy card are
enclosed. All holders of the Company's outstanding membership interests (the
"Shares") as of November , 1997 are entitled to notice of and to vote at the
Special Meeting.
At the Special Meeting, you will be asked to consider and to vote upon a
proposal to approve an Agreement of Merger, dated September 9, 1997 (the "Merger
Agreement"), by and among the Company, Richard C. Blum & Associates, LP, a
California limited partnership ("RCBA"), and TPL Acquisition, LLC, a Delaware
limited liability company (the "Acquisition LLC"), an affiliate of RCBA,
pursuant to which the Acquisition LLC will be merged into the Company (the
"Merger"). If the Merger Agreement is approved and the Merger becomes effective,
each outstanding Share will be converted into the right to receive $1.32 in
cash. Approval of the Merger requires the affirmative vote of the holders of a
majority of the voting power of all outstanding Shares. Details of the proposed
Merger and other important information are set forth in the accompanying Proxy
Statement, which you are urged to read carefully.
YOUR ADVISORY BOARD HAS APPROVED THE MERGER AND RECOMMENDS THAT YOU VOTE
FOR APPROVAL AND ADOPTION OF THE MERGER AGREEMENT. Whether or not you plan to
attend the Special Meeting, please complete, sign and date the accompanying
proxy card and return it in the enclosed postage prepaid envelope. If you attend
the Special Meeting, you may revoke such proxy and vote in person if you wish,
even if you have previously returned your proxy card.
Thank you for your interest and participation.
Sincerely,
James R. Porter
Vice President, 3055 Management Corp.,
Manager of the Company
THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE FAIRNESS OR MERITS OF
SUCH TRANSACTION NOR UPON THE ACCURACY OR ADEQUACY OF THE INFORMATION CONTAINED
IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
<PAGE> 3
TRIAD PARK, LLC
3055 TRIAD DRIVE
LIVERMORE, CALIFORNIA 94550
------------------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON , DECEMBER , 1997
------------------------
To Shareholders of Triad Park, LLC:
The Advisory Board has called a special meeting of the shareholders of
Triad Park, LLC, a Delaware limited liability company (the "Company"), to be
held at the offices of the Company, 3055 Triad Drive, Livermore, California, on
, December , 1997 at 9:00 a.m. local time, including any
adjournments or postponements (the "Special Meeting"), to consider and act upon
the following matters:
1. To consider and vote upon a proposal to approve an Agreement of
Merger, dated September 9, 1997 (the "Merger Agreement"), among the
Company, Richard C. Blum & Associates, LP, a California limited partnership
("RCBA"), and TPL Acquisition, LLC, a Delaware limited liability company
and affiliate of RCBA (the "Acquisition LLC"), pursuant to which, among
other things, (i) the Acquisition LLC will be merged into the Company (the
"Merger"), and (ii) each outstanding membership interest of the Company
(the "Shares") will be converted into the right to receive $1.32 in cash
(the "Merger Consideration"). A copy of the Merger Agreement is attached as
Exhibit A to the accompanying Proxy Statement.
2. To transact such other business as may properly come before the
Special Meeting.
Only holders of record of the Shares at the close of business on November
, 1997 are entitled to notice of and to vote at the Special Meeting. RCBA,
which beneficially holds 1,998,158 Shares (representing approximately 10.1% of
the voting power of the Shares) has notified the Company that it intends to vote
its Shares in favor of the Merger.
No appraisal or dissenters' rights are provided for the Company
shareholders under applicable law, nor will the Company or RCBA be voluntarily
providing appraisal rights to the Company shareholders who object to the
transactions contemplated by the Merger Agreement. Therefore, if the Merger is
approved, shareholders who voted against the Merger will be required to accept
the Merger Consideration in exchange for their interests in the Company. See
"RIGHTS OF DISSENTING SHAREHOLDERS."
Your attention is directed to the Proxy Statement and its Exhibits and the
other materials relating to the Company that have been included in this mailing
for more complete information regarding the Merger Agreement and the Company.
THE ADVISORY BOARD RECOMMENDS A VOTE FOR APPROVAL OF THE MERGER AGREEMENT.
By Order of the Advisory Board
James R. Porter
Vice President, 3055 Management Corp.,
Manager of the Company
Livermore, California
November , 1997
YOUR VOTE IS IMPORTANT. ALL SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND
THE SPECIAL MEETING. WHETHER OR NOT YOU PLAN TO ATTEND, PLEASE MARK, SIGN AND
DATE THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. YOU MAY
NEVERTHELESS VOTE IN PERSON IF YOU ATTEND THE SPECIAL MEETING.
<PAGE> 4
TRIAD PARK, LLC
------------------------
PROXY STATEMENT
------------------------
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON , DECEMBER , 1997
------------------------
This Proxy Statement is being furnished to the shareholders of Triad Park,
LLC, a Delaware limited liability company (the "Company"), in connection with
the solicitation by the Advisory Board of the Company of proxies to be voted at
a special meeting of shareholders of the Company to be held at the offices of
the Company, 3055 Triad Park, Livermore, California, on , December ,
1997 at 9:00 a.m. local time, including any adjournments or postponements (the
"Special Meeting"). At the Special Meeting, the shareholders of the Company will
consider and vote upon a proposal to approve an Agreement of Merger, dated
September 9, 1997 (the "Merger Agreement"), among the Company, Richard C. Blum &
Associates, LP, a California limited partnership ("RCBA"), and TPL Acquisition,
LLC, a Delaware limited liability company and affiliate of RCBA (the
"Acquisition LLC"), pursuant to which, among other things, (i) the Acquisition
LLC will be merged into the Company (the "Merger"), with the result that the
Company will become an affiliate of RCBA, and (ii) each outstanding membership
interest of the Company (the "Shares"), will be converted into the right to
receive $1.32 in cash. See "The Merger Agreement -- Consideration To Be Received
by Shareholders."
This Proxy Statement is accompanied by a copy of the Company's Quarterly
Report on Form 10-QSB for the quarters ended June 30 and September 30, 1997.
These materials are specifically incorporated by reference in this Proxy
Statement and are included to aid shareholders in their consideration of the
Merger.
Only holders of record of the Shares at the close of business on November
, 1997 are entitled to notice of and to vote at the Special Meeting. This
Proxy Statement is first being sent to shareholders on or about November ,
1997.
------------------------
THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE
FAIRNESS OR MERITS OF SUCH TRANSACTION NOR UPON THE ACCURACY OR ADEQUACY OF THE
INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
<PAGE> 5
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
SUMMARY............................................................................... 1
Date, Time and Place of Special Meeting............................................. 1
Record Date; Shareholders Entitled to Vote; Quorum.................................. 1
Purpose of the Meeting.............................................................. 1
The Merger.......................................................................... 1
Effective Time of the Merger........................................................ 2
Voting of Shares Owned by RCBA...................................................... 2
Special Factors..................................................................... 2
Payment for Shares.................................................................. 3
Dissenters' Rights.................................................................. 3
Regulatory Approvals................................................................ 3
The Company......................................................................... 3
RCBA................................................................................ 3
Market Price and Dividend Data...................................................... 4
THE COMPANY........................................................................... 5
History............................................................................. 5
Business of the Company............................................................. 5
Properties of the Company........................................................... 5
THE SPECIAL MEETING................................................................... 8
General............................................................................. 8
Proposal to be Considered at the Special Meeting.................................... 8
Record Date; Shareholder Approval................................................... 8
Proxies............................................................................. 8
SPECIAL FACTORS....................................................................... 9
Background of the Merger............................................................ 9
Purpose and Structure of the Merger................................................. 12
Recommendation of the Company's Advisory Board...................................... 13
Sedway Report....................................................................... 14
Perspective of RCBA on the Merger................................................... 15
Plans for the Company After the Merger.............................................. 15
Certain Effects of the Merger....................................................... 16
Relationship Between the Company and RCBA........................................... 16
Interests of Certain Persons in the Merger.......................................... 16
Sources and Uses of Funds........................................................... 17
Certain Federal Income Tax Consequences............................................. 17
Redemptions of Shares............................................................... 19
Regulatory Approvals................................................................ 19
THE MERGER AGREEMENT.................................................................. 20
General............................................................................. 20
Effective Time...................................................................... 20
Consideration To Be Received by Shareholders........................................ 20
Payment for Shares.................................................................. 20
Operations of the Company Prior to the Merger....................................... 21
Conditions to Consummation of the Merger............................................ 21
Termination......................................................................... 22
</TABLE>
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<TABLE>
<CAPTION>
PAGE
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<S> <C>
Termination Fee..................................................................... 23
Accounting Treatment................................................................ 23
RIGHTS OF DISSENTING SHAREHOLDERS..................................................... 23
SHARE OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS........................... 24
Share Ownership..................................................................... 24
Transactions by Certain Persons in the Shares....................................... 25
MANAGEMENT OF THE COMPANY, RCBA AND THE ACQUISITION LLC............................... 26
The Company......................................................................... 26
RCBA and Affiliates................................................................. 26
The Acquisition LLC................................................................. 27
Certain Proceedings................................................................. 27
SHAREHOLDER PROPOSALS................................................................. 27
INDEPENDENT PUBLIC ACCOUNTANTS........................................................ 27
INFORMATION INCORPORATED BY REFERENCE................................................. 28
AVAILABLE INFORMATION................................................................. 28
ADDITIONAL INFORMATION................................................................ 28
EXHIBIT A -- Agreement of Merger...................................................... A-1
</TABLE>
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SUMMARY
The following is a summary of certain information contained elsewhere in
this Proxy Statement. The following summary is not intended to be complete and
is qualified in its entirety by reference to the more detailed information
contained in this Proxy Statement, in the materials accompanying this Proxy
Statement, in the Exhibits and in the documents incorporated by reference.
Shareholders are urged to review the entire Proxy Statement and accompanying
materials carefully.
DATE, TIME AND PLACE OF SPECIAL MEETING
A Special Meeting of Shareholders of Triad Park, LLC will be held on ,
December , 1997 at 9:00 a.m. local time at the offices of the Company, 3055
Triad Drive, Livermore, California.
RECORD DATE; SHAREHOLDERS ENTITLED TO VOTE; QUORUM
Only holders of record of the Company's membership interests (the "Shares")
at the close of business on November , 1997 (the "Record Date") are entitled
to notice of and to vote at the Special Meeting. On that date, there were
approximately 19,708,123 Shares outstanding, held of record by approximately
1,358 shareholders. Each holder of Shares is entitled to one vote per Share on
the matters to be voted upon at the Special Meeting. See "THE SPECIAL
MEETING -- Record Date; Shareholder Approval." The presence, in person or by
proxy, at the Special Meeting of the holders of a majority of the voting power
of the outstanding Shares is necessary to constitute a quorum at the Special
Meeting.
PURPOSE OF THE MEETING
At the Special Meeting, shareholders will consider and vote upon a proposal
to approve the Merger Agreement, a copy of which is attached as Exhibit A to
this Proxy Statement. See "THE SPECIAL MEETING -- Proposal To Be Considered at
the Special Meeting." The Merger Agreement provides for the merger of the
Acquisition LLC into the Company.
THE MERGER
Pursuant to the Merger Agreement, the Acquisition LLC will merge into the
Company, with the result that the Company, as the surviving company (the
"Surviving Company"), will become an affiliate of RCBA. See "THE MERGER
AGREEMENT -- General." Each outstanding Share will be converted into the right
to receive from the Acquisition LLC or RCBA $1.32 in cash, without interest (the
"Merger Consideration"). See "THE MERGER AGREEMENT -- Consideration To Be
Received by Shareholders." After the Merger, RCBA will own all of the
outstanding membership interests of the Surviving Company. The Shares will no
longer be traded on the open market and the registration of the Shares under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), will be
terminated. See "SPECIAL FACTORS -- Certain Effects of the Merger."
Approval of the Merger requires the affirmative vote of the holders of a
majority of the voting power of all outstanding Shares. See "THE SPECIAL
MEETING -- Record Date; Shareholder Approval."
The Merger is subject to various closing conditions and the absence of any
event that would have a material adverse effect on the assets, properties,
liabilities, obligations, financial condition, results of operations or business
of the Company. See "THE MERGER AGREEMENT -- Conditions to Consummation of the
Merger."
