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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14D-1
Tender Offer Statement
Pursuant to Section 14(d)(1) of the Securities Exchange Act of 1934
(Amendment No.3)
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HEI, Inc.
(Name of Subject Company)
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FANT INDUSTRIES INC.
(Bidder)
COMMON STOCK, PAR VALUE $0.05 PER SHARE
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
(Title of Class of Securities)
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404160103
(CUSIP Number of Class of Securities)
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ANTHONY J. FANT
PRESIDENT AND CHIEF EXECUTIVE OFFICER
FANT INDUSTRIES INC.
2154 HIGHLAND AVENUE
BIRMINGHAM, AL 35205
TELEPHONE: (205) 933-1030
(Name, Address and Telephone Number of Persons Authorized to Receive
Notices and Communications on Behalf of Bidder)
Copies To:
MICHAEL A. KING, ESQ.
BROWN & WOOD LLP
ONE WORLD TRADE CENTER
NEW YORK, NY 10048-0557
TELEPHONE: (212) 839-5546
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Fant Industries Inc. hereby amends and supplements its Tender Offer
Statement on Schedule 14D-1 (the "Statement") filed with the Securities and
Exchange Commission on March 10, 1998 relating to its offer to purchase 11.5%
of the outstanding shares of common stock, par value $0.05 per share, of HEI,
Inc., a Minnesota corporation (together with the associated common stock
purchase rights), as set forth in this Amendment No.3.
ITEM 11) MATERIAL TO BE FILED AS EXHIBITS.
Item 11 is hereby amended to add the following:
(a) (11) Letter to Shareholders, dated March 25, 1998.
SIGNATURES
After reasonable 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.
Date: March 26, 1998
By: /s/ Anthony J. Fant
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Anthony J. Fant
President and Chief Executive Officer
Fant Industries Inc.
Exhibit (a)(11)
TENDER YOUR HEI SHARES TODAY
AT $8.00 PER SHARE!
DON'T BE MISLED BY AN ENTRENCHMENT-MOTIVATED BOARD
HEI'S BOARD OF DIRECTORS SAYS...some of your shares may be returned to you
since we are offering to purchase only a portion of the Company's stock.
THE REALITY IS...the Board omitted to tell you that if that happens, you can
have your cake and eat it too. That is, you get your $8.00 PER SHARE for the
ones that are accepted. As for the ones you get back, you get a new Board
committed to revitalizing HEI and making it a dynamic, growing company. By
the way, if we buy all of your shares, you get a 78% PREMIUM over the stock's
undisturbed price of $4.50 per share, which was the trading level in December
before we started buying shares. IF YOU TENDER, YOU WIN EITHER WAY.
WHO TRULY HAS YOUR INTERESTS AT HEART?
THE BOARD SAYS...Anthony Fant doesn't deserve control of the Company if he
owns only 30% upon completion of the tender offer.
THE REALITY IS...the current directors collectively hold only about 2% of the
Company's shares. So who has a greater interest in creating shareholder
value? During the last 18 months, these directors have consistently sold
their stock within days after they received it under a special stock
compensation plan. What does this behavior suggest about their expectations
for the Company's future?
WHY DON'T YOU BUY T-BILLS INSTEAD?
THE BOARD SAYS...they are proud of the $13.3 million in cash and short-term
investments they have accumulated.
THE REALITY IS...this hoarding of cash reflects a lack of vision and has
resulted in a failure to participate in the industry's growth. Do you want
nearly 50% of the Company's assets merely earning interest at Treasury bill
and similar rates? As Mr. Fant has stated in the Saint Paul Pioneer Press,
"I just don't think people bought this stock to invest in a Treasury bond
fund."
HOW LONG CAN THIS HOUSE OF CARDS STAND?
THE BOARD SAYS...Fant is taking advantage of "recent setbacks."
WELL... THERE THEY GO AGAIN. THE REALITY IS...the Company lost a customer
that accounted for 55% of net sales in fiscal 1997. This is not a mere
"setback," but the foreseeable consequence of a dangerously narrow customer
base. In fact, for each of the past 5 years, a minimum of 64% of the
Company's net sales have come from two or three customers. How long can this
house of cards stand?
WHY WOULD OUR DIRECTORS TELL US THESE THINGS?
HOW ABOUT TO PROTECT THEIR
BOARD SEATS AND STOCK COMPENSATION?
In the face of poor operating performance and a resulting decline in the
market value of the Company's stock, the current directors have continued to
reward themselves through a stock option plan for directors only. Each year,
they get options for 10,000 shares, regardless how well the Company does and
regardless of what your stock does. In the last four years alone, they've
gotten options for 160,000 shares. We strongly believe that, to create the
right incentives, stock compensation should bear a close relationship to
actual operating results and shareholder value.
TENDER YOUR SHARES TODAY!
FANT INDUSTRIES INC.
March 25, 1998
March 25, 1998
A Message to Fellow Shareholders of HEI from Anthony J. Fant:
I would like to take this opportunity to speak with you personally about
who I am, why I have invested in HEI and why I would pay a premium to buy
additional shares from you.
I am a businessman from Birmingham, Alabama. I started in business in
1985 by building a single television station, and over the next 12 years I
acquired, built or managed a number of additional underperforming or
undeveloped television and radio stations in diverse areas of the country.
We chose each business carefully, and after buying it we worked hard and took
innovative steps to enhance and realize its true value. Now I own a number
of businesses in diversified industries.
I have recently invested more than $4.3 million in acquiring more than
18% of HEI's common stock and am by far the largest shareholder. Now I want
to have a chance to lead the Board of Directors. I believe in HEI's future.
I want to revitalize it and make it a dynamic, growing company.
I obviously do not plan to, nor could I, micro-manage the design and
manufacture of microelectronic devices or any other high technology products.
The Company has plenty of talented, highly skilled people for this purpose as
well as for other day-to-day operations. Yet the Company is missing one
element that is essential for real growth, and that element is strategic
leadership. This is what my group will bring to the Company.
In short, we are committed to delivering (1) immediate value through the
tender offer and (2) long term value by setting the Company on the correct
strategic path for growth.
Please don't let scare tactics keep you from tendering your shares. I
have absolutely no intention of liquidating the Company's assets, laying off
employees, moving operations out of Victoria, or otherwise disrupting the
Company's operations. Instead, I want to work with, and not against, current
management to enhance the Company's long-term growth prospects and increase
shareholder value through carefully selected acquisitions, long-term
investments for expansion, and diversification of the Company's customer
base.
Please tender your shares today for immediate value. I am personally
committed to making every reasonable effort to complete our tender offer
promptly!
If you need further information or any assistance in tendering your HEI
shares, please contact:
The Dealer Manager: The Information Agent:
RJ STEICHEN & CO BEACON HILL PARTNERS, INC.
(612) 341-6200 Toll-Free (800) 253-3814
or
Collect (212) 843-8500
