<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 19, 1994
REGISTRATION NO. 33-54137
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------------
DOSKOCIL COMPANIES INCORPORATED
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
DELAWARE 13-2535513
(State or other
jurisdiction of (I.R.S. Employer
incorporation or Identification
organization) No.)
</TABLE>
2601 NORTHWEST EXPRESSWAY
SUITE 1000W
OKLAHOMA CITY, OKLAHOMA 73112
(405) 879-5500
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
DARIAN B. ANDERSEN, ESQ.
SECRETARY AND CORPORATE COUNSEL
2601 NORTHWEST EXPRESSWAY
SUITE 1000W
OKLAHOMA CITY, OKLAHOMA 73112
(405) 879-5500
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
COPY TO:
J. GREGORY MILMOE, ESQ.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM
919 THIRD AVENUE
NEW YORK, NEW YORK 10022
(212) 735-3000
Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective.
If the only Securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box.
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. /X/
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE>
PROSPECTUS
5,555,556 SHARES OF COMMON STOCK
[LOGO]
Issuable Upon Exercise of
Rights to Subscribe for Such Shares
------------------------
Doskocil Companies Incorporated (the "Company") is issuing to its
stockholders and warrantholders of record ("Recordholders") as of the close of
business on September 29, 1994 (the "Record Date") transferable rights
("Rights") entitling the holders thereof ("Holders") to purchase an aggregate of
5,555,556 shares (the "Underlying Shares") of the Company's Common Stock, par
value $.01 per share (the "Common Stock") at an exercise price of $9 per share
(the "Exercise Price"). Recordholders will receive .68 Rights for each share of
Common Stock held or acquirable upon the exercise of warrants. As soon as
practicable after the Record Date, certificates evidencing the Rights (the
"Rights Certificates") will be delivered to the Recordholders. No fractional
Rights or cash in lieu thereof will be issued or paid by the Company. The number
of Rights issued by the Company to each Recordholder will be rounded up to the
nearest whole number. Pursuant to their basic subscription privilege, Rights
holders may purchase one full share of Common Stock for each whole Right held
(the "Basic Subscription Privilege"), subject to reduction by the Company for
the purpose of avoiding the loss of certain federal income tax benefits to the
Company. Recordholders who fully exercise all Rights issued to them by the
Company also will be eligible to subscribe at the Exercise Price for shares of
Common Stock that are not otherwise purchased pursuant to the exercise of Rights
up to the total number of Underlying Shares (the "Oversubscription Privilege"),
subject to reduction by the Company for the purpose of avoiding the loss of
certain federal income tax benefits to the Company. If an insufficient number of
Underlying Shares is available to satisfy fully all elections to exercise the
Oversubscription Privilege, then the available shares will be prorated among
those who exercise the Oversubscription Privilege based upon the number of
Rights exercised by those Holders pursuant to the Basic Subscription Privilege.
Payments received for Underlying Shares which are not available for purchase
will be promptly returned by the independent exercise agent, American Stock
Transfer & Trust Company (the "Exercise Agent"), without interest. The Rights
are evidenced by transferable certificates.
The Rights will expire at 5:00 p.m., New York City time, on October 19,
1994, unless extended as described herein (the "Expiration Date"). A Holder may
exercise Rights by delivering his properly completed and executed Rights
Certificate (or following the procedures for guaranteed delivery set forth
herein), together with payment in full of the Exercise Price for each Underlying
Share subscribed for pursuant to the Basic Subscription Privilege and the
Oversubscription Privilege, to the Exercise Agent by the Expiration Date.
Joseph Littlejohn & Levy Fund, L.P. (together with its affiliates, "JLL"),
the holder of approximately 27% of the currently outstanding shares of Common
Stock, has agreed that JLL will exercise its Basic Subscription Privilege in
full. Further, JLL has agreed that it will exercise its Oversubscription
Privilege to the extent necessary such that JLL will subscribe for Underlying
Shares having an aggregate Exercise Price of $30 million. JLL's exercise of its
Basic Subscription Privilege and its Oversubscription Privilege is subject to
reduction by the Company in order to avoid the loss of certain Federal income
tax benefits to the Company. In the event that no Holder other than JLL
exercises Rights, the Company intends to reduce the number of Underlying Shares
issuable to JLL such that the Company's gross proceeds from the Rights Offering
would be limited to $22.4 million.
The Common Stock is traded on the NASDAQ National Market System under the
symbol DOSK. On June 13, 1994, the last full day of trading before the
announcement of the Rights Offering, the last reported sale price of the Common
Stock on the NASDAQ National Market System was $10 7/8. On September 16, 1994,
the last full day of trading before the effective date of the Registration
Statement, the last reported sale price of the Common Stock on the NASDAQ
National Market System was $9 3/8. The Rights have been approved for quotation
on the NASDAQ National Market System under the symbol "DOSKR."
Questions or requests for assistance or for additional copies of this
Prospectus may be directed to the Exercise Agent at (800) 937-5449.
------------------------
FOR INFORMATION CONCERNING CERTAIN FACTORS THAT SHOULD BE CONSIDERED BY
HOLDERS OF RIGHTS IN CONSIDERING AN INVESTMENT IN THE COMMON STOCK, SEE "RISK
FACTORS."
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
EXERCISE DEALER MANAGER AND PROCEEDS TO
PRICE SOLICITING FEES COMPANY (1)
<S> <C> <C> <C>
Per Share............. $9.00 (2) $9.00
Total Minimum (3)..... $22,400,000 (2) $22,400,000
Total Maximum (3)..... $50,000,000 (2) $50,000,000
<FN>
(1) Before deduction of estimated expenses of this offering, including Dealer
Manager fees and Soliciting Dealer fees, estimated at $1.0 million in the
case of the Minimum Subscription (as defined herein) and $1.5 million in
the case of the Maximum Subscription (as defined herein).
(2) See "Plan of Distribution" for information regarding the Dealer Managers'
fee and commissions payable to soliciting dealers in connection with this
offering. No fees or commissions are payable in respect of Underlying
Shares acquired
by JLL.
(3) "Maximum" assumes that all of the Rights issued will be exercised.
"Minimum" assumes that no Holder other than JLL exercises Rights and that
the Company decreases the number of Underlying Shares issuable to JLL such
that the Company's gross proceeds from the Rights Offering are limited to
$22.4 million.
</TABLE>
The Dealer Managers for this offering are:
MERRILL LYNCH & CO. JOHNSON RICE & COMPANY
The date of this Prospectus is September 19, 1994.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information may be inspected and copied at the public
reference facilities maintained by the Commission at Judiciary Plaza, 450 Fifth
Street, N.W., Room 1024, Washington, D.C. 20549; Seven World Trade Center, 13th
Floor, New York, New York 10007; and Citicorp Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661. Copies of such material can be obtained at
prescribed rates from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549. In addition, material filed by the
Company can be inspected at the offices of the National Association of
Securities Dealers, Inc. at 1735 K Street, N.W., Washington, D.C., 20006
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
This Prospectus incorporates by reference certain documents relating to the
Company which are not delivered herewith. These documents (other than the
exhibits to such documents, unless such exhibits are specifically incorporated
by reference into such documents) are available without charge, on oral or
written request by any person to whom this Prospectus is delivered. Written or
telephone requests should be directed to Darian B. Andersen, Esq., Secretary and
Corporate Counsel, 2601 Northwest Expressway, Suite 1000W , Oklahoma City,
Oklahoma 73112 (405) 879-5500.
The following documents, which have been filed by the Company with the
Commission, are hereby incorporated by reference in this Prospectus:
(i) The Company's Annual Report on Form 10-K for the fiscal year ended
January 1, 1994 as amended by Form 10-K/A No. 1, filed on June 29, 1994
and Form 10-K/A No. 2, filed on July 22, 1994;
(ii) The Company's Current Report on Form 8-K dated March 17, 1994;
(iii) The Company's Quarterly Report on Form 10-Q for the quarterly period
ended April 2, 1994, as amended by Form 10-Q/A No. 1, filed on July 22,
1994;
(iv) The Company's Current Report on Form 8-K dated May 25, 1994;
(v) The Company's Quarterly Report on Form 10-Q for the quarterly period
ended July 2, 1994 as amended by Form 10-Q/A No. 1, filed on August 18,
1994;
(vi) The Company's Current Report on Form 8-K dated June 1, 1994; and
(vii) The Company's Current Report on Form 8-K dated August 15, 1994.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to
the termination of the offering of the Common Stock shall be deemed to be
incorporated by reference into this Prospectus and to be a part hereof from the
respective dates of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein, or in any other subsequently filed
documents that also is or is deemed to be incorporated by reference herein,
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
-------------------
2
<PAGE>
PROSPECTUS SUMMARY
THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE DETAILED
INFORMATION AND CONSOLIDATED FINANCIAL STATEMENTS APPEARING ELSEWHERE OR
INCORPORATED BY REFERENCE HEREIN.
THE COMPANY
The Company produces, markets and distributes branded and processed food
products under proprietary brand names that include Wilson Foods-R-, Corn
King-R-, Wilson's Continental Deli-R-, American Favorite-TM-, Doskocil
Foods-TM-, Jefferson Meats-TM-, Fred's-R-, Rotanelli's-R-, Posada-R- and Butcher
Boy-R-. The Company's products include pepperoni and beef and pork toppings
marketed to the pizza industry as well as boneless hams, sausage, bacon,
appetizers, Mexican and Italian foods, and other branded and processed products
for the foodservice, delicatessen and retail markets.
THE ACQUISITION
On June 1, 1994, the Company acquired the Frozen Specialty Foods division of
International Multifoods Corporation ("IMC") for approximately $136 million (the
"Acquisition"). The Acquisition was financed with borrowings under a $186
million senior secured credit facility with Chemical Bank (the "New Credit
Agreement"). Following the Acquisition, the Frozen Specialty Foods business was
renamed "Doskocil Specialty Brands Company" ("Specialty Brands"). Specialty
Brands, with revenues for the fiscal year ended February 28, 1994 of
approximately $185 million, is a processor and marketer of prepared frozen food
products for the foodservice and consumer markets. Major products, most of which
are branded, include ethnic foods, appetizers, entrees and portion meats.
Specialty Brands' ethnic products include Mexican and Italian foods such as
burritos and pasta. The majority of these products is sold to the foodservice
industry. A portion of the Mexican products is also sold to the retail industry.
Specialty Brands' products are sold nationally through a network of 73
foodservice brokers and 73 retail brokers. A direct sales force of 30 manages
the broker organizations. The six processing facilities in New York, Missouri,
Indiana, New Mexico and California produce approximately 140 million pounds of
frozen food product annually.
The Company's objective is to increase revenue and earnings growth rates
through both internal means and appropriate acquisitions in a manner that will
continue to improve the level and consistency of profitability. The key elements
of the Company's strategy include: (i) becoming a broad-based food company by
diversifying and expanding into complementary product lines; (ii) expanding
market share in the growing food service and deli markets; (iii) continuing
emphasis on higher margin processed food products; and (iv) upgrading and
rationalizing manufacturing and distribution operations. Implementation of these
strategies will focus the Company's business on higher growth and higher margin
food segments thereby transforming the Company from a meat processor to a
broad-based food company. The Company believes that the Acquisition furthers its
objective.
RECENT EVENTS
The Company named R. Randolph Devening as its Chairman of the Board,
President and Chief Executive Officer effective August 15, 1994. Mr. Devening
was formerly Vice Chairman and Chief Financial Officer of Fleming Companies,
Inc. ("Fleming"), which is the second largest food marketing and distribution
company in the United States and one of the Company's largest customers.
THE RIGHTS OFFERING
<TABLE>
<S> <C>
Rights............................ Each record holder of Common Stock and warrants to
acquire Common Stock ("Warrants") at the close of
business on the Record Date ("Recordholders") will
receive .68 transferable Rights for each share of Common
Stock held of record or acquirable upon exercise of
Warrants on the Record Date. The number of Rights
distributed to each Recordholder will be rounded up to
the nearest whole number and no fractional Rights or
cash in lieu thereof will be distributed or paid. Each
whole Right entitles the holder thereof to purchase from
the Company one share of Common Stock (an
</TABLE>
3
<PAGE>
<TABLE>
<S> <C>
"Underlying Share"). An aggregate of approximately
5,555,556 shares of Common Stock will be sold in this
offering upon the exercise of Rights, assuming the
exercise of all Rights. The distribution of Rights and
the sale of shares of Common Stock upon the exercise of
Rights or pursuant to the Oversubscription Privilege are
referred to herein as the "Rights Offering."
Exercise Price.................... $9 per share of Common Stock (the "Exercise Price").
Basic Subscription Privilege...... Rights holders ("Holders") are entitled to purchase for
the Exercise Price one Underlying Share for each whole
Right held, subject to reduction by the Company for the
purpose of avoiding the loss of certain federal income
tax benefits to the Company as described below. See "The
Rights Offering--Subscription Privileges--Basic
Subscription Privilege."
Oversubscription Privilege........ Each Holder who elects to exercise his Basic
Subscription Privilege in full may also subscribe at the
Exercise Price for additional shares of Common Stock up
to the total number of Underlying Shares, subject to
reduction by the Company for the purpose of avoiding the
loss of certain federal income tax benefits to the
Company as described below. If an insufficient number of
Underlying Shares is available to satisfy fully all
elections to exercise the Oversubscription Privilege,
then the available Underlying Shares will be prorated
among Holders who exercise their Oversubscription
Privilege based upon the respective numbers of Rights
exercised by those Holders pursuant to the Basic
Subscription Privilege. See "The Rights Offering--
Subscription Privileges--Oversubscription Privilege."
Potential Reduction............... If the Company believes that the issuance of Underlying
Shares pursuant to the Basic Subscription Privilege or
Oversubscription Privilege will have an adverse effect
upon the Company's ability to utilize certain federal
income tax benefits, then the Company will have the
right to reduce the number of Underlying Shares issuable
to all Holders exercising the Basic Subscription
Privilege or the Oversubscription Privilege, pro rata,
or to any individual Holder whose exercise of the Basic
Subscription Privilege or the Oversubscription Privilege
may create such adverse effect, to the extent necessary
in the opinion of the Company to avoid such adverse
effect. See "Risk Factors--Continuation of Net Operating
Loss Carryforwards" and "The Rights Offering--
Subscription Privileges--Oversubscription Privilege."
Method of Exercising Rights....... A Holder may exercise Rights by properly completing and
signing the certificate evidencing the Rights (a "Rights
Certificate") and forwarding such Rights Certificate (or
following the Guaranteed Delivery Procedures described
herein), with payment of the full Exercise Price for
each Underlying Share subscribed for, pursuant to the
Basic Subscription Privilege and the Oversubscription
Privilege, to American Stock Transfer & Trust Company,
as Exercise Agent, on or prior to the Expiration Date.
IF REGULAR MAIL IS USED TO FORWARD RIGHTS CERTIFICATES,
IT IS RECOMMENDED THAT INSURED, REGISTERED MAIL BE USED.
See "The Rights Offering--Method of Exercising Rights."
No interest will be paid on funds delivered in payment
of the Exercise Price.
</TABLE>
4
<PAGE>
<TABLE>
<S> <C>
Record Date....................... September 29, 1994.
Expiration Date................... 5:00 p.m., New York City time, on October 19, 1994,
unless extended by the Company at its option.
No Revocation..................... HOLDERS WHO EXERCISE THEIR RIGHTS WILL NOT BE ENTITLED
TO REVOKE THEIR SUBSCRIPTIONS.
Transferability................... Rights are transferable until the Expiration Date and,
if a market for the Rights develops, may be traded on
the NASDAQ National Market System until the close of
business on the Expiration Date. There can be no
assurance that a market for the Rights will develop. See
"The Rights Offering--Method of Transferring Rights."
Amendments; Termination........... The Company reserves the right to amend the terms and
conditions of the offering made hereby or to terminate
the Rights Offering at any time prior to delivery of the
shares of Common Stock offered hereby. See "The Rights
Offering--Amendments and Waivers; Termination."
Procedure for Foreign Holders..... Rights Certificates will not be mailed to holders of
Common Stock or Warrants whose addresses are outside the
United States and Canada, or who have an Army Post
Office ("APO") or Fleet Post Office ("FPO") address but
will be held by the Exercise Agent for their account. To
exercise the Rights represented thereby, such holders
must notify the Exercise Agent on or prior to the
Expiration Date. See "The Rights Offering--Foreign
Stockholders."
Persons Holding Shares Through
Others.......................... Persons holding shares of Common Stock and receiving the
Rights distributable with respect thereto through a
broker, dealer, commercial bank, trust company or other
nominee should promptly contact the appropriate
institution or nominee and request it to effect the
transactions for them. See "The Rights
Offering--Exercise of Rights."
Certain Tax Consequences.......... Generally, Holders will not recognize any gain or loss
upon receipt or exercise of Rights. See "Certain United
States Federal Income Tax Consequences."
Shares Currently Outstanding...... 7,940,168 as of September 19, 1994.
Shares Outstanding After the
Rights Offering................. 13,495,724, assuming that all Rights are exercised (the
"Maximum Subscription"); 10,429,868, assuming that no
holder other than JLL exercises Rights and that the
Company decreases the number of Underlying Shares
issuable to JLL such that the Company's gross proceeds
from the Rights Offering are limited to $22.4 million
(the "Minimum Subscription").
Exercise Agent.................... American Stock Transfer & Trust Company is acting as the
Exercise Agent. See "The Rights Offering--Exercise
Agent" for addresses and information relating to the
delivery of Rights Certificates and the payment of the
Exercise Price. The Exercise Agent is acting as the
information agent for the Rights Offering. The Exercise
Agent's toll-free telephone number is (800) 937-5449.
</TABLE>
5
<PAGE>
<TABLE>
<S> <C>
Use of Proceeds................... The purpose of the Rights Offering is to strengthen the
Company's capital structure and enhance its ability to
obtain future financing so as to enable the Company to
continue its growth through both internal means and
appropriate acquisitions. The net proceeds to the
Company from the sale of the Underlying Shares will be
between approximately $21.4 million and $48.5 million
depending on the number of Rights exercised. The Company
intends to use such net proceeds to repay indebtedness
under the New Credit Agreement, subject to the execution
of an amendment to such agreement which would, among
other things, permit the Company to reborrow certain
amounts repaid under the term loan facility of the New
Credit Agreement. In the event that such an amendment is
not executed, the Company intends to use $10 million of
the net proceeds to repay indebtedness under the New
Credit Agreement and the balance thereof for general
corporate purposes. See "Use of Proceeds."
Principal Stockholder............. Joseph Littlejohn & Levy Fund, L.P. (together with its
affiliates, "JLL"), the holder of approximately 27% of
the currently outstanding shares of Common Stock, has
agreed that JLL will exercise its Basic Subscription
Privilege in full. In addition, JLL has agreed that it
will exercise its Oversubscription Privilege to the
extent necessary such that JLL will subscribe for
Underlying Shares having an aggregate Exercise Price of
$30 million. JLL's exercise of its Basic Subscription
Privilege and its Oversubscription Privilege is subject
to reduction by the Company in order to avoid the loss
of certain Federal income tax benefits to the Company.