The Merger Agreement may, under specified circumstances, be terminated and
the Merger abandoned at any time prior to the filing of a Certificate of Merger
with the Delaware Secretary of State, notwithstanding approval of the Merger
Agreement by the shareholders of the Company. The Merger Agreement requires the
Company to pay the Acquisition LLC a termination fee of $1.3 million if the
Merger is not consummated and if (i) the Merger Agreement shall not have been
submitted for approval and adoption by the Company shareholders at a shareholder
meeting prior to January 31, 1998 (unless the meeting is held later solely due
to delays in obtaining approval of this proxy statement by the Securities and
Exchange Commission (the
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"Commission")), (ii) the Advisory Board of the Company recommends to the
Company's shareholders a third party proposal regarding a merger, consolidation,
sale of assets, sale of securities or similar transaction (an "Acquisition
Proposal"), or (iii) the Company enters into an agreement with a third party
regarding an Acquisition Proposal. See "THE MERGER AGREEMENT -- Termination" and
"-- Termination Fee."
EFFECTIVE TIME OF THE MERGER
Unless otherwise agreed by the parties to the Merger Agreement or otherwise
provided by law, the Merger will become effective upon the acceptance for
recording of the Certificate of Merger by the Delaware Secretary of State (the
"Effective Time"). Subject to approval of the Merger at the Special Meeting and
the satisfaction or waiver of the terms and conditions in the Merger Agreement,
the Effective Time is expected to occur as soon as practicable after the Special
Meeting. See "THE MERGER AGREEMENT -- Effective Time."
VOTING OF SHARES OWNED BY RCBA
The General Partner of RCBA, which beneficially holds 1,998,158 Shares
(representing approximately 10.1% of the outstanding Shares), has approved the
Merger and has notified the Company that it intends to vote its Shares in favor
of the Merger. Because RCBA is entitled to vote substantially less than 50.0% of
the voting power of the outstanding Shares, approval of the Merger is not
assured as a result of the voting power held by RCBA. See "THE SPECIAL
MEETING -- Record Date; Shareholder Approval."
SPECIAL FACTORS
In determining whether to vote in favor of the Merger, shareholders of the
Company should consider the following special factors, as well as the other
factors discussed elsewhere in this Proxy Statement under the caption "SPECIAL
FACTORS":
PURPOSE AND STRUCTURE OF THE MERGER. The purpose of the Merger is to effect
the sale of the Company to RCBA in a transaction that will provide the Company
shareholders cash for their Shares at a price that the Advisory Board of the
Company believes to be fair. The Advisory Board believes the Merger is the most
effective means of achieving the purpose of liquidating the shareholders'
investment in a reasonable time at a reasonable price. See "SPECIAL
FACTORS -- Purpose and Structure of the Merger."
RECOMMENDATION OF THE COMPANY'S ADVISORY BOARD. The Advisory Board of the
Company has determined that the Merger is fair from a financial point of view to
and in the best interests of the Company's shareholders (other than RCBA). The
Advisory Board has approved the Merger Agreement and recommends that the
Company's shareholders vote in favor of the proposal to approve and adopt the
Merger Agreement. See "SPECIAL FACTORS--Recommendation of the Company's Advisory
Board."
SEDWAY REPORT. On July 22, 1997, Sedway Group, a real estate and urban
economics firm ("Sedway Group") delivered a written report to the Company's
Advisory Board recommending a disposition strategy for maximization of the
Company's real estate assets. Sedway Group's report forecasted proceeds of $25.6
million if its disposition strategy was followed. See "SPECIAL FACTORS -- Sedway
Report."
INTERESTS OF CERTAIN PERSONS IN THE MERGER. In considering the
recommendation of the Advisory Board of the Company with respect to the Merger
Agreement and the transactions contemplated thereby, shareholders should be
aware that certain officers and Advisory Board members of the Company have
interests in connection with the consummation of the Merger that may conflict
with the interests of the Company's shareholders. See "SPECIAL
FACTORS -- Interests of Certain Persons in the Merger."
FEDERAL INCOME TAX CONSEQUENCES. For federal income tax purposes, the
Merger will be treated as a taxable sale or exchange of Shares for cash by each
holder of the Shares. The amount of gain or loss to be recognized by each
shareholder will be measured by the difference between the amount of cash
received by such shareholder in connection with the Merger plus such
shareholder's share of the Company's liabilities less such shareholder's tax
basis in the Shares at the Effective Time. See "SPECIAL FACTORS -- Certain
Federal Income Tax Consequences."
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PAYMENT FOR SHARES
As promptly as possible after the Effective Time, instructions will be
furnished to holders of Shares regarding procedures to be followed to surrender
their certificates and receive payment for their Shares. See "THE MERGER
AGREEMENT -- Payment for Shares."
DISSENTERS' RIGHTS
No appraisal or dissenters' rights are provided for the Company
shareholders under the Delaware limited liability company act or under the
Company's limited liability company agreement, nor will the Company or RCBA be
voluntarily providing appraisal rights to the Company shareholders who object to
the transactions contemplated by the Merger Agreement. Therefore, if the Merger
is approved, shareholders who voted against the Merger will be required to
accept the Merger Consideration in exchange for their interests in the Company.
See "RIGHTS OF DISSENTING SHAREHOLDERS."
REGULATORY APPROVALS
Although no particular regulatory approval is required in connection with
the proposed Merger, state Attorneys General and private parties may bring legal
actions under the federal or state antitrust laws under certain circumstances.
See "SPECIAL FACTORS -- Regulatory Approvals."
THE COMPANY
The Company was formed on February 10, 1997. The Company's manager is 3055
Management Corp., a California corporation ("Management Corp."). The Company's
primary assets consist of three buildings and improvements (comprising 220,000
square feet) situated on approximately 15 acres of land in Triad Park,
Livermore, California (the "Headquarters") and 303 acres of undeveloped land
located in Triad Park (the "Land", the Land and the Headquarters, collectively
the "Property"). The Company was formed to liquidate its investment in the
Property. In the absence of any liquidation, the Company's principal business
has been to own, operate, improve and maintain the Property.
The principal executive office of the Company is located at 3055 Triad
Drive, Livermore, California 94550, and the Company's telephone number is (510)
449-0606.
RCBA
RCBA is a California limited partnership whose principal business is acting
as general partner for investment partnerships and providing investment advisory
and financial consulting services. RCBA is a registered investment adviser with
the Commission. The sole general partner of RCBA is Richard C. Blum &
Associates, Inc., a California corporation ("RCBA Inc."). RCBA Inc. is in turn
controlled, for purposes of the federal securities laws, by Richard C. Blum, the
Chairman and a substantial shareholder of RCBA Inc.
The principal executive office of RCBA is located at 909 Montgomery Street,
Suite 400, San Francisco, California 94133, and its telephone number is (415)
434-1111.
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MARKET PRICE AND DIVIDEND DATA
The Shares are publicly traded, although the Shares are not registered for
trading on any exchange. The Company is aware that bid and ask prices have been
quoted over the Internet under the symbol "TDPK." The following table sets forth
the range of high and low bid quotations per Share as quoted on the OTC Bulletin
Board. The quotations reflect inter-dealer prices, without retail mark-up,
mark-down or commission and may not represent actual transactions.
<TABLE>
<CAPTION>
BID QUOTATIONS
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HIGH LOW
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<S> <C> <C>
1997
Third Quarter (July 31 through September 30)............... $1.26 $0.75
Fourth Quarter (through October 9)......................... $1.30 $1.26
</TABLE>
On August 13, 1997, the last full day of trading prior to the filing of the
RCBA Schedule 13D (as defined herein) which disclosed RCBA's interest in
acquiring the Company, such reported high and low bid quotations per Share was
$0.75 in both cases. On November , 1997, the last full day of trading prior to
the printing of this Proxy Statement, the reported high and low bid quotations
per Share were $ and $ , respectively. SHAREHOLDERS ARE URGED
TO OBTAIN A CURRENT MARKET QUOTATION FOR THEIR SHARES.
The Company has never paid a cash distribution on the Shares and does not
anticipate paying any such distribution in the foreseeable future.
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THE COMPANY
HISTORY
Prior to the Company's formation, the real estate assets now owned by the
Company were owned by Triad Systems Corporation, a Delaware corporation
("Triad") and its wholly-owned subsidiary, 3055 Triad Dr. Corp., a California
corporation ("3055 Triad Dr. Corp."). 3055 Triad Dr. Corp. was the owner of the
Headquarters as well as a certain portion of the Land, and Triad was the owner
of the remainder of the Land.
On October 23, 1996, Cooperative Computing, Inc., a Texas corporation
("CCI"), through a wholly owned subsidiary, commenced a tender offer (the
"Offer") to purchase all of the outstanding shares of common stock of Triad. The
Offer contemplated that, among other things, certain real property assets of
Triad and 3055 Triad Dr. Corp. would be spun off to the shareholders of Triad in
a dividend to be declared prior to the consummation of the Offer. The dividend
was declared on February 26, 1997.
The Company was organized under the laws of the State of Delaware as a
limited liability company on February 10, 1997 as a spin-off of Triad. At the
time of the formation of the Company, 3055 Triad Dr. Corp., the owner of the
Headquarters, was merged with and into Triad, with Triad being the surviving
corporation. On February 27, 1997, the Offer was consummated, CCI merged with
Triad, and Triad became known as Cooperative Computing, Inc., a Delaware
corporation, aka CCI/Triad ("CCI/Triad").
BUSINESS OF THE COMPANY
The Company's Shares are owned 99% by the former shareholders of Triad and
1% by Management Corp. The Management Corp. is the exclusive operator of the
Company's business except that certain actions require the approval of its
Advisory Board (the "Advisory Board"). The Advisory Board was responsible for
considering, reviewing and analyzing the Merger Agreement and the other
competing offers.
The Company's main objective is to liquidate its investment in the
Property. In the meantime, the Company will own, operate, improve and maintain
the Property. The Company may enter into joint ventures with third parties for
the purpose of disposing of the Property if the Advisory Board determines that
such arrangements are appropriate to the purposes of the Company.
There can be no assurance that the Company will be successful in its
efforts to dispose of the Property or that the Company will realize a profit
from its activities. The Company will be subject to all of the market forces
which impact the ownership and operation of real property, including market
supply and demand, interest rates, local, regional and national economic
conditions, local land use policies and restrictions, construction costs,
competition from other sellers and landlords, and the effects of inflation. The
Company is unable to predict the amount of time it will take to completely
dispose of the Property and wind up the Company.
PROPERTIES OF THE COMPANY
Pursuant to that certain Real Estate Distribution Agreement dated as of
February 26, 1997 between Triad, 3055 Triad Dr. Corp., Management Corp. and the
Company (the "Distribution Agreement"), Triad contributed to the Company certain
of its real estate assets located in Livermore, California, consisting primarily
of the Headquarters, subject to the existing first deed of trust, and the Land,
subject to existing assessment bonds, and the right to certain refunds for
infrastructure expenditures from the City of Livermore (the "Contribution").
In conjunction with the Contribution, the Company agreed in the
Distribution Agreement to indemnify CCI/Triad against any claims relating to
"Environmental Costs and Liabilities" associated with the Land or the
Headquarters prior to the Contribution. These "Environmental Costs and
Liabilities" include all costs, liabilities, losses, claims and expenses arising
from or under any "environmental law." The term "environmental law" is defined
to include any applicable law regulating or prohibiting releases into any part
of the natural environment, or pertaining to the protection of natural
resources, the environment and public and employee health and safety including,
among other law, the Comprehensive Environmental Response, Compensation,
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<PAGE> 12
and Liability Act (CERCLA), the Hazardous Materials Transportation Act, the
Resource Conservation and Recovery Act (RCRA), the Clean Water Act, the Clean
Air Act, the Toxic Substances Control Act, and the Occupational Safety and
Health Act, and any applicable state or local statutes.
Subject to certain limitations, the Company also agreed in the Distribution
Agreement to indemnify CCI/Triad against certain taxes arising from, or relating
to, among other things, any sale of the Property after October 17, 1996, the
Company, the formation of the Company, the transfer by Triad or any affiliate of
Triad of the Property to the Company, the assumption or refinancing of any
liabilities with respect to the Property and the sale, exchange or distribution
of interests in the Company by CCI/Triad.
