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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1
TO
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(D)(4)
OF THE SECURITIES EXCHANGE ACT OF 1934
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ALEXANDER & ALEXANDER SERVICES INC.
(NAME OF SUBJECT COMPANY)
ALEXANDER & ALEXANDER SERVICES INC.
(NAME OF PERSON(S) FILING STATEMENT)
COMMON STOCK, PAR VALUE $1.00 PER SHARE
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
(TITLE OF CLASS OF SECURITIES)
014476 10 5
(CUSIP NUMBER OF CLASS OF SECURITIES)
ALBERT A. SKWIERTZ, JR., ESQ.
SENIOR VICE PRESIDENT & GENERAL COUNSEL
ALEXANDER & ALEXANDER SERVICES INC.
1185 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10036
(212) 444-4500
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICE
ANDCOMMUNICATIONS ON BEHALF OF THE PERSON(S) FILING STATEMENT)
COPIES TO:
KEVIN KEOGH, ESQ.
WHITE & CASE
1155 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10036
(212) 819-8200
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Alexander & Alexander Services Inc., a Maryland corporation (the "Company"),
hereby amends and supplements its Solicitation/Recommendation Statement on
Schedule 14D-9 (the "Statement"), originally filed on December 16, 1996. The
title of the class of equity securities to which this statement relates is the
Common Stock, par value $1.00 per share, of the Company (the "Shares"),
including the associated preferred stock purchase rights (the "Rights") issued
pursuant to the Rights Agreement dated as of June 11, 1987, as amended and
restated as of March 22, 1990 and as amended as of April 21, 1992, June 6,
1994, July 15, 1994, November 16, 1995 and December 11, 1996 (the "Rights
Agreement"), between the Company and First Chicago Trust Company of New York,
a New York corporation, formerly Morgan Shareholder Services Trust Company, as
Rights Agent. Capitalized terms not defined herein shall have the meanings
assigned thereto in the Statement.
ITEM 3. IDENTITY AND BACKGROUND.
On January 7, 1997, the Merger Agreement was amended in certain technical
respects. A copy of the First Amendment to Agreement and Plan of Merger, dated
as of January 7, 1997 (the "First Amendment"), among Aon, Sub and the Company
is filed as Exhibit 12 hereto and is incorporated herein by reference.
ITEM 7. CERTAIN NEGOTIATIONS AND TRANSACTIONS BY THE SUBJECT COMPANY.
On January 7, 1997, the Merger Agreement was amended in certain technical
respects. A copy of the First Amendment is filed as Exhibit 12 hereto and is
incorporated herein by reference.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
The following exhibits are filed herewith:
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<CAPTION>
EXHIBIT
NO. DESCRIPTION
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<C> <S>
8 Letter from Frank G. Zarb, Chairman of the Board, President and Chief
Executive Officer of the Company, to Shareholders of RSC, dated
December 16, 1996.
9 Letter from James S. Horrick, President and Chief Executive Officer of
RSC, to Shareholders of RSC, dated December 16, 1996.
10 Letter from Frank G. Zarb, Chairman of the Board, President and Chief
Executive Officer of the Company, to holders of the Class C Common
Stock, dated December 24, 1996.
11 Letter from R.A. Iles, Chairman of Alexander & Alexander Services UK
plc ("A&A UK"), to Shareholders of A&A UK, dated December 24, 1996.
12 First Amendment to Agreement and Plan of Merger, dated as of January
7, 1997 among Aon, Sub and the Company.
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2
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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.
Dated: January 9, 1997 Alexander & Alexander Securities
Inc.
/s/ Edward F. Kosnik
By: _________________________________
Name: Edward F. Kosnik
Title: Senior Executive Vice
President and Chief Financial
Officer
3
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EXHIBIT 8
ALEXANDER & Alexander Services Inc.