In the event that no Holder other than JLL exercises
Rights, the Company intends to reduce the number of
Underlying Shares issuable to JLL such that the
Company's gross proceeds from the Rights Offering would
be limited to $22.4 million. Accordingly, although JLL
will subscribe for Underlying Shares having an aggregate
Exercise Price of $30 million, it will be required to
pay $22.4 million of the Exercise Price in respect of
such Underlying Shares on or prior to the Expiration
Date. As soon as practicable after the Expiration Date,
the Company will determine, based on the number of
Underlying Shares subscribed for by other Holders, the
additional Exercise Price, if any, that is payable in
respect of Underlying Shares that will be issuable to
JLL. JLL will be notified of the additional Exercise
Price, if any, and will remit payment for such
Underlying Shares to the Exercise Agent within three
days of receipt of such notice. If no Holder other than
JLL exercises Rights, then no additional Exercise Price
will be payable by JLL.
NASDAQ National Market System
Symbols......................... Common Stock--"DOSK"; Rights--"DOSKR."
</TABLE>
See "Risk Factors" for a discussion of certain factors that should be
considered by Holders in evaluating an investment in Common Stock.
6
<PAGE>
RISK FACTORS
In addition to the other information included in this Prospectus, the
following factors should be considered carefully by each prospective purchaser
of the Common Stock.
ABSENCE OF PROFITABLE OPERATIONS
The Company realized a $2 million net loss during the six months ended July
2, 1994, a $32 million net loss in fiscal 1993 and a $27 million net loss in
fiscal 1992 as a result of an extraordinary charge of approximately $1 million
due to the early extinguishment of debt during fiscal 1994, a one-time charge to
earnings of approximately $34.4 million in fiscal 1993 in connection with
recognition of certain retiree medical benefit expenses and a provision of $32
million for plant closings in fiscal 1992, respectively. There can be no
assurance that the Company will be profitable in future periods.
LEVERAGE
The Company currently has a significant amount of outstanding indebtedness.
At July 2, 1994, the Company had long-term indebtedness (excluding current
maturities) of approximately $262.1 million and, on a pro forma basis, at July
2, 1994, after giving effect to the Rights Offering (assuming the Minimum
Subscription and Maximum Subscription), the Company would have had long-term
indebtedness of approximately $250.6 million and $230.6 million, respectively.
The degree to which the Company is leveraged could have important
consequences to the Company, including: (i) increased vulnerability to adverse
general economic and industry conditions, (ii) impaired ability to obtain
additional financing for future working capital, capital expenditures,
acquisitions, general corporate purposes or other purposes, and (iii) dedication
of a substantial portion of the Company's cash flow from operations to the
payment of principal and interest on indebtedness, thereby reducing the funds
available for operations and future business opportunities. In addition, the New
Credit Agreement contains certain covenants which could limit the Company's
operating and financial flexibility.
CONTINUATION OF NET OPERATING LOSS CARRYFORWARDS
The Company currently has net operating loss carryforwards for Federal
income tax purposes of approximately $133 million. Acquisitions of Common Stock
by persons who are not currently holders of Common Stock, or by current holders
whose acquisition would increase or maintain their equity ownership in the
Company above five percent, could result in an "ownership change" within the
meaning of section 382 of the Internal Revenue Code of 1986, as amended (the
"Code"), thereby imposing an annual limitation (the "Section 382 Limitation") on
the Company's ability to utilize the net operating loss carryforward to reduce
future taxable income. Specifically, in the event of an "ownership change," the
Company's utilization of its net operating loss carryforwards would be limited
to an annual amount equal to the product of the equity value of the Company at
the time of such "ownership change" (subject to reduction with respect to
certain recent increases in value) multiplied by the long-term tax-exempt rate
as published monthly by the Internal Revenue Service, without extending the
expiration date of the net operating loss carryforwards. The long-term
tax-exempt rate is currently 6.01%; such rate, however, is subject to change,
and it is impossible to predict whether the equity value of the Company and such
rate will increase or decrease, and to what extent. See "Certain United States
Federal Income Tax Consequences--Tax Consequences to Company."
If the Company believes that the issuance of Underlying Shares pursuant to
the Basic Subscription Privilege or the Oversubscription Privilege will cause an
"ownership change," then the Company will have the right to reduce the number of
Underlying Shares issuable to all holders exercising the Basic Subscription
Privilege or the Oversubscription Privilege, pro rata, or to any individual
Holder or Holders whose exercise of the Basic Subscription Privilege or the
Oversubscription Privilege may cause an "ownership change," to the extent
necessary in the sole discretion of the Company to prevent such "ownership
change." Notwithstanding the foregoing, the Rights Offering increases the
likelihood that an "ownership change" will occur in the future, and it is
impossible for the Company to ensure that such "ownership change," will not
occur, in part because the Company has no ability to restrict the acquisition or
disposition of Common Stock by persons whose ownership could cause an "ownership
change." In addition, the Company may in the future take certain actions which
could give rise to an ownership change, if in the exercise of the business
judgment
7
<PAGE>
of the Company such actions are necessary or appropriate. If an "ownership
change" were to occur subsequent to the Rights Offering, the Section 382
Limitation could have a material adverse impact upon the Company's earnings and
upon the Company's cash flow.
RAW MATERIAL AND PRICING CONSIDERATIONS
The Company's results of operations and financial condition are affected by
the cost and supply of raw materials, including pork, beef, poultry and produce,
and by the selling prices for some of its products, both of which are determined
by constantly changing market forces of supply and demand over which the Company
has limited control. Severe price swings in such raw materials, and the
resultant impact on the prices the Company charges for its products, have at
times had, and may in the future have, material adverse effects on the demand
for the Company's products and its profits.
The Company utilizes several techniques for reducing the risk of future raw
materials price increases. These techniques include purchasing and freezing raw
materials and finished products during periods of the year when raw material
prices are low and entering into futures contracts for raw materials.
PRINCIPAL STOCKHOLDER
JLL owns approximately 27% of the currently outstanding shares of Common
Stock and has agreed that it will exercise its Basic Subscription Privilege in
full. Accordingly, upon consummation of the Rights Offering, JLL will continue
to own at least 27% of the outstanding shares of Common Stock. If JLL acquires
Underlying Shares pursuant to the exercise of its Oversubscription Privilege, it
will increase its percentage ownership of Common Stock after the Rights
Offering. Depending upon the number of shares subscribed for by others, the
percentage of the outstanding Common Stock owned by JLL upon completion of the
Rights Offering will range from approximately 27% (in the event that all
stockholders exercise their Rights in full) to approximately 45%. Further,
pursuant to the terms of a stock purchase agreement, dated February 16, 1993
between the Company and JLL (the "JLL Stock Purchase Agreement"), JLL is
entitled to designate for nomination to the Company's Board of Directors (the
"JLL Designees") one less than the number of persons that would constitute a
majority of the members of the Company's Board of Directors, and the Company has
agreed to nominate and use its best efforts to cause such persons to be elected.
The number of JLL Designees is subject to reduction in the event that JLL's
Common Stock ownership percentage decreases. JLL's level of ownership is
expected to enable it to continue to exert significant influence on the
Company's affairs.
DIVIDEND RESTRICTIONS
The Company has not paid dividends on the Common Stock since its issuance in
1991. The Company does not expect to pay any cash dividends in the foreseeable
future and intends to continue to retain any earnings for the Company's
operations. Additionally, payment of such dividends is limited by the terms of
the New Credit Agreement and the indenture governing its 9 3/4% Senior
Subordinated Redeemable Notes due 2000 (the "9 3/4% Notes"). See "Price Range of
Common Stock and Dividends" and "Description of Capital Stock--Common Stock."
MARKET CONSIDERATIONS
There can be no assurance that the market price of the Common Stock will not
decline during the subscription period or that, following the issuance of the
Rights and the sale of the Underlying Shares upon exercise of Rights, a
subscribing Holder will be able to sell shares purchased in the Rights Offering
at a price equal to or greater than the Exercise Price. The election of a Holder
to exercise Rights in the Rights Offering is irrevocable. Moreover, until
certificates are delivered, subscribing Holders may not be able to sell the
shares of Common Stock that they have purchased in the Rights Offering.
Certificates representing shares of Common Stock purchased will be delivered as
soon as practicable after consummation of the Rights Offering.
No interest will be paid to Holders on funds delivered to the Exercise Agent
pursuant to the exercise of Rights pending delivery of Underlying Shares.
8
<PAGE>
ABSENCE OF PUBLIC MARKET FOR RIGHTS
Although the Rights have been approved for quotation on the NASDAQ National
Market System, no assurance can be given that an active trading market for the
Rights will develop.
THE COMPANY
The Company produces, markets and distributes branded and processed food
products under proprietary brand names that include Wilson Foods-R-, Corn
King-R-, Wilson's Continental Deli-R-, American Favorite-TM-, Doskocil
Foods-TM-, Jefferson Meats-TM-, Fred's-R-, Rotanelli's-R-, Posada-R- and Butcher
Boy-R-. The Company's products include pepperoni and beef and pork toppings
marketed to the pizza industry as well as boneless hams, sausage, bacon,
appetizers, Mexican and Italian foods, and other branded and processed products
for the foodservice, delicatessen and retail markets.
The Company was incorporated in 1964 under the laws of the State of
Delaware. Its executive offices are located at 2601 Northwest Expressway, Suite
1000W, Oklahoma City, Oklahoma 73112 and its telephone number is (405) 879-5500.
THE ACQUISITION
On June 1, 1994, the Company acquired Specialty Brands for approximately
$136 million. Specialty Brands, with revenues for the fiscal year ended February
28, 1994 of approximately $185 million, is a processor and marketer of prepared
frozen food products for the foodservice and consumer markets. Major products,
most of which are branded, include ethnic foods, appetizers, entrees and portion
meats. Specialty Brands' ethnic products include Mexican and Italian foods such
as burritos and pasta. The majority of these products is sold to the foodservice
industry. A portion of the Mexican products is also sold to the retail industry.
Specialty Brands' products are sold nationally through a network of 73
foodservice brokers and 73 retail brokers. A direct sales force of 30 manages
the broker organizations. The six processing facilities in New York, Missouri,
Indiana, New Mexico and California produce approximately 140 million pounds of
frozen food product annually.
The Acquisition was financed with borrowings under the New Credit Agreement.
The New Credit Agreement provides the Company with a $146 million term loan and
a $40 million revolving credit facility. As of July 2, 1994, $146 million was
outstanding under the term loan and $11.5 million was outstanding under the
revolving credit facility. Loans under the New Credit Agreement currently bear
interest, at the Company's option, at either the Alternate Base Rate plus 1 1/2%
or the Adjusted LIBO Rate plus 2 1/2% (each as defined in the New Credit
Agreement). In the event that the Company meets certain financial tests in the
future, the interest rates under the Credit Agreement will be decreased. At July
2, 1994, debt outstanding under the term loan and revolving credit facility bore
interest at a weighted average interest rate of 7.19% per annum. The maturity
date for the term loan and revolving credit facility is January 15, 2000, with
semi-annual principal payments due under the term loan commencing December 31,
1994. The borrowing base under the New Credit Agreement is equal to 75% of
certain eligible accounts receivable plus 50% of the lower of the cost or market
value of certain eligible inventory plus certain uncollected receipts. The New
Credit Agreement contains certain customary financial and other covenants which
may limit the Company's ability in the future to incur debt and make capital
expenditures, among other things.
The Company's objective is to increase revenue and earnings growth rates
through both internal means and appropriate acquisitions in a manner that will
continue to improve the level and consistency of profitability. The key elements
of the Company's strategy include: (i) becoming a broad-based food company by
diversifying and expanding into complementary product lines; (ii) expanding
market share in the growing food service and deli markets; (iii) continuing
emphasis on higher margin processed food products; and (iv) upgrading and
rationalizing manufacturing and distribution operations. Implementation of these
strategies will focus the Company's business on higher growth and higher margin
food segments thereby transforming the Company from a meat processor to a
broad-based food company. The Company believes that the Acquisition furthers its
objective.
9
<PAGE>
RECENT EVENTS
The Company named R. Randolph Devening as its Chairman of the Board,
President and Chief Executive Officer effective August 15, 1994. Mr. Devening
was formerly Vice Chairman and Chief Financial Officer of Fleming, which is the
second largest food marketing and distribution company in the United States and
one of the Company's largest customers.
PRICE RANGE OF COMMON STOCK AND DIVIDENDS
The Common Stock was and is traded on the NASDAQ National Market System
under the following symbols: (i) "DOSKV" from November 1, 1991, to January 14,
1992; and (ii) "DOSK" as of and since January 15, 1992. 7,940,168 shares of the
Common Stock were outstanding as of September 19, 1994. The number of holders of
record of Common Stock at September 19, 1994 was approximately 8,211.
The following table sets forth the range of high and low closing bid prices
for the Common Stock for each full quarterly period in fiscal 1993 and fiscal
1992, respectively, as quoted by the NASDAQ National Market System. The Common
Stock traded in the over-the-counter market on a "when issued" basis from
November 1, 1991 until January 14, 1992. The Common Stock began to trade on a
"regular way" basis as of January 15, 1992. These prices represent quotations
between dealers without retail mark-ups, mark-downs, or commissions and may not
necessarily represent actual transactions. The Common Stock is traded on the
NASDAQ National Market System under the symbol DOSK. On June 13, 1994, the last
full day of trading before the announcement of the Rights Offering, the last
reported sale price of the Common Stock on the NASDAQ National Market System was
$10 7/8. On September 16, 1994, the last full day of trading before the
effective date of the Registration Statement, the last reported sale price of
the Common Stock on the NASDAQ National Market System was $9 3/8.
<TABLE>
<CAPTION>
HIGH BID LOW BID
----------- -----------
<S> <C> <C>
Fiscal 1992
First Quarter...................................................... $ 18 3/4 $ 8 3/8
Second Quarter..................................................... $ 17 1/2 $ 12 1/4
Third Quarter...................................................... $ 14 1/2 $ 11 1/2
Fourth Quarter..................................................... $ 16 7/8 $ 10 1/2
Fiscal 1993
First Quarter...................................................... $ 16 1/2 $ 13 1/2
Second Quarter..................................................... $ 17 $ 14 3/4
Third Quarter...................................................... $ 15 5/8 $ 10
Fourth Quarter..................................................... $ 12 $ 9 5/8
Fiscal 1994
First Quarter...................................................... $ 15 1/4 $ 10 3/8
Second Quarter..................................................... $ 13 1/2 $ 8 1/4
Third Quarter (through September 16, 1994)......................... $ 9 7/8 $ 7 7/8
</TABLE>
The Company has not paid any cash dividends on the Common Stock since its
issuance in 1991. The Company does not expect to pay any dividends in the
foreseeable future and intends to continue to retain any such earnings for the
Company's operations. Additionally, payment of such dividends is limited by the
terms of the New Credit Agreement and the indenture governing the 9 3/4% Notes.
10
<PAGE>
CAPITALIZATION
The following table sets forth the capitalization of the Company and its
consolidated subsidiaries as of July 2, 1994 and as adjusted to reflect the
Rights Offering assuming (i) the Minimum Subscription and (ii) the Maximum
Subscription. This table should be read in conjunction with the Consolidated
Financial Statements of the Company and related Notes thereto incorporated by
reference in this Prospectus.
<TABLE>
<CAPTION>
AS OF JULY 2, 1994
-------------------------------------
AS ADJUSTED
---------------------------
MINIMUM MAXIMUM
ACTUAL SUBSCRIPTION SUBSCRIPTION
-------- ------------ ------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Current maturities of long-term debt...................................... $ 20,104 $ 10,197 $ 3,104
-------- ------------ ------------
-------- ------------ ------------
Long-term debt............................................................ $262,062 $250,562 $230,562
-------- ------------ ------------
Stockholders' equity:
Preferred Stock, 4 million shares authorized; none issued................. -- -- --
Common Stock, $.01 par value; 20,000,000 shares authorized; 7,940,168
shares issued and outstanding (10,429,868 as adjusted assuming Minimum
Subscription and 13,495,724 as adjusted assuming Maximum Subscription)... 79 104 135
Capital in excess of par value............................................ 112,465 133,847 160,909
Retained earnings (deficit) (1)........................................... (57,155) (57,155) (57,155)
Minimum pension liability adjustment...................................... (1,575) (1,575) (1,575)
Unearned compensation..................................................... (99) (99) (99)
-------- ------------ ------------
Total stockholders' equity............................................ 53,715 75,122 102,215
-------- ------------ ------------
Total capitalization.................................................. $315,777 $325,684 $332,777
-------- ------------ ------------
-------- ------------ ------------
<FN>
- ------------------------
(1) Does not include the write-off of debt issue costs of $.3 million and $.7
million, respectively, resulting from the application of the minimum and
maximum net proceeds of the Rights Offering to reduce debt under the New
Credit Agreement.
</TABLE>
11
<PAGE>
SELECTED HISTORICAL FINANCIAL DATA
The following table sets forth certain historical financial data with
respect to the Company on a consolidated basis. This table is principally
derived from and should be read in conjunction with the Company's historical
consolidated financial statements and related notes thereto and management's
discussions and analysis of financial condition and results of operations
incorporated by reference herein. As a result of the adoption of Fresh Start
Reporting, historical financial data for periods ended prior to September 29,
1991 is that of a different reporting entity and is not prepared on a basis
comparable to financial data for periods ending after that date.