The Property consists of approximately 303 acres of unimproved land and the
220,000 (approximate) square feet of office contained in three separate
buildings situated on 15 acres of land occupied by CCI/Triad. The Property is
located on the north side of Interstate 580 in the City of Livermore,
California. The City of Livermore is located approximately 40 miles southeast of
San Francisco.
All of the buildings are of concrete tilt-up construction and were built in
1987. Building G is a two story office building containing approximately 70,986
square feet. Building K is a 74,064 square foot single story research and
development building and Building F is a single story industrial flex building
of 74,768 square feet. The office build-out in Buildings K and F is 90 percent
and 40 percent, respectively. The Company's management believes that the
Headquarters is adequately insured. There are 689 parking spaces associated with
the Headquarters. The parking area is landscaped and the areas between the
buildings are improved as open courtyards, fenced with iron gates for controlled
access. Although the buildings were primarily designed for owner-occupancy, they
were also designed to be flexible to allow multi-tenant occupancy.
The 303 acres of vacant land is divided into land use categories of
residential, industrial/office flex, retail and open space. The residential
portion consists of three lots comprising approximately 28.1 useable acres. The
industrial/office flex portion is divided into eight lots and contains
approximately 114.6 acres. The retail/commercial portion is divided into ten
lots and contains approximately 35.9 useable acres. The total useable area for
these lots is approximately 141 acres. In addition, there are two lots, one of
approximately 112 acres designated for open space or agricultural use and one
lot of 4.54 acres dedicated for transportation improvements. Finally,
approximately 7.8 acres are to be developed as public roadways. Approximately
half the required offsite improvements are in place, funded through a
combination of assessment bonds and community facility bonds. The construction
of the remaining offsite improvements are expected to be funded through
additional community facility bonds, as further described below in the final
paragraph of this section. Several of the vacant land sites are in escrow and
most of the remaining sites are subject to a first right of refusal contract.
Two residential lots, comprising 19.4 acres, are in escrow to be sold to a
single purchaser for a total price of $2,900,000 plus current assessments and up
to approximately $1,500,000 of future assessments on these lots and an adjacent
lot. This transaction is subject to the satisfaction of several material
conditions, and the closing is not assured.
One 19.3 acre lot is subject to a seven day right of first offer held by
Lincoln Property Co., starting at $3.99 per square foot and increasing 5% per
year, plus assessments. In addition, Lincoln Property Co. has the right of first
offer on 8 lots plus the above mentioned lot. Finally, a previous purchaser of a
lot holds a three year option, commencing September 1996, on 3.4 to 6 acres of
land adjacent to the lot it owns. The option price is $3.60 per square foot plus
assessments for two years, increasing to $5.50 for the third year.
The Property is partially improved with infrastructure improvements,
including curbs, gutters, storm drains and typical utilities. A community
facilities bond issue was completed on March 24, 1997, the proceeds of which
funded the reimbursement to the Company of $1,485,000 for completed
infrastructure, created a $600,000 security fund for future infrastructure
obligations, and will fund $3,700,000 for in-progress infrastructure
improvements. In addition, there are $7,000,000 of new bonds which are planned
to be sold in the future to fund the remaining improvements required for
completion of Triad Park. The current cost estimates for the required
improvements indicate that the community facilities bond funding limits should
be adequate to cover the expenses of the remaining items of improvement.
However, design and engineering is
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not complete and there is a significant possibility that the actual cost of the
improvements may be greater than estimated and may exceed the bond funding
limit. Any shortfall in the bond funding will be borne by the Company or by
purchasers of lots, which may have an adverse impact on the value of the Land.
The remaining required improvements are scheduled to be completed by 2000.
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THE SPECIAL MEETING
GENERAL
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Advisory Board of the Company for a Special Meeting of
Shareholders to be held on December , 1997 at 9:00 a.m. local time at the
offices of the Company, 3055 Triad Drive, Livermore, California, and as may be
adjourned to a later date. Shares represented by properly executed proxies
received by the Company will be voted at the Special Meeting in accordance with
the terms of the proxies, unless the proxies are revoked. See "-- Proxies"
below.
PROPOSAL TO BE CONSIDERED AT THE SPECIAL MEETING
At the Special Meeting, the shareholders of the Company will consider and
vote upon a proposal to approve and adopt the Merger Agreement. Pursuant to the
Merger Agreement, the Acquisition LLC will merge with and into the Company, the
separate corporate existence of the Acquisition LLC will cease, and the Company
will be the Surviving Company. At the Effective Time, each outstanding Share
will be converted into the right to receive $1.32 in cash. A copy of the Merger
Agreement is attached as Exhibit A to this Proxy Statement.
In addition to approval of the Merger Agreement and the Merger,
shareholders of the Company may be asked to approve a proposal to adjourn the
Special Meeting to permit further solicitation of proxies in the event there are
not sufficient votes at the time of the Special Meeting to approve and adopt the
Merger Agreement. It is not anticipated that any other matters will be brought
before the Special Meeting. However, if other matters should come before the
Special Meeting, it is intended that the holders of Proxies will vote upon them
in their discretion, unless that authority is withheld in the Proxy.
RECORD DATE; SHAREHOLDER APPROVAL
Only holders of record of the Shares at the close of business on November
, 1997 are entitled to notice of and to vote at the Special Meeting. On that
date, there were 19,708,123 Shares outstanding, which were held of record by
approximately 1,358 shareholders. Each Share entitles its holder to one vote
concerning all matters properly coming before the Special Meeting. A majority of
the voting power of the Shares entitled to vote, represented in person or by
proxy, will constitute a quorum. Abstentions and broker non-votes (i.e. Shares
held by brokers in street name, voting on certain matters due to discretionary
authority or instructions from the beneficial owner but not voting on other
matters due to lack of authority to vote on those matters without instructions
from the beneficial owner) are counted for the purpose of establishing a quorum
and will have the same effect as a vote against the approval of the Merger. The
Merger must be approved by the holders of at least a majority of the voting
power of all outstanding Shares. RCBA, which beneficially owns 1,998,158 Shares
(representing approximately 10.1% of the voting power of the Shares), has
notified the Company that it intends to vote its Shares in favor of the Merger.
Because RCBA is entitled to vote substantially less than 50.0% of the voting
power of all outstanding Shares, approval of the Merger is not assured as a
result of the voting power held by RCBA.
Although they have not specifically agreed to do so, the Company believes
that each of the Advisory Board members and executive officers of the Company
will vote the Shares with respect to which he has voting power in favor of the
Merger. Such Shares represent less than 8% of the Shares entitled to vote at the
Special Meeting. See "SHARE OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL
OWNERS."
PROXIES
Any Company shareholder entitled to vote at the Special Meeting may vote
either in person or by duly authorized proxy. All Shares represented by properly
executed proxies received prior to or at the Special Meeting and not revoked
will be voted in accordance with the instructions indicated in the proxies. IF
NO INSTRUCTIONS ARE INDICATED, THE PROXIES WILL BE VOTED FOR THE PROPOSAL TO
APPROVE AND ADOPT THE MERGER AGREEMENT AND, IN THE DISCRETION OF THE
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<PAGE> 15
PERSONS NAMED IN THE PROXY, ON SUCH OTHER MATTERS AS MAY PROPERLY BE PRESENTED
AT THE SPECIAL MEETING.
A shareholder may revoke his or her proxy at any time prior to its use by
delivering to the President of the Company a signed notice of revocation or a
later dated and signed proxy or by attending the Special Meeting and voting in
person. Attendance at the Special Meeting will not in itself constitute the
revocation of a proxy.
Expenses in connection with the solicitation of proxies will be paid by
RCBA or the Acquisition LLC. Upon request, RCBA or the Acquisition LLC will
reimburse brokers, dealers and banks, or their nominees, for reasonable expenses
incurred in forwarding copies of the proxy material to the beneficial owners of
the Shares which such persons hold of record. Solicitation of proxies will be
made principally by mail. Proxies may also be solicited in person, or by
telephone or telegraph, by officers and regular employees of the Company.
SPECIAL FACTORS
BACKGROUND OF THE MERGER
HISTORY OF RELATIONSHIP BETWEEN THE COMPANY AND RCBA. The Company was
formed in 1997 as a spin-off of Triad. RCBA's President and Chairman, Richard C.
Blum ("Mr. Blum"), was a director of Triad from August 3, 1992 until February
26, 1997, when Triad was acquired by CCI as part of CCI's successful tender
offer for all outstanding shares of Triad common stock.
When Management Corp. was formed in February, 1997, all of the outstanding
stock was issued in equal amounts to Mr. Blum, William W. Stevens ("Mr.
Stevens") and James R. Porter ("Mr. Porter"), three former directors of Triad.
Mr. Blum was also a vice president and director of Management Corp. On August 8,
1997, Mr. Blum resigned from the Board of Directors and also resigned as vice
president of Management Corp. On September 5, 1997, Mr. Blum assigned his shares
in Management Corp. over to Mr. Stevens and Mr. Porter. Mr. Blum was never a
member of the Advisory Board.
REAL ESTATE LISTING AGENT. On June 1, 1997, the Company engaged the real
estate firm of Grubb & Ellis, the same real estate firm that had been previously
engaged by Triad to represent it in certain real estate matters, to act as its
exclusive listing agent in connection with the potential sale of the Property.
From time to time, representatives of Grubb & Ellis have had discussions with
senior management of the Company and the Company's Advisory Board concerning the
Company's potential strategic alternatives with respect to the sale of the
Property. Such discussions have been general in nature and did not result in any
formal actions by the Company's Advisory Board.
DISCUSSIONS WITH THIRD PARTIES. In addition to the negotiations with RCBA
discussed below, the Company has had discussions with several other parties as
described below.
CONTACTS AND NEGOTIATIONS WITH EVEREST FINANCIAL. On August 28, 1997,
Everest Financial, Inc. ("Everest"), in a letter to the Company, set forth the
terms and conditions upon which it would be willing to acquire the Company. In
the letter, Everest indicated that it was willing to undertake a tender offer
for all of the Company's outstanding Shares at a price of $0.91 per Share (an
aggregate purcase price of less than $18,000,000), subject to due diligence and
other contingencies.
CONTACTS AND NEGOTIATIONS WITH T.V.O.B. GENERAL PARTNERSHIP. On August 25,
1997, Jeffrey S. Kendall ("Mr. Kendall"), General Partner of T.V.O.B. General
Partnership ("TVOB"), met with Stanley F. Marquis, a member of the Company's
Advisory Board ("Mr. Marquis"), in a meeting initiated by Mr. Kendall, to
discuss the general terms of a proposal whereby TVOB would acquire all of the
Company's outstanding Shares. On August 26, 1997, TVOB, in a letter to the
Company, indicated it would be willing to acquire the Company for a total price
of $25,500,000.
On August 29, 1997, Larry D. McReynolds, President of the Company ("Mr.
McReynolds") and Mr. Marquis met with Mr. Kendall and Joseph A. Duffel ("Mr.
Duffel"), General Partner of TVOB. The parties discussed general due diligence
issues and certain contingent liabilities of the Company. Mr. Marquis
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<PAGE> 16
informed the TVOB representatives that their offer was lower than another offer
previously received by the Company. In the course of the meeting, TVOB increased
its offer for the Company to $26,500,000.
On the morning of September 5, 1997, Mr. Kendall telephoned Mr. Marquis and
verbally indicated that TVOB would be increasing its offer price to $27,000,000.
On the afternoon of September 5, 1997, Mr. Duffel, in a letter delivered via
facsimile to Mr. Marquis, changed TVOB's offer price to $26,900,000. In
addition, Mr. Duffel proposed an alternative transaction structure in which the
Company would join TVOB in a joint venture regarding the development of the
Property. This proposal called for the Company to receive $1 million in cash at
closing, with a $25.9 million wrap around mortgage on all of the Property. The
Company would receive 10% imputed interest on $25.9 million, TVOB would
liquidate the Property over three years, and all profits would be split evenly
between TVOB and the Company.
During all of the discussions with TVOB, TVOB never indicated whether it
was willing to assume all of the contingent liabilities of the Company.