December 16, 1996
Dear Shareholder of Reed Stenhouse Companies Limited:
I am pleased to inform you that on December 11, 1996, Alexander & Alexander
Services Inc. ("Alexander & Alexander") entered into an Agreement and Plan of
Merger (the "Merger Agreement") with Aon Corporation and Subsidiary
Corporation, Inc. (the "Offeror"). Pursuant to the Merger Agreement, the
Offeror today commenced a tender offer to purchase all outstanding shares of
Alexander & Alexander's Common Stock, par value $1.00 per share, and
associated preferred stock purchase rights (the "Shares"), for US $17.50 per
share in cash. Under the Merger Agreement, the tender offer will be followed
by a merger in which any remaining Shares (other than Shares held by
dissenting stockholders, if applicable) will be converted into the same
consideration as is paid in the tender offer.
The Board of Directors of Alexander & Alexander unanimously has approved the
Merger Agreement, the tender offer and the merger, has determined that the
terms of each of the tender offer and merger are fair to and in the best
interests of Alexander & Alexander's common stockholders, and recommends that
the Alexander & Alexander's common stockholders accept the tender offer. The
Board also recommends that holders of Class 1 Special Shares of Reed Stenhouse
Companies Limited retract such shares and tender the shares of Alexander &
Alexander Common Stock received on such retraction in acceptance of the tender
offer. Mr. Peter C. Godsoe, who is Chairman of the Board and Chief Executive
Officer of The Bank of Nova Scotia and a director of both Alexander &
Alexander and Reed Stenhouse Companies Limited, voted for the recommendation
as a director of Alexander & Alexander.
In arriving at its recommendation, the Board of Directors of Alexander &
Alexander gave careful consideration to a number of factors which are
described in the enclosed materials, including, among other things, the
opinion of CS First Boston Corporation, Alexander & Alexander's financial
advisor, that the cash consideration of US $17.50 per share to be received by
the holders of Common Stock pursuant to the offer and the merger is fair to
such common stockholders from a financial point of view.
Accompanying this letter is a copy of the Alexander & Alexander Services
Inc. Solicitation/Recommendation Statement as well as the Offer to Purchase
and related materials, including a form of Retraction and Tender Request for
use in requesting redemption of shares you own in Reed Stenhouse Companies
Limited and tendering Shares received upon such redemption. We urge you to
read the enclosed materials carefully. The management and directors of
Alexander & Alexander thank you for the support you have given Reed Stenhouse
Companies Limited.
Sincerely,
Frank G. Zarb
Chairman of the Board, President &
Chief Executive Officer
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EXHIBIT 9
REED STENHOUSE COMPANIES LIMITED
Reed Stenhouse Tower,
20 Ray Street
Toronto, Canada M5J 2N9
(416) 868-5500
Facsimile (416) 868-
5580
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Reed Stenhouse
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December 16, 1996
TO: HOLDERS OF CLASS 1 SPECIAL SHARES ("RSC Shares") of
REED STENHOUSE COMPANIES LIMITED (the "Company")
Aon Corporation, through its wholly owned subsidiary, Subsidiary
Corporation, Inc., a Maryland corporation, (the "Offeror") is making an offer
to purchase all of the shares of Common Stock, par value $1.00 per share, and
associated preferred stock purchase rights (the "A&A Shares"), of Alexander &
Alexander Services Inc. ("A&A") at a price of U.S. $17.50 per share, net to
seller in cash, without interest, upon the terms and subject to the conditions
set forth in the Offer to Purchase, dated December 16, 1996, and in the
related Letter of Transmittal (which together constitute the "Offer"). Copies
of the Offer to Purchase and Letter of Transmittal are enclosed. The Letter of
Transmittal has been provided for informational purposes only and does not
need to be completed. Your RSC Shares are intended to represent the economic
equivalent of an equal number of A&A Shares. In order for you to participate
in the Offer, it will be necessary for you to (a) request the redemption of
your RSC Shares for A&A Shares on a one-for-one basis, and (b) tender the A&A
Shares received upon such redemption pursuant to the Offer. You may do this by
properly completing and executing the enclosed Retraction and Tender Request
and transmitting such request, together with the certificates representing
your RSC Shares, as instructed therein so that they are received by First
Chicago Trust Company of New York no later than January 14, 1997.