<TABLE>
<CAPTION>
POST-CONFIRMATION
------------------------------------------------------------------------
SIX MONTHS SIX MONTHS FISCAL YEAR FISCAL YEAR THREE MONTHS
ENDED ENDED ENDED ENDED ENDED
JULY 2, JULY 3, JANUARY 1, JANUARY 2, DECEMBER 28,
1994 1993 1994 1993 1991
------------ ------------ ------------ ------------ ------------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA
Net Sales................................... $322,925 $302,621 $648,207 $770,687 $ 208,691
Gross profit................................ 57,407 49,935 110,677 109,338 32,744
Total operating expenses.................... 51,456 44,789 94,180 124,442(4) 23,891
------------ ------------ ------------ ------------ ------------
Operating income (loss)..................... $ 5,951 $ 5,146 $ 16,497 $(15,104)(4) $ 8,853
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Income (loss) from continuing operations.... $ (1,259) $ (483) $ 2,407 $(26,834)(4) $ 3,943
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Net income (loss)........................... $ (2,245)(1) $(34,909)(2) $(32,019)(2) $(26,834)(4) $ 3,943
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Earnings (loss) per share: (7)
Income (loss) from continuing
operations............................... $ (0.16) $ (0.07) $ 0.32 $ (4.63) $ 0.68
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
Net income (loss)........................... $ (0.28)(1) $ (5.00)(2) $ (4.32)(2) $ (4.63) $ 0.68
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
BALANCE SHEET DATA
(at period end)
Working capital (8)......................... $ 45,334 $ 27,041 $ 31,152 $ 14,428 $ 15,852
Total assets................................ 470,838 325,005 316,881 290,978 311,912
Long-term debt (8).......................... 262,062 133,185 127,906 137,305 140,455
Total long-term obligations (8)............. 342,270 208,097 207,893(3) 157,036 146,726
Stockholders' equity........................ 53,715 54,012 55,569 61,639 88,075
CASH FLOW AND CAPITAL EXPENDITURES DATA
Depreciation................................ $ 5,492 $ 4,547 $ 9,166 $ 11,479 $ 3,047
Amortization (9)............................ 3,244 3,092 6,183 6,307 1,436
EBITDA (10)................................. 15,127 14,388 32,024 2,794 13,296
Capital expenditures........................ 5,911 7,710 19,690 6,604 1,193
Net cash provided (used) by operating
activities................................. (1,305) (2,146) 18,138 1,088 14,599
<CAPTION>
PRE-CONFIRMATION
---------------------------------------------
NINE MONTHS FISCAL YEAR ENDED
ENDED ---------------------------
SEPTEMBER 28, DECEMBER 29, DECEMBER 30,
1991 1990 1989
--------------- ------------ ------------
<S> <C> <C> <C>
INCOME STATEMENT DATA
Net Sales................................... $611,529 $877,568 $1,133,398
Gross profit................................ 77,986 97,070 98,454
Total operating expenses.................... 68,926 87,909 96,161
--------------- ------------ ------------
Operating income (loss)..................... $ 9,060 $ 9,161 $ 2,293
--------------- ------------ ------------
--------------- ------------ ------------
Income (loss) from continuing operations.... $(48,424)(5) $(32,562)(5) $ (29,254)
--------------- ------------ ------------
--------------- ------------ ------------
Net income (loss)........................... $ 65,370 (5)(6 $(25,290)(5) $ (7,857)
--------------- ------------ ------------
--------------- ------------ ------------
Earnings (loss) per share: (7)
Income (loss) from continuing
operations............................... $ (9.46)(5) $ (6.37)(5) $ (5.74)
--------------- ------------ ------------
--------------- ------------ ------------
Net income (loss)........................... $ 12.78(6) $ (4.94) $ (1.54)
--------------- ------------ ------------
--------------- ------------ ------------
BALANCE SHEET DATA
(at period end)
Working capital (8)......................... $ 16,938 $ 2,632 $ 44,379
Total assets................................ 321,200 438,534 461,520
Long-term debt (8).......................... 149,402 301,299 221,449
Total long-term obligations (8)............. 156,106 301,299 260,460
Stockholders' equity........................ 84,132 31,034 56,304
CASH FLOW AND CAPITAL EXPENDITURES DATA
Depreciation................................ $ 10,504 $ 10,135 $ 10,699
Amortization (9)............................ 3,963 4,676 3,419
EBITDA (10)................................. 23,589 23,256 16,713
Capital expenditures........................ 5,816 1,606 7,581
Net cash provided (used) by operating
activities................................. (3) (32) (12,507)
<FN>
- ------------------------------
(1) Includes a net extraordinary charge of $1 million resulting from the early
extinguishment of debt.
(2) Includes the cumulative effect on years prior to fiscal year ended January
1, 1994 for a change in accounting for postretirement medical benefits of a
noncash charge against earnings of $34.4 million.
(3) Includes the recognition of a long-term liability of $65.4 million for
postretirement medical benefits.
(4) Includes a $32 million provision for plant closings.
(5) Includes reorganization expenses of $41.0 million and $12.7 million for the
nine months ended September 28, 1991 and year ended December 29, 1990.
(6) Includes an extraordinary gain of $113.8 million for the forgiveness of
debt as part of the Chapter 11 reorganization of the Company which became
effective on October 31, 1991 and reorganization expenses of $41.0 million.
(7) The per share amounts for fiscal years 1989 and 1990 and the period ended
September 28, 1991 do not provide meaningful comparisons due to the
Company's Chapter 11 reorganization.
(8) Certain long-term obligations which were classified as current liabilities
in fiscal 1989 and fiscal 1990, due to bankruptcy proceedings, have been
reclassified as long-term obligations in order to be consistent with the
current year's presentation.
(9) Amortization of intangible assets only. Does not include amortization of
certain other items included in interest expense of $0.6 million for the
six months ended July 2, 1994, $0.1 million for the six months ended July
3, 1993, $0.7 million in the fiscal year ended January 1, 1994, $4.1
million in the nine months ended September 28, 1991, $4.9 million and $6.3
million in the fiscal years ended December 29, 1990 and December 30, 1989,
respectively.
(10) EBITDA represents income (loss) from continuing operations before income
taxes, extraordinary items and cumulative effect of a change in accounting
principle, interest and financing costs, depreciation and amortization.
EBITDA should not be considered as an alternative to, or more meaningful
than, operating income or cash flow as an indication of the Company's
operating performance. EBITDA has been presented here to provide additional
information related to monitoring compliance with certain restrictive
covenants contained in certain of the Company's debt instruments. Under the
covenants of the 9 3/4% Notes and the New Credit Agreement, EBITDA is
defined differently than in the above table.
</TABLE>
12
<PAGE>
PRO FORMA FINANCIAL DATA
YEAR ENDED JANUARY 1, 1994
Presented below is certain unaudited summary pro forma financial information
which assumes that the Acquisition and Rights Offering had occurred on January
3, 1993, that the Exercise Price is $9.00 and that all net proceeds from the
Rights Offering are used to repay indebtedness under the New Credit Agreement.
The pro forma combined results of operations are not necessarily indicative of
results of operations that would have resulted had the Acquisition and Rights
Offering actually occurred on January 3, 1993, nor are they necessarily
indicative of future results of operations. For more detailed information
regarding the pro forma financial statements, see the Company's Form 8-K dated
March 17, 1994, incorporated herein by reference.
The pro forma condensed combined statement of operations includes the
historical consolidated results of operations of the Company for the fiscal year
ended January 1, 1994 and the historical results of Specialty Brands for the
twelve months ended November 27, 1993. The pro forma combined results of
operations do not give effect to the net extraordinary charge of $1 million
incurred in June, 1994 as a result of extinguishing the Old Credit Agreement,
nor the effect of a net, non-recurring write-off of $.3 million and $.7 million,
respectively, of debt issue costs resulting from the application of the minimum
and maximum net proceeds of the Rights Offering to reduce outstanding debt under
the New Credit Agreement.
<TABLE>
<CAPTION>
PRO FORMA COMBINED
AFTER RIGHTS OFFERING
----------------------------
SPECIALTY ACQUISITION PRO FORMA MINIMUM MAXIMUM
COMPANY BRANDS ADJUSTMENTS COMBINED SUBSCRIPTION SUBSCRIPTION
--------- --------- ------------- --------- ------------- -------------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C>
Net Sales............................. $648,207 $183,330 $-- $831,537 $ 831,537 $ 831,537
Gross profit.......................... 110,677 53,528 1,465 165,670 165,670 165,670
Operating income...................... 16,497 11,958 1,802 30,257 30,257 30,257
Income before income taxes and
cumulative effect of changes in
accounting........................... 2,826 12,010 (5,491) 9,345 11,044 13,178
Income before cumulative effect of
changes in accounting................ $ 2,407 $ 6,966 $(3,295) $ 6,078 $ 7,097 $ 8,378
--------- --------- ------------- --------- ------------- -------------
--------- --------- ------------- --------- ------------- -------------
Earnings per share (income before
cumulative effect of changes in
accounting).......................... $ 0.32 $ 0.82 $ 0.72 $ 0.65
--------- --------- ------------- -------------
--------- --------- ------------- -------------
Weighted average shares outstanding... 7,419 7,419 9,909 12,975
--------- --------- ------------- -------------
--------- --------- ------------- -------------
</TABLE>
13
<PAGE>
SIX MONTHS ENDED JULY 2, 1994
Presented below is certain summary pro forma financial information which
assumes that the Acquisition, which was consummated on June 1, 1994, and Rights
Offering had occurred on January 2, 1994 and that all net proceeds from the
Rights Offering are used to repay indebtedness under the New Credit Agreement.
The pro forma combined results of operations are not necessarily indicative of
results of operations that would have resulted had the Acquisition and Rights
Offering actually occurred on January 2, 1994, nor are they necessarily
indicative of future results of operations. For more detailed information
regarding the pro forma financial statements, see the Company's Form 8-K dated
June 1, 1994, incorporated herein by reference.
The pro forma condensed combined statement of operations for the six months
ended July 2, 1994 includes the historical consolidated results of operations of
the Company for the six months ended July 2, 1994 and the historical results of
Specialty Brands for the five months ended May 31, 1994. The pro forma combined
results of operations do not give effect to the net extraordinary charge of $1
million incurred in June, 1994 as a result of extinguishing the Old Credit
Agreement, nor the effect of a net, non-recurring write-off of $.3 million and
$.7 million, respectively, of debt issue costs resulting from the application of
the minimum and maximum net proceeds of the Rights Offering to reduce
outstanding debt under the New Credit Agreement.
<TABLE>
<CAPTION>
PRO FORMA COMBINED
AFTER RIGHTS OFFERING
----------------------------
SPECIALTY ACQUISITION PRO FORMA MINIMUM MAXIMUM
COMPANY BRANDS ADJUSTMENTS COMBINED SUBSCRIPTION SUBSCRIPTION
---------- ---------- ------------ ----------- ------------ -------------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA
Net Sales............................. $ 322,925 $78,914 $-- $401,839 $ 401,839 $401,839
Gross Profit.......................... 57,407 22,009 854 80,270 80,270 80,270
Operating income...................... 5,951 3,544 707 10,202 10,202 10,202
Income (loss) before income taxes..... (2,423) 3,508 (2,893) (1,808) (958) 109
Income (loss) before extraordinary
item................................. $ (1,259) $ 2,032 $(1,736) $ (963) $ (453) $ 187
---------- ---------- ------------ ----------- ------------ -------------
---------- ---------- ------------ ----------- ------------ -------------
Earnings (loss) per share before
extraordinary item................... $ (0.16) $ (0.12) $ (0.04) $ 0.01
---------- ----------- ------------ -------------
---------- ----------- ------------ -------------
Weighted average shares outstanding... 7,921 7,921 10,411 13,477
---------- ----------- ------------ -------------
---------- ----------- ------------ -------------
</TABLE>
14
<PAGE>
USE OF PROCEEDS
The purpose of the Rights Offering is to strengthen the Company's capital
structure and enhance its ability to obtain future financing so as to enable the
Company to continue its growth through both internal means and appropriate
acquisitions. The Company currently has no written or oral agreements with
respect to any pending acquisitions. In the event of the Maximum Subscription,
the net proceeds to the Company are estimated to be approximately $48.5 million.
In the event of the Minimum Subscription, the net proceeds to the Company are
estimated to be approximately $21.4 million. The Company intends to use the net
proceeds from the sale of the Underlying Shares to repay indebtedness under the
New Credit Agreement, subject to the execution of an amendment to such agreement
which would, among other things, permit the Company to reborrow certain amounts
that are repaid under the term loan facility of the New Credit Agreement. In the
event that such an amendment is not executed, the Company intends to use $10
million of the net proceeds to repay indebtedness under the New Credit Agreement
and the balance thereof for general corporate purposes.
THE RIGHTS OFFERING
THE RIGHTS
The Company is issuing the Rights to Recordholders at no charge to such
Recordholders. The Company is issuing .68 Rights for each share of Common Stock
held or acquirable upon the exercise of Warrants on the Record Date. The Rights
are evidenced by transferable Rights Certificates, which are being distributed
contemporaneously with the delivery of this Prospectus.
No fractional Rights or cash in lieu thereof will be issued or paid. The
number of Rights issued to each Recordholder will be rounded up to the nearest
whole number. A depository, bank, trust company, securities broker or dealer
holding shares of Common Stock on the Record Date for more than one beneficial
owner may, upon proper showing to the Exercise Agent, exchange its Rights
Certificates to obtain a Rights Certificate for the number of Rights to which
all such beneficial owners in the aggregate would have been entitled had each
been a Recordholder; no other Rights Certificates may be so divided as to
increase the number of Rights to which its original recipient was entitled. The
Company reserves the right to refuse to issue any Rights Certificates if such
issuance would be inconsistent with the principle that each beneficial owner's
holdings will be rounded up to the nearest whole Right.
Because the number of Rights issued to each Recordholder will be rounded up
to the nearest whole number, beneficial owners of Common Stock or Warrants who
are also the record holders of their securities will receive more Rights under
certain circumstances than beneficial owners of Common Stock who are not the
record holders of their securities and who do not obtain (or cause the
Recordholder to obtain) a separate Rights Certificate with respect to the shares
or Warrants beneficially owned by them, including shares held in an investment
advisory or similar account. To the extent that Recordholders or beneficial
owners who obtain a separate Rights Certificate receive more Rights, they will
be able to subscribe for more shares pursuant to the Basic Subscription
Privilege.
EXPIRATION DATE
The Rights will expire at 5:00 p.m., New York City time, on October 19,
1994, subject to extension in the discretion of the Company. After the
Expiration Date, unexercised Rights will be null and void. The Company will not
be obligated to honor any purported exercise of Rights received by the Exercise
Agent after the Expiration Date, regardless of when the documents relating to
that exercise were sent, except pursuant to the Guaranteed Delivery Procedures
described below.
SUBSCRIPTION PRIVILEGES
BASIC SUBSCRIPTION PRIVILEGE. Subject to the possible reduction described
below, each Right entitles the holder thereof to purchase at the Exercise Price
one Underlying Share (the "Basic Subscription Privilege"). Certificates
representing Underlying Shares purchased pursuant to the Basic Subscription
Privilege will be delivered to subscribers as soon as practicable after the
Expiration Date.
15
<PAGE>
OVERSUBSCRIPTION PRIVILEGE. Subject to the allocation and possible
reduction described below, each Right also carries the right of the Holder to
subscribe, at the Exercise Price, for additional Underlying Shares up to the
total number of Underlying Shares (the "Oversubscription Privilege"). Only
Holders who exercise the Basic Subscription Privilege in full will be entitled
to exercise this Oversubscription Privilege.
Underlying Shares will be available for purchase pursuant to the
Oversubscription Privilege only to the extent that any Underlying Shares are not
subscribed for through the Basic Subscription Privilege or are not issuable
pursuant to the Basic Subscription Privilege as a result of a reduction in the
number of shares issuable to a Holder or Holders by the Company as described
below. See "--Potential Reduction." If the Underlying Shares not subscribed for
or issuable through the Basic Subscription Privilege (the "Excess Shares") are
not sufficient to satisfy all subscriptions pursuant to the Oversubscription
Privilege, the Excess Shares will be allocated pro rata (subject to the
elimination of fractional shares) among those holders of Rights exercising the
Oversubscription Privilege in proportion to the number of Rights exercised by
each Holder pursuant to the Basic Subscription Privilege, relative to the number
of Rights exercised pursuant to the Basic Subscription Privilege by all Holders
exercising the Oversubscription Privilege, provided, however, that if such pro
rata allocation results in any Holder being allocated a greater number of Excess
Shares than such Holder subscribed for pursuant to the exercise of that Holder's
Oversubscription Privilege, then such Holder will be allocated only that number
of Excess Shares for which such Holder oversubscribed, and the remaining Excess
Shares will be allocated among all other Holders exercising the Oversubscription
Privilege on the same pro rata basis outlined above; such proration will be
repeated until all Excess Shares have been allocated to the full extent of the
Oversubscription Privileges exercised. If a proration of the Excess Shares
results in a Holder receiving fewer Excess Shares than such holder subscribed
for pursuant to the Oversubscription Privilege, then the excess funds paid by
that Holder as the Exercise Price for shares not issued will be returned without
interest or deduction. Certificates representing Underlying Shares purchased
pursuant to the Oversubscription Privilege will be delivered to subscribers as
soon as practicable after the Expiration Date and after all prorations and
adjustments contemplated by the terms of the Rights Offering have been effected.
In order to exercise the Oversubscription Privilege, banks, brokers, and
other nominee holders of Rights who exercise the Oversubscription Privilege on
behalf of beneficial owners of Rights will be required to certify to the
Exercise Agent and the Company the aggregate number of Rights as to which the
Oversubscription Privilege has been exercised and the number of Underlying
Shares thereby subscribed for by each beneficial owner of Rights on whose behalf
such nominee holder is acting. Copies of the Nominee Holder Certification form
may be obtained from the Exercise Agent.
POTENTIAL REDUCTION. If the Company believes, following the Expiration
Date, that the issuance of Underlying Shares pursuant to the Basic Subscription
Privilege or the Oversubscription Privilege will have an adverse effect upon its
ability to utilize its net operating loss carryforwards (including its built-in
losses), then the Company will have the right to reduce the number of Underlying
Shares issuable to all Holders exercising the Basic Subscription Privilege or
the Oversubscription Privilege pro rata, or to any individual Holder whose
exercise of the Basic Subscription Privilege or Oversubscription Privilege may
create such adverse effect, to the extent necessary in the sole opinion of the
Company to avoid such adverse effect. See "Risk Factors--Continuation of Net
Operating Loss Carryforwards." Such opinion of the Company shall be conclusive
and binding.
EXERCISE OF RIGHTS
Holders may exercise their Rights by delivering to the Exercise Agent, at
the address specified below, at or prior to the Expiration Date, the properly
completed and executed Rights Certificate(s) evidencing those Rights, with any
signatures guaranteed as required, together with payment in full of the Exercise
Price for each Underlying Share subscribed for pursuant to the Basic
Subscription Privilege and the Oversubscription Privilege. Payment may only be
made (a) by check or bank draft drawn upon a U.S. bank, or postal, telegraphic
or express money order, payable to American Stock Transfer & Trust Company, as
Exercise Agent, or (b) by wire transfer of funds to the account maintained by
the Exercise Agent for the purpose of accepting subscriptions at Chemical Bank
Account No. 61-093-045 ; ABA No. 021-000-128, or (c) a
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combination of the foregoing. If paying by uncertified personal check, please
note that the funds paid thereby may take at least five business days to clear.
Accordingly, holders of Rights who wish to pay the Exercise Price by means of
uncertified personal check are urged to make payment sufficiently in advance of
the Expiration Date to ensure that such payment is received and clears by such
time and are urged to consider in the alternative payment by means of certified
or cashier's check, money order or wire transfer of funds. All funds received in
payment of the Exercise Price shall be held by the Exercise Agent and invested
at the direction of the Company in short-term certificates of deposit,
short-term obligations of the United States, any state or any agency thereof, or
money market mutual funds investing in the foregoing instruments. Earnings on
such funds will be retained by the Company.
THE ADDRESS TO WHICH THE RIGHTS CERTIFICATES AND PAYMENT OF THE EXERCISE
PRICE SHOULD BE DELIVERED IS:
AMERICAN STOCK TRANSFER & TRUST COMPANY
40 WALL STREET
46TH FLOOR
NEW YORK, NEW YORK 10005
THE EXERCISE AGENT'S TELEPHONE NUMBERS ARE (800) 937-5449 OR (212) 936-5100.
