SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
SCHEDULE TO
Tender Offer Statement Under Section 14(d)(1) or 13(e)(1)
of the Securities Exchange Act of 1934
WYNSTONE FUND, L.L.C.
(Name of Issuer)
WYNSTONE FUND, L.L.C.
(Name of Person(s) Filing Statement)
LIMITED LIABILITY COMPANY INTERESTS
(Title of Class of Securities)
N/A
(CUSIP Number of Class of Securities)
Howard M. Singer
Wynstone Fund, L.L.C.
One World Financial Center
200 Liberty Street
31st Floor
New York, New York 10281
(212) 667-4225
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of the Person(s) Filing Statement)
With a copy to:
Kenneth S. Gerstein, Esq.
Schulte Roth & Zabel LLP
900 Third Avenue
New York, New York 10022
(212) 756-2533
December 1, 2000
(Date Tender Offer First Published,
Sent or Given to Security Holders)
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CALCULATION OF FILING FEE
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Transaction Valuation: $5,000,000(a) Amount of Filing Fee: $1,000(b)
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(a) Calculated as the aggregate maximum purchase price for Interests.
(b) Calculated at 1/50th of 1% of the Transaction Valuation.
[ ] Check the box if any part of the fee is offset as provided by Rule
0-1l(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
Amount Previously Paid: __________________________
Form or Registration No.: ________________________
Filing Party: ____________________________________
Date Filed: ______________________________________
[ ] Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
Check the appropriate boxes below to designate any transactions to which the
statement relates:
[ ] third-party tender offer subject to Rule 14d-1.
[X] issuer tender offer subject to Rule 13e-4.
[ ] going-private transaction subject to Rule 13e-3.
[ ] amendment to Schedule 13D under Rule 13d-2.
Check the following box if the filing is a final amendment reporting the results
of the tender offer: [ ]
ITEM 1. SUMMARY TERM SHEET.
As stated in the Fund's offering documents, the Fund is offering to
purchase limited liability company interests in the Fund ("Interests") from
members at their estimated net asset value (that is, the estimated value of the
Fund's assets minus its liabilities, multiplied by the proportionate interest in
the Fund a member desires to tender). The offer will remain open until 12:00
midnight, New York time, on December 31, 2000. Estimated net asset value of the
Fund will be calculated for this purpose on December 31, 2000. The Fund will
review the net asset value calculation during the Fund's audit for calendar year
2000, which the Fund expects will be completed in February 2001.
Members may tender their entire Interest, a portion of their Interest
defined as a specific dollar value, or the portion of their Interest above the
required capital account balance.
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If a member tenders its entire interest in the Fund, the Fund will pay the
member in cash and/or marketable securities (valued in accordance with the
Fund's Limited Liability Company Agreement dated July 1, 1999) by January 10,
2001, 95% of the estimated value of the member's Interest based on the Fund's
calculation of the estimated net asset value as of December 31, 2000, less any
incentive allocation payable to the investment adviser on December 31, 2000 or,
if the offer is extended, on the expiration date of the offer. The Fund will owe
the member the balance, for which it will give the member a promissory note that
will be held in the member's brokerage account with CIBC World Markets Corp.
("CIBC WM"). A member who tenders for repurchase only part of its Interest will
be required to maintain a capital account balance equal to the greater of: (i)
$150,000, net of the amount of the incentive allocation, if any, that is to be
debited from the capital account of the member on the expiration date of the
offer (the "Incentive Allocation") or would be so debited if the expiration date
were a day on which an incentive allocation was made (the "Tentative Incentive
Allocation"); or (ii) the amount of the Tentative Incentive Allocation, if any.
In the case of a partial tender of an Interest, the Fund will pay the full
estimated net asset value of the portion of the Interest tendered in cash and/or
marketable securities by January 10. The Fund reserves the right to purchase
less than the amount tendered by a member if the amount tendered would cause the
member's capital account in the Fund to have a value less than the required
minimum balance. The Fund will make payment for the Interests it purchases from
one or more of the following sources: cash on hand, the proceeds from the sale
of portfolio securities held by the Fund, or by borrowing, if the offer is
extended (which the Fund does not intend to do).
The offer remains open to members until 12:00 midnight New York time on
December 31, 2000, the expected expiration date of the offer. Until this time,
members have the right to change their minds and withdraw any tenders of their
Interests. Members will also have the right to withdraw tenders of their
Interests at any time after January 30, 2001, if their Interests have not yet
been accepted for purchase by the Fund.
A member who would like the Fund to purchase all or part of its Interest
should mail or fax a Letter of Transmittal (attached to this document as Exhibit
C) to PFPC Inc., attention Karl Garrett, so that it is received before 12:00
midnight, New York time, on December 31, 2000. A member who chooses to fax the
Letter of Transmittal should mail the original Letter of Transmittal to PFPC
Inc. promptly after it is faxed (although the original does not have to be
received before 12:00 midnight, December 31, 2000). The mailing address for PFPC
Inc. is P.O. Box 249, Claymont, DE 19703, and the fax numbers are (302) 791-3225
or (302) 791-2387.
Of course, the value of the Interests will change due to market fluctuation
between October 31 (the last time estimated net asset value was calculated) and
December 31, when the value of the Fund will be determined for purposes of
calculating the purchase price for Interests. Members may obtain the estimated
net asset value of their Interests, which the Fund calculates weekly until the
expiration date of the offer and daily for the last five business days of the
offer, by contacting PFPC Inc. at (888) 697-9661 or (866) 306-0232 or at the
address listed above, Monday through Friday, except holidays, during normal
business hours of 9:00 a.m. to 5:00 p.m. (Eastern Time).
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Each member has the right to withdraw an Interest it has tendered, and the
Fund has the right to cancel, amend or postpone this offer, at any time before
12:00 midnight, New York time, on December 31, 2000.
ITEM 2. ISSUER INFORMATION.
(a) The name of the issuer is Wynstone Fund, L.L.C. (the "Fund"). The Fund
is registered under the Investment Company Act of 1940 (the "1940 Act"), as a
closed-end, non-diversified, management investment company and is organized as a
Delaware limited liability company. The principal executive office of the Fund
is located at One World Financial Center, 200 Liberty Street, 31st Floor, New
York, New York 10281 and the telephone number is (212) 667-4225.
(b) The title of the securities that are the subject of the offer to
purchase (the "Offer") is limited liability company interests or portions
thereof in the Fund. (As used herein, the term "Interest" or "Interests," as the
context requires, refers to the limited liability company interests in the Fund
and portions thereof that constitute the class of security that is the subject
of this tender offer or the limited liability company interests in the Fund or
portions thereof that are tendered by members to the Fund pursuant to the
Offer.) As of the close of business on October 31, 2000, there was approximately
$17,794,122 outstanding in capital of the Fund, represented by Interests.
Subject to the conditions set forth in the Offer to Purchase, the Fund will
purchase up to $5 million of Interests that are tendered by, and not withdrawn
prior to, 12:00 midnight, New York time, on December 31, 2000, subject to any
extension of the Offer.
(c) Interests are not traded in any market, and their transfer is strictly
limited by the terms of the Fund's Limited Liability Company Agreement dated as
of July 1, 1999 (the "LLC Agreement").
ITEM 3. IDENTITY AND BACKGROUND OF FILING PERSON.
(a) The name of the filing person is Wynstone Fund, L.L.C. (the "Fund").
The Fund's principal executive office is located at One World Financial Center,
200 Liberty Street, 31st Floor, New York, New York 10281 and the telephone
number is (212) 667-4225. The Investment Adviser to the Fund is CIBC Oppenheimer
Advisers, L.L.C. (the "Adviser"). The principal executive office of the Adviser
is located at One World Financial Center, 31st Floor, 200 Liberty Street, New
York, New York 10281 and the telephone number is (212) 667-4225. The Fund's
Managers are Jesse H. Ausubel, Charles F. Barber, Paul Belica and Howard M.
Singer. Their address is c/o CIBC Oppenheimer Advisers, L.L.C., One World
Financial Center, 31st Floor, 200 Liberty Street, New York, New York 10281.
ITEM 4. TERMS OF THIS TENDER OFFER.
(a) (1) (i) Subject to the conditions set forth in the Offer to Purchase,
the Fund will purchase up to $5 million of Interests that are tendered by, and
not withdrawn prior to, 12:00 midnight, New York time, on December 31, 2000
(this time and date, the "Initial Expiration Date"), subject to any extension of
the Offer. The later of the Initial Expiration Date or the latest time and date
to which the offer is extended is called the "Expiration Date."
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(ii) The purchase price of Interests tendered to the Fund for purchase
will be their estimated net asset value as of the close of business on the
Expiration Date.