Your request for redemption will be effected contemporaneously with the
Offeror's first acceptance for payment of A&A Shares pursuant to the Offer. If
your request for redemption has not been effected prior to 12:00 midnight (New
York time) on April 1, 1997, your RSC Shares will be returned to you. You may
also withdraw your Retraction and Tender Request prior to the purchase of the
A&A Shares by contacting the Company c/o First Chicago Trust Company of New
York. In addition, you are entitled to withdrawal rights described in the
Offer to Purchase under "Withdrawal Rights".
The Board of Directors of A&A has determined that the terms of the Offer are
fair to and in the best interests of the stockholders of A&A and has
recommended that all holders of A&A Shares accept the Offer. Such
recommendation is included in the documents enclosed with this letter.
If you have any questions with respect to the foregoing matters, please
contact the Information Agent, Georgeson & Company, Inc., at 1-800-223-2064.
If you wish to participate in the Offer, please complete and send the
documentation referred to above to the Company, c/o the First Chicago Trust
Company of New York, at the address provided in the enclosed documents for
arrival prior to January 14, 1997.
Yours truly,
James S. Horrick
President and Chief Executive
Officer
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EXHIBIT 10
ALEXANDER & ALEXANDER SERVICES INC.
24 December 1996
Dear Holder of Class C Common Stock:
I am pleased to inform you that on 11 December 1996, Alexander & Alexander
Services Inc. ("Alexander & Alexander") entered into an Agreement and Plan of
Merger (the "Merger Agreement") with Aon Corporation ("Aon") and Subsidiary
Corporation, Inc. (the "Offeror"), a wholly owned subsidiary of Aon. Pursuant
to the Merger Agreement, the Offeror commenced a tender offer to purchase all
outstanding shares of Alexander & Alexander's Common Stock, par value $1.00 per
share, and associated preferred stock purchase rights (the "Common Shares"),
for US $17.50 per share in cash, upon the terms and subject to the conditions
set forth in the Offer to Purchase, dated 16 December 1996 (the "Offer to
Purchase"), and the related Letter of Transmittal (which together constitute
the "Offer"). Copies of the Offer to Purchase and Letter of Transmittal are
enclosed. The Letter of Transmittal has been provided to you for information
purposes only and should not be completed. Under the Merger Agreement, the
tender offer will be followed by a merger in which any remaining Common Shares
and shares of Class C Common Stock, par value $1.00 per share, and associated
preferred stock purchase rights (the "Class C Shares"), of Alexander &
Alexander, together with the related dividend shares of 2 pence each (the
"Dividend Shares") in Alexander & Alexander Services UK plc (other than shares
held by dissenting stockholders, if applicable) will be converted into the same
consideration as is paid in the Offer.
Your shares of Class C Shares are intended to represent the economic
equivalent of an equal number of Common Shares. In order for you to participate
in the Offer, it will be necessary for you to (a) request the conversion of
your Class C Shares into Common Shares on a one-for-one basis, and (b) tender
the Common Shares received upon such conversion pursuant to the Offer. You may
do this by properly completing and executing the enclosed Conversion and Tender
Request and transmitting the certificate representing your Class C Shares and
the related Dividend Shares.
Your request for conversion will be effected contemporaneously with the
Offeror's first acceptance for payment of Common Shares pursuant to the Offer.
If your request for conversion has not been effected prior to 12:00 midnight
(New York time) on 1 April 1997, your Class C Shares will be returned to you.
You may also withdraw your Conversion and Tender Request prior to the purchase
of the Common Shares. In addition, you are entitled to withdrawal rights
described in the Offer to Purchase under "Withdrawal Rights".