If a Rights holder wishes to exercise Rights, but time will not permit such
holder to cause the Rights Certificates evidencing those Rights to reach the
Exercise Agent prior to the Expiration Date, such Rights may nevertheless be
exercised if all of the following conditions (the "Guaranteed Delivery
Procedures") are met:
(i) the Rights holder has caused payment in full of the Exercise Price
for each Underlying Share being subscribed for pursuant to the Basic
Subscription Privilege and the Oversubscription Privilege to be received (in
the manner set forth above) by the Exercise Agent at or prior to the
Expiration Date;
(ii) the Exercise Agent receives, at or prior to the Expiration Date, a
guarantee notice (a "Notice of Guaranteed Delivery"), substantially in the
form provided with the Instructions as to Use of the Doskocil Companies
Incorporated Rights Certificates (the "Instructions") distributed with the
Rights Certificates, from a member firm of a registered national securities
exchange or a member of the National Association of Securities Dealers, Inc.
(the "NASD"), or from a commercial bank or trust company having an office or
correspondent in the United States (each, an "Eligible Institution"),
stating the name of the exercising Rights holder, the number of Rights
represented by the Rights Certificate(s) held by the exercising Rights
holder, the number of Underlying Shares being subscribed for pursuant to the
Basic Subscription Privilege and, if any, pursuant to the Oversubscription
Privilege, and guaranteeing the delivery to the Exercise Agent of the Rights
Certificate(s) evidencing those Rights within five business days following
the date of the Notice of Guaranteed Delivery; and
(iii) the properly completed Rights Certificate(s) evidencing the Rights
being exercised, with any signatures guaranteed as required, is received by
the Exercise Agent within five business days following the date of the
Notice of Guaranteed Delivery relating thereto. The Notice of Guaranteed
Delivery may be delivered to the Exercise Agent in the same manner as Rights
Certificates at the addresses set forth above, or may be transmitted to the
Exercise Agent by telegram or facsimile transmission (telecopier no. (718)
234-5001). Additional copies of the form of Notice of Guaranteed Delivery
are available upon request from the Exercise Agent, whose addresses and
telephone numbers are set forth under "Exercise Agent" below.
If an exercising Holder does not indicate the number of Rights being
exercised or does not forward full payment of the aggregate Exercise Price for
the number of Rights that the Rights holder indicates are being exercised, then
the Rights holder will be deemed to have exercised the Basic Subscription
Privilege with respect to the maximum number of Rights that may be exercised for
the aggregate Exercise Price payment delivered by the Rights holder, and to the
extent that the aggregate Exercise Price payment delivered by the Rights holder
exceeds the product of the Exercise Price multiplied by the number of Rights
evidenced by the Rights Certificates delivered by the Rights holder (such excess
being the "Subscription Excess"), the Rights holder will be deemed to have
exercised the Oversubscription Privilege to purchase, to the extent available,
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that number of whole Excess Shares equal to the quotient obtained by dividing
the Subscription Excess by the Exercise Price. Any amount remaining after such
division shall be returned to the Rights holder promptly by mail without
interest or deduction.
Funds received in payment of the Exercise Price for Excess Shares subscribed
for pursuant to the Oversubscription Privilege will be held in a segregated
account pending issuance of the Excess Shares. If a Rights holder exercising the
Oversubscription Privilege is allocated less than all of the Underlying Shares
for which that holder subscribed pursuant to the Oversubscription Privilege,
then the excess funds paid by that holder as the Exercise Price for shares not
allocated to such Rights holder shall be returned by mail without interest or
deduction as soon as practicable after the Expiration Date and after all
prorations and adjustments contemplated by the terms of the Rights Offering have
been effected.
Unless a Rights Certificate (i) provides that the Underlying Shares to be
issued pursuant to the exercise of the Rights represented thereby are to be
issued to the holder of such Rights or (ii) is submitted for the account of an
Eligible Institution, signatures on each Rights Certificate must be guaranteed
by an Eligible Institution.
Holders who hold shares of Common Stock for the account of others, such as
brokers, trustees or depositaries for securities, should contact the respective
beneficial owners of such shares as soon as possible to ascertain those
beneficial owners' intentions and to obtain instructions with respect to their
Rights. If a beneficial owner so instructs, the record holder of that beneficial
owner's Rights should complete appropriate Rights Certificates and submit them
to the Exercise Agent with the proper payment. In addition, beneficial owners of
Common Stock or Rights held through such a nominee holder should contact the
nominee holder and request the nominee holder to effect transactions in
accordance with the beneficial owner's instructions.
The Instructions accompanying the Rights Certificate should be read
carefully and followed in detail. RIGHTS CERTIFICATES SHOULD BE SENT WITH
PAYMENT TO THE EXERCISE AGENT. DO NOT SEND RIGHTS CERTIFICATES TO THE COMPANY.
THE METHOD OF DELIVERY OF RIGHTS CERTIFICATES AND PAYMENT OF THE EXERCISE
PRICE TO THE EXERCISE AGENT ARE AT THE ELECTION AND RISK OF THE RIGHTS HOLDERS.
IF SENT BY MAIL, RIGHTS HOLDERS ARE URGED TO SEND RIGHTS CERTIFICATES AND
PAYMENTS BY REGISTERED MAIL, PROPERLY INSURED, WITH RETURN RECEIPT REQUESTED,
AND ARE URGED TO ALLOW A SUFFICIENT NUMBER OF DAYS TO ENSURE DELIVERY TO THE
EXERCISE AGENT AND CLEARANCE OF PAYMENT PRIOR TO THE EXPIRATION DATE. BECAUSE
UNCERTIFIED PERSONAL CHECKS MAY TAKE AT LEAST FIVE BUSINESS DAYS TO CLEAR,
RIGHTS HOLDERS ARE STRONGLY URGED TO PAY, OR ARRANGE FOR PAYMENT, BY MEANS OF
CERTIFIED OR CASHIER'S CHECK, MONEY ORDER OR WIRE TRANSFER OF FUNDS.
All questions concerning the timeliness, validity, form and eligibility of
any exercise of Rights will be determined by the Company, whose determinations
will be final and binding. The Company, in its sole discretion, may waive any
defect or irregularity, or permit a defect or irregularity to be corrected
within such time as it may determine, or reject the purported exercise of any
Right. Rights Certificates will not be deemed to have been received or accepted
until all irregularities have been waived or cured within such time as the
Company determines, in its sole discretion. Neither the Company nor the Exercise
Agent will be under any duty to give notification of any defect or irregularity
in connection with the submission of Rights Certificates or incur any liability
for failure to give such notification.
Any questions or requests for assistance concerning the method of exercising
Rights or requests for additional copies of this Prospectus, the Instructions or
the Notice of Guaranteed Delivery should be directed to the Exercise Agent at
its address set forth under "Exercise Agent." (telephone (800) 937-5449).
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NO REVOCATION
ONCE A HOLDER OF RIGHTS HAS PROPERLY EXERCISED THE BASIC SUBSCRIPTION
PRIVILEGE AND/OR THE OVERSUBSCRIPTION PRIVILEGE, SUCH EXERCISE MAY NOT BE
REVOKED.
METHOD OF TRANSFERRING RIGHTS
Rights may be purchased or sold through usual investment channels. It is
anticipated that the Rights will trade on the NASDAQ National Market System
until the close of business on the Expiration Date. There has been no prior
trading in the Rights, and no assurance can be given that a trading market will
develop or, if a market develops, that such market will be maintained throughout
the Rights Offering.
The Rights evidenced by a single Rights Certificate may be transferred in
whole by endorsing the Rights Certificate for transfer in accordance with the
accompanying Instructions. A portion of the Rights evidenced by a single Rights
Certificate (but not fractional Rights) may be transferred by delivering to the
Exercise Agent a Rights Certificate properly endorsed for transfer, with
instructions to register that portion of the Rights indicated therein in the
name of the transferee and to issue a new Rights Certificate to the transferee
evidencing the transferred Rights. In that event, a new Rights Certificate
evidencing the balance of the Rights will be issued to the Rights holder or, if
the Rights holder so instructs, to an additional transferee, or will be sold by
the Exercise Agent in the manner described below upon appropriate instruction
from the Rights holder.
The Rights evidenced by a Rights Certificate may be sold, in whole or in
part, through the Exercise Agent by delivering to the Exercise Agent the Rights
Certificate properly executed for sale by the Exercise Agent. If only a portion
of the Rights evidenced by a single Rights Certificate is to be sold by the
Exercise Agent, that Rights Certificate must be accompanied by instructions
setting forth the action to be taken with respect to the Rights that are not to
be sold. Promptly following the sale, the Exercise Agent will send the Holder a
check for the proceeds from the sale of any Rights sold, less any applicable
brokerage commissions, taxes and other direct expenses of sale. The Company will
pay the fees charged by the Exercise Agent for effecting such sales. Orders to
sell Rights must be received by the Exercise Agent at or prior to 11:00 a.m.,
New York City time, on the Expiration Date. The Exercise Agent's obligation to
execute orders is subject to its ability to find buyers. If the Rights cannot be
sold by the Exercise Agent, they will be returned promptly by mail to the
Holder.
Holders wishing to transfer all or a portion of their Rights (but not
fractional Rights) should allow a sufficient amount of time prior to the
Expiration Date for (i) the transfer instructions to be received and processed
by the Exercise Agent, (ii) new Rights Certificate to be issued and transmitted
to the transferee or transferees with respect to transferred Rights, and to the
transferor with respect to retained Rights, if any, and (iii) the Rights
evidenced by the new Rights Certificate to be exercised or sold by the
recipients thereof. Such amount of time could range from two to ten business
days, depending upon the method by which delivery of the Rights Certificates and
payment is made and the number of transactions which the Rights holder instructs
the Exercise Agent to effect. Neither the Company nor the Exercise Agent shall
have any liability to a transferee or transferor of Rights if Rights
Certificates are not received in time for exercise or sale prior to the
Expiration Date.
Except for the fees charged by the Exercise Agent (which will be paid by the
Company, as described above), all commissions, fees and other expenses
(including brokerage commissions and transfer taxes) incurred in connection with
the purchase, sale or exercise of Rights will be for the account of the
transferor of the Rights, and none of such commissions, fees or expenses will be
paid by the Company or the Exercise Agent.
AMENDMENTS AND WAIVERS; TERMINATION
The Company reserves the right to extend the Expiration Date and to amend
the terms and conditions of the Rights Offering, whether the amended terms are
less or more favorable to the Holders. In the event that the Company amends the
terms of the Rights Offering, the Registration Statement of which this
Prospectus forms a part will be amended, a new definitive Prospectus will be
distributed to all Rights holders
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who have theretofore exercised Rights and to holders of record of unexercised
Rights on the date the Company amends such terms. All Rights holders who have
theretofore exercised Rights shall simultaneously be provided with a form of
Consent to Amended Rights Offering Terms, on which they may confirm their
exercise of Rights under the terms of the Rights Offering as amended by the
Company; any Rights holder who has theretofore exercised any Rights and who does
not return such Consent within 10 business days after the mailing thereof by the
Company shall be deemed to have canceled his or her exercise of Rights, and the
full amount of the Exercise Price theretofore paid by such Rights holder will be
returned promptly by mail, without interest or deduction. Any completed Rights
Certificate received by the Exercise Agent five or more business days after the
date of the amendment will be deemed to constitute the consent of the Rights
holder who completed such Rights Certificate to the amended terms. The Company
reserves the right, in its sole discretion, at any item prior to delivery of the
Underlying Shares to terminate the Rights Offering by giving oral or written
notice to the Exercise Agent and making a public announcement thereof. If the
Rights Offering is so terminated, all funds received from Holders will be
promptly refunded without interest.
EXERCISE AGENT
The Company has appointed American Stock Transfer & Trust Company as
Exercise Agent for the Rights Offering. The Exercise Agent's address, which is
the address to which the Rights Certificates and payment of the Exercise Price
should be delivered, as well as the address to which a Notice of Guaranteed
Delivery must be delivered, is:
American Stock Transfer & Trust Company
40 Wall Street
46th Floor
New York, New York 10005
The Exercise Agent's telephone numbers are (800) 937-5449 or (212) 936-5100.
The Company will pay the fees and expenses of the Exercise Agent and has
also agreed to indemnify the Exercise Agent from any liability which it may
incur in connection with the Rights Offering.
INFORMATION AGENT
The Exercise Agent will also act as information agent for the Rights
Offering. Any questions or requests for additional copies of this Prospectus,
the Instructions, or the Notice of Guaranteed Delivery may be directed to the
Exercise Agent at the address and telephone number set forth above.
DETERMINATION OF EXERCISE PRICE
The Exercise Price was determined by the Company, based on a number of
factors, including advice provided by Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated, as financial advisor (the "Financial
Advisor"). The Company believes that the Exercise Price reflects the Company's
objective of achieving the maximum net proceeds obtainable from the Rights
Offering while providing the holders of Common Stock with an opportunity to make
an additional investment in the Company, and thus avoid an excessive dilution of
their ownership position in the Company.
In approving the Exercise Price, the Board of Directors considered the
advice provided by the Financial Advisor and such additional factors as the
alternatives available to the Company for raising capital, the market price of
the Common Stock, the business prospects for the Company and the general
condition of the securities markets at the time of the meeting of the Board of
Directors at which the Rights Offering was approved. There can be no assurance
however, that the market price of the Common Stock will not decline during the
subscription period to a level equal to or below the Exercise Price, or that,
following the issuance of the Rights and of the Common Stock upon exercise of
Rights, a subscribing Holder will be able to sell shares purchased in the Rights
Offering at a price equal to or greater than the Exercise Price.
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FOREIGN STOCKHOLDERS
Rights Certificates will not be mailed to Holders whose addresses are
outside the United States and Canada or who have an APO or FPO address, but will
be held by the Exercise Agent for such Holders' accounts. To exercise their
Rights, such Holders must notify the Exercise Agent at or prior to the
Expiration Date. The Rights of such Holders expire at the Expiration Date.
SUBSCRIPTION BY PRINCIPAL STOCKHOLDER
JLL beneficially owns approximately 27% of the Common Stock currently
outstanding. JLL has agreed that it will exercise its Basic Subscription
Privilege in full. In addition, JLL has agreed that it will exercise its
Oversubscription Privilege to the extent necessary such that JLL will subscribe
for Underlying Shares having an aggregate Exercise Price of $30 million. JLL's
exercise of its Basic Subscription Privilege and its Oversubscription Privilege
is subject to reduction by the Company in order to avoid the loss of certain
Federal income tax benefits to the Company. In the event that no Holder other
than JLL exercises Rights, the Company intends to reduce the number of
Underlying Shares issuable to JLL such that the Company's gross proceeds from
the Rights Offering would be limited to $22.4 million. Accordingly, although JLL
will subscribe for Underlying Shares having an aggregate Exercise Price of $30
million, it will be required to pay $22.4 million of the Exercise Price in
respect of such Underlying Shares on or prior to the Expiration Date. As soon as
practicable after the Expiration Date, the Company will determine, based on the
number of Underlying Shares subscribed for by other Holders, the additional
Exercise Price, if any, that is payable in respect of Underlying Shares that
will be issuable to JLL. JLL will be notified of the additional Exercise Price,
if any, and will remit payment for such Underlying Shares to the Exercise Agent
within three days of receipt of such notice. If no Holder other than JLL
exercises Rights, then no additional Exercise Price will be payable by JLL.
Depending upon the number of shares subscribed for by others, the percentage of
the outstanding Common Stock owned by JLL upon completion of the Rights Offering
will range from approximately 27% (in the event that all stockholders exercise
their Rights in full) to approximately 45%.
NO BOARD RECOMMENDATION
An investment in the Common Stock must be made pursuant to each investor's
evaluation of its, his or her best interests. Accordingly, although the Board of
Directors of the Company unanimously approved the Rights Offering, it makes no
recommendation to Holders regarding whether they should exercise their Rights.
DESCRIPTION OF CAPITAL STOCK
The Company's authorized capital stock consists of 20,000,000 shares of
Common Stock and 4,000,000 shares of Preferred Stock, par value $.01 per share
(the "Preferred Stock"). The following summary description of the capital stock
of the Company does not purport to be complete and is qualified in its entirety
by reference to the Company's Certificate of Incorporation, a copy of which is
incorporated by reference as an exhibit to the registration statement of which
this Prospectus forms a part, and to Delaware corporate law.
COMMON STOCK
The holders of Common Stock are entitled to receive, pro rata, dividends,
when, if and as declared by the Board of Directors out of any funds lawfully
available therefor. However, the Company's ability to declare and pay dividends
on the Common Stock is limited by the terms of the New Credit Agreement and the
indenture for the 9% Notes. In the event of a liquidation, dissolution or
winding up of the Company, the holders of Common Stock are entitled to
participate ratably in the distribution of assets remaining after payment of
liabilities. The issued and outstanding shares of Common Stock are, and the
Common Stock issued upon the exercise of Rights will be, fully paid and
nonassessable. See "Capitalization."
Holders of Common Stock are entitled to vote at all meetings of stockholders
of the Company for the election of directors and for other purposes. Holders
have one vote for each share of Common Stock held. The Common Stock does not
have cumulative voting rights. Therefore, holders of more than 50% of the shares
voting can elect all directors.
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The JLL Stock Purchase Agreement provides certain preemptive rights to JLL.
Such preemptive rights permit JLL to participate in future issuances by the
Company of its Common Stock (including rights and other securities convertible
into Common Stock) to the extent necessary to maintain its fully-diluted
ownership interest of Common Stock of the Company, subject to certain exceptions
set forth in the JLL Stock Purchase Agreement.
PREFERRED STOCK
The Board of Directors has the authority to issue the Preferred Stock in one
or more classes or series and to fix the designations, powers, preferences and
rights of the shares of each such class or series, including dividend rates,
conversion rights, voting rights, terms of redemption and liquidation
preferences and the number of shares constituting each such class or series,
without any further vote or action by the stockholders. The ability of the Board
of Directors to issue the Preferred Stock, while providing flexibility in
connection with possible acquisitions and other corporate purposes, could have
the effect of making it more difficult for a third party to acquire, or of
discouraging a third party from acquiring, a majority of the outstanding voting
stock of the Company. The Company has no present plans to issue any of the
Preferred Stock.
WARRANTS
On October 31, 1991, the Company entered into a warrant agreement (the
"Warrant Agreement") pursuant to which the Company issued Warrants to purchase
shares of Common Stock (the "Warrant Shares"), representing approximately a 3%
equity interest in the Company on a fully-diluted basis, at a price of $17.53
per share (the "Warrant Price"). The Warrants may be exercised at any time
before their expiration on December 31, 1998.
The number of Warrant Shares is subject to adjustment upon the occurrence of
certain events, including the issuance of Common Stock to be sold pursuant to
the exercise of Rights.
The Warrant Agreement prohibits the declaration or payment of any dividend
or distribution on the Common Stock unless the Company pays to the Warrant
holders the amount of any such dividend or distribution receivable by a holder
of the number of shares of Common Stock for which the Warrants might have been
exercised immediately prior to the declaration or payment of the dividend or
distribution. In addition, if any person or group acquires the power to vote
more than 30% of the Common Stock, the Warrant Agreement provides that the
holders of a majority of the Warrants may require the Company to repurchase the
Warrants at the then current market price of the Common Stock less the Warrant
Price.