For members who tender their entire Interest, payment of the purchase
price will consist of: (a) cash and/or marketable securities (valued in
accordance with the LLC Agreement) in an aggregate amount equal to 95% of
the estimated unaudited net asset value of Interests tendered and accepted
by the Fund, determined as of the Expiration Date (which is expected to be
12:00 midnight, New York time, on Sunday December 31, 2000) payable within
ten days after the Expiration Date, (the "95% Payment"); and (b) a
promissory note (the "Note"), entitling the holder thereof to a contingent
payment equal to the excess, if any, of (a) the net asset value of the
Interests tendered and accepted by the Fund as of the Expiration Date,
determined based on the audited financial statements of the Fund for
calendar year 2000, over (b) the 95% Payment. The Note will be delivered to
the tendering member in the manner set forth in the Letter of Transmittal,
attached as Exhibit C, within ten days after the Expiration Date and will
not be transferable. The Note will be payable in cash within ten days after
completion of the audit of the financial statements of the Fund for
calendar year 2000. It is anticipated that the audit of the Fund's
financial statements for calendar year 2000 will be completed by no later
than 60 days after the end of the year. Any amounts payable under the Note
will include interest, if any, earned by the Fund on an amount, deposited
by the Fund in a segregated custodial account, equal to 5% of the estimated
unaudited net asset value of Interests tendered and accepted for purchase
by the Fund. Although the Fund has retained the option to pay all or a
portion of the purchase price by distributing marketable securities, the
purchase price will be paid entirely in cash except in the unlikely event
that the Board of Managers of the Fund determines that the distribution of
securities is necessary to avoid or mitigate any adverse effect of the
Offer on the remaining members of the Fund.
Members who tender only a portion of their Interests (subject to
maintenance of the required minimum capital account balance discussed in
Item 1 above) will receive cash and/or marketable securities in an
aggregate amount equal to 100% of the estimated unaudited net asset value
of Interests tendered and accepted for purchase by the Fund, determined as
of the Expiration Date, payable within ten days after the Expiration Date.
A copy of: (a) the Cover Letter to the Offer to Purchase and Letter of
Transmittal; (b) the Offer to Purchase; (c) a form of Letter of
Transmittal; (d) a form of Notice of Withdrawal of Tender; and (e) forms of
Letters to Members that will be sent in connection with the Fund's
acceptance of tenders, are attached as Exhibits A, B, C, D and E,
respectively, and are incorporated by reference in their entirety.
(iii) The scheduled expiration date of the Offer is 12:00 midnight,
New York time, Sunday, December 31, 2000.
(iv) Not applicable.
(v) The Fund reserves the right, at any time and from time to time, to
extend the period of time during which the Offer is pending by notifying
members of the extension. If the Fund elects to extend the tender period,
for the purpose of determining the
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purchase price for tendered Interests, the estimated net asset value of
such Interests will be determined at the close of business on the day the
tender offer actually expires. During any such extension, all Interests
previously tendered and not withdrawn will remain subject to the Offer. The
Fund also reserves the right, at any time and from time to time, up to and
including acceptance of tenders pursuant to the Offer, to: (a) cancel the
Offer in the circumstances set forth in Section 7 of the Offer to Purchase
and in the event of such cancellation, not to purchase or pay for any
Interests tendered pursuant to the Offer; (b) amend the Offer; or (c)
postpone the acceptance of Interests. If the Fund determines to amend the
Offer or to postpone the acceptance of Interests tendered, it will, to the
extent necessary, extend the period of time during which the Offer is open
as provided above and will promptly notify members.
(vi) Interests may be withdrawn at any time before 12:00 midnight, New
York time, Sunday, December 31, 2000 and, if Interests have not then been
accepted for purchase by the Fund, at any time after January 30, 2001.
(vii) Members wishing to tender Interests pursuant to the Offer should
mail or fax a completed and executed Letter of Transmittal to PFPC Inc.
("PFPC"), to the attention of Karl Garrett, at the address or fax numbers
listed on page 2 of the Offer to Purchase. The completed and executed
Letter of Transmittal must be received by PFPC, either by mail or by fax,
no later than the Expiration Date. The Fund recommends that all documents
be submitted to PFPC by certified mail, return receipt requested, or by
facsimile transmission. A member who faxes a Letter of Transmittal to PFPC
must also send or deliver the original completed and executed Letter of
Transmittal to PFPC promptly thereafter.
Any member who tenders an Interest pursuant to the Offer may withdraw
its tender at any time on or before on the Expiration Date and, if
Interests have not then been accepted for purchase by the Fund, at any time
after January 30, 2001. To be effective, any notice of withdrawal must be
timely received by PFPC at the address or fax numbers listed on page 2 of
the Offer to Purchase. A form to use to give notice of withdrawal is
available by calling PFPC at the phone numbers indicated on page 2 of the
Offer to Purchase. Interests properly withdrawn shall not thereafter be
deemed to be tendered for purposes of the Offer. However, withdrawn
Interests may be tendered prior to the Expiration Date by following the
procedures described above.
(viii) For purposes of the Offer, the Fund will be deemed to have
accepted (and purchased) Interests that are tendered when it gives written
notice to the tendering member of its election to purchase the member's
Interest.
(ix) If more than $5 million of Interests are duly tendered to the
Fund prior to the Expiration Date and not withdrawn, the Fund will in its
sole discretion either: (a) accept the additional Interests permitted to be
accepted pursuant to Rule 13e-4(f)(1)(ii) under the Securities Exchange Act
of 1934; (b) extend the Offer, if necessary, and increase the amount of
Interests that the Fund is offering to purchase to an amount it believes
sufficient to accommodate the excess Interests tendered as well as any
Interests tendered during the extended Offer; or (c) accept Interests
tendered on or before the Expiration Date for payment on a pro rata basis
based on the aggregate estimated net asset value of tendered Interests. The
Offer may be extended, amended or canceled in various other circumstances
described in (v) above.
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(x) The purchase of Interests pursuant to the Offer will have the
effect of increasing the proportionate interest in the Fund of members who
do not tender Interests. Members who retain their Interests may be subject
to increased risks that may possibly result from the reduction in the
Fund's aggregate assets resulting from payment for the Interests tendered.
These risks include the potential for greater volatility due to decreased
diversification. However, the Fund believes that this result is unlikely
given the nature of the Fund's investment program. A reduction in the
aggregate assets of the Fund may result in members who do not tender
Interests bearing higher costs to the extent that certain expenses borne by
the Fund are relatively fixed and may not decrease if assets decline. These
effects may be reduced or eliminated to the extent that additional
subscriptions for Interests are made by new and existing members on January
1, 2001 and thereafter from time to time.
(xi) Not applicable.
(xii) The following discussion is a general summary of the federal
income tax consequences of the purchase of Interests by the Fund from
members pursuant to the Offer. Members should consult their own tax
advisers for a complete description of the tax consequences to them of a
purchase of their Interests by the Fund pursuant to the Offer.
In general, a member from whom an Interest is purchased by the Fund
will be treated as receiving a distribution from the Fund. A member
generally will not recognize income or gain as a result of this purchase,
except to the extent (if any) that the amount of consideration received by
the member exceeds the member's then adjusted tax basis in the member's
Interest. A member's basis in its Interest will be adjusted for income,
gain or loss allocated (for tax purposes) to the member for periods prior
to the purchase of the Interest. Cash distributed to a member in excess of
the adjusted tax basis of the member's Interest is taxable as a capital
gain or ordinary income, depending on the circumstances. A member whose
entire Interest is purchased by the Fund may recognize a loss, but only to
the extent that the amount of consideration received from the Fund is less
than the member's then adjusted tax basis in the member's Interest.
(a) (2) Not applicable.
(b) Canadian Imperial Holdings, Inc., an affiliate of the Adviser, has
informed the Fund that it intends to tender $1.5 million in Interests.
ITEM 5. PAST CONTRACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS WITH RESPECT
TO THE ISSUER'S SECURITIES.
The Fund's Confidential Memorandum dated March 1999, as supplemented (the
"Confidential Memorandum"), and the LLC Agreement, which were provided to each
member in advance of subscribing for Interests, provide that the Fund's Board of
Managers has the discretion to determine whether the Fund will purchase
Interests from members from time to time pursuant to written tenders. The
Confidential Memorandum also states that the Adviser expects that it will
recommend to the Board of Managers that the Fund purchase Interests from members
twice each year, in June and December. The Fund previously offered to purchase
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Interests from members pursuant to written tenders effective as of December 31,
1999 and June 30, 2000. Those were the first two tender offers made by the Fund.
The Fund is not aware of any contract, arrangement, understanding or
relationship relating, directly or indirectly, to this tender offer (whether or
not legally enforceable) between: (i) the Fund and the Adviser or any Manager of
the Fund or any person controlling the Fund or controlling the Adviser; and (ii)
any person, with respect to Interests. However, the LLC Agreement provides that
the Fund shall be dissolved if the Interest of any member that has submitted a
written request in accordance with the terms of the LLC Agreement to tender its
entire Interest for repurchase by the Fund has not been repurchased within a
period of two years of the request.
ITEM 6. PURPOSES OF THIS TENDER OFFER AND PLANS OR PROPOSALS OF THE ISSUER OR
AFFILIATE.