The Board of Directors of Alexander & Alexander recommends that holders of
Class C Shares convert such shares and tender the Common Shares received on
such conversion in acceptance of the Offer. The Board of Directors of Alexander
& Alexander unanimously has approved the Merger Agreement, the Offer and the
merger, has determined that the terms of each of the Offer and merger are fair
to and in the best interests of Alexander & Alexander's common stockholders,
and recommends that the Alexander & Alexander's common stockholders accept the
Offer.
In arriving at its recommendation, the Board of Directors of Alexander &
Alexander gave careful consideration to a number of factors which are described
in the enclosed materials, including, among other things, the opinion of CS
First Boston Corporation, Alexander & Alexander's financial advisor, that the
cash consideration of US $17.50 per share to be received by the holders of
Common Shares pursuant to the Offer and the merger is fair to such common
stockholders from a financial point of view.
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Accompanying this letter is a copy of a letter from Alexander & Alexander UK
plc, the Alexander & Alexander Services Inc. Solicitation/Recommendation
Statement as well as the Offer to Purchase and related materials, including a
form of Conversion and Tender Request for use in requesting conversion of Class
C Shares you own and tendering Common Shares received upon such conversion. We
urge you to read the enclosed materials carefully. The management and directors
of Alexander & Alexander thank you for the support you have given the Company.
If you have any questions with respect to the foregoing matters, please
contact the Information Agent, Georgeson & Company Inc., at 44-171-454-7100. If
you wish to participate in the Offer, please complete and send the
documentation referred to above in the prepaid envelope to R.M. Trust Co.,
which is acting as the receiving agent for Alexander & Alexander and First
Chicago Trust Company of New York.
Sincerely,
Frank G. Zarb
Chairman of the Board, President &
Chief Executive Officer
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EXHIBIT 11
ALEXANDER & ALEXANDER SERVICES UK PLC
8 Devonshire Square
London EC2M 4PL
Telephone: 0171-623-5500
Facsimile: 0171-621-1511
ALEXANDER & ALEXANDER SERVICES UK PLC
24 December 1996
Dear Shareholder,
I am pleased to inform you that on 11 December 1996, the parent of Alexander
& Alexander Services UK plc ("Alexander & Alexander UK"), Alexander &
Alexander Services Inc. ("Alexander & Alexander Inc.") entered into an
Agreement and Plan of Merger (the "Merger Agreement") with Aon Corporation
("Aon") and Subsidiary Corporation, Inc. (the "Offeror"), a wholly owned
subsidiary of Aon. Pursuant to the Merger Agreement, the Offeror commenced a
tender offer on 16 December 1996 to purchase all outstanding shares of
Alexander & Alexander's Common Stock, par value $1.00 per share, and
associated preferred stock purchase rights (the "Common Shares"), for $17.50
per share in cash, upon the terms and subject to the conditions set forth in
the Offer to Purchase dated 16 December 1996 (the "Offer to Purchase") and in
the related Letter of Transmittal (which together constitute the "Offer").
Under the Merger Agreement, the Offer will be followed by a merger in which
any remaining Common Shares and shares of Class C Common Stock, par value
$1.00 per share, and associated preferred stock purchase rights (the "Class C
Shares"), of Alexander & Alexander Inc., together with the related dividend
shares of 2 pence each (the "Dividend Shares") in Alexander & Alexander UK
(other than shares held by dissenting stockholders, if applicable) will be
converted into the same consideration as is paid in accordance with the terms
of the Offer.
As a holder of Class C Common Shares you may convert your shares into Common
Shares. Your Class C Shares are stapled to Dividend Shares in Alexander &
Alexander UK and the conversion of the Class C Shares will result in the
automatic mandatory redemption by Alexander & Alexander UK of the Dividend
Shares at their par value of 2 pence per share.