REGISTRATION RIGHTS
THE WARRANT AGREEMENT. The Warrant Agreement grants to the Warrant holders
certain demand and piggyback registration rights that require the Company to
include up to 256,250 Warrant Shares in certain registrations under the
Securities Act. Warrant holders are required to exercise Warrants in order to
take advantage of such registration rights. The Warrantholders have not
exercised their registration rights in connection with the Rights Offering.
STOCKHOLDERS AGREEMENT. On March 22, 1993, the Company entered into a
stockholders agreement (the "Stockholders Agreement") with The Airlie Group,
L.P. ("Airlie"). Under the terms of the Stockholders Agreement, Airlie has
certain demand and piggyback registration rights with respect to 761,561 shares
of Common Stock. The Rights Offering is subject to the piggyback registration
rights conferred to Airlie by the Stockholders Agreement. The Company has been
advised by Airlie that it does not intend to exercise such registration rights.
THE JLL STOCK PURCHASE AGREEMENT. The JLL Stock Purchase Agreement grants
to JLL certain demand and piggyback registration rights with respect to
2,000,000 shares of Common Stock. Of these, only the piggyback registration
rights have vested, and JLL has advised the Company that it does not intend to
exercise them in the Rights Offering.
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CERTAIN PROVISIONS OF THE CERTIFICATE OF INCORPORATION, THE INDENTURE AND THE
CREDIT AGREEMENT
Certain provisions of the Certificate of Incorporation, the indenture
governing the 9 3/4% Notes and the New Credit Agreement may delay, deter or
prevent a stockholder or group of stockholders from taking corporate action or
gaining control of the Company.
CLASSIFIED BOARD OF DIRECTORS. The Certificate of Incorporation requires
the Company's Board of Directors to be divided into three classes, with
directors in each class serving successive three-year terms. In addition, the
Certificate of Incorporation provides that directors may be removed only for
cause. These provisions of the Certificate of Incorporation may be amended only
by the affirmative vote of the holders of 75% of the outstanding shares of
Common Stock entitled to vote thereon.
INDENTURE CHANGE OF CONTROL PROVISIONS. The indenture governing the 9 3/4%
Notes provides that in the event of a change of control of the Company, the
Company must repurchase, at the prices set forth in the Indenture, all properly
tendered Notes.
CREDIT AGREEMENT DEFAULT UPON CERTAIN BENEFICIAL OWNERSHIP/CHANGE OF CONTROL
CHANGES. The New Credit Agreement provides that an event of default shall occur
thereunder if any person or group (other than JLL) shall own directly,
beneficially and of record, 30% or more (or at any time that JLL shall own
directly, beneficially and of record, shares representing at least 15% of the
outstanding voting capital stock, 50% or more) of the outstanding voting capital
stock of the Company, among other things.
SECTION 203 OF THE DELAWARE GENERAL CORPORATION LAW
Section 203 of the Delaware General Corporation Law ("Section 203")
prohibits a publicly-held Delaware corporation from engaging in a "business
combination" with an "interested stockholder" for a period of three years after
the date of the transaction in which the person became an interested stockholder
unless (i) prior to the date of the business combination, the corporation's
board of directors approved either the business combination or the transaction
which resulted in the stockholder becoming an interested stockholder, (ii) upon
consummation of the transaction which resulted in the stockholder becoming an
interested stockholder, the interested stockholder owns at least 85% of the
outstanding voting stock, or (iii) on or after such date the business
combination is approved by the corporation's board of directors and by the
affirmative vote of at least 66 2/3% of the outstanding voting stock which is
not owned by the interested stockholder. A "business combination" includes
mergers, asset sales and other transactions resulting in a financial benefit to
the stockholder. An "interested stockholder" is a person who, together with
affiliates and associates, owns, or within three years did own, 15% or more of
the corporation's voting stock. The Company is subject to Section 203.
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
The following discussion is based upon current provisions of the Code,
applicable Treasury Regulations, judicial authority and administrative rulings
and practice. Legislative, judicial or administrative changes and
interpretations may be forthcoming that could alter or modify the statements and
conclusions set forth herein. Any such changes or interpretations may or may not
be retroactive and could affect the tax consequences to holders of Rights or
Underlying Shares.
TAX CONSEQUENCES TO COMPANY
The Company currently has net operating loss carryforwards for Federal
income tax purposes of approximately $133 million. Acquisitions of Common Stock
by persons who are not currently holders of Common Stock, or by persons whose
acquisition would increase or maintain their equity ownership in the Company
above five percent, could result in an "ownership change" within the meaning of
section 382 of the Code, thereby imposing a Section 382 Limitation on the
Company's ability to utilize the net operating loss carryforward to reduce
future taxable income.
In general, an ownership change occurs for purposes of section 382 if the
percentage of stock ownership of any one or more "5 percent shareholder(s)" (as
determined under Federal income tax regulations) increases in the aggregate by
more than 50 percentage points during a running three-year period. For this
purpose, the term "5 percent shareholder" includes certain public groups of
shareholders of the Company
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who may own, directly or indirectly, less than five percent of the Company's
stock. Under existing regulations, direct public groups which currently own
Common Stock will be deemed to exercise the Basic Subscription Privilege to
purchase 50% of such direct public groups' current percentage ownership interest
in the Company (increased to the extent that the Company has actual knowledge
that additional Underlying Shares are purchased by members of existing direct
public groups and limited so that the number of Underlying Shares actually
issued to shareholders when added to the number of Underlying Shares deemed
issued to existing direct public groups does not exceed the total number of
Underlying Shares issued in the Rights Offering). Any remaining Underlying
Shares purchased by shareholders who are not 5 percent shareholders will be
deemed to be purchased by a new public group.
If the Company believes that the issuance of Underlying Shares pursuant to
the Basic Subscription Privilege or the Oversubscription Privilege will cause an
ownership change, then the Company will have the right to reduce the number of
Underlying Shares issuable to all Holders exercising the Basic Subscription
Privilege or the Oversubscription Privilege, pro rata, or to any individual
Holder or Holders whose exercise of the Basic Subscription Privilege or the
Oversubscription Privilege may cause an ownership change, to the extent
necessary in the sole discretion of the Company to prevent such ownership
change. Notwithstanding the foregoing, the Rights Offering increases the
likelihood that an ownership change will occur in the future, and it is
impossible for the Company to ensure that such ownership change will not occur,
in part because the Company has no ability to restrict the acquisition or
disposition of Common Stock by persons whose ownership could cause an ownership
change. In addition, the Company may in the future take certain actions which
could give rise to an ownership change, if in the exercise of the business
judgment of the Company such actions are necessary or appropriate. If an
"ownership change" were to occur subsequent to the Rights Offering, the Section
382 Limitation could have a material adverse impact upon the Company's earnings
and upon the Company's cash flow. See "Risk Factors--Continuation of Net
Operating Loss Carryforwards."
TAX CONSEQUENCES TO HOLDERS
Neither distribution nor exercise of the Rights will be a taxable event for
U.S. Federal income tax purposes to U.S. individual citizens or residents or to
U.S. corporations. Upon the sale of Rights, Holders will recognize gain or loss
for U.S. Federal income tax purposes equal to the difference between the amount
realized from the sale and the adjusted tax basis of the Rights. Any gain or
loss recognized will be long-term or short-term capital gain or loss to
shareholders who hold the Rights as capital assets, depending upon whether the
Common Stock or Warrants with respect to which the Rights were issued has been
held for more than one year.
Except as provided below, a Holder of Rights must allocate the tax basis of
the Common Stock or Warrants between the Common Stock or Warrants and the Rights
in proportion to the fair market value of each on the date of the distribution
of the Rights where the value of the Rights on the date of the distribution is
equal to or greater than 15% of the fair market value of the Common Stock or
Warrants owned by such Holder on the date of the distribution. Where the value
of the Rights is less than 15% of the value of such Common Stock or Warrants at
the time of distribution, the Holder will be treated as having no basis in the
Rights unless a special election is made to allocate the basis in the manner
described above. In any event, no portion of the basis of a Holder's Common
Stock or Warrants will be allocated to the Rights in accordance with these
allocation rules unless such Rights are exercised or sold.
If a Holder exercises Rights pursuant to this offering, the tax basis of the
Underlying Shares will be equal to the Exercise Price plus any tax basis the
Holder has in the Rights.
If a Holder allows the Rights to lapse without exercise or sale, such Holder
will realize no gain or loss since no basis will be allocated to the Rights, and
such Holder's basis in the Common Stock or Warrants will remain the same as such
basis was prior to the distribution of the Rights. Purchasers of the Rights will
be entitled to a loss equal to their tax basis in the Rights, if such Rights
expire unexercised. Any loss recognized on the expiration of the Rights acquired
by purchase will be a capital loss if Common Stock would be a capital asset in
the hands of the seller (if acquired by him).
24
<PAGE>
THE FOREGOING SUMMARY DOES NOT DISCUSS ALL ASPECTS OF FEDERAL INCOME
TAXATION THAT MAY BE RELEVANT TO A PARTICULAR PROSPECTIVE HOLDER OF RIGHTS OR
UNDERLYING SHARES OR TO CERTAIN PROSPECTIVE HOLDERS OF RIGHTS OR UNDERLYING
SHARES SUBJECT TO SPECIAL TREATMENT UNDER THE FEDERAL INCOME TAX LAWS (FOR
EXAMPLE, BANKS, DEALERS IN SECURITIES, LIFE INSURANCE COMPANIES, TAX-EXEMPT
ENTITIES AND FOREIGN PERSONS OR ENTITIES). EACH PROSPECTIVE HOLDER OF RIGHTS OR
UNDERLYING SHARES SHOULD CONSULT HIS OWN TAX ADVISOR AS TO THE PARTICULAR TAX
CONSEQUENCES TO HIM OF RECEIVING, ACQUIRING, HOLDING, EXERCISING, CONVERTING AND
DISPOSING OF THE RIGHTS, OR UNDERLYING SHARES, INCLUDING THE APPLICABILITY AND
EFFECT OF STATE, LOCAL AND FOREIGN TAX LAWS.
PLAN OF DISTRIBUTION
The Company has retained Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner
& Smith Incorporated and Johnson Rice & Company, L.L.C. to act as dealer
managers (the "Dealer Managers") in connection with the Rights Offering. The
Dealer Managers will provide marketing assistance and financial advisory
services in connection with the Rights Offering and will solicit the exercise of
Rights by Holders. The Company has agreed to pay the Dealer Managers an
aggregate fee of $.04 per share for each Underlying Share issued pursuant to the
exercise of Rights other than any Underlying Shares issued to JLL and to pay
broker-dealers (the "Soliciting Dealers"), including the Dealer Managers, fees
for their soliciting efforts equal to $.10 per share for each Underlying Share
issued pursuant to the exercise of Rights other than any Underlying Shares
issued to JLL. In addition, the Company has agreed to pay each of the Dealer
Managers $125,000 on the date of the completion of the Rights Offering. The
maximum compensation that either Dealer Manager would receive under this
arrangement is $611,667. In addition, the Company has agreed to indemnify the
Dealer Managers, the Soliciting Dealers and JLL with respect to certain
liabilities, including liabilities under the Securities Act of 1933, as amended
(the "Securities Act").
The Company is also required to pay to the Financial Advisor a fee in the
amount of $250,000. In addition, the Company has agreed to reimburse the
Financial Advisor, upon request made from time to time, for its reasonable
out-of-pocket expenses incurred in connection with its activities as Financial
Advisor, including, without limitation, the reasonable fees and disbursements of
its legal counsel which are not expected to exceed $75,000.
Other than the Dealer Managers and the Soliciting Dealers, the Company has
not employed any brokers, dealers or underwriters in connection with the
solicitation of exercise of Rights, and, except as described above, no other
commissions, fees or discounts will be paid in connection with the Rights
Offering. Certain employees of the Company may solicit responses from Holders,
but such employees will not receive any commissions or compensation for such
services other than their normal employment compensation.
LEGAL OPINIONS
The validity of the Common Stock will be passed upon for the Company by
Darian B. Andersen, Esq., Secretary and Corporate Counsel of the Company.
INDEPENDENT PUBLIC ACCOUNTANTS
The consolidated balance sheets of the Company as of January 1, 1994 and
January 2, 1993 and the related consolidated statements of operations,
stockholders' equity and cash flows and the related financial statement
schedules for the years ended January 1, 1994 and January 2, 1993, the three
months ended December 28, 1991, and the nine months ended September 28, 1991,
incorporated by reference in this prospectus, have been incorporated herein in
reliance on the report, which includes an explanatory paragraph relating to the
Company's adoption of new methods of accounting for income taxes and
postretirement benefits other than pensions, of Coopers & Lybrand L.L.P.,
independent accountants, given on the authority of that firm as experts in
accounting and auditing. With respect to the unaudited interim financial
25
<PAGE>
information for the periods ended April 2, 1994 and April 3, 1994 and July 2,
1994 and July 3, 1993, incorporated by reference in this prospectus, the
independent accountants have reported that they have applied limited procedures
in accordance with professional standards for a review of such information.
However, their separate reports included in the Company's amended quarterly
reports on Form 10-Q/A for the quarters ended April 2, 1994 and July 2, 1994,
and incorporated by reference herein, state that they did not audit and they do
not express an opinion on that interim financial information. Accordingly, the
degree of reliance on their report on such information should be restricted in
light of the limited nature of the review procedures applied. The accountants
are not subject to the liability provisions of Section 11 of the Securities Act
for their report on the unaudited interim financial information because that
report is not a "report" or a "part" of the registration statement prepared or
certified by the accountants within the meaning of Sections 7 and 11 of the
Securities Act.
The financial statements of the Frozen Specialty Foods Business (a unit of
the Prepared Foods Division of International Multifoods Corporation) as of
November 27, 1993, February 27, 1993 and February 29, 1992 and for the nine
months ended November 27, 1993 and the years ended February 27, 1993 and
February 29, 1992 incorporated by reference herein and elsewhere in the
registration statement have been incorporated by reference herein and in the
registration statement in reliance upon the report of KPMG Peat Marwick LLP,
independent certified public accountants, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing. The
report of KPMG Peat Marwick LLP refers to the adoption by the Frozen Specialty
Foods Business of the provisions of the Financial Accounting Standards Boards'
Statement of Financial Accounting Standards No. 109, ACCOUNTING FOR INCOME
TAXES, in the nine months ended November 27, 1993 and Statement of Financial
Accounting Standards No. 106, EMPLOYERS' ACCOUNTING FOR POSTRETIREMENT BENEFITS
OTHER THAN PENSIONS, in the year ended February 29, 1992.
26
<PAGE>
- -------------------------------------------
-------------------------------------------
- -------------------------------------------
-------------------------------------------
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS IN CONNECTION WITH
THE OFFERING DESCRIBED HEREIN, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR THE DEALER MANAGERS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR
A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THOSE SPECIFICALLY
OFFERED HEREBY OR OF ANY SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY
PERSON TO WHOM IT IS UNLAWFUL TO MAKE AN OFFER OR SOLICITATION IN SUCH
JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THE
INFORMATION HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
-------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Available Information.......................... 2
Incorporation of Certain Documents by
Reference..................................... 2
Prospectus Summary............................. 3
Risk Factors................................... 7
The Company.................................... 9
The Acquisition................................ 9
Recent Events.................................. 10
Price Range of Common Stock and Dividends...... 10
Capitalization................................. 11
Selected Historical Financial Data............. 12
Pro Forma Financial Data....................... 13
Use of Proceeds................................ 15
The Rights Offering............................ 15
Description of Capital Stock................... 21
Certain United States Federal Income Tax
Consequences.................................. 23
Plan of Distribution........................... 25
Legal Opinions................................. 25
Independent Public Accountants................. 25
</TABLE>
[LOGO]
5,555,556 SHARES OF
COMMON STOCK ISSUABLE
UPON EXERCISE OF RIGHTS TO
SUBSCRIBE FOR SUCH SHARES
-------------------
PROSPECTUS
-------------------
MERRILL LYNCH & CO.
JOHNSON RICE & COMPANY
SEPTEMBER 19, 1994
- -------------------------------------------
-------------------------------------------
- -------------------------------------------
-------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee.................... $ 19,158
NASD Fee............................................................... 6,056
NASDAQ NMS Fee......................................................... 1,000
Fees and expenses of the Exercise Agent................................ 50,000*
Printing and engraving expenses........................................ 100,000*
Legal Fees and expenses................................................ 250,000*
Accounting Fees and expenses........................................... 75,000*
Blue Sky Fees and expenses (including fees and expenses of counsel).... 10,000*
Fees and expenses of the Dealer Managers............................... 500,000*
Fees and expenses of the Financial Advisor............................. 250,000
Miscellaneous.......................................................... 38,786*
----------
Total.............................................................. $1,300,000*
----------
----------
<FN>
- ------------------------
* Estimated
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Certificate of Incorporation and Bylaws provide that the
Company shall indemnify and advance expenses to its currently acting and its
former directors, officers, employees or agents to the fullest extent permitted
by the Delaware General Corporation Law (the "DGCL"), whenever they are
defendants or threatened to be made defendants in any legal or administrative
proceeding by reason of their relationship with the Company. Section 145 of the
DGCL provides that a corporation may indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceedings whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Company) by reason
of the fact that such person is or was a director, officer, employee or agent of
the Company or is or was serving at the request of the Company as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, against expenses (including attorney's fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by him in connection with such action, suit or proceeding if such person acted
in good faith and in a manner the person reasonably believed to be in or not
opposed to the best interests of the Company, and, with respect to any criminal
action or proceeding, had not reasonable cause to believe was unlawful. A
similar standard of care is applicable in the case of derivative actions, except
that indemnification only extends to expenses (including attorneys' fees)
incurred in connection with defense or settlement of such an action and then,
where the person is adjudged to be liable to the Company, only if and to the
extent that the Court of Chancery of the State of Delaware or the court in which
such action was brought determines that such person is fairly and reasonably
entitled to such indemnity and then only for such expenses as the court shall
deem proper.
The Company has entered into Transition Employment Agreements with its
employee-Directors and officers and into Indemnification Agreements with its
nonemployee-Directors contractually obligating the Company to provide
indemnification rights substantially similar to those described above.
The Company is empowered by Section 102(b)(7) of the DGCL to include a
provision in its Certificate of Incorporation that limits a director's liability
to the Company or its stockholders for monetary damages for breaches of his or
her fiduciary duty as a director. The Certificate of Incorporation states that
directors shall not be liable for monetary damages for breaches of their
fiduciary duty to the fullest extent permitted by the DGCL.