(a) The purpose of the Offer is to provide liquidity to members who hold
Interests as contemplated by and in accordance with the procedures set forth in
the Confidential Memorandum and the LLC Agreement.
(b) Interests that are tendered to the Fund in connection with the Offer to
Purchase will be retired, although the Fund may issue Interests from time to
time in transactions not involving any public offering, conducted pursuant to
Rule 506 of Regulation D under the Securities Act of 1933. The Fund currently
expects that it will accept subscriptions for Interests as of January 1, 2001
and on the first day of each calendar quarter thereafter, but is under no
obligation to do so.
(c) Neither the Fund, the Adviser nor the Board of Managers has any plans
or proposals that relate to or would result in: (1) the acquisition by any
person of additional Interests (other than the Fund's intention to accept
subscriptions for Interests on January 1, 2001 and from time to time in the
discretion of the Fund), or the disposition of Interests; (2) an extraordinary
transaction, such as a merger, reorganization or liquidation, involving the
Fund; (3) any material change in the present distribution policy or indebtedness
or capitalization of the Fund; (4) any change in the identity of the Adviser or
the members of the Board of Managers, or in the management of the Fund
including, but not limited to, any plans or proposals to change the number or
the term of members of the Board of Managers, to fill any existing vacancy on
the Board of Managers or to change any material term of the investment advisory
arrangements with the Adviser; (5) a sale or transfer of a material amount of
assets of the Fund (other than as the Board of Managers determines may be
necessary or appropriate to fund all or a portion of the purchase price for
Interests to be acquired pursuant to the Offer or in connection with the
ordinary portfolio transactions of the Fund); (6) any other material change in
the Fund's structure or business, including any plans or proposals to make any
changes in its fundamental investment policies, as amended, for which a vote
would be required by Section 13 of the 1940 Act; or (7) any changes in the LLC
Agreement or other actions that might impede the acquisition of control of the
Fund by any person. Because Interests are not traded in any market, Items (6),
(7) and (8) of Item 1006(c) are not applicable to the Fund.
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ITEM 7. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) The Fund expects that the purchase price for Interests acquired
pursuant to the Offer, which will not exceed $5 million (unless the Fund elects
to purchase a greater amount), will be derived from one or more of the following
sources: (i) cash on hand; (ii) the proceeds from the sale or delivery of
securities and portfolio assets held by the Fund; and (iii) possibly borrowings,
as described in paragraph (b), below. The Fund will segregate, with its
custodian, cash or U.S. government securities or other liquid securities equal
to the value of the amount estimated to be paid under any Notes as described
above.
(b) Neither the Fund, the Adviser nor the Board of Managers has determined
at this time to borrow funds to purchase Interests in connection with the Offer.
However, depending on the dollar amount of Interests tendered and prevailing
general economic and market conditions, the Fund, in its sole discretion, may
decide to seek to borrow money to fund all or a portion of the purchase price
for Interests, subject to compliance with applicable law, from its existing
margin facility established with the Fund's prime broker, Morgan Stanley & Co.
Incorporated ("Morgan Stanley"). If the Fund finances any portion of the
purchase price in that manner, it will deposit assets in a special custody
account with its custodian, to serve as collateral for any amounts so borrowed,
and if the Fund were to fail to repay any such amounts, Morgan Stanley would be
entitled to satisfy the Fund's obligations from the collateral deposited in the
special custody account. The Fund expects that the repayment of any amounts
borrowed from Morgan Stanley will be made from additional funds contributed to
the Fund by existing or new members, or from proceeds of the sale of securities
and portfolio assets held by the Fund.
ITEM 8. INTEREST IN SECURITIES OF THE ISSUER.
(a) Based on October 31, 2000 estimated values, Canadian Imperial Holdings,
Inc., an affiliate of the Adviser, owns $5,407,597 (30.4%) of the Interests. In
addition, the Adviser is entitled under the terms of the LLC Agreement to
receive an incentive allocation (subject to certain limitations), as specified
in the LLC Agreement and described in the Confidential Memorandum.
(b) Other than the acceptance of subscriptions for Interests as of October
1, 2000, there have been no transactions involving Interests that were effected
during the past 60 business days by the Fund, the Adviser, any Manager or any
person controlling the Fund or the Adviser.
ITEM 9. PERSONS/ASSETS RETAINED, EMPLOYED, COMPENSATED OR USED.
No persons have been employed, retained or are to be compensated by the
Fund to make solicitations or recommendations in connection with the Offer to
Purchase.
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ITEM 10. FINANCIAL STATEMENTS.
(a) (1) Reference is made to the following financial statements of the
Fund, which the Fund has prepared and furnished to members pursuant to Rule
30d-l under the 1940 Act and filed with the Securities and Exchange Commission
pursuant to Rule 30b2-1 under the 1940 Act, and which are incorporated by
reference in their entirety for the purpose of filing this Schedule TO:
Audited financial statements for the period November 16, 1998 (commencement
of operations) through December 31, 1998, previously filed on EDGAR on Form
N-30D on March 1, 1999;
Audited financial statements for the year ended December 31, 1999,
previously filed on EDGAR on Form N-30D on March 1, 2000; and
Unaudited financial statements for the six-month period ended June 30,
2000, previously filed on EDGAR on Form N-30D on September 8, 2000.
(2) The Fund is not required to and does not file quarterly unaudited
financial statements under the Securities Exchange Act of 1934. The Fund
does not have shares, and consequently does not have earnings per share
information.
(3) Not Applicable.
(4) The Fund does not have shares, and consequently does not have book
value per share information.
(b) The Fund's assets will be reduced by the amount of the tendered
Interests that are purchased by the Fund. Thus, income relative to assets may be
affected by the tender offer. The Fund does not have shares and consequently
does not have earnings or book value per share information.
ITEM 11. ADDITIONAL INFORMATION.
(a) (1) None.
(2) None.
(3) Not Applicable.
(4) Not Applicable.
(5) None.
(b) None.
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ITEM 12. EXHIBITS.
A. Cover Letter to Offer to Purchase and Letter of Transmittal.
B. Offer to Purchase (financial statements to be enclosed).
C. Form of Letter of Transmittal.
D. Form of Notice of Withdrawal of Tender.
E. Forms of Letters from the Fund to Members in connection with
acceptance of tenders.
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
WYNSTONE FUND, L.L.C.
By: Board of Managers
By: /s/ HOWARD M. SINGER
--------------------------
Name: Howard M. Singer
Title: Manager
December 1, 2000
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EXHIBIT INDEX
EXHIBIT
A Cover Letter to Offer to Purchase and Letter of Transmittal.
B Offer to Purchase (financial statements to be enclosed).
C Form of Letter of Transmittal.
D Form of Notice of Withdrawal of Tender.
E Forms of Letters from the Fund to Members in connection with acceptance of
tenders.
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EXHIBIT A
Cover Letter to Offer to Purchase and Letter of Transmittal
[Wynstone Fund, L.L.C. Letterhead]
IF YOU DO NOT WANT TO SELL YOUR LIMITED LIABILITY COMPANY INTERESTS
AT THIS TIME, PLEASE DISREGARD THIS NOTICE.
THIS IS SOLELY A NOTIFICATION OF THE FUND'S TENDER OFFER.
December 1, 2000
Dear Wynstone Fund, L.L.C. Member:
We are writing to inform you of important dates relating to a tender offer
by Wynstone Fund, L.L.C. (the "Fund"). If you are not interested in selling your
limited liability company interests in the Fund ("Interests") at this time,
please disregard this notice and take no action.
The tender offer period will begin on December 1, 2000 and end on December
31, 2000. The purpose of the tender offer is to provide liquidity to members who
hold Interests. Interests may be presented to the Fund for purchase only by
tendering them during one of the Fund's announced tender offers.
Should you wish to tender all or part of your Interest for purchase by the
Fund during this tender offer period, please complete and return the enclosed
Letter of Transmittal in the enclosed postage-paid envelope or by fax so that it
arrives no later than December 31, 2000. If you do not wish to tender your
Interests, simply disregard this notice. NO ACTION IS REQUIRED IF YOU DO NOT
WISH TO SELL ANY PORTION OF YOUR INTEREST AT THIS TIME.
All tenders of Interests must be received by the Fund's Administrator, PFPC
Inc., either by mail or by fax (if by fax, please deliver an original, executed
copy promptly thereafter) in good order by December 31, 2000.
If you have any questions, please refer to the attached Offer to Purchase
document, which contains additional important information about the tender
offer, or call your Account Executive or Karl Garrett at our Administrator,
(888) 697-9661 or (866) 306-0232.
Sincerely,
Wynstone Fund, L.L.C.
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EXHIBIT B
Offer to Purchase (financial statements to be enclosed)
WYNSTONE FUND, L.L.C.