On September 10, 1997, Mr. Marquis telephoned Mr. Duffel to inform him of
the Advisory Board's decision to approve the Merger Agreement.
CONTACTS AND NEGOTIATIONS WITH LINCOLN PROPERTY COMPANY. On September 5,
1997, Lincoln Property Company ("Lincoln"), in a letter to Mr. Marquis delivered
via facsimile, indicated that it would be willing to purchase the assets of the
Company for an aggregate purchase price of $30,000,000. The letter indicated
that Lincoln would assume the bond assessments, but was silent as to the
assumption of the Company's liabilities. Mr. Marquis telephoned Steven N. Dunn,
Vice President of Lincoln ("Mr. Dunn"), to clarify Lincoln's position with
respect to the Company's liabilities. Mr. Dunn told Mr. Marquis that the Lincoln
offer contemplated that Lincoln would not assume any of the Company's
liabilities, contingent or otherwise. In light of this clarification by Mr.
Dunn, Mr. Marquis calculated that the aggregate value of Lincoln's offer to the
Company's shareholders, after paying off the existing mortgage and before any
real estate or transactions costs, was approximately $21,000,000.
CONTACTS AND NEGOTIATIONS WITH GRIGGS RESOURCE GROUP. On September 8, 1997,
shortly before a special meeting of the Advisory Board, Griggs Resource Group,
on behalf of PeopleSoft, Inc., sent a letter to the Company that indicated
PeopleSoft was willing to purchase all of the Company's remaining assets for an
aggregate purchase price of $36,000,000, subject to (a) changes being made in
the Company's lease with CCI/Triad (over which the Company had no control) and
(b) a due diligence period of up to 60 days after the execution of a definitive
agreement. Under the terms of this offer, PeopleSoft would not be assuming the
existing mortgage. Thus, after deducting the existing mortgage and applicable
commissions, the net realizable value of the PeopleSoft offer was approximately
$26,000,000. However, PeopleSoft did not contemplate the assumption of the
Company's contingent liabilities. The letter also indicated that PeopleSoft
would be willing to consider a merger or tender offer structure.
On September 10, 1997, Mr. Marquis telephoned Brian Griggs ("Mr. Griggs")
of Griggs Resource Group to inform him of the Board's decision to approve the
Merger Agreement.
On September 12, 1997, Mr. Griggs, in a letter to Mr. Marquis, reiterated
PeopleSoft's interest in acquiring the Company in an all-cash merger
transaction. Subsequent to that date, Mr. Griggs has had several conversations
with members of the Company's management regarding certain liabilities of the
Company.
On October 2, 1997, Mr. Marquis and McReynolds met with Mr. Griggs and
Deborah J. Oxendine, Director of Real Estate and Administrative Services for
PeopleSoft ("Ms. Oxendine"), in a meeting initiated by Mr. Griggs, to discuss
the terms of PeopleSoft's offer. During the meeting, Ms. Oxendine reiterated
PeopleSoft's interest in acquiring the Company and inquired as to what type of
offer would be necessary to merit the Advisory Board's consideration. Mr.
Marquis informed Ms. Oxendine and Mr. Griggs that any offer at this point would
have to be higher than the sum of RCBA's offer plus the $1.3 million termination
fee that the Company would be required to pay to RCBA in the event that the
Advisory Board approved an alternative offer.
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On October 6, 1997, Mr. McReynolds telephoned Mr. Griggs. During the
conversation, Mr. Griggs informed Mr. McReynolds that PeopleSoft had entered
into an exclusive negotiations agreement with Alameda County and the City of
Dublin with the intent of purchasing property in the City of Dublin
(approximately four miles west of Triad Park). Mr. Griggs indicated that
PeopleSoft would not be continuing further discussions with the Company at this
time.
CONTACTS AND NEGOTIATIONS WITH RCBA. On August 8, 1997, in a letter from
Mr. Blum to Mr. Porter, a member of the Company's Advisory Board, RCBA advised
the Company that it was working on an offer to purchase all of the assets or
membership interests of the Company, and that it expected to submit a more
detailed offer to the Company within a week.
On August 11, 1997, RCBA, in a letter from Mr. Blum to Mr. Porter,
submitted a written proposal to the Company which indicated the material terms
and conditions upon which RCBA would be willing to proceed in an acquisition of
all of the assets or stock of the Company. In this letter, RCBA indicated it
would be willing to purchase all of the outstanding Shares at a price of $1.20
per Share, inclusive of the debt on the Property.
On August 12, 1997, the Company, in a letter from Mr. Porter to Mr. Blum,
informed RCBA that the proposed terms were inadequate but that the Company would
be interested in continuing discussions regarding a potential acquisition. In
the letter, Mr. Porter pointed out that any transaction would have to
contemplate RCBA assuming all of the Company's liabilities and, because of Mr.
Blum's prior association with the Company as a member of the Board of Directors
of Management Corp. (but not as a member of the Advisory Board), would have to
include a mechanism whereby the Company could consider other offers that may be
more favorable to the Company's shareholders.
In its Schedule 13D filed with the Commission on August 14, 1997 (the "RCBA
Schedule 13D"), RCBA confirmed the above contacts between RCBA and the Company
and indicated that it was considering a response to the Company's letter of
August 12, 1997.
On August 15, 1997, the Advisory Board held a telephonic board meeting at
which all Advisory Board members were present. The Advisory Board reviewed
RCBA's proposal of August 11, and generally discussed the manner in which the
Company should proceed in negotiating the proposed transaction.
Later that same day, RCBA, in a letter from Mr. Blum to Mr. Porter
delivered via facsimile, increased its offer price to $1.30 per Share. RCBA
indicated that its offer was contingent upon completion of customary due
diligence, including an engineering study of the Company's properties and
environmental review.
On August 18, 1997, the Advisory Board held a telephonic board meeting at
which all Advisory Board members were present to consider RCBA's latest offer.
Mr. Porter was instructed to further negotiate with RCBA in an attempt to obtain
a price above $1.30 per Share.
On August 18, 1997, Mr. Porter telephoned Mr. Blum to further negotiate the
price at which RCBA was willing to purchase the Shares. In the course of the
conversation, Mr. Blum agreed to a price of $1.32 per Share, the equivalent of a
net purchase price of $26,014,722 since RCBA agreed to assume all of the
Company's actual and contingent liabilities subject to negotiation of definitive
documentation and other standard conditions.
On August 25, 1997, Murray A. Indick, Managing Director and General Counsel
of RCBA ("Mr. Indick") delivered to McCutchen, Doyle, Brown & Enersen, LLP, the
Company's outside legal counsel ("McCutchen"), a draft merger agreement which
contemplated a transaction whereby the Acquisition LLC would acquire the
outstanding Shares for $1.32 per Share in cash.
On August 29, 1997, Mr. Indick, Robert Zerbst, Managing Director of
Westmark Realty Advisors LLC ("Mr. Zerbst"), Rick Mariano, an employee of RCBA
("Mr. Mariano"), Mr. McReynolds, Mr. Marquis, Patrick J. Kernan, legal counsel
to the Company ("Mr. Kernan") and representatives of McCutchen met in
McCutchen's offices in San Francisco, California to discuss the draft merger
agreement. The parties discussed the structure of the proposed transaction and
certain provisions contained in the draft merger agreement. Mr. Marquis
disclosed that the Company had received two other proposals regarding the
Property and
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suggested that perhaps a tender offer would be the best structure for the
proposed transaction. Mr. Indick indicated that RCBA was committed to proceeding
with the transaction under a cash-out merger format. The parties also discussed
certain provisions of the lease under which CCI/Triad leases the Headquarters
from the Company. During these discussions pertaining to the CCI/Triad lease,
Mr. McReynolds and Mr. Kernan, both of whom are employees of CCI/Triad, excused
themselves from the meeting. Mr. Indick also submitted comments to the draft
merger agreement.
On September 5, 1997 Mr. Indick, Mr. Zerbst, Mr. Mariano, Mr. McReynolds,
Mr. Marquis, Mr. Kernan and representatives of McCutchen again met in
McCutchen's offices. Mr. Marquis disclosed that the Company was expecting to
receive additional offers for the Property. The parties then negotiated specific
provisions contained in the draft merger agreement, including those related to a
termination fee and payment of the Company's transaction expenses. At the end of
the meeting, the parties had agreed on all provisions in the draft merger
agreement.
On September 8, 1997, at a meeting of the Company's Advisory Board that
included all members in attendance (Messrs. Porter, Stevens, Marquis and Martin
W. Inderbitzen), and was also attended by Mr. Kernan, Mr. McReynolds and
representatives of McCutchen, the parties discussed recent events, including a
review of all proposals received by the Company to date. The Advisory Board
considered the validity of each offer and the reputations of each potential
acquiror, and also considered asking RCBA for a reduced termination fee in
exchange for approving the draft merger agreement.
The Advisory Board rejected Everest's offer because the offering price was
far less than that offered by RCBA. The Advisory Board rejected both offers from
TVOB because neither offer considered assuming all of the Company's contingent
liabilities and because neither offer called for the entire purchase price to be
paid up front at the time of the transaction's closing. In addition, the
Advisory Board members expressed concerns about the ability of TVOB to fund the
potential transaction. The Advisory Board also noted that TVOB had undertaken no
due diligence.
The Advisory Board rejected the offer from Lincoln because it was not in
definitive form and because it did not contemplate assumption of the Company's
current liabilities. In addition, the Lincoln offer was in the form of an asset
sale and therefore did not contemplate assumption of the Company's contingent
liabilities. As a result of not assuming any of the Company's liabilities, the
Advisory Board concluded that the value of the Lincoln offer was significantly
less than the proposal from RCBA.
The Advisory Board rejected the offer from Griggs Resource Group because it
was in preliminary form and was first submitted only minutes before the meeting.
Additionally, the Advisory Board concluded that this offer did not appear to
equal or exceed the value of the RCBA proposal since PeopleSoft would not be
assuming the existing mortgage or the Company's contingent liabilties.
Furthermore, any acquisition would be delayed for up to 60 days while PeopleSoft
conducted due diligence.
In rejecting these offers, the Advisory Board noted that any of the
offerors could submit a more competitive offer at any time.
The Advisory Board ultimately authorized Mr. Marquis and Mr. Edward S.
Merrill ("Mr. Merrill") of McCutchen to contact Mr. Indick and propose that RCBA
drop its request for an environmental due diligence contingency in exchange for
which the Advisory Board would approve the draft merger agreement. The members
of the Advisory Board concluded that a transaction in this form with RCBA
offered significantly more value than the proposals from the other potential
acquirors and consequently did not pursue negotiations with the other parties at
that time. Mr. Marquis and Mr. Merrill telephoned Mr. Indick and advised him of
the Advisory Board's proposal.
Later in the evening on September 8, 1997, Mr. Indick telephoned Mr.
Marquis and Mr. Merrill to inform them that RCBA had accepted the Advisory
Board's proposal. Representatives of McCutchen and Mr. Indick then negotiated
the remainder of the minor terms of the definitive Merger Agreement, and the
Merger Agreement was executed on September 9, 1997.
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PURPOSE AND STRUCTURE OF THE MERGER
The primary benefit of the Merger to the Company's shareholders is the
opportunity to sell all of their Shares at a price which represents a
substantial premium over trading prices in effect immediately prior to the
filing of the RCBA Schedule 13D, which disclosed RCBA's interest in acquiring
the Company. The structure of the transaction as a cash merger provides a cash
payment at a premium price to all holders of outstanding Shares and ensures the
acquisition by the Acquisition LLC of all the outstanding Shares of the Company.
The primary reason for the Company entering into the Merger Agreement is
the Advisory Board's belief that the Merger is the most effective means of
achieving the purpose of liquidating the shareholders' investment in a
reasonable time at a reasonable price. The Advisory Board also believes that
since RCBA is willing to assume the contingent liabilities of the Company, the
Merger is the most advantageous transaction for the Company's shareholders, as
opposed to an asset sale. The Company is obligated to indemnify CCI/Triad for
certain taxes arising from, among other things, any transfer of the Property to
the Company (see "THE COMPANY -- Properties of the Company"). Due to this
indemnification obligation, the Company ordinarily would not be able to make
final distributions to shareholders until after CCI/Triad's audit was complete,
a process that could last up to three years, not including extensions. Instead,
RCBA is prepared to assume all liabilities, contingent or otherwise, of the
Company in conjunction with the Merger. As a result, the Company's shareholders
will receive their proceeds shortly after the consummation of the Merger without
any requirement to hold back contingency reserves.