The Company maintains insurance policies under which directors and officers
are insured, within the limits and subject to the limitations of the policies,
against expenses in connection with the defense of
II-1
<PAGE>
actions, suits or proceedings, and certain liabilities that might be imposed as
a result of such actions, suits or proceedings, to which they are parties by
reason of being or having been directors or officers of the Company.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ----------- ----------------------------------------------------------------------------------------------
<C> <S>
1.1 Form of Dealer Manager Agreement.*
1.2 Agreement to Exercise Rights among Joseph Littlejohn & Levy Fund, L.P., Joseph Littlejohn &
Levy Fund II, L.P. and the Company.*
4.1 Specimen certificate for the Company's common stock, par value $.01 per share. (1)
4.2 Form of Rights Certificate to Purchase Common Stock of the Company.**
4.3 Credit Agreement among Doskocil, the Several Lenders from Time to Time Parties Thereto and
Chemical Bank, as Agent dated as of May 25, 1994. (2)
4.4 Form of Doskocil 9 3/4% Senior Subordinated Redeemable Note due 2000. (3)
4.5 Indenture between Doskocil and First Fidelity Bank, National Association, New York, as
Trustee. (3)
4.6 Warrant Agreement dated as of October 31, 1991 between the Company and the signatory banks
thereto. (4)
4.7 Amended and Restated Certificate of Incorporation of the Company. (5)
4.8 Amended and Restated Bylaws of the Company. (6)
4.9 Doskocil Employee Investment Plan. (4)
4.10 Doskocil Companies Incorporated 1992 Stock Incentive Plan. (1)
4.11 Doskocil Companies Incorporated Retirement and Profit Sharing Plan. (7)
4.12 Guaranty Agreement between the Company and The Fourth National Bank and Trust Company,
Wichita, dated August 1, 1985. (4)
4.13 Agreement for Waste Water Treatment Service between Stoppenbach, Inc. and the City of
Jefferson, Wisconsin, dated November 1985. (4)
4.14 Agreement (for waste water treatment) between the City of Logansport, Indiana and Wilson &
Co., Inc., dated June 26, 1967. (4)
5 Opinion of Darian B. Andersen, regarding the legality of the Underlying Shares.**
15 Letter re: Unaudited Interim Financial Information.**
23.1 Consent of Darian B. Andersen (included as part of Exhibit 5).**
23.2 Consent of Coopers & Lybrand L.L.P.*
23.3 Consent of KPMG Peat Marwick LLP.*
24 Powers of Attorney pursuant to which amendments to the Registration Statement may be filed
(included on signature page of the Registration Statement).**
99.1 Form of Letter to Securities Dealers, Commercial Banks, Trust Companies and Other Nominees.*
99.2 Form of Transmittal Letter to Holders of Common Stock of the Company.*
99.3 Form of Transmittal Letter to Holders of Common Stock of the Company whose addresses are
outside the continental United States and Canada and who have APO or FPO addresses.*
99.4 Form of Transmittal Letter to Holders of Warrants of the Company.*
</TABLE>
II-2
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ----------- ----------------------------------------------------------------------------------------------
99.5 Form of Transmittal Letter to Clients of Securities Dealers, Commercial Banks, Trust Companies
and Other Nominees.*
<C> <S>
99.6 Form of Instructions as to Use of the Doskocil Companies Incorporated Rights Certificates.*
99.7 Form of Notice of Guaranteed Delivery.*
99.8 Form of Certification and Request for Additional Rights.*
<FN>
- ------------------------
* Filed herewith.
** Previously filed.
(1) Incorporated by reference to the exhibits filed with the Registration
Statement on Form S-8 filed with the Commission on March 4, 1992.
(2) Incorporated by reference to the exhibit filed with the current Report on
Form 8-K filed on June 14, 1994.
(3) Incorporated by reference to the exhibits filed with the Registration
Statement (File No. 33-59484) on Form S-1 filed with the Commission April
13, 1993.
(4) Incorporated by reference to the exhibits to the Annual Report on Form 10-K
(File No. 7803) filed with the Commission on March 13, 1992.
(5) Incorporated by reference to the exhibits to the Current Report on Form 8-K
dated February 5, 1993.
(6) Incorporated by reference to the exhibits to the Current Report on Form 8-K
filed with the Commission on March 23, 1993.
(7) Incorporated by reference to the Annual Report on Form 10-K (File No. 7803)
filed with the Commission on March 31, 1994 as amended by Form 10-K/A No. 1
filed on June 29, 1994 and 10-K/A No. 2 filed on July 22, 1994.
</TABLE>
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(a) To include any material information with respect to the plan of
distribution not previously described in the registration statement or any
material change to such information in the registration statement;
(b) That for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial BONA FIDE offering thereof.
(c) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling the Company
pursuant to the foregoing provisions, or otherwise, the Company has been
informed that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is
therefore unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Company of expenses incurred or
paid by a director, officer, or controlling person of the Company in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question of whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by the
final adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this amendment to the
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Oklahoma City, State of Oklahoma, on September
19, 1994.
DOSKOCIL COMPANIES INCORPORATED
By: _____/s/_R. RANDOLPH DEVENING_____
R. Randolph Devening
CHAIRMAN OF THE BOARD OF DIRECTORS,
PRESIDENT,
CHIEF EXECUTIVE OFFICER AND
DIRECTOR
Pursuant to the requirements of the Securities Act of 1933, this amendment
to the Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------------------------ --------------------------------------- ----------------------
<C> <S> <C>
/s/ R. RANDOLPH DEVENING Chairman of the Board of Directors,
-------------------------------------- President, Chief Executive Officer and September 19, 1994
R. Randolph Devening Director (Principal Executive Officer)
/s/ WILLIAM L. BRADY Vice President and Controller
-------------------------------------- (Principal Financial and Accounting September 19, 1994
William L. Brady Officer)
*
-------------------------------------- Director September 19, 1994
Theodore Ammon
*
-------------------------------------- Director September 19, 1994
Thomas W. Arenz
*
-------------------------------------- Director September 19, 1994
Richard N. Bauch
*
-------------------------------------- Director September 19, 1994
Richard T. Berg
*
-------------------------------------- Director September 19, 1994
Dort A. Cameron III
* By: /s/ WILLIAM L. BRADY
---------------------------------
William L. Brady
Attorney-in-Fact.
</TABLE>
II-4
<PAGE>
<TABLE>
<C> <S> <C>
*
-------------------------------------- Director September 19, 1994
Yvonne V. Cliff
*
-------------------------------------- Director September 19, 1994
Robert D. Cook
*
-------------------------------------- Director September 19, 1994
Terry M. Grimm
*
-------------------------------------- Director September 19, 1994
Peter A. Joseph
*
-------------------------------------- Director September 19, 1994
Michael I. Klein
*
-------------------------------------- Director September 19, 1994
Paul S. Levy
*
-------------------------------------- Director September 19, 1994
Angus C. Littlejohn, Jr.
*
-------------------------------------- Director September 19, 1994
Paul W. Marshall
* By: /s/ WILLIAM L. BRADY
---------------------------------
William L. Brady
Attorney-in-Fact.
</TABLE>
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT PAGE
NUMBER DESCRIPTION NUMBER
- ----------- ------------------------------------------------------------------------------------ ---------
<C> <S> <C>
1.1 Form of Dealer Manager Agreement.*
1.2 Agreement to Exercise Rights among Joseph Littlejohn & Levy Fund, L.P., Joseph
Littlejohn & Levy Fund II, L.P. and the Company.*
4.1 Specimen certificate for the Company's common stock, par value $.01 per share. (1)
4.2 Form of Rights Certificate to Purchase Common Stock of the Company.**
4.3 Credit Agreement among Doskocil, the Several Lenders from Time to Time Parties
Thereto and Chemical Bank, as Agent dated as of May 25, 1994. (2)
4.4 Form of Doskocil 9 3/4% Senior Subordinated Redeemable Note due 2000. (3)
4.5 Indenture between Doskocil and First Fidelity Bank, National Association, New York,
as Trustee. (3)
4.6 Warrant Agreement dated as of October 31, 1991 between the Company and the signatory
banks thereto. (4)
4.7 Amended and Restated Certificate of Incorporation of the Company. (5)
4.8 Amended and Restated Bylaws of the Company. (6)
4.9 Doskocil Employee Investment Plan. (4)
4.10 Doskocil Companies Incorporated 1992 Stock Incentive Plan. (1)
4.11 Doskocil Companies Incorporated Retirement and Profit Sharing Plan. (7)
4.12 Guaranty Agreement between the Company and The Fourth National Bank and Trust
Company, Wichita, dated August 1, 1985. (4)
4.13 Agreement for Waste Water Treatment Service between Stoppenbach, Inc. and the City
of Jefferson, Wisconsin, dated November 1985. (4)
4.14 Agreement (for waste water treatment) between the City of Logansport, Indiana and
Wilson & Co., Inc., dated June 26, 1967. (4)
5 Opinion of Darian B. Andersen, regarding the legality of the Underlying Shares.**
15 Letter re: Unaudited Interim Financial Information.**
23.1 Consent of Darian B. Andersen (included as part of Exhibit 5).**
23.2 Consent of Coopers & Lybrand L.L.P.*
23.3 Consent of KPMG Peat Marwick LLP.*
24 Powers of Attorney pursuant to which amendments to the Registration Statement may be
filed (included on signature page of the Registration Statement).**
99.1 Form of Letter to Securities Dealers, Commercial Banks, Trust Companies and Other
Nominees.*
99.2 Form of Transmittal Letter to Holders of Common Stock of the Company.*
99.3 Form of Transmittal Letter to Holders of Common Stock of the Company whose addresses
are outside the continental United States and Canada and who have APO or FPO
addresses.*
99.4 Form of Transmittal Letter to Holders of Warrants of the Company.*
99.5 Form of Transmittal Letter to Clients of Securities Dealers, Commercial Banks, Trust
Companies and Other Nominees.*
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT PAGE
NUMBER DESCRIPTION NUMBER
- ----------- ------------------------------------------------------------------------------------ ---------
99.6 Form of Instructions as to Use of the Doskocil Companies Incorporated Rights
Certificates.*
<C> <S> <C>
99.7 Form of Notice of Guaranteed Delivery.*
99.8 Form of Certification and Request for Additional Rights.*
<FN>
- ------------------------
* Filed herewith.
** Previously filed.
(1) Incorporated by reference to the exhibits filed with the Registration
Statement on Form S-8 filed with the Commission on March 4, 1992.
(2) Incorporated by reference to the exhibit filed with the current Report on
Form 8-K filed on June 14, 1994.
(3) Incorporated by reference to the exhibits filed with the Registration
Statement (File No. 33-59484) on Form S-1 filed with the Commission April
13, 1993.
(4) Incorporated by reference to the exhibits to the Annual Report on Form 10-K
(File No. 7803) filed with the Commission on March 13, 1992.
(5) Incorporated by reference to the exhibits to the Current Report on Form 8-K
dated February 5, 1993.
(6) Incorporated by reference to the exhibits to the Current Report on Form 8-K
filed with the Commission on March 23, 1993.
(7) Incorporated by reference to the Annual Report on Form 10-K (File No. 7803)
filed with the Commission on March 31, 1994 as amended by Form 10-K/A No. 1
filed on June 29, 1994 and 10-K/A No. 2 filed on July 22, 1994.
</TABLE>
<PAGE>
EXHIBIT 1.1
DEALER MANAGER AGREEMENT
September 19, 1994
MERRILL LYNCH & CO.
JOHNSON RICE & COMPANY, L.L.C.
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281
Ladies and Gentlemen:
Doskocil Companies Incorporated, a Delaware corporation ("Doskocil"), hereby
appoints Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated
("Merrill Lynch") and Johnson Rice & Company, L.L.C. ("Johnson Rice", and,
together with Merrill Lynch, the "Dealer Managers") to act as co-dealer managers
in connection with the distribution by Doskocil to its stockholders and
warrantholders of rights (the "Rights") to purchase an aggregate of up to
5,555,556 shares (the "Underlying Shares") of Doskocil's common stock, par value
$.01 per share (the "Common Stock"), at a price of $9.00 per share (the
"Offering").
Doskocil hereby confirms its agreement with the Dealer Managers as follows:
1. AGREEMENT TO ACT AS DEALER MANAGER. (a) Doskocil proposes to undertake
the Offering pursuant to which each stockholder and warrantholder shall receive
Rights to subscribe for an additional .68 shares of Common Stock for each share
of Common Stock held or acquirable upon the exercise of warrants at a
subscription price of $9.00 per share. Doskocil represents that it has filed, in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations thereunder (collectively called the "Act"), with the
Securities and Exchange Commission (the "Commission") a registration statement
on Form S-3, including a prospectus relating to the Underlying Shares, which
incorporates by reference documents which Doskocil has filed or will file in
accordance with the provisions of the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder (collectively called the
"Exchange Act"). Except where the context otherwise requires, the registration
statement, as amended at the time it became or becomes effective, including all
documents filed as a part thereof or incorporated by reference therein, and
including information contained in any prospectus subsequently filed with the
Commission pursuant to Rule 424(b) under the Act and deemed to be a part of the
registration statement at the time of effectiveness pursuant to Rule 430A under
the Act, is herein called the Registration Statement, and the prospectus,
including all documents incorporated therein by reference, in the form filed by
the Company with the Commission pursuant to Rule 424(b) under the Act, is herein
called the Prospectus.
(b) Doskocil hereby authorizes Merrill Lynch and Johnson Rice to act as
co-dealer managers, in accordance with Merrill Lynch's customary practices, in
connection with the Offering, and on the basis of the representations and
warranties and agreements of Doskocil herein contained and subject to and in
accordance with the terms and conditions hereof, Merrill Lynch and Johnson Rice
agree to act as co-dealer managers in connection with the Offering. Merrill
Lynch's customary practices consist of, among other things, the coordinating of
the mailing of the Offer Documents, arranging for advertisements to be published
concerning the Offering, the contacting of holders of 100 shares or more of
Common Stock and of warrants to acquire 100 shares or more of Common Stock
(registered and beneficial to the extent practicable), and continuing such
solicitation efforts until the expiration of the Offering.
(c) Doskocil shall furnish the Dealer Managers, as soon as practicable after
the date hereof (to the extent not previously furnished), with cards or lists or
copies thereof showing the names of persons who were the holders of record or,
to the extent available to Doskocil, the beneficial owners of
<PAGE>
Common Stock and warrants as of a recent date, together with their addresses,
and the number of shares or warrants, as the case may be, held by them.
Additionally, Doskocil shall use its best efforts to update such information
from time to time during the term of this Agreement as requested by Merrill
Lynch. Except as otherwise provided herein, the Dealer Managers agree to use
such information only in connection with the Offering. The Dealer Managers shall
act hereunder as independent contractors and nothing herein contained shall make
either Merrill Lynch or Johnson Rice (in their capacity as Dealer Managers) an
agent of Doskocil in connection with the Offering. Nothing contained in this
Agreement shall constitute either Merrill Lynch or Johnson Rice (in their
capacity as Dealer Managers) a partner of or joint venturer with the Doskocil.
(d) There will be used in connection with the Offering certain additional
soliciting materials, including Doskocil's advertisement announcing commencement
of the Offering; a letter from Merrill Lynch, as co-dealer manager, to brokers,
dealers, commercial banks, trust companies and nominees; a letter from brokers,
dealers, commercial banks and trust companies to their customers relating to the
Offering; and other materials relating to the Offering approved by Doskocil (the
"Offering Materials"). The Dealer Managers shall be given an opportunity to
review and comment upon the Registration Statement, Prospectus and Offering
Materials. Doskocil authorizes the Dealer Managers to use the Offering Materials
in connection with the Offering and for such period of time as a prospectus is
required by law to be delivered in connection therewith. The Dealer Managers
shall not have any obligation to cause any Offering Materials to be transmitted
generally to any stockholder or holder of warrants.
(e) Doskocil agrees that any reference to Merrill Lynch or Johnson Rice in
any newspaper announcement or press release or other document or communication
is subject to the prior approval of Merrill Lynch or Johnson Rice, as
applicable.
2. SOLICITATION BY THE DEALER MANAGERS. Subject to the terms and
conditions of this Agreement, the Dealer Managers agree in accordance with
Merrill Lynch's customary practice to use their best efforts to solicit the
exercise of the Rights and subscriptions for Common Stock pursuant to the Offer
Documents, to contact holders of 100 shares or more of Common Stock and of
warrants to acquire 100 shares are more of Common Stock where practicable, and
to respond to requests for information and materials in connection with the
Offering, such services to commence upon the commencement of the Offering.
In addition, the Dealer Managers shall use their best efforts to form and
manage a group consisting of securities brokers and dealers selected by Merrill
Lynch (the "Soliciting Dealers") to assist in the solicitation of holders of
Common Stock and warrants regarding the exercise of their Rights. Attached as
Exhibit A hereto is a form of Soliciting Dealer Agreement by and between the
Dealer Managers and each respective Soliciting Dealer.
Doskocil hereby authorizes Merrill Lynch, or a registered broker chosen by
Merrill Lynch with notice to Doskocil, to act as Doskocil's agent in making the
Offering to residents of such states as to which such agent designation may be
necessary to comply with applicable law. Except as otherwise expressly provided
in the preceding sentence, nothing in this Agreement shall constitute the Dealer
Managers the agents of Doskocil or joint venturers or members of a syndicate or
group with Doskocil in connection with the solicitation or otherwise.
3. COMPENSATION. (a) Doskocil agrees to pay to each of Merrill Lynch and
Johnson Rice, for their services as Dealer Managers, $.02 per share for each
share of Common Stock acquired upon the exercise of any Rights, other than
Rights exercised by Joseph Littlejohn & Levy Fund II, L.P., and to pay an
additional amount equal to $0.10 per share to Merrill Lynch for each share of
Common Stock acquired upon the exercise of Rights solicited by Merrill Lynch and
$0.10 per share to Johnson Rice for each share of Common Stock acquired upon the
exercise of Rights solicited by Johnson Rice in each case other than Rights
exercised by Joseph Littlejohn & Levy Fund II, L.P.; provided however, that the
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<PAGE>
amount, if any, by which the compensation per share payable to Merrill Lynch
hereunder in connection with shares of Common Stock acquired upon the exercise
of Rights by registered investment companies for which affiliates of Merrill
Lynch act as investment advisor or manager exceeds 1% of $9.00 shall be paid to
Johnson Rice. Such fees shall be paid upon completion of the Offering.
(b) Doskocil agrees to pay an additional fee of $125,000 to each of Merrill
Lynch and Johnson Rice for their services as Dealer Managers payable on the date
of completion of the Offering.
(c) In addition to any fees that may be payable to the Dealer Managers under
this Agreement, Doskocil agrees to reimburse the Dealer Managers upon request
made from time to time for their reasonable out-of-pocket expenses incurred in
connection with the Dealer Managers' activities under this Agreement, including
the reasonable fees and disbursements of their legal counsel designated by
Merrill Lynch.
4. CERTAIN COVENANTS OF DOSKOCIL. Doskocil covenants with Merrill Lynch
as follows:
(a) Doskocil will notify the Dealer Managers immediately, and confirm
such notice in writing, (i) of the receipt by it (or by any of its officers,
representatives or attorneys) of any request of the Commission or any other
governmental agency or authority to amend or supplement the Registration
Statement, Prospectus or any Offering Materials or for additional
information with respect thereto or (ii) of receipt (whether written or
oral) by it (or by any of its officers, representatives or attorneys) of any
other communication from the Commission or any other governmental agency or
authority relating to the Registration Statement, Prospectus or any Offering
Materials, including, without limitations, any order suspending or
preventing the use of the Registration Statement, Prospectus or any Offering
Materials or otherwise concerning the Offering.