One World Financial Center
200 Liberty Street, 31st Floor
New York, New York 10281
OFFER TO PURCHASE $5 MILLION OF OUTSTANDING
INTERESTS AT NET ASSET VALUE
DATED DECEMBER 1, 2000
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT
12:00 MIDNIGHT, NEW YORK TIME, ON SUNDAY, DECEMBER 31, 2000,
UNLESS THE OFFER IS EXTENDED
To the Members of
Wynstone Fund, L.L.C.:
Wynstone Fund, L.L.C., a closed-end, non-diversified, management investment
company organized as a Delaware limited liability company (the "Fund"), is
offering to purchase for cash on the terms and conditions set forth in this
offer to purchase ("Offer to Purchase") and the related Letter of Transmittal
(which together with the Offer to Purchase constitutes the "Offer") up to $5
million of interests in the Fund or portions thereof pursuant to tenders by
members at a price equal to their estimated net asset value as of December 31,
2000, if the Offer expires on December 31, 2000. If the Fund elects to extend
the tender period, for the purpose of determining the purchase price for
tendered Interests, the estimated net asset value of such Interests will be
determined at the close of business on the expiration date of the Offer. (As
used in this Offer, the term "Interest," or "Interests," as the context
requires, shall refer to the Interests in the Fund and portions thereof
representing beneficial Interests in the Fund.) This Offer is being made to all
members of the Fund and is not conditioned on any minimum amount of Interests
being tendered, but is subject to certain conditions described below. Interests
are not traded on any established trading market and are subject to strict
restrictions on transferability pursuant to the Fund's Limited Liability Company
Agreement dated as of July 1, 1999 (the "LLC Agreement").
Members should realize that the value of the Interests tendered in this
Offer will change due to market fluctuation between October 31 (the last time
net asset value was calculated) and December 31, when the value of the Fund will
be determined for purposes of calculating the purchase price of Interests.
Members should also note that they remain members in the Fund until the
expiration date of the offer when the net asset value of their Interests is
calculated. Any tendering members who wish to obtain the estimated net asset
value of their Interests should contact PFPC Inc., at the telephone numbers or
address set forth below, Monday through Friday, except holidays, during normal
business hours of 9:00 a.m. to 5:00 p.m. (Eastern Time).
<PAGE>
Members desiring to tender all or any portion of their Interest in
accordance with the terms of the Offer should complete and sign the attached
Letter of Transmittal and mail or fax it to the Fund in the manner set forth in
Section 4 below.
IMPORTANT
NEITHER THE FUND, ITS INVESTMENT ADVISER NOR ITS BOARD OF MANAGERS MAKES
ANY RECOMMENDATION TO ANY MEMBER AS TO WHETHER TO TENDER OR REFRAIN FROM
TENDERING INTERESTS. MEMBERS MUST MAKE THEIR OWN DECISIONS WHETHER TO TENDER
INTERESTS, AND, IF SO, THE PORTION OF THEIR INTERESTS TO TENDER.
BECAUSE EACH MEMBER'S INVESTMENT DECISION IS A PERSONAL ONE, BASED ON ITS
OWN FINANCIAL CIRCUMSTANCES, NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY
RECOMMENDATION ON BEHALF OF THE FUND AS TO WHETHER MEMBERS SHOULD TENDER
INTERESTS PURSUANT TO THE OFFER. NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THE OFFER OTHER
THAN THOSE CONTAINED HEREIN OR IN THE LETTER OF TRANSMITTAL. IF GIVEN OR MADE,
SUCH RECOMMENDATION AND SUCH INFORMATION AND REPRESENTATIONS MUST NOT BE RELIED
ON AS HAVING BEEN AUTHORIZED BY THE FUND.
THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY
STATE SECURITIES COMMISSION HAS PASSED ON THE FAIRNESS OR MERITS OF THIS
TRANSACTION OR ON THE ACCURACY OR ADEQUACY OF THE INFORMATION CONTAINED IN THIS
DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
Questions, requests for assistance, and requests for additional copies of
the Offer may be directed to the Fund's service agent:
PFPC Inc.
Attention: Karl Garrett
P.O. Box 249
Claymont, Delaware 19703
Phone: (888) 697-9661
(866) 306-0232
Fax: (302) 791-3225
(302) 791-2387
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TABLE OF CONTENTS
1. Background and Purpose of the Offer......................................5
2. Offer to Purchase and Price..............................................6
3. Amount of Tender.........................................................7
4. Procedure for Tenders....................................................8
5. Withdrawal Rights........................................................8
6. Purchases and Payment....................................................8
7. Certain Conditions of the Offer.........................................10
8. Certain Information About the Fund......................................11
9. Certain Federal Income Tax Consequences.................................11
10. Miscellaneous...........................................................12
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SUMMARY TERM SHEET
o As stated in the Fund's offering documents, we will purchase your limited
liability company interests ("Interests") at their estimated net asset
value (that is, the estimated value of the Fund's assets minus its
liabilities, multiplied by the proportionate interest in the Fund you
desire to tender). This offer will remain open until 12:00 midnight New
York time, on December 31, 2000. Estimated net asset value will be
calculated for this purpose on December 31, 2000. We will review the net
asset value calculation during our audit for calendar year 2000, which we
expect will be completed in February 2001.
o You may tender your entire Interest, a portion of your Interest defined as
a specific dollar value, or the portion of your Interest above the required
minimum capital account balance.
o If you tender your entire interest in the Fund, we will pay you in cash
and/or marketable securities (valued in accordance with the Fund's LLC
Agreement) by January 10, 2001, 95% of our calculation of the estimated net
asset value of your Interest as of December 31, 2000, less any incentive
allocation payable to the investment adviser on December 31, 2000 (or if
the offer is extended, on the expiration date of the offer). We will owe
you the balance, for which we will give you a promissory note that will be
held in your brokerage account with CIBC World Markets Corp. ("CIBC WM").
o If you tender only part of your Interest, you will be required to maintain
a capital account balance equal to the greater of: (i) $150,000, net of the
amount of the incentive allocation, if any, that is to be debited from your
capital account on the expiration date of the offer (the "Incentive
Allocation") or would be so debited if the expiration date were a day on
which an incentive allocation was made (the "Tentative Incentive
Allocation"); or (ii) the amount of the Tentative Incentive Allocation, if
any. In the case of a partial tender of an Interest, we will pay the full
estimated net asset value of the portion of the Interest tendered in cash
and/or marketable securities by January 10. We reserve the right to
purchase less than the amount you tender if the amount you tender would
cause your account in the Fund to have a value less than the required
minimum balance. We will pay you from: cash on hand, the proceeds from the
sale or delivery of portfolio securities held by the Fund, or by borrowing
if the offer is extended (which we do not intend to do).
o Following this summary is a formal notice of our offer to purchase your
Interests. Our offer remains open to you until 12:00 midnight New York
time, on December 31, 2000, the expected expiration date of the offer.
Until this time, you have the right to change your mind and withdraw any
tenders of your Interests. You will also have the right to withdraw the
tenders of your Interests at any time after January 30, 2001, if your
Interests have not yet been accepted for purchase.
o If you would like us to purchase all or a portion of your Interest, you
should mail or fax a Letter of Transmittal (enclosed), to PFPC Inc.,
attention Karl Garrett, so that it is received before 12:00 midnight, New
York time, on December 31, 2000. The mailing address and fax numbers for
PFPC Inc. are listed on page 2. If you fax the Letter of Transmittal, you
should mail the original Letter of Transmittal to PFPC Inc. promptly after
you fax it (although the
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<PAGE>
original does not have to be received before 12:00 midnight, New York time,
on December 31, 2000).
o The value of your Interests will change due to market fluctuation between
October 31 (the last time estimated net asset value was calculated) and
December 31, when the value of the Fund will be determined for purposes of
calculating the purchase price for Interests.
o If you would like to obtain the estimated net asset value of your
Interests, which is calculated weekly until the expiration date of the
offer and daily for the last five business days of the offer, you may
contact PFPC Inc. at (888) 697-9661 or (866) 306-0232 or at the address
listed on page 2, Monday through Friday, except holidays, during normal
business hours of 9:00 a.m. to 5:00 p.m. (Eastern Time).
o You have the right to withdraw the Interests you tender, and we have the
right to cancel, amend or postpone this offer, at any time before 12:00
midnight, New York time, on December 31, 2000.
1. BACKGROUND AND PURPOSE OF THE OFFER. The purpose of the Offer is to
provide liquidity to members who hold Interests, as contemplated by and in
accordance with the procedures set forth in the Fund's Confidential Memorandum
dated September 1998, as supplemented (the "Confidential Memorandum"), and the
LLC Agreement. The Confidential Memorandum and the LLC Agreement, which were
provided to each member in advance of subscribing for Interests, provide that
the Board of Managers of the Fund has the discretion to determine whether the
Fund will purchase Interests from time to time from members pursuant to written
tenders. The Confidential Memorandum also states that CIBC Oppenheimer Advisers,
L.L.C., the investment adviser of the Fund (the "Adviser"), expects that it will
recommend to the Board of Managers that the Fund purchase Interests from members
twice in each year, in June and December. The Fund previously offered to
purchase Interests from members pursuant to written tenders effective as of
December 31, 1999 and June 30, 2000. Those were the first two tender offers made
by the Fund. Because there is no secondary trading market for Interests and
transfers of Interests are prohibited without prior approval of the Fund, the
Board of Managers has determined, after consideration of various matters,
including but not limited to those set forth in the Confidential Memorandum,
that the Offer is in the best interests of members of the Fund in order to
provide liquidity for Interests as contemplated in the Confidential Memorandum
and the LLC Agreement. The Board of Managers intends to consider the continued
desirability of the Fund making an offer to purchase Interests twice in each
year, but the Fund is not required to make any such offer.