In addition, the Company is currently obligated to undertake approximately
an additional $7,000,000 in improvements on the Property. The City of Livermore
has indicated that it is willing to reimburse the Company for improvements
undertaken and paid for by the Company by means of bond financings.
Historically, the City of Livermore has fulfilled such reimbursement commitments
to Triad. However, if the City of Livermore is unsuccessful in completing a bond
offering, the Company would not receive any reimbursement for such improvements.
Further, there is a significant chance the cost of the improvements undertaken
by the Company will exceed the amount of the bond financings and the Company
would be responsible for paying any such cost overruns. Again, RCBA is prepared
to assume this potential liability of the Company in conjunction with the
Merger, so the Company's shareholders will receive their full proceeds shortly
after the consummation of the Merger.
The Advisory Board also believes it significant that by entering into the
Merger at this time the Company avoids ongoing operating expenses such as taxes
(which are currently in excess of $1 million annually) and the costs of ongoing
reporting requirements, including those related to securities filings made with
the Commission.
The Advisory Board believes that the Merger is the best available
opportunity to maximize shareholder value at the present time. The $1.32 per
share price to be received by the shareholders represents a premium of
approximately 54% over the reported average closing price of the Shares for all
trades reported during the period prior to the filing of the RCBA Schedule 13D.
RCBA's purpose and reasons for engaging in the transaction contemplated by
the Merger Agreement is to obtain ownership of the Company, thereby becoming
entitled to the benefits of ownership including management and investment
discretion with regard to the future of the real estate assets of the Company.
This includes execution of a business plan that combines strategic undeveloped
lots dispositions and developments of other lots for the Company's own account
or for third parties, depending on market conditions. RCBA will receive the
benefits, if any, of its decisions and will also bear the risk of loss.
RECOMMENDATION OF THE COMPANY'S ADVISORY BOARD
On September 8, 1997, the Company's Advisory Board, by unanimous vote, at a
special board meeting held on that date, determined that the transactions
contemplated by the Merger are fair from a financial point of view to and in the
best interests of the shareholders of the Company other than (i) affiliates of
the Company and (ii) RCBA and its affiliates (the "Unaffiliated Shareholders"),
approved the Merger Agreement and resolved to recommend that the Company's
shareholders approve the Merger Agreement.
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In determining to approve and adopt the Merger Agreement, and in
determining the fairness of the terms of the Merger to the Unaffiliated
Shareholders, the Advisory Board considered the following factors, each of
which, in the view of the Advisory Board, supported the determination to
recommend the Merger:
(i) the going concern value of the Company (as reflected in part by
its historical operating results) and the net book value and liquidation
value of the Company, each of which, on a per Share basis, was projected to
be less than the $1.32 per Share being offered by RCBA;
(ii) the historical market prices of the Company's Shares,
particularly the fact that the Merger will enable the shareholders of the
Company to realize a significant premium over the prices at which the
Shares traded prior to the filing of the RCBA Schedule 13D;
(iii) the conclusion contained in the Sedway Report that following a
three-and-one-half year disposition strategy could result in proceeds with
a net present value of $25.6 million and the fact that the Merger would
result in proceeds of over $26 million (inclusive of Shares beneficially
held by RCBA);
(iv) the terms and conditions of the Merger Agreement, including the
provision negotiated by the Company which allowed the Company to consider
and respond to unsolicited offers after the date of the Merger Agreement;
the fact that the Company may terminate the Merger Agreement in certain
circumstances; the circumstances under which the termination fee is
payable; and the relatively few substantive closing conditions;
(v) the fact that, as discussed above in "-- Purpose and Structure of
the Merger," RCBA is willing to assume all contingent liabilities of the
Company, including those related to tax matters and construction of
improvements on the Property;
(vi) RCBA's positive reputation in the financial industry for its
ability to fund and close transactions in which it has been involved; and
(vii) the fact that the offer from RCBA, when considered on a net
basis, was higher than the offers received from the other potential
acquirors and that none of the other offers considered the assumption of
the Company's liabilities, contingent or otherwise.
In considering the fairness of the Merger to Unaffiliated Shareholders, the
Advisory Board gave primary consideration to factors (i) through (v) above. It
also gave consideration to factors (vi) and (vii) in determining whether to
approve the Merger. The Company's Advisory Board did not find it practicable to,
and did not, quantify or otherwise attempt to assign relative weights to the
specific factors considered in reaching its conclusions.
The executive officers of the Company have made no recommendation with
respect to the Merger.
If the Merger is not approved by the Company's shareholders and the Merger
does not occur, the Company will continue its current operations as an
independent company. However, for the reasons discussed above, it is possible
that the Company would seek a business combination with another company.
SEDWAY REPORT
Shortly after its formation, the Company began considering various methods
in order to effectuate an orderly disposition of the Property. Accordingly, on
May 22, 1997, the Company's Advisory Board authorized Martin W. Inderbitzen, a
member of the Advisory Board, and Mr. McReynolds to engage Sedway Group or a
comparable firm for the purpose of preparing a report exploring various
disposition strategies. On July 22, 1997, Sedway Group delivered its written
report to the Company's Advisory Board (the "Sedway Report").
The Sedway Report does not relate to the Merger Consideration or the
fairness of the Merger Consideration, or the fairness of the Merger to the
Company, RCBA or shareholders who are not affiliates. However, the Sedway Report
does relate to the value of the Company's real estate assets in a liquidation
situation, and as such, was given strong consideration by the Company's Advisory
Board during its decision making process. A copy of the Sedway Report, which
sets forth the assumptions made and matters considered in, and limits on the
review undertaken, is available for inspection and copying at the principal
executive
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offices of the Company during regular business hours by any interested
shareholder or such shareholder's representative who has been so designated in
writing.
In preparing its report, Sedway Group met with Company management and
reviewed the current status of Triad Park, inspected Triad Park and its
environs, read various documents related to Triad Park, including the listing
agreement with Grubb & Ellis and the lease pertaining to the Triad Park building
complex, held telephone interviews with members of the Company's Advisory Board,
held telephone discussions with brokers, developers, and land owners active in
the Livermore area and reviewed market information provided by Grubb & Ellis.
Sedway Group was asked to provide a strategy to maximize the value of the
Company's real estate assets.
The Sedway Report contains a history of Triad Park and a summary of the
current situation at Triad Park. The Sedway Report also contains a market
overview, including current market conditions for retail, office and R&D
properties. The Sedway Report recommends an "aggressive but orderly real estate
disposition program" including certain improvements to the Triad Park area and a
multi-faceted marketing program. According to the Sedway Report, the proposed
strategy should "result in proceeds with a net present value of $25.6 million."
The Sedway Report also includes a presentation of the financial analysis of the
disposition strategy and assumptions and limiting conditions.
GENERAL. The summary set forth above does not purport to be a complete
description of the analyses performed by Sedway Group. The preparation of a
report similar to the Sedway Report involves various determinations and
assumptions and therefore is not readily susceptible to summary description.
Accordingly, Sedway Group believes that its report must be considered as a whole
and that selected portions of its report and the factors considered by it,
without considering all analyses and factors, could create an incomplete view of
the evaluation process underlying its report. In preparing its report, Sedway
Report made numerous assumptions with respect to industry performance, general
business and economic conditions and other matters, many of which are beyond the
control of the Company.
Sedway Group is a nationally recognized full-service real estate and urban
economics consulting firm engaged, among other things, in market research and
analysis, real estate strategy and asset management (including acquisition and
disposition strategies), financial analysis and valuation services. Sedway Group
has substantial experience in major land uses (residential, retail, office,
industrial, hotel and mixed use) and in specialized areas such as entertainment
retail, public/private transactions and economic revitalization.
It was the opinion of the Advisory Board that Sedway Group was very
familiar and experienced with economic analysis in the Tri-Valley region of
Northern California. At the time that the Advisory Board was seeking a firm to
undertake the analysis, Sedway Group was conducting similar analyses in the City
of Livermore and in the Tri-Valley area. Members of the Advisory Board were also
personally familiar with Sedway Group, and all agreed that Sedway Group had a
positive business reputation in the community. All of these factors were
considered by the Advisory Board when it chose Sedway Group to prepare the
economic report.
The Company has paid Sedway Group approximately $15,000 for preparing the
Sedway Report. No portion of the fee payable to Sedway Group is contingent upon
consummation of the Merger or similar type of transaction.
PERSPECTIVE OF RCBA ON THE MERGER
The determination of the Merger Consideration resulted from extensive
arm's-length negotiation between the Company and RCBA and their respective
representatives. See "-- Background of the Merger." At the conclusion of the
negotiation process, RCBA offered to acquire the Company for a price of $1.32
per Share. In determining such price, RCBA analyzed the real estate market in
Northern California generally, and the development of the Company owned sites in
particular, taking into account current market conditions.
RCBA did not undertake any formal or informal evaluation of its own as to
the fairness of the Merger Consideration to the Company shareholders.
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PLANS FOR THE COMPANY AFTER THE MERGER
Effective upon consummation of the Merger, the manager of the Acquisition
LLC will be the initial manager of the Surviving Company. The Surviving Company
will not have an Advisory Board.
Except as otherwise indicated in this Proxy Statement, RCBA does not have
any other present plans or proposals which relate to or would result in an
extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving the Company or any of its subsidiaries, a sale or
transfer of a material amount of assets of the Company or any of its
subsidiaries or any material change in the Company's capitalization or any other
material changes in the Company's corporate structure or business or the
composition of the Company's management.
CERTAIN EFFECTS OF THE MERGER
As a result of the Merger, the entire equity interest of the Company will
be owned by RCBA, and the current shareholders will have no continuing interest
in the Company. Therefore, following the Merger, the shareholders of the Company
other than RCBA will no longer benefit from any increases in the value of the
Company and will no longer bear the risk of any decreases in the value of the
Company. Following the Merger, RCBA and its affiliates will own 100% of the
Company and will have complete control over the management and conduct of the
Company's business, all income generated by the Company and any future increase
in the Company's value. Similarly, RCBA will also bear the risk of any losses
incurred in the operation of the Company and any decrease in the value of the
Company.
The Shares are currently registered as a class of securities 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 quoted on the Nasdaq National
Market and there are fewer than 300 record holders of the Shares. Termination of
registration of the Shares under the Exchange Act 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 trading 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. It
is the present intention of RCBA to cause the Company to make an application for
the termination of the registration of the Shares under the Exchange Act as soon
as practicable after the Effective Time of the Merger.
RELATIONSHIP BETWEEN THE COMPANY AND RCBA
NO INTERCOMPANY BUSINESS RELATIONSHIP. Not including the Merger Agreement,
the transactions contemplated thereby, or as otherwise disclosed in this Proxy
Statement, there have been no business relationships between the Company and
either RCBA or the Acquisition LLC.
INTERESTS OF CERTAIN PERSONS IN THE MERGER
In considering the recommendation of the Advisory Board of the Company with
respect to the Merger Agreement and the transactions contemplated thereby,
shareholders should be aware that certain members of the Advisory Board and
management of the Company have certain interests in the Merger in addition to
the interests of shareholders of the Company generally. In connection with the
Advisory Board's determination that the Merger is fair to the Company's
shareholders (excluding RCBA and its affiliates), the Advisory Board carefully
considered conflict of interest issues relating to the matters described below.
INDEPENDENT CONTRACTOR SERVICES AGREEMENT. Larry D. McReynolds, President
of the Company, has an Independent Contractor Services Agreement with the
Company, under which he is currently paid an annual base salary of approximately
$108,000, of which the Company is responsible for 50%. Mr. McReynold's
independent contractor agreement provides for bonus compensation in the event of
certain "changes in control" of the Company, including a merger involving the
Company. Upon consummation of the Merger,
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Mr. McReynolds is entitled to receive a bonus of less than 1% of the net value
paid to the Company's shareholders, which is estimated to be approximately
$200,000.