Your Board of Directors believes that the terms of the Offer are fair to and
in the best interests of holders of Dividend Shares. Your Board recommends
that as holders of Alexander & Alexander UK's Dividend Shares you convert your
Class C Shares and tender the Common Shares received on such conversion
pursuant to the Offer. Alexander & Alexander UK will pay holders of Dividend
Shares 2 pence per Dividend Share after the Class C Shares are converted.
If you decide to convert your Class C Shares and accept the Offer, you
should complete and sign the Conversion and Tender Request and send it to R.M.
Trust Co., which is acting as the receiving agent for Alexander & Alexander
Inc. and First Chicago Trust Company of New York, in the prepaid envelope
provided with this pack together with your stock certificate in respect of the
Class C Shares and the related Dividend Shares.
Yours faithfully,
R. A. Iles
Chairman
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Exhibit 12
FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER
FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER, dated as of January
7, 1997 (this "First Amendment"), among AON CORPORATION, a Delaware corporation
("Parent"), SUBSIDIARY CORPORATION, INC., a Maryland corporation and a
wholly-owned subsidiary of Parent ("Sub"), and ALEXANDER & ALEXANDER SERVICES
INC., a Maryland corporation (the "Company").
W I T N E S S E T H:
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WHEREAS, Parent, Sub and the Company have entered into that certain
Agreement and Plan of Merger, dated as of December 11, 1996 (the "Merger
Agreement"), providing for the merger of Sub and the Company upon the terms and
subject to the conditions contained therein; and
WHEREAS, Parent, Sub and the Company desire to amend the Merger
Agreement in certain respects in accordance with Section 9.3 thereof.
NOW, THEREFORE, in consideration of the premises and of the agreements
herein contained, the parties hereto agree as follows:
1. Section 3.1 of the Merger Agreement is hereby amended by deleting
clause (e) thereof in its entirety and substituting therefor the following:
"(e) Shares of Series A Convertible Preferred Stock. The holder of
each share of Series A Convertible Preferred Stock (as defined in Section
4.3) shall have the right to convert such share only into cash in the
amount equal to the sum of (i) $52.54 and (ii) the amount per share of
dividends accrued and unpaid with respect to the Series A Convertible
Preferred Stock as of the day immediately preceding the date of purchase of
Shares pursuant to the Offer."
2. Section 4.3 of the Merger Agreement is hereby amended by deleting
the last sentence of the first paragraph amended by deleting the last sentence
of the first paragraph thereof in its entirety and substituting therefor the
following:
"Following the consummation of the Merger, each share of Series A
Convertible Preferred Stock shall cease to be convertible at the option of
a holder into shares of Common Stock but will, at the option of a holder,
be convertible solely into cash in the amount equal to the sum of (i)
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$52.54 (assuming the purchase of Shares pursuant to the Offer is effected
prior to March 22, 1997) and (ii) the amount per share of dividends
accrued and unpaid with respect to the Series A Convertible Preferred Stock
as of the day immediately preceding the date of purchase of Shares pursuant
to the Offer."
3. The Merger Agreement, as amended by this First Amendment, shall
remain in full force and effect in accordance with its terms. This First
Amendment may be executed in one or more counterparts.
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IN WITNESS WHEREOF, Parent, Sub and the Company have caused this First
amendment to be signed by their respective officers thereunto duly authorized
all as of the date first written above.
AON CORPORATION
By: /s/ Raymond I. Skilling
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Name: Raymond I. Skilling
Attest:
/s/ Cheryl L. Killmer
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Name: Cheryl L. Killmer
SUBSIDIARY CORPORATION, INC.
By:/s/ Raymond I. Skilling
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Name: Raymond I. Skilling
Attest:
/s/ Cheryl L. Killmer
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Name: Cheryl L. Killmer
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ALEXANDER & ALEXANDER SERVICES INC.
By: /s/ Edward F. Kosnik
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Name: Edward F. Kosnik
Attest:
/s/ Stephen H. Meyers
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Name: Stephen H. Meyers
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