The purchase of Interests pursuant to the Offer will have the effect of
increasing the proportionate interest in the Fund of members who do not tender
Interests. Members who retain their Interests may be subject to increased risks
that may possibly result from the reduction in the Fund's aggregate assets
resulting from payment for the Interests tendered. These risks include the
potential for greater volatility due to decreased diversification. However, the
Fund believes that this result is unlikely given the nature of the Fund's
investment program. A reduction in the aggregate assets of the Fund may result
in members who do not tender interests bearing higher costs to the extent that
certain expenses borne by the Fund are relatively fixed and may not decrease if
assets decline. These effects may be reduced or eliminated to the extent that
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<PAGE>
additional subscriptions for Interests are made by new and existing members on
January 1, 2001 and thereafter from time to time.
Interests that are tendered to the Fund in connection with this Offer will
be retired, although the Fund may issue new Interests from time to time in
transactions not involving any public offering conducted pursuant to Rule 506 of
Regulation D under the Securities Act of 1933. The Fund currently expects that
it will accept subscriptions for Interests as of January 1, 2001 and on the
first day of each calendar quarter thereafter, but is under no obligation to do
so.
2. OFFER TO PURCHASE AND PRICE. The Fund will, on the terms and subject to
the conditions of the Offer, purchase up to $5 million of those outstanding
Interests that are properly tendered by and not withdrawn (in accordance with
Section 5 below) prior to 12:00 midnight, New York time, on Sunday, December 31,
2000 (this time and date is called the "Initial Expiration Date"), or any later
date as corresponds to any extension of the Offer. The later of the Initial
Expiration Date or the latest time and date to which the Offer is extended is
called the "Expiration Date." The Fund reserves the right to extend, amend or
cancel the Offer as described in Sections 3 and 7 below. The purchase price of
an Interest tendered will be its estimated net asset value as of the close of
business on the Expiration Date, payable as set forth in Section 6. As of the
close of business on October 31, 2000, the estimated unaudited net asset value
of an Interest corresponding to an initial capital contribution of $150,000 on
the following closing dates of the Fund was as follows:
If you invested $150,000 on the Your Unaudited Net Asset Value as of
following closing date: October 31, 2000 would be:
------------------------------- ------------------------------------
November 1, 1998 $168,680.40
December 1, 1998 $172,619.50
January 1, 1999 $170,652.40
February 1, 1999 $174,099.80
March 1, 1999 $174,528.90
May 1, 1999 $164,380.90
July 1, 1999 $162,440.55
August 1, 1999 $165,741.38
September 1, 1999 $175,028.54
October 1, 1999 $177,795.93
January 1, 2000 $178,971.70
-6-
<PAGE>
If you invested $150,000 on the Your Unaudited Net Asset Value as of
following closing date: October 31, 2000 would be:
------------------------------- -------------------------------------
April 1, 2000 $179,198.85
July 1, 2000 $177,833.42
October 1, 2000 $151,743.45
As of the close of business on October 31, 2000, there was approximately
$17,794,122 outstanding in capital of the Fund held in Interests (based on the
unaudited net asset value of such Interests). Members may obtain weekly current
net asset value information until the expiration of the Offer, and daily net
asset value information during the last five business days of the Offer, by
contacting PFPC Inc. ("PFPC") at the telephone numbers or address listed on page
2, Monday through Friday, except holidays, during normal business hours of 9:00
a.m. to 5:00 p.m. (Eastern Time).
3. AMOUNT OF TENDER. Subject to the limitations set forth below, members
may tender their entire Interest, a portion of their Interest defined as a
specific dollar value, or the portion of their Interest above the required
minimum capital account balance, as described below. A member who tenders for
repurchase only a portion of the member's Interest shall be required to maintain
a capital account balance equal to the greater of: (i) $150,000, net of the
amount of the incentive allocation, if any, that is to be debited from the
capital account of the member on the Expiration Date (the "Incentive
Allocation") or would be so debited if the Expiration Date were a day on which
an incentive allocation was made (the "Tentative Incentive Allocation"); or (ii)
the amount of the Tentative Incentive Allocation, if any. If a member tenders an
amount that would cause the member's capital account balance to fall below the
required minimum, the Fund reserves the right to reduce the amount to be
purchased from that member so that the required minimum balance is maintained.
The Offer is being made to all members of the Fund and is not conditioned on any
minimum amount of Interests being tendered.
If the amount of the Interests that are properly tendered pursuant to the
Offer and not withdrawn pursuant to Section 5 below is less than or equal to $5
million (or such greater amount as the Fund may elect to purchase pursuant to
the Offer), the Fund will, on the terms and subject to the conditions of the
Offer, purchase all of the Interests so tendered unless the Fund elects to
cancel or amend the Offer, or postpone acceptance of tenders made pursuant to
the Offer, as provided in Section 7 below. If more than $5 million of Interests
are duly tendered to the Fund prior to the expiration of the Offer and not
withdrawn pursuant to Section 5 below, the Fund will in its sole discretion
either (a) accept the additional Interests permitted to be accepted pursuant to
Rule 13e-4(f)(1)(ii) under the Securities Exchange Act of 1934; (b) extend the
Offer, if necessary, and increase the amount of Interests that the Fund is
offering to purchase to an amount it believes sufficient to accommodate the
excess Interests tendered as well as any Interests tendered during the extended
Offer; or (c) accept Interests tendered prior to or on the Expiration Date for
payment on a pro rata basis based on the aggregate estimated net asset value
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<PAGE>
of tendered Interests. The Offer may be extended, amended or canceled in various
other circumstances described in Section 7 below.
Canadian Imperial Holdings, Inc., an affiliate of the Adviser, has informed
the Fund that it intends to tender $1.5 million in Interests.
4. PROCEDURE FOR TENDERS. Members wishing to tender Interests pursuant to
the Offer should mail or fax a completed and executed Letter of Transmittal to
PFPC, to the attention of Karl Garrett, at the address or fax numbers listed on
page 2. The completed and executed Letter of Transmittal must be received by
PFPC, either by mail or by fax, no later than the Expiration Date.
The Fund recommends that all documents be submitted to PFPC via certified
mail, return receipt requested, or by facsimile transmission. A member who faxes
a Letter of Transmittal to PFPC must also send or deliver the original completed
and executed Letter of Transmittal to PFPC. Members who wish to confirm receipt
of a Letter of Transmittal may contact PFPC at the address or phone numbers
listed on page 2. The method of delivery of any documents is at the election and
complete risk of the member tendering an Interest including, but not limited to,
the failure of PFPC to receive any Letter of Transmittal or other document
submitted by facsimile transmission. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance of tenders will be
determined by the Fund, in its sole discretion, and such determination shall be
final and binding. The Fund reserves the absolute right to reject any or all
tenders determined by it not to be in appropriate form or the acceptance of or
payment for which would, in the opinion of counsel for the Fund, be unlawful.
The Fund also reserves the absolute right to waive any of the conditions of the
Offer or any defect in any tender with respect to any particular Interest or any
particular member, and the Fund's interpretation of the terms and conditions of
the Offer will be final and binding. Unless waived, any defects or
irregularities in connection with tenders must be cured within such time as the
Fund shall determine. Tenders will not be deemed to have been made until the
defects or irregularities have been cured or waived. None of the Fund, the
Adviser or the Board of Managers shall be obligated to give notice of any
defects or irregularities in tenders, nor shall any of them incur any liability
for failure to give such notice.
5. WITHDRAWAL RIGHTS. Any member tendering an Interest pursuant to this
Offer may withdraw its tender at any time prior to or on the Expiration Date
and, if the member's Interests are not yet accepted by the Fund, at any time
after 40 business days from the commencement of the Offer. To be effective, any
notice of withdrawal must be timely received by PFPC at the address or fax
numbers listed on page 2. A form to give notice of withdrawal is available by
calling PFPC at the phone numbers indicated on page 2. All questions as to the
form and validity (including time of receipt) of notices of withdrawal will be
determined by the Fund, in its sole discretion, and such determination shall be
final and binding. Interests properly withdrawn shall not thereafter be deemed
to be tendered for purposes of the Offer. However, withdrawn Interests may be
tendered prior to the Expiration Date by following the procedures described in
Section 4.