INDEMNIFICATION OF OFFICERS AND DIRECTORS. The Merger Agreement provides
that, for a period of not less than six years following the Effective Time, the
Surviving Company will maintain in effect all rights of indemnification of the
officers, directors or employees of the Company provided in its limited
liability company agreement or bylaws. RCBA has also agreed to allow the
Company, with the Acquisition LLC's prior consent (such consent is not required
if the cost does not exceed $110,000), to purchase additional policies of
directors' and officers' liability insurance of at least the same coverage as
currently maintained by the Company, such policies to be pre-paid and in effect
for a period of six years from the Effective Time.
SOURCES AND USES OF FUNDS
MERGER CONSIDERATION, FEES AND EXPENSES. RCBA estimates that the total
consideration payable to shareholders other than RCBA and its affiliates upon
consummation of the Merger will be approximately $23,359,000. The estimated fees
and expenses incurred or to be incurred by RCBA in connection with the Merger
are legal fees and expenses of $75,000 and miscellaneous fees of $25,000. RCBA
expects to use working capital funds to make such payments and pay such fees and
expenses.
The estimated fees and expenses incurred or to be incurred by the Company
in connection with the Merger, which will be paid by RCBA or the Acquisition
LLC, are approximately as follows.
<TABLE>
<S> <C>
Legal fees and expenses................................... $ 100,000
Printing and mailing fees................................. 10,000
Commission filing fee..................................... 4,672
Disbursing Agent fees..................................... 7,000
Miscellaneous fees........................................ 5,000
Total Fees and Expenses................................... $ 126,672
</TABLE>
Certain of the Company's officers will receive certain payments if the
Merger is consummated. See "-- Interest of Certain Persons in the Merger."
SOLICITATION FEES AND EXPENSES. Neither RCBA nor the Company will pay any
fees or commissions to any broker or dealer or any other person for soliciting
Company shareholders with respect to the Merger. Brokers, dealers, commercial
banks and trust companies will, upon request, be reimbursed by RCBA or the
Acquisition LLC for reasonable and necessary costs and expenses incurred by them
in forwarding materials to their customers.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
Under currently existing provisions of the Internal Revenue Code of 1986,
as amended (the "Code"), the Treasury Regulations promulgated thereunder,
applicable judicial decisions and administrative rulings, all of which are
subject to change, the federal income tax consequences described below are
expected to arise in connection with the Merger. Due to the complexity of the
Code, the following discussion is limited to the material federal income tax
aspects of the Merger for a Company shareholder who is a citizen or resident of
the United States. The general tax principles discussed below are subject to
retroactive changes that may result from subsequent amendments to the Code. The
following discussion does not address potential foreign, state, local and other
tax consequences, nor does it address taxpayers subject to special treatment
under the federal income tax laws, such as insurance companies, tax-exempt
organizations, regulated investment companies, S corporations and taxpayers
subject to the alternative minimum tax. Neither the Company nor RCBA has
requested either the Internal Revenue Service or counsel to rule or issue an
opinion on the federal income tax consequences of the Merger. ALL SHAREHOLDERS
ARE URGED TO CONSULT THEIR OWN TAX ADVISORS REGARDING THE FEDERAL, FOREIGN,
STATE AND LOCAL TAX CONSEQUENCES OF THE DISPOSITION OF THEIR SHARES IN THE
MERGER.
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<PAGE> 24
Merger as Sale of Shares
Although the transaction will be cast in the form of the merger of the
Company with Acquisition LLC, for federal income tax purposes it is anticipated
that the Merger will be treated as a taxable sale of Shares by each holder of
Shares. Accordingly, each holder of Shares will recognize gain or loss by reason
of the consummation of the Merger.
Measure of Gain or Loss
A shareholder's gain or loss in the Merger will be equal to the difference
between the consideration received in the Merger and the shareholder's adjusted
basis in the shareholder's Shares. The consideration received will be equal to
the sum of the cash received plus the shareholder's allocable share of the
Company's liabilities.
A shareholder's initial basis in the Shares will be the cost of the Shares
plus the shareholder's allocable share of the Company's liabilities. For shares
received in the distribution from Triad, the shareholder's "cost" of the Shares
will be the fair market value of the Shares at the time of the distribution. The
basis of the Shares will be increased by the shareholder's share of Company
income and by any increases in the shareholder's share of Company liabilities.
The basis will be reduced (but not below zero) by distributions from the
Company, by the shareholder's share of Company losses, by decreases in the
shareholder's share of Company liabilities and by the shareholder's share of
expenditures of the Company that are neither deductible in computing taxable
income nor required to be capitalized.
It will not be possible to determine the precise amount of gain or loss on
the sale of the Shares until after the Effective Time, because the calculation
of gain or loss requires a determination of the Company's liabilities as of the
Effective Time and the shareholder's share of the Company's income, gain, loss
and deduction for the taxable year in which the Merger occurs. Following the
Effective Time, the Company's books will be closed and the shareholders will
receive the information they require to determine the adjusted basis of their
Shares and the consideration received in the Merger.
Character of Gain or Loss
The Shares represent interests in the Company, which is taxed as a
partnership for federal income tax purposes. Generally, gain or loss on the sale
of a partnership interest is capital gain or loss under Section 741 of the Code.
An exception to this general rule is provided in Section 751 of the Code, which
treats as ordinary income or ordinary loss any gain or loss on unrealized
receivables or inventory items (including real property held for sale to
customers).
A substantial portion of the Property is land held by the Company for sale
to customers and any gain or loss attributable to such land will be ordinary
income or loss to the shareholders in the Merger. Although the precise amount
cannot be calculated until after the Effective Time, it is estimated that each
shareholder who received Shares from Triad in the distribution will recognize
approximately $ ordinary gain per Share in the Merger. The balance of
gain, if any, will be capital gain.
If a shareholder who is an individual (and any individual who is a partner
in a partnership that is a shareholder) has held the Shares for more than 12
months but less than 18 months as of the Effective Time, any capital gain will
be long term capital gain and will be subject to federal tax at not more than a
28% tax rate. If the Shares have been held for more than 18 months as of the
Effective Time, any capital gain will be subject to federal tax at not more than
a 20% tax rate. However, it is not anticipated that any of the Shares will have
been held for 18 months as of the Effective Time and it is possible that none of
the Shares will have been held for more than 12 months at the Effective Time.
Any capital gain on Shares held for 12 months or less will be short term capital
gain and will be subject to tax at the rates applicable to ordinary income.
Company Income or Loss Prior to the Merger
Each shareholder will receive an allocation of the shareholder's share of
the Company's income or loss for the periods prior to the Merger. Shareholders
should review the discussion in the Company's Information
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<PAGE> 25
Statement mailed to shareholders on or about August 21, 1997 under "Tax
Considerations" for a summary of the federal income tax consequences of the
Company's operations. If the Company has taxable income during the periods prior
to the Merger, it is not anticipated that the Company will make any
distributions to shareholders and shareholders may be required to pay federal
income taxes on Company income.
Reporting and Withholding
Cash payments made pursuant to the Merger will be reported to the extent
required by the Code to shareholders of the Company and the Internal Revenue
Service. The payments will ordinarily not be subject to withholding of federal
income tax. However, backup withholding of such tax at a rate of 31% may apply
to certain shareholders by reason of the events specified in Section 3406 of the
Code and related Treasury Regulations, which include failure of a shareholder to
supply the Company or its agent with the shareholder's taxpayer identification
number. Accordingly, each Company shareholder will be asked to provide the
shareholder's correct taxpayer identification number on a Substitute Form W-9
which is to be included in the letter of transmittal to be sent to shareholders
relating to their Shares. Withholding may also apply to Company shareholders who
are otherwise exempt from such withholding, such as a foreign person, if that
person fails to properly document its status as an exempt recipient.
REDEMPTIONS OF SHARES
In August, 1997, as part of the consummation of a transaction completed as
a part of the formation of the Company, the Management Corp. paid its promissory
note due the Company in full, Messrs. Porter and Stevens paid their respective
promissory notes due the Management Corp. in full, and the Company redeemed
99,536 Shares from each of Mr. Porter and Mr. Stevens at a price of $0.72 per
Share. The net effect of the transaction was to reduce the outstanding Shares of
the Company to 19,708,123, the same as the number of Triad Systems Corporation
shares which existed immediately prior to formation of the Company and to reduce
the number of Shares beneficially owned by Mr. Stevens and Mr. Porter to the
same number of Shares they owned in Triad Systems Corporation immediately prior
to formation of the Company.
REGULATORY APPROVALS
Although no particular regulatory approval is required in connection with
the proposed Merger, state Attorneys General and private parties may bring legal
actions under the federal or state antitrust laws under certain circumstances.
There can be no assurance that a challenge to the proposed Merger on antitrust
grounds will not be made or of the result if such a challenge is made.
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<PAGE> 26
THE MERGER AGREEMENT
The information in this summary is qualified in its entirety by reference
to the full text of the Merger Agreement, a copy of which is attached as Exhibit
A to this Proxy Statement.
GENERAL
The Company, the Acquisition LLC and RCBA entered into the Merger Agreement
effective September 9, 1997. If the shareholders of the Company approve the
Merger Agreement, the Acquisition LLC will be merged with and into the Company,
with the result that the separate corporate existence of the Acquisition LLC
will then cease. The Company will be the Surviving Company and will be an
affiliate of RCBA. At the Effective Time, the Shares will be converted
automatically into the right to receive cash, as described below. See
"-- Consideration to be Received by Shareholders." The Shares will no longer be
listed or traded in any public market, and the registration of the Shares under
the Exchange Act will be terminated.
EFFECTIVE TIME
If the Merger Agreement is adopted by the majority vote of the Company's
shareholders, the Merger will be consummated and become effective upon the
acceptance for record of the Certificate of Merger by the Delaware Secretary of
State on a date as soon as practicable after conditions to the Merger are
satisfied (or waived to the extent permitted), or such other date agreed on by
the parties. It is currently contemplated that the Effective Time will occur on
or about December 31, 1997. There can be no assurance that all conditions to the
Merger will be satisfied. See "-- Conditions to Consummation of the Merger."
CONSIDERATION TO BE RECEIVED BY SHAREHOLDERS
In connection with the Merger, each Share outstanding immediately prior to
the Effective Time will be converted into the right to receive $1.32 in cash,
without interest (the cash consideration per share to be paid to the Company's
shareholders in the Merger being sometimes referred to herein as the "Merger
Consideration")."
PAYMENT FOR SHARES
Payment for Shares. First Trust of California, National Association (the
"Disbursing Agent") will act as the paying agent for payment of the Merger
Consideration to the holders of the Shares. Instructions with regard to the
surrender of certificates formerly representing Shares, together with the letter
of transmittal to be used for that purpose, will be mailed to shareholders as
soon as practicable after the Effective Time. As soon as practicable following
receipt from the shareholder of a duly executed letter of transmittal, together
with certificates formerly representing Shares and any other items specified by
the letter of transmittal, the Disbursing Agent will pay the Merger
Consideration to the shareholder, by check or draft.
After the Effective Time, the holder of a certificate formerly representing
Shares will cease to have any rights as a shareholder of the Company, and the
holder's sole right will be to receive the Merger Consideration with respect to
the Shares. If payment is to be made to a person other than the person in whose
name the surrendered certificate is registered, it will be a condition of
payment that the certificates so surrendered be properly endorsed or otherwise
in proper form for transfer and that the person requesting the payment shall pay
any transfer or other taxes required by reason of the payment or establish to
the satisfaction of the Surviving Company that the taxes have been paid or are
not applicable. No transfer of Shares outstanding immediately prior to the
Effective Time will be made on the stock transfer books of the Surviving Company
after the Effective Time.
To the extent permitted by law, the appointment of the Disbursing Agent may
be terminated at any time by RCBA upon notice to the Disbursing Agent, or by the
Disbursing Agent upon 30 days notice to RCBA. Any portion of the Merger
Consideration remaining undistributed one year after the Effective Time will be
returned to the Surviving Company, and any holders of unsurrendered Share
certificates may surrender them
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<PAGE> 27
to the Surviving Company and (subject to abandoned property, escheat or similar
laws) receive the Merger Consideration to which they are entitled.