(b) Doskocil will not at any time make any amendment or supplement to
the Registration Statement, Prospectus or any of the Offering Materials of
which Merrill Lynch shall not have been advised previously and furnished a
copy or to which Merrill Lynch or its counsel shall reasonably object.
(c) Doskocil will not commence any Offering or send to any holder of
Common Stock or of warrants any request or invitation for a subscription for
Common Stock or any Right relating thereto prior to the Registration
Statement becoming effective in compliance with the applicable provisions of
the Act and any other applicable laws. Doskocil will comply in all material
respects with the Act and the Exchange Act in connection with the Offering,
and the transactions contemplated hereby and thereby. If any event shall
occur or condition exist as a result of which it is necessary, in the
reasonable opinion of counsel for Merrill Lynch or counsel for Doskocil, to
amend or supplement the Registration Statement or the Prospectus in order
that the Registration Statement or the Prospectus will not include an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein not misleading in the light of the
circumstances existing at the time they are delivered to a stockholder or
warrantholder, or if it shall be necessary, in the reasonable opinion of
either such counsel, at any such time to amend or supplement the
Registration Statement or Prospectus (a "Proposed Amendment") in order to
comply with the requirements of the Act or Exchange Act, Doskocil will
promptly prepare such amendment or supplement as may be necessary to correct
such untrue statement or omission or to make the Registration Statement or
Prospectus comply with such requirements.
(d) Doskocil will deliver to the Dealer Managers without charge, from
time to time as requested, such number of copies of the Offering Materials
(each as supplemented or amended) as the Dealer Managers may reasonably
request and will cause all amendments and supplements to be distributed to
Holders as may be required by the Acts.
(e) Doskocil will pay and bear all costs and expenses incident to the
Offering and the performance of its obligations under this Agreement
including, without limitation, (i) the reasonable fees, disbursements and
expenses of its counsel and those of counsel to the Dealer Managers
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<PAGE>
designated by Merrill Lynch, (ii) the preparation and distribution of this
Agreement, (iii) the preparation, printing or copying and distribution of
the Registration Statement, Prospectus and the Offering Materials and any
Proposed Amendment, (iv) the fees and expenses of the exercise agent for the
Offering (the "Exercise Agent") and (v) all other costs and expenses
incident to the Offering incurred by Doskocil.
(f) Doskocil will advise or cause the Exercise Agent to advise the
Dealer Managers from day to day during the period of the Offering as to all
names and addresses of stockholders and holders of warrants who have
exercised Rights, and the aggregate number of shares purchased through the
exercise of Rights and as to such other information as Merrill Lynch may
reasonably request; and will notify Merrill Lynch, not later than 5:00 P.M.,
New York City time, on the first business day following the Expiration Date
(as defined in the Prospectus), of the aggregate number of shares purchased
through the exercise of Rights.
(g) Doskocil will promptly give the Dealer Managers notice of any change
in the Expiration Date.
5. REPRESENTATIONS AND WARRANTIES OF DOSKOCIL. Doskocil represents and
warrants to and agrees with the Dealer Managers that as of the date hereof:
(a) Doskocil is a corporation duly incorporated, validly existing and in
good standing under the laws of the jurisdiction of its incorporation, has
all requisite corporate power and authority to execute, deliver and perform
its obligations under this Agreement, to consummate the Offering in
accordance with its terms; and this Agreement has been duly authorized,
executed and delivered by Doskocil and, assuming due execution and delivery
of this Agreement by the Dealer Managers, constitutes a legal, valid and
binding obligation of Doskocil, enforceable against Doskocil in accordance
with its terms, except as (i) enforcement thereof may be limited by
applicable bankruptcy, insolvency, reorganization or other similar laws
affecting creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether enforcement
is considered in a proceeding in equity or at law), and (ii) as rights to
indemnity and contribution hereunder may be limited by Federal or state
securities laws and/or public policy.
(b) The Rights and the Underlying Shares have been duly authorized for
issuance.
(c) As of its effective date, the Registration Statement does not or
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and the Prospectus (including the
documents incorporated therein by reference) did not or will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading;
PROVIDED, HOWEVER, that Doskocil makes no warranty or representation with
respect to any statement contained in the Registration Statement or the
Prospectus in reliance upon and in conformity with information concerning
the Dealer Managers that was furnished in writing by or on behalf of either
Dealer Manager to Doskocil expressly for use in the Registration Statement
or the Prospectus.
(d) The information contained in the Offering Materials is accurate in
all material respects and is complete for its intended purposes.
(e) The execution and delivery of this Agreement and the letter
agreement dated May 26, 1994 between Doskocil and Merrill Lynch (the
"Engagement Letter"), and the consummation by Doskocil of the transactions
contemplated in this Agreement and the Engagement Letter and in the Offering
Materials and compliance by Doskocil with the terms of this Agreement and
the Engagement Letter have been duly authorized by all necessary corporate
action on the part of Doskocil and do not and will not result in any
violation of the charter or by-laws of Doskocil or any significant
subsidiary of Doskocil, as defined in Rule 405 of Regulation C of the
regulations promulgated under the Securities Act of 1933 (each, a
"Significant Subsidiary"), and do not and
4
<PAGE>
will not conflict with, or result in a breach of any of the terms or
provisions of, or constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon, any property or assets
of Doskocil or any Significant Subsidiary under (i) any indenture, mortgage,
loan agreement, note, lease or other agreement or instrument to which
Doskocil or any Significant Subsidiary is a party or by which each of them
or any of them may be bound or to which any of their respective properties
may be subject, except for such conflicts, breaches or defaults or liens,
charges or encumbrances that would not have a material adverse effect on the
condition (financial or otherwise), earnings, business affairs or business
prospects of Doskocil and its subsidiaries considered as one enterprise or
(ii) any existing applicable law, rule, regulation, judgment, order or
decree of any government, governmental instrumentality or court, domestic or
foreign, having jurisdiction over Doskocil or any Significant Subsidiary or
any of their respective properties.
(f) No authorization, approval, consent or license of any government,
governmental instrumentality or court, domestic or foreign, is required for
the consummation by Doskocil of the transactions contemplated in this
Agreement and the Engagement Letter, including the consummation of the
Offering.
(g) The Registration Statement is effective under the Act and, to the
best of Doskocil's knowledge and information, no stop order suspending the
effectiveness of the Registration Statement has been issued under the Act or
proceedings therefor initiated or threatened by the Commission.
(h) At the time the Registration Statement became effective the
Registration Statement (other than the financial statements and supporting
schedules included therein, as to which no opinion need be rendered)
complied as to form in all material respects with the requirements of the
1933 Act and the regulations promulgated thereunder.
The representations and warranties set forth in this Section 5 shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of any Indemnified Party (as defined in the Engagement Letter) and
any termination of this Agreement.
6. INDEMNIFICATION; LIMITATION OF INDEMNIFIED PARTY LIABILITY;
CONTRIBUTION. (a) Except as otherwise provided in this Section 6, the
provisions of the Engagement Letter relating to indemnification, limitations on
the liability of Indemnified Parties and contribution are incorporated herein by
reference as if restated herein in their entirety, and Doskocil agrees to
indemnify Merrill Lynch and the other Indemnified Parties and to contribute to
amounts paid or payable by Merrill Lynch and the other Indemnified Parties, and
agrees that Merrill Lynch's liability and the liability of the other Indemnified
Parties shall be limited, in each case as provided in the Engagement Letter. For
purposes of the indemnification and contribution provided for in this Section 6,
the definition of Indemnified Parties shall consist of Merrill Lynch, Johnson
Rice, each Soliciting Dealer and their respective directors, officers,
employees, agents and controlling persons.
(b) Without limiting the generality of the foregoing, Doskocil agrees to
indemnify and hold harmless each Dealer Manager and Soliciting Dealer and each
person, if any, who controls any of the foregoing within the meaning of Section
15 of the Act:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, promptly after submission for payment, arising out of any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendments thereto), or the omission or
alleged omission therefrom of a material fact required to be stated therein
or necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact
contained in the Prospectus (or any amendment or supplement thereto) or the
omission or alleged omission therefrom of a material fact necessary in order
to make the statements therein, in the light of the circumstances under
which they were made, not misleading;
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<PAGE>
(ii) against any and all loss, liability, claim, damage or expense
whatsoever, promptly after submission for payment, to the extent of the
aggregate amount paid in settlement of any litigation, or any investigation
or proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or omission,
or any such alleged untrue statement or omission, if such settlement is
effected with the written consent of Doskocil; and
(iii) against any and all expense whatsoever, promptly after submission
for payment, reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense is
not paid under (i) or (ii) above.
7. SETTLEMENT OF LITIGATION; RELEASE. The provisions of the Engagement
Letter relating to the settlement of claims, the release of Indemnified Parties
in the event of such settlement and waiver of the right to trial by jury are
incorporated herein by reference as if restated herein in their entirety, and
Doskocil agrees to comply with its obligations under such provisions as provided
therein.
8. CONDITIONS TO THE DEALER MANAGERS' OBLIGATIONS. The Dealer Managers'
obligations hereunder are subject as of the commencement of the Offering (the
"Commencement Date") to the accuracy of the representations and warranties of
Doskocil contained herein, to the performance by Doskocil of its obligations
hereunder, and to the following further conditions:
(a) On the Commencement Date, the Dealer Managers shall have received
signed opinions of each of Skadden, Arps, Slate, Meagher & Flom, counsel for
Doskocil, and Darian B. Andersen, General Counsel for Doskocil, each dated
as of the Commencement Date, substantially in the form attached hereto as
Exhibit B, which opinion shall be in form and substance reasonably
satisfactory to counsel for the Dealer Managers, and shall have received a
letter addressed to them from Coopers & Lybrand in form and substance
reasonably satisfactory to Merrill Lynch.
(b) At the Commencement Date, there shall have been delivered to the
Dealer Managers certificates of the chief executive officer and chief
financial officer of Doskocil, dated as of the Commencement Date, (i)
stating that, the representations and warranties set forth in Section 5
hereof are accurate on such date; and (ii) that Doskocil has duly performed,
in all material respects, all obligations required to be performed by it
pursuant to the terms of this Agreement.
9. TERMINATION. (a) This Agreement shall terminate upon the earliest to
occur of (i) thirty days after the final Expiration Date of the Offering, (ii)
the date on which Merrill Lynch gives notice to Doskocil that any of the
conditions specified in Section 8 have not been fulfilled pursuant to Section 8,
(iii) the date on which Merrill Lynch gives notice to Doskocil that it
reasonably objects to Doskocil's decision to use or permit the use of any
supplement to the Offering Materials that has not been submitted to Merrill
Lynch for its and its counsel's comments or has been so submitted and Merrill
Lynch and its counsel have made comments but such comments have not resulted in
changes therein to reflect such comments or in another response, in either case,
reasonably satisfactory to Merrill Lynch and its counsel or (iv) the date on
which Doskocil terminates or withdraws the Offering for any reason (the earliest
to occur of clauses (i), (ii), (iii) and (iv) being referred to as the
"Termination Date").
(b) Notwithstanding termination of this Agreement pursuant to subsection (a)
of this Section 9, Sections 3, 5, 6, 7 and 14 shall survive any termination of
this Agreement.
10. NOTICES. All notices and other communications under this Agreement
shall be in writing and shall be deemed to have been duly given if delivered,
mailed or transmitted by any standard form of telecommunication. Notices to the
Dealer Managers shall be directed to Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated at Merrill Lynch World Headquarters, North
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Tower, World Financial Center, New York, New York 10281, Attention: W. Gregg
Smart, and notices to Doskocil shall be directed to it at 2601 Northwest
Expressway, Suite 1000W, Oklahoma City, Oklahoma 73112, Attention: Darian B.
Andersen, Secretary and Corporate Counsel.
11. TOMBSTONE. Doskocil acknowledges that Merrill Lynch may place an
announcement in such newspapers and periodicals as it may choose, stating that
Merrill Lynch and Johnson Rice are acting as co-dealer managers, and that
Merrill Lynch is acting as financial advisor to Doskocil in connection with the
Offering. Any such announcement shall be at the sole expense of Merrill Lynch
and Johnson Rice.
12. SURVIVAL OF CERTAIN PROVISIONS. The provisions relating to
indemnification and contribution, fees and expenses and independent contractor
status of the Dealer Managers remain operative and in full force and effect
regardless of any investigation made by or on behalf of Doskocil, Merrill Lynch
or Johnson Rice or any affiliates or controlling persons and will survive the
consummation or termination of the Offering.
13. GOVERNING LAW. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, applicable to contracts
executed in and to be performed in that state.
14. INDEPENDENT CONTRACTOR. Doskocil acknowledges and agrees that Merrill
Lynch has been retained to act solely as financial advisor to Doskocil and that
Merrill Lynch and Johnson Rice have been retained to act solely as Dealer
Managers in connection with the Offering. In such capacity, Merrill Lynch and
Johnson Rice shall act as independent contractors, and any duties of Merrill
Lynch or Johnson Rice arising out of its engagement pursuant to this Agreement
shall be owed solely to Doskocil.
15. SEVERABILITY. If any term or provision of this Agreement or the
application thereof shall, in any jurisdiction and to any extent, be invalid or
unenforceable, such term or provision shall be ineffective as to such
jurisdiction solely to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable any remaining terms or provisions hereof or
affecting the validity or enforceability of such term or provision in any other
jurisdiction. To the extent permitted by applicable law, the parties hereto
waive any provision of law that renders any term or provision of this Agreement
invalid or unenforceable in any respect.
16. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, and by different parties hereto on separate counterparts, each of
such counterparts, when a counterpart has been executed and delivered, shall be
deemed to be an original and all of such counterparts, taken together, shall
constitute one and the same Agreement.
17. SUCCESSORS. This Agreement is made solely for the benefit of Merrill
Lynch, Johnson Rice and Doskocil and, to the extent expressed, the Indemnified
Parties and their executors, administrators, successors and assigns, and no
other persons shall acquire or have any right under or by virtue of this
Agreement.
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If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us a counterpart hereof, whereupon this instrument
will become a binding agreement between Doskocil, on the one hand, and Merrill
Lynch and Johnson Rice, on the other hand, in accordance with its terms.
Very truly yours,
DOSKOCIL COMPANIES INCORPORATED
By ___________________________________
Name:
Title:
Confirmed and accepted
as of the date first
above written:
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By ________________________________________
Name:
Title:
JOHNSON RICE & COMPANY, L.L.C.
By ________________________________________
Name:
Title:
8
<PAGE>
EXHIBIT A
SOLICITING DEALER AGREEMENT
September 19, 1994
Gentlemen:
Doskocil Companies Incorporated ("Doskocil") has commenced a rights offering
(the "Offering") pursuant to which each holder of common stock and warrants to
acquire common stock (the "Warrants") of Doskocil on September 29, 1994 (the
"Record Date") has received .68 rights (the "Rights") per share of common stock
held or acquirable upon the exercise of the Warrants. Each Right entitles the
holder thereof to purchase one share of common stock (the "Common Stock") of
Doskocil at a subscription price of $9.00 per share. The Rights have been
approved for quotation on the NASDAQ National Market System.
Doskocil has prepared the following material, of which you have been
furnished copies (all such materials and all other materials approved by
Doskocil in writing for use in connection with any Offering solicitation, as any
of them may be amended or supplemented, are collectively referred to herein as
the "Offer Documents"):
(i) Registration Statement on Form S-3, as amended, dated September 19,
1994;
(ii) Prospectus, dated September 19, 1994;
(iii) Rights Certificate;
(iv) Preliminary Blue Sky Survey, dated September 19, 1994;
(v) Letters to securities brokers, dealers and nominees for use in the
distribution of the Offer Documents;
(vi) Letter from securities brokers, dealers and nominees to clients;
(vii) Notice of Guaranteed Delivery;
(viii) Instructions as to Use of the Rights Certificates;
(ix) Certification and Request for Additional Rights;
(x) Transmittal Letter to Holders of Common Stock of the Company;
(xi) Transmittal Letter to Holders of Common Stock of the Company whose
addresses are outside the continental United States and Canada and who have
APO or FPO addresses; and
(xii) Transmittal Letter to Holders of Warrants of the Company.
Each of the undersigned, as co-dealer-manager (each, a "Dealer Manager",
and, together, the "Dealer Managers") of the Offering, has entered into a Dealer
Manager Agreement with Doskocil dated September 19, 1994 pursuant to which each
has agreed, among other things, to use its best efforts as Dealer Manager to
form and manage a group consisting of selected securities brokers and dealers
(including bank trust departments), including itself (such brokers and dealers
being hereinafter referred to as "Soliciting Dealers"), to solicit the exercise
of Rights by holders of Common Stock and Warrants of Doskocil as described and
upon the terms and conditions set forth in the Prospectus. You are invited to
become one of the Soliciting Dealers and by your confirmation hereof you agree
to act in such capacity in accordance with the following terms and conditions:
1. OFFER DOCUMENTS. You agree to use your best efforts to solicit the
exercise of Rights by holders of Common Stock and Warrants of Doskocil (the
"Solicitations"). You agree that the Solicitations by Soliciting Dealers
hereunder shall be undertaken only in accordance with the Securities Act of
1933, as amended, and the Securities Exchange Act of 1934, as amended
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(together, the "Acts"), and the applicable rules and regulations of the
Securities and Exchange Commission thereunder, in accordance with the terms
of this Agreement and only in those states and other jurisdictions where the
Solicitations may lawfully be made and in accordance with the laws thereof.
Accompanying this Agreement are copies of the Offer Documents listed above
relating to the Offering. Additional copies of these documents will be
supplied to you in reasonable quantities upon request.
2. COMPENSATION OF SOLICITING DEALERS. Each Soliciting Dealer will be
paid fees by the Dealer Manager promptly after the termination of the
Offering, subject to the payment of such fees by Doskocil to the Dealer
Managers, in an amount equal to $0.10 for each share of Common Stock
purchased upon the exercise of a Right through such Soliciting Dealer's
efforts (other than shares of Common Stock acquired upon the exercise of
Rights by Joseph Littlejohn & Levy Fund II, L.P.), as evidenced by the
naming of such Soliciting Dealer in the Rights Certificate, provided,
however, that the Dealer Managers have received from such Soliciting Dealer
an executed confirmation of this Soliciting Dealer Agreement. In the event
that any Soliciting Dealer, as nominee, exercises Rights and subscribes for
shares of Common Stock on behalf of customers, such Soliciting Dealer agrees
to provide to the Dealer Managers, upon request, properly executed
instructions, including a designation of Soliciting Dealer, from such
customers where a Soliciting Dealer's fee is requested.