6. PURCHASES AND PAYMENT. For purposes of the Offer, the Fund will be
deemed to have accepted (and purchased) Interests that are tendered when it
gives oral or written
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<PAGE>
notice to the tendering member of its election to purchase the member's
Interest. As stated in Section 2 above, the purchase price of an Interest
tendered by any member will be the net asset value thereof as of the close of
business on December 31, 2000, if the Offer expires on the Initial Expiration
Date, and otherwise the net asset value thereof as of the close of business on
any later date as corresponds to any extension of the Offer. The net asset value
will be determined after all allocations to capital accounts of the member
required to be made by the LLC Agreement have been made.
For members who tender their entire Interest, payment of the purchase price
will consist of: (1) cash and/or marketable securities (valued in accordance
with the LLC Agreement) in an aggregate amount equal to 95% of the estimated
unaudited net asset value of Interests tendered and accepted by the Fund,
determined as of the Expiration Date, which is expected to be 12:00 midnight,
New York time, on Sunday, December 31, 2000, payable within ten days after the
Expiration Date (the "95% Cash Payment") in the manner set forth below; and (2)
a promissory note (the "Note") entitling the holder thereof to a contingent
payment equal to the excess, if any, of (a) the net asset value of the Interests
tendered and accepted by the Fund as of the Expiration Date, determined based on
the audited financial statements of the Fund for 2000, over (b) the 95% Cash
Payment. The Note will be delivered to the tendering member in the manner set
forth below within ten days after the Expiration Date and will not be
transferable. The Note will be payable in cash (in the manner set forth below)
within ten days after completion of the audit of the financial statements of the
Fund for calendar year 2000. It is anticipated that the audit of the Fund's
calendar year 2000 financial statements will be completed no later than 60 days
after December 31, 2000. Any amounts payable under the Note will include
interest, if any, earned by the Fund on an amount, deposited by the Fund in a
segregated custodial account, equal to 5 percent of the estimated unaudited net
asset value of Interests tendered and accepted by the Fund. Although the Fund
has retained the option to pay all or a portion of the purchase price by
distributing marketable securities, the purchase price will be paid entirely in
cash except in the unlikely event that the Board of Managers determines that the
distribution of securities is necessary to avoid or mitigate any adverse effect
of the Offer on the remaining members of the Fund.
Members who tender a portion of their Interest (subject to maintenance of
the minimum capital account balance described in Item 3, above) will receive
cash and/or marketable securities in an aggregate amount equal to 100% of the
estimated unaudited net asset value of Interests tendered and accepted by the
Fund, determined as of the Expiration Date (the "100% Cash Payment") payable
within ten days after the Expiration Date.
Both the 95% Cash Payment and the 100% Cash Payment (together, the "Cash
Payment") will be made by wire transfer directly to the tendering member's
brokerage account with CIBC World Markets Corp. ("CIBC WM"). Cash Payments wired
directly to brokerage accounts will be subject upon withdrawal from the account
to any fees that CIBC WM would customarily assess upon the withdrawal of cash
from the account.
The Note will be deposited directly to the tendering member's brokerage
account with CIBC WM. Any contingent payment due pursuant to the Note will also
be deposited directly to the tendering member's brokerage account at CIBC WM and
will be subject upon
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<PAGE>
withdrawal from the account to any fees that CIBC WM would customarily assess
upon the withdrawal of cash from the account.
It is expected that cash payments for Interests acquired pursuant to the
Offer to Purchase, which will not exceed $5 million, (unless the Fund elects to
purchase a greater amount) will be derived from: (a) cash on hand; (b) the
proceeds of the sale of securities and portfolio assets held by the Fund; and/or
(c) possibly borrowings, as described below. The Fund will segregate with its
custodian cash or U.S. government securities or other liquid securities equal to
the value of the amount estimated to be paid under the Notes, as described
above. Neither the Fund, the Board of Managers, nor the Adviser have determined
at this time to borrow funds to purchase Interests tendered in connection with
the Offer. However, depending on the dollar amount of Interests tendered and
prevailing general economic and market conditions, the Fund, in its sole
discretion, may decide to finance any portion of the purchase price, subject to
compliance with applicable law, from its existing margin facility established
with the Fund's prime broker, Morgan Stanley & Co. Incorporated ("Morgan
Stanley"). If the Fund finances any portion of the purchase price in that
manner, it will deposit assets in a special custody account with its custodian,
PFPC Trust Company, to serve as collateral for any amounts so borrowed, and if
the Fund were to fail to repay any such amounts, Morgan Stanley would be
entitled to satisfy the Fund's obligations from the collateral deposited in the
special custody account. The Fund expects that the repayment of any amounts
borrowed from Morgan Stanley will be made from additional funds contributed to
the Fund by existing and/or new members, or from the proceeds of the sale of
securities and portfolio assets held by the Fund.
7. CERTAIN CONDITIONS OF THE OFFER. The Fund reserves the right, at any
time and from time to time, to extend the period of time during which the Offer
is pending by notifying members of the extension. In the event that the Fund so
elects to extend the tender period, for the purpose of determining the purchase
price for tendered Interests, the estimated net asset value of the Interests
will be determined as of a date after December 31, 2000, corresponding to any
extension of the Offer. During any extension, all Interests previously tendered
and not withdrawn will remain subject to the Offer. The Fund also reserves the
right, at any time and from time to time, up to and including acceptance of
tenders pursuant to the Offer, to: (a) cancel the Offer in the circumstances set
forth in the following paragraph and in the event of such cancellation not to
purchase or pay for any Interests tendered pursuant to the Offer; (b) amend the
Offer; and (c) postpone the acceptance of Interests. If the Fund determines to
amend the Offer or to postpone the acceptance of Interests tendered, it will, to
the extent necessary, extend the period of time during which the Offer is open
as provided above and will promptly notify members.
The Fund may cancel the Offer, amend the Offer or postpone the acceptance
of tenders made pursuant to the Offer if: (a) the Fund would not be able to
liquidate portfolio securities in a manner that is orderly and consistent with
the Fund's investment objectives and policies in order to purchase Interests
tendered pursuant to the Offer; (b) there is, in the judgment of the Board of
Managers, any (i) legal action or proceeding instituted or threatened
challenging the Offer or otherwise materially adversely affecting the Fund, (ii)
declaration of a banking moratorium by Federal or state authorities or any
suspension of payment by banks in the United States or New York State that is
material to the Fund, (iii) limitation imposed by Federal or state authorities
on the extension of credit by lending institutions, (iv) suspension of trading
on any
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<PAGE>
organized exchange or over-the-counter market where the Fund has a material
investment, (v) commencement of war, armed hostilities or other international or
national calamity directly or indirectly involving the United States that is
material to the Fund, (vi) material decrease in the net asset value of the Fund
from the net asset value of the Fund as of commencement of the Offer, or (vii)
other event or condition that would have a material adverse effect on the Fund
or its members if Interests tendered pursuant to the Offer were purchased; or
(c) the Board of Managers determines that it is not in the best interest of the
Fund to purchase Interests pursuant to the Offer. However, there can be no
assurance that the Fund will exercise its right to extend, amend or cancel the
Offer or to postpone acceptance of tenders pursuant to the Offer.
8. CERTAIN INFORMATION ABOUT THE FUND. The Fund is registered under the
Investment Company Act of 1940 (the "1940 Act"), as a closed-end,
non-diversified, management investment company and is organized as a Delaware
limited liability company. The principal office of the Fund is located at One
World Financial Center, 31st Floor, 200 Liberty Street, New York, New York
10281. Interests are not traded on any established trading market and are
subject to strict restrictions on transferability pursuant to the LLC Agreement.
The Fund does not have any plans or proposals that relate to or would
result in: (a) the acquisition by any person of additional Interests (other than
the Fund's intention to accept subscriptions for Interests on January 1, 2001
and from time to time in the discretion of the Fund) or the disposition of
Interests; (b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Fund; (c) any material change in
the present distribution policy or indebtedness or capitalization of the Fund;
(d) any change in the identity of the investment adviser of the Fund or in the
management of the Fund, including but not limited to, any plans or proposals to
change the number or the term of the members of the Board of Managers, to fill
any existing vacancy on the Board of Managers or to change any material term of
the investment advisory arrangement with the Adviser; (e) a sale or transfer of
a material amount of assets of the Fund (other than as the Board of Managers
determines may be necessary or appropriate to fund any portion of the purchase
price for Interests acquired pursuant to this Offer to Purchase or in connection
with ordinary portfolio transactions of the Fund); (f) any other material change
in the Fund's structure or business, including any plans or proposals to make
any changes in its fundamental investment policy for which a vote would be
required by Section 13 of the 1940 Act; or (g) any changes in the LLC Agreement
or other actions that may impede the acquisition of control of the Fund by any
person.
Other than the acceptance of subscriptions for Interests on October 1,
2000, there have been no transactions involving the Interests that were effected
during the past 60 business days by the Fund, the Adviser, any member of the
Fund or any person controlling the Fund or the Adviser or controlling any member
of the Fund. Based on October 31, 2000 estimated values, Canadian Imperial
Holdings, Inc., an affiliate of the Adviser, owns $5,407,597 (30.4%) of the
Interests. The Adviser of the Fund is entitled under the terms of the LLC
Agreement to receive the Incentive Allocation (subject to certain limitations),
as specified in the LLC Agreement and described in the Confidential Memorandum.