SHAREHOLDERS OF THE COMPANY SHOULD NOT FORWARD THEIR SHARE CERTIFICATES TO
THE DISBURSING AGENT WITHOUT A LETTER OF TRANSMITTAL, AND SHOULD NOT RETURN
THEIR SHARE CERTIFICATES WITH THE ENCLOSED PROXY.
No Interest on Payment Amounts. In no event will holders of Shares be
entitled to receive payment of any interest on the Merger Consideration.
OPERATIONS OF THE COMPANY PRIOR TO THE MERGER
The Company has agreed that, prior to the Effective Time, the business of
the Company will be conducted in accordance with certain restrictions set forth
in the Merger Agreement. Among other things, the Company has agreed that, except
as the Company and the Acquisition LLC may otherwise agree, the Company will
operate only in the ordinary course of business, and the Company will not do any
of the following: (a) take any action which would or could reasonably be
expected to jeopardize any of its material contracts or its good standing with
any applicable governmental agency with jurisdiction over the Company, or (b)
declare, set aside or pay any dividend or other distribution in respect of its
membership interests, whether in securities, cash, or other property, redeem,
repurchase or otherwise acquire any of its outstanding Shares, or issue any
membership interests or any right to acquire or convert into membership
interests.
In addition, the Company has agreed that until the earlier of the
termination of the Merger Agreement or the Effective Time, neither the Company
nor any of its employees or representatives will take any action to solicit,
initiate or encourage the submission of any Acquisition Proposal (as defined
below) or enter into any agreement for or relating to any Acquisition Proposal
(an "Acquisition Agreement"). Notwithstanding the foregoing, at any time prior
to obtaining the approval of the Company shareholders to the Merger, the Company
may, in response to an unsolicited written request for information made by a
third party to the Company, provide information to or have discussions or
negotiations with the third party if the Advisory Board of the Company, after
having considered the advice of outside counsel, has determined in good faith
that it is the fiduciary duty under applicable law of such Advisory Board
members to do so.
An Acquisition Proposal is defined in the Merger Agreement as a proposal
for any (i) merger, consolidation or similar transaction involving the Company,
(ii) sale, lease or other disposition directly or indirectly by merger,
consolidation, share exchange or otherwise of either (a) assets of the Company
representing 75% or more of the consolidated assets of the Company in one
transaction, or (b) all or substantially all of the undeveloped Property on one
transaction (but not including solicitation of sales of individual parcels of
the undeveloped Property), (iii) issuance, or other acquisition or disposition
of (including by way of merger, consolidation, share exchange or any similar
transaction) securities (or options, rights or warrants to purchase, or
securities convertible into, such securities) representing 20% or more of the
voting power of the Company, or (iv) transaction in which any person or group of
persons would acquire beneficial ownership or the right to acquire beneficial
ownership, or any group shall have been formed which beneficially owns or would
own or would have the right to acquire beneficial ownership of 20% or more of
the outstanding Shares, other than transactions contemplated by the Merger
Agreement.
CONDITIONS TO CONSUMMATION OF THE MERGER
The Merger will occur only if the Merger Agreement is approved and adopted
by majority vote of the holders of the Shares. Consummation of the Merger also
is subject to the satisfaction of the following conditions specified in the
Merger Agreement, unless the conditions are waived (to the extent waiver is
permitted by law). The failure of any of these conditions to be satisfied, if
not waived, would prevent consummation of the Merger.
The obligations of the Acquisition LLC to consummate the Merger are subject
to satisfaction of the following conditions: (i) the Merger shall have been
approved by a majority vote of the shareholders of the Company, (ii) no
temporary restraining order, preliminary or permanent injunction or other order
of any court
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or other judicial or administrative body of competent jurisdiction (each, an
"Injunction") which prohibits or prevents the consummation of the Merger shall
have been issued and remain in effect, (iii) the Company shall have performed in
all material respects its agreements contained in the Merger Agreement required
to be performed on or prior to the Effective Time, (iv) each of the
representations and warranties of the Company contained in the Merger Agreement
shall be true in all material respects when made on and as of the Effective
Time, and (v) the Company shall have obtained all consents, appeals, releases or
authorizations from, and shall have made all filings and registrations to or
with, any person necessary to be obtained or made in order to consummate the
transactions contemplated by the Merger Agreement.
The obligations of Company to consummate the Merger are subject to
satisfaction of the following conditions: (i) the Merger shall have been
approved by a majority vote of the shareholders of the Company, (ii) no
Injunction which prohibits or prevents the consummation of the Merger shall have
been issued and remain in effect, (iii) the Acquisition LLC shall have performed
in all material respects its agreements contained in the Merger Agreement
required to be performed on or prior to the Effective Time, (iv) each of the
representations and warranties of the Acquisition LLC contained in the Merger
Agreement shall be true in all material respects when made on and as of the
Effective Time, and (v) the Merger Consideration shall have been deposited with
the Disbursing Agent with irrevocable instructions to exchange the Shares for
the Merger Consideration in accordance with the terms of the Merger Agreement
immediately upon notification by the Company and the Acquisition LLC of the
Effective Time.
TERMINATION
The Merger Agreement may be terminated and the Merger abandoned at any time
prior to the filing of Certificate of Merger with the Delaware Secretary of
State whether before or after action by the Company's shareholders and without
further approval by the Company's shareholders under any of the following
circumstances: (i) by mutual consent of the Board of Directors of the
Acquisition and the Company's Advisory Board; (ii) by either the Acquisition LLC
or the Company, if the Merger shall have not been consummated on or before
January 31, 1998; provided that this particular right to terminate shall not be
available to any party whose failure to perform in any material respect any
covenant under the Merger Agreement has been the cause of or resulted in whole
or in part in the failure of the Merger to be consummated before January 31,
1998; (iii) by either the Acquisition LLC or the Company, if there shall be any
Injunction or other order by any court which is final and nonappealable
preventing the consummation of the Merger; (iv) by either the Acquisition LLC or
the Company if the Company shareholders do not approve the Merger Agreement and
the transactions contemplated thereby; or (v) by the Acquisition LLC if the
Merger Agreement and the transactions contemplated thereby shall not have been
submitted for approval by the Company's shareholders by January 31, 1998.
In addition, the Merger Agreement may be terminated by (a) the Acquisition
LLC, if the Advisory Board withdraws, modifies in a manner adverse to the
Acquisition LLC, or refrains from making its recommendation concerning the
Merger, or the Advisory Board shall have recommended to the Company shareholders
any Acquisition Proposal or the Company shall have entered into an Acquisition
Agreement, or, other than in connection with the Company's delivery of a
Superior Proposal Notice (as defined below), the Advisory Board shall have
resolved to do any of the foregoing, and (b) by the Company, if by a good faith
vote, with the advice of outside legal counsel, in order to avoid breaching its
fiduciary duties to Company shareholders under applicable law, (1) the Advisory
Board has delivered to the Acquisition LLC a Superior Proposal Notice, (2) the
Company has paid the Termination Fee (as defined below), and (3) five business
days have passed since the Acquisition LLC received the Superior Proposal
Notice. A "Superior Proposal Notice" is written notice advising the Acquisition
LLC that the Advisory Board has received a Superior Proposal (as defined below)
which the Advisory Board has authorized and intends to effect, specifying the
material terms and conditions of such Superior Proposal and identifying the
person making the Superior Proposal. A "Superior Proposal" is a definitive
unconditioned agreement with a third party, with all due diligence
investigations completed, to acquire, directly or indirectly, more than 50% of
the membership interests of the Company, assets of the Company representing 75%
or more of the real estate assets of the Company in one transaction (but not
solicitation of sales of individual parcels of the Property) or all or
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substantially all of the undeveloped Property in one transaction (but not
solicitation of sales of individual parcels of the undeveloped Property), and
otherwise on terms which the Advisory Board determines in its good faith
judgment to be more favorable from a financial point of view to the Company
shareholders than the Merger Agreement, the Merger and the transactions
contemplated thereby and for which financing, to the extent required, is then
committed.
TERMINATION FEE
The Merger Agreement requires the Company to pay the Acquisition LLC a
termination fee of $1.3 million (the "Termination Fee") if the Board of
Directors of the Company takes the action described in clause (b) above under
the caption "-- Termination," (but only if the Company executes the agreement
contemplating the Superior Proposal within three business days after the receipt
by the Acquisition LLC of the Superior Proposal Notice) or the Merger Agreement
is terminated by the Acquisition LLC for any of the reasons set forth in clauses
(v) or (a) above under such caption.
ACCOUNTING TREATMENT
The Merger will be accounted for under the purchase method of accounting
under which the total consideration paid in the Merger will be allocated among
the Surviving Company's consolidated assets and liabilities based on the fair
values of the assets acquired and liabilities assumed.
RIGHTS OF DISSENTING SHAREHOLDERS
No appraisal rights are provided for the Company shareholders under the
Delaware limited liability company act or under the Company's limited liability
company agreement. Neither the Company, RCBA or the Acquisition LLC will be
voluntarily providing appraisal rights to the Company shareholders who object to
the transactions contemplated by the Merger Agreement. Neither the Company nor
RCBA is aware of any appraisal rights available to objecting shareholders under
applicable law.
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SHARE OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
SHARE OWNERSHIP
The following table sets forth certain information, as of June 30, 1997,
with respect to the beneficial ownership of Shares by (i) all persons known by
the Company to beneficially own more than 5% of the outstanding Shares, (ii)
each Advisory Board member of the Company, (iii) each executive officer of the
Company, and (iv) all executive officers and directors of the Company as a
group. For purposes of this table, beneficial ownership of securities is defined
in accordance with the rules of the Commission and means generally the power to
vote or dispose of securities, regardless of any economic interest therein.
Except as otherwise indicated, the shareholders listed in the table have sole
voting and investment power with respect to the Shares indicated.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
NAME AND ADDRESS OF BENEFICIAL OWNERSHIP
BENEFICIAL OWNER OF SHARES PERCENT OF CLASS(1)
- -------------------------------------------------------- -------------------- -------------------
<S> <C> <C>
Richard C. Blum......................................... 2,012,158(2) 10.2%
909 Montgomery Street, Suite 400
San Francisco, CA 94133
Manchester Securities Corp.............................. 1,914,760(3) 9.7%
712 Fifth Avenue
New York, NY 10019
Farallon Capital Management, L.L.C...................... 1,569,900(4) 8.0%
One Maritime Plaza, Suite 1325
San Francisco, CA 94111
Pioneering Management Corporation....................... 1,237,950 6.3%
60 State Street
Boston, MA 02109
Gabelli Funds, Inc...................................... 1,031,200(5) 5.2%
One Corporate Center
Rye, New York 10580-1434
James R. Porter......................................... 828,664 4.2%
3055 Triad Drive
Livermore, CA 94550
William W. Stevens...................................... 324,154(6) 1.6%
3055 Triad Drive
Livermore, CA 94550
3055 Management Corp.................................... 199,072(7) 1.0%
3055 Triad Drive
Livermore, CA 94550
Stanley F. Marquis...................................... 136,824 0.7%
3055 Triad Drive
Livermore, CA 94550
Larry D. McReynolds..................................... 19,317 0.1%
3055 Triad Drive
Livermore, CA 94550
Martin W. Inderbitzen................................... 0 0%
3055 Triad Drive
Livermore, CA 94550
All Executive Officers and Advisory Board Members as a
Group................................................. 1,508,031 7.7%
</TABLE>
- ---------------
(1) Except as indicated in the footnotes to this table, the persons named in the
table have sole voting and investment power with respect to all Shares shown
as beneficially owned by them, subject to community property laws, where
applicable.
(2) Richard C. Blum ("Mr. Blum") is a controlling person and Chairman of Richard
C. Blum & Associates Inc. ("Inc."), which is the general partner of Richard
C. Blum & Associates LP ("LP"). These Shares
24
<PAGE> 31
are directly owned by three limited partnerships for which LP is the general
partner (BK Capital Partners II, 111,111 Shares; BK Capital Partners III,
500,000 Shares; and BK Capital Partners IV, 1,387,047 Shares). Mr. Blum
disclaims beneficial ownership of these securities except to the extent of
his pecuniary interest thereof.