9. CERTAIN FEDERAL INCOME TAX CONSEQUENCES. The following discussion is a
general summary of the federal income tax consequences of the purchase of
Interests by the Fund from members pursuant to the Offer. Members should consult
their own tax advisers for a
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complete description of the tax consequences to them of a purchase of their
Interests by the Fund pursuant to the Offer.
In general, a member from whom an Interest is purchased by the Fund will be
treated as receiving a distribution from the Fund. A member generally will not
recognize income or gain as a result of the purchase, except to the extent (if
any) that the amount of consideration received by the member exceeds the
member's then adjusted tax basis in the member's Interest. A member's basis in
its Interest will be reduced (but not below zero) by the amount of consideration
received by the member from the Fund in connection with the purchase of the
Interest. A member's basis in its Interest will be adjusted for income, gain or
loss allocated (for tax purposes) to the member for periods prior to the
purchase of the Interest. Cash distributed to a member in excess of the adjusted
tax basis of the member's Interest is taxable as capital gain or ordinary
income, depending on the circumstances. A member whose entire Interest is
purchased by the Fund may recognize a loss, but only to the extent that the
amount of consideration received from the Fund is less than the member's then
adjusted tax basis in the member's Interest.
10. MISCELLANEOUS. The Offer is not being made to, nor will tenders be
accepted from, members in any jurisdiction in which the Offer or its acceptance
would not comply with the securities or Blue Sky laws of the jurisdiction. The
Fund is not aware of any jurisdiction in which the Offer or tenders pursuant
thereto would not be in compliance with the laws of the jurisdiction. However,
the Fund reserves the right to exclude members from the Offer in any
jurisdiction in which it is asserted that the Offer cannot lawfully be made. The
Fund believes this exclusion is permissible under applicable laws and
regulations, provided the Fund makes a good faith effort to comply with any
state law deemed applicable to the Offer.
The Fund has filed an Issuer Tender Offer Statement on Schedule TO with the
Securities and Exchange Commission, which includes certain information relating
to the Offer summarized herein. A free copy of the statement may be obtained
from the Fund by contacting PFPC at the address and phone numbers listed on page
2 or from the Securities and Exchange Commission's internet web site,
http://www.sec.gov. For a fee, a copy may be obtained from the public reference
office of the Securities and Exchange Commission at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, DC 20549.
-12-
<PAGE>
ANNEX A
Financial Statements
Members will be sent full and complete copies of the following financial
statements of the Fund, which were previously filed on EDGAR and are
incorporated by reference in their entirety for the purpose of filing this
Schedule TO:
Audited financial statements for the period November 16, 1998 (commencement
of operations) through December 31, 1998, previously filed on EDGAR on Form
N-30D on March 1, 1999;
Audited financial statements for the year ended December 31, 1999,
previously filed on EDGAR on Form N-30D on March 1, 2000; and
Unaudited financial statements for the six-month period ended June 30,
2000, previously filed on EDGAR on Form N-30D on September 8, 2000.
<PAGE>
EXHIBIT C
LETTER OF TRANSMITTAL
Regarding Interests in
WYNSTONE FUND, L.L.C.
Tendered Pursuant to the Offer to Purchase
Dated December 1, 2000
--------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE
AT, AND THIS LETTER OF TRANSMITTAL MUST BE
RECEIVED BY THE FUND BY, 12:00 MIDNIGHT, NEW YORK TIME,
ON SUNDAY, DECEMBER 31, 2000, UNLESS THE OFFER IS EXTENDED.
--------------------------------------------------------------------------------
Complete this Letter of Transmittal and Return by Mail or Fax to:
PFPC Inc.
Attn: Karl Garrett
P.O. Box 249
Claymont, DE 19703
Fax: (302) 791-3225
(302) 791-2387
For additional information:
Phone: (888) 697-9661 or (866) 306-0232
Ladies and Gentlemen:
The undersigned hereby tenders to Wynstone Fund, L.L.C., a closed-end,
non-diversified, management investment company organized under the laws of the
State of Delaware (the "Fund"), the limited liability company interest
(hereinafter the "Interest" or "Interests" as the context requires) in the Fund
or portion thereof held by the undersigned, described and specified below, on
the terms and conditions set forth in the offer to purchase, dated December 1,
2000 ("Offer to Purchase"), receipt of which is hereby acknowledged, and in this
Letter of Transmittal (which together constitute the "Offer"). THE TENDER AND
THIS LETTER OF TRANSMITTAL ARE SUBJECT TO ALL THE TERMS AND CONDITIONS SET FORTH
IN THE OFFER TO PURCHASE, INCLUDING, BUT NOT LIMITED TO, THE ABSOLUTE RIGHT OF
THE FUND TO REJECT ANY AND ALL TENDERS DETERMINED BY THE FUND, IN ITS SOLE
DISCRETION, NOT TO BE IN THE APPROPRIATE FORM.
C-1
<PAGE>
The undersigned hereby sells to the Fund the Interest or portion thereof
tendered hereby pursuant to the Offer. The undersigned hereby warrants that the
undersigned has full authority to sell the Interest or portion thereof tendered
hereby and that the Fund will acquire good title thereto, free and clear of all
liens, charges, encumbrances, conditional sales agreements or other obligations
relating to the sale thereof, and not subject to any adverse claim, when and to
the extent the same are purchased by it. Upon request, the undersigned will
execute and deliver any additional documents necessary to complete the sale in
accordance with the terms of the Offer.
The undersigned recognizes that under certain circumstances set forth in
the Offer, the Fund may not be required to purchase any of the Interests in the
Fund or portions thereof tendered hereby.
Payment of the purchase price for the Interest or portion thereof tendered
by the undersigned will be made by wire transfer of the funds to the
undersigned's brokerage account at CIBC World Markets Corp. ("CIBC WM"), as
described in Section 6 of the Offer. The undersigned hereby represents and
warrants that the undersigned understands that upon a withdrawal of this cash
payment from the account, CIBC WM may subject the withdrawal to any fees that
CIBC WM would customarily assess upon the withdrawal of cash from the account.
(Any payment in the form of marketable securities would be made by means of
special arrangement with the tendering member in the sole discretion of the
Board of Managers of the Fund.)
A promissory note reflecting the contingent payment portion of the purchase
price, if any, as described in Section 6 of the Offer to Purchase, will be
deposited directly to the undersigned's brokerage account with CIBC WM. (Any
contingent payment of cash due pursuant to the Note will also be deposited
directly to the tendering member's brokerage account with CIBC WM and, upon a
withdrawal of this cash from the account, CIBC WM may impose any fees that would
customarily be assessed upon the withdrawal of cash from the account.) The
undersigned recognizes that the amount of the purchase price for Interests will
be based on the unaudited estimated net asset value of the Fund as of December
31, 2000, and that the contingent payment portion of the purchase price, if any,
will be determined upon completion of the audit of the Fund's financial
statements for calendar year 2000, which is anticipated to be completed not
later than 60 days after December 31, 2000, the Fund's fiscal year end, and will
be paid within ten days thereafter.
All authority herein conferred or agreed to be conferred shall survive the
death or incapacity of the undersigned and the obligation of the undersigned
hereunder shall be binding on the heirs, personal representatives, successors
and assigns of the undersigned. Except as stated in Section 5 of the Offer to
Purchase, this tender is irrevocable.
C-2
<PAGE>
PLEASE FAX OR MAIL IN THE ENCLOSED POSTAGE PAID ENVELOPE TO:
PFPC INC., ATTN: KARL GARRETT; P.O. BOX 249, CLAYMONT, DE 19703
FAX: (302) 791-3225 OR (302) 791-2387.
FOR ADDITIONAL INFORMATION: PHONE: (888) 697-9661 OR (866) 306-0232
PART 1. MEMBER INFORMATION:
Name of Member:
--------------------------------------------------------
Social Security No.
or Taxpayer
Identification No.:
-------------------
Telephone Number: ( )
---------------------
PART 2. AMOUNT OF LIMITED LIABILITY COMPANY INTEREST IN THE FUND BEING
TENDERED:
[ ] Entire limited liability company interest.
[ ] Portion of limited liability company interest expressed as a specific
dollar value. (A minimum interest with a value greater than: (a)
$150,000, net of the incentive allocation or net of the tentative
incentive allocation; or (b) the tentative incentive allocation, must
be maintained (the "Required Minimum Balance").)*
$___________________
[ ] Portion of limited liability company interest in excess of the
Required Minimum Balance.
*The undersigned understands and agrees that if the undersigned
tenders an amount that would cause the undersigned's capital account
balance to fall below the Required Minimum Balance, the Fund may
reduce the amount to be purchased from the undersigned so that the
Required Minimum Balance is maintained.