(3) Manchester Securities Corp. is wholly-owned by Elliott Associates, L.P.
("Elliott"). Paul E. Singer ("Singer") and Braxton Associates, L.P., a New
Jersey limited partnership, which is controlled by Singer, are the general
partners of Elliott.
(4) Includes 1,363,200 Shares held by Farallon Capital Partners, L.P. and
206,700 Shares held by Tinicum Partners, L.P.
(5) Includes 205,000 Shares held by GAMCO Investors, Inc., 169,900 Shares held
by Gabelli Performance Partnership L.P. and 656,300 Shares held by Gabelli
Associates Fund. Mario J. Gabelli is the Chairman, Chief Executive Officer
and Chief Investment Officer of Gabelli Funds, Inc.
(6) Includes 324,154 Shares held as tenant-in-common with Virda J. Stevens.
(7) In addition to the totals shown in the above table, Messrs. Porter and
Stevens are deemed to be the beneficial owners of 199,072 Shares by virtue
of their respective 50% equity ownership in 3055 Management Corp.
TRANSACTIONS BY CERTAIN PERSONS IN THE SHARES
No transactions in the Company's Shares were effected by any Advisory Board
member or executive officer of the Company during the 60 day period preceding
the date of this Proxy Statement.
25
<PAGE> 32
MANAGEMENT OF THE COMPANY, RCBA
AND THE ACQUISITION LLC
Certain information concerning the directors and executive officers of the
Company, RCBA and the Acquisition LLC is set forth below. Unless otherwise
indicated, each such person is a citizen of the United States and the address of
each such person is that of the Company, RCBA or the Acquisition LLC, as the
case may be. Such addresses are set forth under the caption "SUMMARY -- The
Company" and "-- RCBA."
THE COMPANY
The names, ages, principal occupations and employment history for the past
five years of the members of the Advisory Board and executive officers of the
Company, and the Board of Directors and executive officers of the Management
Corp. are set forth below.
James R. Porter, 61, has been a member of the Company's Advisory Board
since the Company's inception in February, 1997, and has been a director and
Vice President of the Management Corp. since its inception in February, 1997. He
is Chairman of the Board of CCI/Triad. He was President and Chief Executive
Officer of Triad from September, 1985 until its merger with Cooperative
Computing, Inc. in February, 1997. He is also a director of Silicon Valley Bank,
Brock International, Inc. and Cellular Technical Services, Inc.
William W. Stevens, 65, has been a member of the Company's Advisory Board
since the Company's inception in February, 1997, and has been a director and
Chairman of the Management Corp. since its inception in February, 1997. He was
Chairman of the Board of Triad from 1972 until its merger with Cooperative
Computing, Inc. in February, 1997. He is the founder of Triad and was its
President and Chief Executive Officer from its inception until September, 1985.
Stanley F. Marquis, 54, has been a member of the Company's Advisory Board
since the Company's inception in February, 1997. He was President of Triad
Systems Financial Corporation from August, 1983 until June 30, 1997. Mr. Marquis
was also Treasurer of Triad from September, 1987 until June 30, 1997, and was
its Vice President, Finance from December, 1994 until March, 1997.
Martin W. Inderbitzen, 45, has been a member of the Company's Advisory
Board since March, 1997. He has been a member of the State Bar of California
since 1976, maintaining a private general civil law practice since that time.
His practice has emphasized land use entitlement and zoning work almost
exclusively for the past ten years.
Larry D. McReynolds, 52, has been the President of the Company since its
inception in February, 1997. He joined Triad in September, 1984 as its Manager,
Facilities and became Manager, Real Estate and Facilities in June, 1992. In
July, 1994 he also assumed responsibility for Triad's Office Services. He is
currently employed in similar capacities for CCI/Triad.
RCBA AND AFFILIATES
RCBA. The names, principal occupations and employment history for the past
five years of the directors and executive officers of RCBA are set forth below.
Richard C. Blum, 62, has been President and Chairman of RCBA since 1994 and
has been President and Chairman of RCBA Inc. since 1985.
Nils Colin Lind, 41, has been Managing Director of RCBA since 1994 and has
been Managing Director of RCBA Inc. since 1987. Mr. Lind is a Norwegian citizen.
Jeffrey W. Ubben, 36, has been Managing Director of Investments of RCBA
since April, 1995. Prior to that, he was a portfolio manager for Fidelity
Management and Research Company from March, 1991 until March, 1995.
26
<PAGE> 33
William C. Johnston, 44, has been Managing Director of Investments of RCBA
since August, 1997. Prior to that, he was a Managing Director of APAC Holdings
Ltd., a direct investment firm in Hong Kong, from 1991 until July, 1997.
John C. Walker, 36, has been a Managing Director of RCBA since April, 1997.
Prior to that, he held various positions with Pexco Holdings, Inc. from Ocotber,
1992 until March, 1997.
Murray A. Indick, 38, has been Managing Director and General Counsel of
RCBA since April, 1997. He was a partner with the law firm of Dechert Price &
Rhoads from December, 1996 until March, 1997. He was with the law firm of
Wilmer, Cutler & Pickering from November, 1985 to March, 1992 and from
September, 1993 until November, 1996, and was Deputy General Counsel of First
American Bankshares from April, 1992 until August, 1993.
George F. Hamel, Jr., 40, has been Managing Director of Marketing of RCBA
since April, 1996. He was Vice President of Private Capital Management, Inc.
from March, 1992, until March, 1996.
Marc T. Scholvinck, 40, has been Managing Director and Chief Financial
Officer of RCBA since March, 1996. He was Vice President and Controller of RCBA
from November, 1995 until March, 1996, and was Director of Finance and
Controller of RCBA Inc. from January, 1994 until November, 1995, positions he
also held with RCBA Inc. from August, 1991 until March, 1993. He was a
self-employed financial consultant from March, 1993 until December, 1993 and
served as Financial Director of Leopard Rock Hotel (Pty) Ltd. during that
period.
Thomas L. Kempner, 70, has been a Director of RCBA, Inc. since May, 1985.
He has been Chairman of Loeb Partners Corp. since December, 1979.
THE ACQUISITION LLC
RCBA is the Managing Member of the Acquisition LLC. All information
regarding the directors and executive officers of RCBA may be found in the
preceding section.
CERTAIN PROCEEDINGS
During the past five years, neither the Company, RCBA, the Acquisition LLC,
nor any of the individuals named above with respect to those entities has been
convicted in a criminal proceeding (excluding traffic violations and similar
misdemeanors), or been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
been or become subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws of finding any violation with respect to such laws.
SHAREHOLDER PROPOSALS
In the event the Merger is not consummated for any reason, proposals of
shareholders intended to be presented at the 1998 annual meeting of shareholders
must be received by the Company at its principal executive offices not later
than December 15, 1997 for inclusion in the Company's proxy statement and form
of proxy relating to that meeting. Shareholders should mail any proposals by
certified mail return receipt requested.
INDEPENDENT PUBLIC ACCOUNTANTS
The financial statements of the Company as of September 30, 1996,
incorporated by reference in this Proxy Statement, have been audited by Coopers
& Lybrand LLP, independent public accountants.
A representative of Coopers & Lybrand LLP will be at the Special Meeting to
answer questions by shareholders and will have the opportunity to make a
statement if so desired.
27
<PAGE> 34
INFORMATION INCORPORATED BY REFERENCE
The Company's Information Statement on Form 10-SB dated June 20, 1997,
Quarterly Report on Form 10-QSB for the quarters ended June 30, 1997 and
September 30, 1997 and its Current Reports on Form 8-K dated September 10, 1997
and September 15, 1997 as filed by the Company with the Commission (Commission
File No. 0-22343), are incorporated by reference into this Proxy Statement.
All documents filed by the Company pursuant to sections 13(a), 13(c), 14 or
15(d) or the Exchange Act after the date of this Proxy Statement and prior to
the date of the Special Meeting shall be deemed to be incorporated by reference
herein and to be a part hereof from the date of filing of such documents. Copies
of the documents (without exhibits) incorporated by reference in this Proxy
Statement are available without charge upon written or oral request from Larry
D. McReynolds, President, Triad Park, LLC, 3055 Triad Drive, Livermore,
California 94550 (telephone (510)449-0606).
AVAILABLE INFORMATION
The Company is subject to the informational reporting requirements of the
Exchange Act and, in accordance therewith, files reports, proxy statements and
other information with the Commission. Such reports, proxy statements and other
information can be inspected and copies made at the public reference facilities
of the Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549
and the Commission's regional offices at Seven World Trade Center, Suite 1300,
New York, New York 10048 and Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661. Copies of such material can also be obtained from
the Public Reference Section of Commission at its Washington, D.C. address at
prescribed rates. The Commission also maintains a Web site address,
http://www.sec.gov.
ADDITIONAL INFORMATION
This Proxy Statement contains information disclosed pursuant to Rule 13e-3
under the Exchange Act, which governs so-called "going private" transactions by
certain issuers and their affiliates. At the time the Company and RCBA entered
into the Merger Agreement, RCBA owned 1,998,158 Shares which represents
approximately 10.1% of the voting power of the Company's Shares. Although
neither the Company nor RCBA believes that RCBA or the Acquisition LLC was than
an "affiliate" of the Company within the meaning of Rule 13e-3(a)(1) of the
Exchange Act, RCBA, the Acquisition LLC and the Company are filing a Rule 13e-3
Transaction Statement ("Schedule 13E-3") with the Commission to furnish
information with respect to the transactions described herein. This Proxy
Statement does not contain all of the information set forth in the Schedule
13E-3, parts of which are omitted in accordance with the regulations of the
Commission. The Schedule 13E-3, and any amendments thereto, including exhibits
filed as part thereof, will be available for inspection and copying at the
offices of the Commission as set forth above.
By Order of the Advisory Board
James R. Porter
Vice President, 3055 Management Corp.,
Manager of the Company
Livermore, California
November , 1997
28
<PAGE> 35
TRIAD PARK, LLC
3055 TRIAD DRIVE
LIVERMORE, CALIFORNIA 94550
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS DECEMBER , 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE ADVISORY BOARD
The undersigned appoints Larry D. McReynolds and Stanley F. Marquis, and
each of them, with power to act without the other and with all the right of
substitution in each, the proxies of the undersigned to vote all shares of Triad
Park, LLC (the "Company") held by the undersigned on November , 1997, at the
Special Meeting of Shareholders of the Company, to be held on December , 1997
at 9:00 a.m. local time at the offices of the Company, 3055 Triad Drive,
Livermore, California 94550, and all adjournments thereof, with all powers the
undersigned would possess if present in person. All previous proxies given with
respect to the meeting are revoked.
Receipt of Notice of Special Meeting of Shareholders and Proxy Statement is
acknowledged by your execution of this proxy. Complete, sign, date, and return
this proxy in the addressed envelope -- no postage required. Please mail
promptly to save further solicitation expenses.
<TABLE>
<S> <C> <C> <C>
1. Approval of Merger Agreement, dated [ ] FOR THE MERGER [ ] AGAINST THE MERGER [ ] ABSTAIN
September 9, 1997, by and between TPL
Acquisition, LLC, Richard C. Blum &
Associates, LP and Triad Park, LLC
</TABLE>
(continued, and to be dated and signed, on other side)
<PAGE> 36
2. To vote with discretionary authority upon such other matters as may come
before the meeting. (Discretionary authority will be only exercised with
respect to votes in favor or abstentions.)
[ ] APPROVED [ ] WITHHELD
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS PROVIDED BY THE
UNDERSIGNED SHAREHOLDER, THIS PROXY WILL BE VOTED "FOR" ITEM 1 LISTED HEREIN,
UPON ALL OTHER MATTERS, THE PROXIES SHALL VOTE AS THEY DEEM IN THE BEST
INTERESTS OF THE COMPANY.
SIGNATURE(S)
-----------------------------------
-----------------------------------
Dated: , 1997
INSTRUCTION: When shares are held
by joint tenants, all joint tenants
should sign. When signing as
attorney, executor, administrator,
trustee, custodian, or guardian,
please give full title as such. If
shares are held by a corporation,
this proxy should be signed in full
corporate name by its president or
other authorized officer. If a
partnership holds the shares
subject to this proxy, an
authorized person should sign in
the name of such partnership.