PART 3. PAYMENT.
CASH PAYMENT
Cash payments will be wire transferred directly to the undersigned's
brokerage account at CIBC WM. The undersigned hereby represents and
warrants that the undersigned understands that, for cash payments wired
directly to the undersigned's brokerage account, upon a withdrawal of this
cash payment from the account, CIBC WM may impose any fees that would
customarily be assessed upon the withdrawal of cash from the account. (Any
payment in the form of marketable securities would be made by means of
special arrangements with the tendering member.)
C-3
<PAGE>
PROMISSORY NOTE
The promissory note reflecting the contingent payment portion of the
purchase price, if applicable, will be deposited directly to the
undersigned's brokerage account at CIBC WM. The undersigned hereby
represents and warrants that the undersigned understands that any
contingent payment of cash due pursuant to the Note will also be deposited
directly to the undersigned's brokerage account at CIBC WM, and, upon a
withdrawal of this cash from the account, CIBC WM may impose any fees that
would customarily be assessed upon the withdrawal of cash from the account.
PART 4. SIGNATURE(S).
--------------------------------------------------------------------------------
FOR INDIVIDUAL INVESTORS FOR OTHER INVESTORS:
AND JOINT TENANTS:
------------------------------------ ------------------------------------
Signature Print Name of Investor
(Signature of Owner(s) Exactly as
Appeared On Subscription Agreement)
------------------------------------ ------------------------------------
Print Name of Investor Signature
(Signature of Owner(s) Exactly as
Appeared On Subscription Agreement)
------------------------------------ ------------------------------------
Joint Tenant Signature if necessary Print Name of Signatory and Title
(Signature of Owner(s) Exactly as
Appeared On Subscription Agreement)
------------------------------------ ------------------------------------
Print Name of Joint Tenant Co-signatory if necessary
(Signature of Owner(s) Exactly as
Appeared On Subscription Agreement)
------------------------------------
Print Name and Title of Co-signatory
--------------------------------------------------------------------------------
Date:
--------------------
C-4
<PAGE>
EXHIBIT D
Form of Notice of Withdrawal of Tender
(To be provided only to members who call and request the form.)
NOTICE OF WITHDRAWAL OF TENDER
Regarding Interests in
WYNSTONE FUND, L.L.C.
Tendered Pursuant to the Offer to Purchase
Dated December 1, 2000
--------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE
AT, AND THIS NOTICE OF WITHDRAWAL MUST BE
RECEIVED BY THE FUND BY, 12:00 MIDNIGHT, NEW YORK TIME,
ON SUNDAY, DECEMBER 31, 2000, UNLESS THE OFFER IS EXTENDED.
--------------------------------------------------------------------------------
Complete this Notice of Withdrawal and Return by Mail or Fax to:
PFPC Inc.
Attn: Karl Garrett
P.O. Box 249
Claymont, DE 19703
Fax: (302) 791-3225
(302) 791-2387
For additional information:
Phone: (888) 697-9661 or (866) 306-0232
Ladies and Gentlemen:
The undersigned wishes to withdraw the tender of its limited liability
company interest in Wynstone Fund, L.L.C. (the "Fund"), or the tender of a
portion of such interests, for purchase by the Fund that previously was
submitted by the undersigned in a Letter of Transmittal dated ________________.
D-1
<PAGE>
This tender was in the amount of:
[ ] Entire limited liability company interest.
[ ] Portion of limited liability company interest expressed as a specific
dollar value.
$_______________________
[ ] Portion of limited liability company interest in excess of the
Required Minimum Balance.
The undersigned recognizes that upon the submission on a timely basis of
this Notice of Withdrawal of Tender, properly executed, the interest in the Fund
(or portion of the interest) previously tendered will not be purchased by the
Fund upon expiration of the tender offer described above.
SIGNATURE(S).
--------------------------------------------------------------------------------
FOR INDIVIDUAL INVESTORS FOR OTHER INVESTORS:
AND JOINT TENANTS:
------------------------------------ ------------------------------------
Signature Print Name of Investor
(Signature of Owner(s) Exactly as
Appeared On Subscription Agreement)
------------------------------------ ------------------------------------
Print Name of Investor Signature
(Signature of Owner(s) Exactly as
Appeared On Subscription Agreement)
------------------------------------ ------------------------------------
Joint Tenant Signature if necessary Print Name of Signatory and Title
(Signature of Owner(s) Exactly as
Appeared On Subscription Agreement)
------------------------------------ ------------------------------------
Print Name of Joint Tenant Co-signatory if necessary
(Signature of Owner(s) Exactly as
Appeared On Subscription Agreement)
------------------------------------
Print Name and Title of Co-signatory
--------------------------------------------------------------------------------
Date:
--------------------
D-2
<PAGE>
EXHIBIT E
Forms of Letters from the Fund
to Members in Connection with Acceptance of Tenders
THIS LETTER IS BEING SENT TO YOU IF YOU TENDERED YOUR ENTIRE INTEREST IN THE
FUND.
January 10, 2001
Dear Member:
Wynstone Fund, L.L.C. (the "Fund") has received and accepted for purchase
your tender of a limited liability company interest in the Fund. Enclosed is a
statement showing the breakdown of your capital withdrawal resulting from our
purchase of your interest in the Fund and the manner in which payment of the
purchase price is being distributed, in accordance with the term of the tender
offer.
Because you have tendered and the Fund has purchased your entire
investment, you have been paid 95% of the estimated purchase price based on the
unaudited net asset value of the Fund as of December 31, 2000, in accordance
with the terms of the tender offer. A cash payment in this amount has been wired
directly into your CIBC WM brokerage account.
The balance of the purchase price will be paid to you after the completion
of the Fund's 2000 year-end audit and is subject to year-end audit adjustment.
This amount, together with interest, will be paid within ten days after the
conclusion of the year-end audit, or on such earlier date as the Fund's Board of
Managers may determine, according to the terms of the tender offer. We expect
the audit to be completed by the end of February 2001.
Should you have any questions, please feel free to contact the Fund's
Administrator, PFPC Inc., at (888) 697-9661 or (866) 306-0232.
Sincerely,
Wynstone Fund, L.L.C.
Enclosure
E-1
<PAGE>
THIS LETTER IS BEING SENT TO YOU IF YOU TENDERED A PORTION OF YOUR INTEREST IN
THE FUND.
January 10, 2001
Dear Member:
Wynstone Fund, L.L.C. (the "Fund") has received and accepted for purchase
your tender of a portion of your limited liability company interest in the Fund.
Enclosed is a statement showing the breakdown of your capital withdrawal
resulting from our purchase of a portion of your interest.
Since you have tendered only a portion of your investment, you have been
paid 100% of the amount requested in cash, provided that your account retains
the required minimum balance, in accordance with the terms of the tender offer.
The funds were wired directly into your CIBC WM brokerage account. You remain a
member of the Fund with respect to the portion of your interest in the Fund that
you did not tender.
Should you have any questions, please feel free to contact the Fund's
Administrator, PFPC Inc., at (888) 697-9661 or (866) 306-0232.
Sincerely,
Wynstone Fund, L.L.C.
Enclosure
E-2
<PAGE>
PROMISSORY NOTE
Pursuant to the Offer to Purchase (the "Offer") up to $5 million of
outstanding Limited Liability Company Interests or portions thereof based on the
unaudited net asset value as of December 31, 2000 or such later date as
corresponds to any extension of the Offer made by Wynstone Fund, L.L.C. (the
"Fund) with respect to limited liability company interests in the Fund
("Interests"), the Fund hereby promises to pay, in the manner set forth below,
to the person identified below as the payee (the "Payee") an amount equal to the
excess, if any, of (a) the net asset value of the Interests tendered by the
Payee as of December 31, 2000, determined based on the audited 2000 financial
statements of the Fund in accordance with the asset valuation policy of the
Fund, over (b) the Cash Payment to the Payee; provided, however, that if the
Fund's Board of Managers determines that payment of all or a portion of the
purchase price by a distribution of marketable securities is necessary to avoid
or mitigate any adverse effect of the Offer on the remaining members of the
Fund, then this payment shall be made by distributing marketable securities, all
as more fully described in the Offer.
This note shall be due and payable within ten calendar days after the
completion of the audit of the Fund's financial statements for 2000.
The amount payable by the Fund under this note shall include interest, if
any, earned by the Fund on an amount, deposited by the Fund in a segregated
custodial account, equal to 5 percent of the estimated unaudited net asset value
of Interests tendered by the Payee as of December 31, 2000.
Payment of this note shall be made by wire transfer to the Payee's
brokerage account at CIBC Oppenheimer.
This note may not be pledged, assigned or otherwise transferred by the
Payee.
This note shall be construed according to and governed by the laws of the
State of New York without giving effect to the conflict of laws principles
thereof.
Any capitalized term used herein but not defined shall have the meaning
ascribed to it in the Offer.
Payee:
----------------------
Wynstone Fund, L.L.C.
By:
----------------------------
Howard M. Singer
Manager