In the event of any disagreement as to amounts of compensation payable to a
Soliciting Dealer, the determination of the Dealer Managers shall be conclusive,
subject to Doskocil's determination (which shall be conclusive) of the validity
or timeliness of receipt of any subscription for Common Stock pursuant to the
exercise of Rights, provided, however, that in no event shall more than one
Soliciting Dealer's fee be payable per share of Common Stock subscribed for upon
the exercise of Rights.
No fee will be payable to Soliciting Dealers with respect to the exercise of
Rights which are not accepted by Doskocil, in its sole discretion.
Acceptance of compensation by you will constitute a representation that you
have not engaged in any activities prohibited by the Acts or rule or regulations
thereunder, or this Agreement.
3. UNAUTHORIZED INFORMATION AND REPRESENTATION. You agree not to give
any information or make any representations in connection with the
Solicitations other than those contained in the Offer Documents. You agree
not to publish, circulate or otherwise use any other advertisements or
solicitation material without the prior written approval of the undersigned
Dealer Managers and, if specified in writing on any Offer Documents, not to
show, quote or give such material to any person outside your firm. You are
not authorized to act as agent of Doskocil or the undersigned Dealer
Managers in any connection or transaction and you agree not to act as such
agent and not to purport to do so.
4. BLUE SKY QUALIFICATION. Included in the Offer Documents is a
Preliminary Blue Sky Survey, dated September 19, 1994. Under no
circumstances will you as a Soliciting Dealer engage in any activities
hereunder in any state in which you may not lawfully so engage. You
authorize each of the undersigned to cause to be filed in the Department of
State of the State of New York a Further State Notice with respect to the
Common Stock, if required.
5. TERMINATION. This Agreement may be terminated at any time by
written or telegraphic notice to you from either the undersigned Dealer
Managers or Doskocil, or to the Dealer Managers from you, and in any case,
it will terminate as to any Solicitations upon the expiration of the Rights
and the conclusion of the Offering, provided, however, (i) the provisions
hereof relating to payment of fees and (ii) the indemnification provisions
contained in paragraph 6 hereof shall survive any termination.
Doskocil may terminate any or all Solicitations at any time at its
discretion.
A-2
<PAGE>
6. LIABILITY OF THE DEALER MANAGER AND INDEMNIFICATION. Nothing
herein contained shall constitute the Soliciting Dealers partners with
either of the Dealer Managers, Doskocil, or with one another, or agents of
the Dealer Managers, of Doskocil, or an association, or shall render either
of the Dealer Managers liable for the obligations of any Soliciting Dealer.
The Dealer Managers shall be under no liability to make any payment to you
and shall be under no other liabilities to any Soliciting Dealer except for
obligations expressly assumed by them in this Agreement, and no obligations
of any sort shall be implied.
Under the Dealer Manager Agreement, Doskocil has agreed to the extent and
upon the terms set forth therein, to indemnify each Dealer Manager, each
Soliciting Dealer, each officer, director, employee or agent of each Dealer
Manager and each Soliciting Dealer and each person controlling each Dealer
Manager or any Soliciting Dealer against certain liabilities, including
liabilities under the Acts.
7. NOTICES. Any notice from the undersigned Dealer Managers or
Doskocil to you as a Soliciting Dealer shall be deemed to have been duly
given if mailed or telegraphed to you at your address set forth below. Any
notice from you as a Soliciting Dealer to the Dealer Managers or Doskocil
shall be deemed to have been duly given if mailed or telecopied,
respectively, to the Dealer Managers c/o Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated, North Tower, World Financial Center,
New York, NY 10281, Attention: Domenick LaMagna.
8. MISCELLANEOUS. This Agreement may not be assigned or delegated
without the express written consent of the Dealer Managers. This Agreement
is made solely for the benefit of you, the Dealer Managers, Doskocil and
their respective successors and permitted assigns, and no other persons
shall acquire or have any right under or by virtue of this Agreement.
9. APPLICABLE LAW. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York, applicable to
contracts executed in and to be performed in that state.
10. CONFIRMATION. Please confirm your agreement to become one of the
Soliciting Dealers under the terms and conditions herein set forth by
signing the attached confirmation and returning the enclosed duplicate copy
of it at once to Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, North Tower, World Financial Center, New York, NY 10281,
Attention: Domenick LaMagna, 5th Floor, Syndicate Department, Fax No. (212)
449-2784.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
JOHNSON RICE & COMPANY, L.L.C.
AS DEALER MANAGERS
By: Merrill, Lynch, Pierce, Fenner &
Smith
Incorporated
By: __________________________________________
A-3
<PAGE>
FORM OF CONFIRMATION
(Soliciting Dealer Agreement)
To: MERRILL LYNCH & CO.
JOHNSON RICE & COMPANY, L.L.C.
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, NY 10281
Attention: Domenick LaMagna
5th Floor
Syndicate Department
Fax No. (212) 449-2784
We hereby confirm our agreement to act as a Soliciting Dealer in accordance
with the terms and conditions of the Soliciting Dealer Agreement dated September
19, 1994, in connection with the solicitation of the exercise of Rights by
holders of Common Stock and Warrants of Doskocil pursuant to the related
Prospectus dated September 19, 1994. We hereby acknowledge receipt of such
Prospectus and related Offer Documents referred to in your letter relating to
the Solicitations, and confirm that in executing this confirmation we have
relied upon such Prospectus and other Offer Documents and confirm that we are
members in good standing of a national securities exchange or of the National
Association of Securities Dealers, Inc. (the "NASD"), or if a foreign dealer not
eligible for membership in the NASD, we agree to conform to the Rules of Fair
Practice of the NASD in connection with the Solicitations.
Date: ____________, 1994
Firm Name: ___________________________
By: __________________________________
Address ______________________________
________________________________
________________________________
________________________________
A-4
<PAGE>
EXHIBIT B
OPINION OF SKADDEN, ARPS, SLATE, MEAGHER & FLOM
The opinion of Skadden, Arps, Slate, Meagher & Flom, counsel to Doskocil, to
be delivered pursuant to Section 8(a) of this Agreement shall be to the effect
that:
(a) Doskocil is a corporation duly incorporated, validly existing and in
good standing under the laws of the jurisdiction of its incorporation.
Doskocil has the requisite corporate power and authority to execute, deliver
and perform its obligations under the Agreement.
(b) The Rights and the underlying shares of Common Stock have been duly
authorized for issuance.
(c) Based upon our review of the General Corporation Law of the State of
Delaware and those laws, rules and regulations of the United States which,
in our experience, are normally applicable to transactions of the type
provided for by the Agreement and the Offering, but without our having made
any special investigation concerning any other laws, rules or regulations,
no authorization, approval, consent or license of any government,
governmental instrumentality or court, is required under the General
Corporation Law of the State of Delaware or the laws, rules and regulations
of the United States of America for the consummation by Doskocil of the
transactions contemplated in the Agreement and the Engagement Letter,
including the consummation of the Offering.
(d) The execution and delivery of the Agreement and the Engagement
Letter, the consummation of the Offering and the consummation by Doskocil of
the transactions contemplated in the Agreement and the Engagement Letter and
in the Offering Materials and compliance by Doskocil with the terms of the
Agreement and the Engagement Letter have been duly authorized by all
necessary corporate action on the part of Doskocil and (i) do not and will
not result in any violation of the charter or by-laws of Doskocil, and (ii)
to the best of such counsel's knowledge, do not and will not conflict with,
or result in a breach of any of the terms or provisions of, or constitute a
default under, or result in the creation or imposition of any lien, charge
or encumbrance upon any property or assets of Doskocil under (A) any
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument to which Doskocil is a party or by which it may be bound or to
which its properties may be subject and which is set forth on a schedule
listing all indentures, mortgages, loan agreements, notes, leases or other
agreements that have been identified to such counsel by an officer of the
Company as the agreements the breach of which or default under which would
have a material adverse effect on the business, assets and condition
(financial or otherwise) of Doskocil attached hereto or (B) the General
Corporation Law of the State of Delaware or, without having made any special
investigation, any administrative or court decrees known to us to be
applicable to Doskocil.
(e) At the time the Registration Statement became effective the
Registration Statement (other than the documents incorporated by reference
therein and the financial statements, supporting schedules and other
financial and statistical information included therein or excluded
therefrom, as to which no opinion need be rendered) complied as to form in
all material respects with the requirements of the Act and the regulations
promulgated thereunder.
Such counsel shall also state that it has been advised by the Commission
that the Registration Statement was declared effective under the Act and, to the
best of their knowledge and information, no stop order suspending the
effectiveness of the Registration Statement has been issued under the Act or
proceedings therefor initiated by the Commission.
Such counsel shall also advise that nothing has come to their attention that
would lead them to believe that the Registration Statement, at the time it
became effective, or the Prospectus, as of the date thereof, contained an untrue
statement of a material fact required to be stated therein or omitted to state a
material fact necessary in order to make the statements therein, in the light of
the
B-1
<PAGE>
circumstances under which they were made, not misleading, except that such
counsel need not express an opinion with respect to the documents incorporated
by reference into the Registration Statement and the financial statements,
schedules and other financial and statistical information included in or
excluded from the Registration Statement or the exhibits to the Registration
Statement.
The opinion of the General Counsel of Doskocil shall be to the effect that
the documents incorporated by reference into the Registration Statement complied
as to form in all material respects with the requirements of the Act and the
regulations promulgated thereunder and that nothing has come to the attention of
such General Counsel that would lead him to believe that the documents
incorporated by reference into the Registration Statement, at the time the
Registration Statement became effective, contained an untrue statement of a
material fact required to be stated therein or in the Registration Statement or
omitted to state a material fact necessary in order to make the statements
therein or in the Registration Statement, in the light of the circumstances
under which they were made, not misleading.
B-2
<PAGE>
EXHIBIT 1.2
September , 1994
Joseph Littlejohn & Levy Fund, L.P.
126 E. 56th Street
New York, NY 10022
Joseph Littlejohn & Levy Fund II, L.P.
126 E. 56th Street
New York, NY 10022
Re: Doskocil Rights Offering --
Agreement to Exercise Rights
Dear Ladies and Gentlemen:
This letter confirms our agreement with respect to the intention of Doskocil
Companies Incorporated (the "Company") to raise additional equity capital
through a rights offering (the "Rights Offering") pursuant to which the Company
will distribute as a dividend transferable rights (the "Rights") to purchase
shares of its common stock, par value $.01 per share (the "Common Stock"), to
the holders of record of Common Stock. Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated and Johnson Rice & Company L.L.C. will act
as the dealer managers in the Rights Offering.
As a stockholder of the Company, Joseph Littlejohn & Levy Fund, L.P. ("JLL
Fund I") will receive as a dividend distribution its pro rata share of Rights
issued in the Rights Offering (the "JLL Rights"), which it will, in turn, sell
to Joseph Littlejohn & Levy Fund II, L.P. ("JLL Fund II").
Pursuant to the terms of the Rights Offering, holders of Rights who fully
exercise all Rights issued to them by the Company also will be eligible to
subscribe for shares of Common Stock that are not otherwise purchased pursuant
to the exercise of Rights, subject to reduction by the Company and subject
further to proration (the "Oversubscription Privilege").
JLL Fund II hereby agrees that it will exercise all of the JLL Rights and
further agrees that it will exercise its Oversubscription Privilege to the
extent necessary to assure that JLL Fund II has subscribed for shares of Common
Stock having an aggregate exercise price of $30 million. JLL Fund II recognizes
that its purchase of Common Stock upon exercise of Rights is subject to
reduction by the Company for the purpose of avoiding the loss of certain federal
income tax benefits to the Company.
JLL Fund II further agrees that there will be no fee paid to JLL Fund II by
the Company in connection with the exercise of the JLL Rights.
The Company agrees to indemnify JLL Fund I and JLL Fund II and each person
who is a general or limited partner of JLL Fund I or JLL Fund II or who controls
JLL Fund I or JLL Fund II within the meaning of Section 15 of the Securities Act
of 1933 or Section 20 of the Exchange Act of 1934 (JLL Fund I and JLL Fund II
and each such person being an "Indemnified Person") from and against any and all
losses, claims, damages and liabilities, joint or several, to which JLL Fund I
or JLL Fund II may become subject under any applicable federal or state law or
otherwise, and related to or arising out of any untrue statement or alleged
untrue statement of any material fact contained in a registration statement
covering the Rights and Common Stock underlying such Rights, in the prospectus
contained therein, in an amendment or supplement thereto, or arising out of or
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statement therein, in
light of the circumstances under which they were made, not misleading; and the
Company will reimburse any Indemnified Person for all reasonable expenses
(including reasonable counsel fees and expenses) as they are incurred in
connection with the investigation of, preparation for or defense of any pending
or threatened claim or any action or proceeding arising therefrom, whether or
not such Indemnified Person is a party and whether or not such claim, action or
proceeding is initiated or brought by or on behalf of the Company. The Company
will not be liable under
<PAGE>
the foregoing indemnification provision to the extent that any loss, claim,
damage, liability or expense is found in a nonappealable judgment by a court of
competent jurisdiction to have resulted from JLL Fund I's or JLL Fund II's
willful misconduct, bad faith or gross negligence. The Company also agrees that
no Indemnified Person shall have any liability (whether direct or indirect, in
contract or tort or otherwise) to the Company or any of its officers, directors
or creditors related to or arising out of any untrue statement or alleged untrue
statement of any material fact contained in a registration statement covering
the Rights and Common Stock underlying such Rights, in the prospectus contained
therein, or in an amendment or supplement thereto, or arising out of or based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statement therein, in light of the
circumstances under which they were made, not misleading, except to the extent
that any loss, claim damage or liability is found in a nonappealable judgment by
a court of competent jurisdiction to have resulted from the JLL Fund I's or JLL
Fund II's willful misconduct, bad faith or gross negligence.
Promptly after receipt by an Indemnified Person of written notice of any
claim or commencement of any action or proceeding with respect to which
indemnification is being sought hereunder, such Indemnified Person will notify
the Company in writing of such claim or of the commencement of such action or
proceeding; but failure so to notify the Company will not relieve the Company
from any liability which it may have to such Indemnified Person under this
letter agreement except to the extent that the Company is materially prejudiced
by such failure, and will not relieve the Company from any other liability that
it may have to such Indemnified Person. If the Company so elects or is requested
by an Indemnified Person, the Company will assume the defense of such action or
proceeding, including the employment of counsel reasonably satisfactory to such
Indemnified Person and the payment of the reasonable fees and expenses of such
counsel. In the event, however, that such Indemnified Person reasonably
determines in its judgment that having common counsel would present such counsel
with a conflict of interest or if the Company fails to assume the defense of the
action or proceeding in a timely manner, then such Indemnified Person may employ
separate counsel to represent or defend it in any such action or proceeding and
the Company will pay the reasonable fees and expenses of such counsel; PROVIDED,
HOWEVER, that the Company will not be required to pay the fees and expenses of
more than one separate counsel (in addition to any local counsel) for all
Indemnified Persons in any jurisdiction in any single action or proceeding. In
any action or proceeding the defense of which the Company assumes, the
Indemnified Persons will have the right to participate in such litigation and to
retain its own counsel at such Indemnified Person's own expense.
The Company agrees that, without such Indemnified Person's prior written
consent, it will not settle, compromise or consent to the entry of any judgment
in any pending or threatened claim, action or proceeding in respect of which
indemnification could be sought under the indemnification provision of this
letter agreement (whether or not JLL Fund I or JLL Fund II or any other
Indemnified Person is an actual or potential party to such claim, action or
proceeding), unless such settlement, compromise or consent includes an
unconditional release of each Indemnified Person from all liability arising out
of such claim, action or proceeding.
If for any reason (other than the willful misconduct, bad faith or gross
negligence of an Indemnified Person) the foregoing indemnity is unavailable to
the Indemnified Person to hold such Indemnified Person harmless from any such
liability, then the Company shall contribute to the amount paid or payable by
the Indemnified Person as a result of any such claim, liability, loss, damage or
expense in such proportion as is appropriate to reflect not only the relative
benefits received from the proposed transaction by the Company on the one hand
and JLL Fund I and JLL Fund II on the other but also the relative fault of the
Company and JLL Fund I and JLL Fund II as well as any equitable considerations.
<PAGE>
Please indicate your agreement with the terms set forth herein by signing
below.
Very truly yours,
DOSKOCIL COMPANIES INCORPORATED
By: __________________________________
Name:
Title:
Agreed and Accepted:
JOSEPH LITTLEJOHN & LEVY
FUND, L.P.
By: _________JLL Associates, L.P._________
General Partner
By: ____________________________________
Name:
Title:
JOSEPH LITTLEJOHN & LEVY
FUND II, L.P.
By: ____________________________________
General Partner
By: ____________________________________
Name:
Title:
<PAGE>
Exhibit 23.2
[Letterhead of Coopers & Lybrand L.L.P.]
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement of
Doskocil Companies Incorporated on Form S-3 (File no. 33-54137) of our report,
which includes an explanatory paragraph relating to the Company's adoption of
new methods of accounting for income taxes and postretirement benefits other
than pensions, dated March 1, 1994, on our audits of the consolidated financial
statements and financial statement schedules of Doskocil Companies Incorporated
as of January 1, 1994 and January 2, 1993, and for the years ended
January 1, 1994 and January 2, 1993, the three months ended December 28, 1991
and the nine months ended September 28, 1991, which report is included in the
amended Annual Report on Form 10-K/A for the year ended January 1, 1994, which
Form 10-K/A is incorporated by reference in this registration statement. We
also consent to the reference to our firm as experts, under the caption
Independent Public Accountants.
/s/ COOPERS & LYBRAND L.L.P.
------------------------------
Coopers & Lybrand L.L.P.
Tulsa, Oklahoma
August 19, 1994
2
<PAGE>
EXHIBIT 23.3
[Letterhead of KPMG Peat Marwick LLP]
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Doskocil Companies Incorporated:
We consent to the use of our report dated February 21, 1994 on the financial
statements of the Frozen Specialty Foods Business (a unit of the Prepared Foods
Division of International Multifoods Corporation) as of November 27, 1993,
February 27, 1993 and February 29, 1992 and for the nine months ended November
27, 1993 and the years ended February 27, 1993 and February 29, 1992
incorporated herein by reference and to the reference to our firm under the
heading "Independent Public Accountants" in the prospectus.
Our report refers to the adoption by the Frozen Specialty Foods Business of
the provisions of the Financial Accounting Standards Board's Statement of
Financial Accounting Standards No. 109, ACCOUNTING FOR INCOME TAXES, in the nine
months ended November 27, 1993 and Statement of Financial Accounting Standards
No. 106, EMPLOYERS' ACCOUNTING FOR POSTRETIREMENT BENEFITS OTHER THAN PENSIONS,
in the year ended February 29, 1992.
/S/ KPMG PEAT MARWICK LLP
--------------------------------------
KPMG PEAT MARWICK LLP
Orange County, California
September 19, 1994
<PAGE>
EXHIBIT 99.1
DOSKOCIL COMPANIES INCORPORATED
5,555,556 SHARES OF COMMON STOCK
OFFERED PURSUANT TO RIGHTS
DISTRIBUTED TO STOCKHOLDERS AND WARRANTHOLDERS OF
DOSKOCIL COMPANIES INCORPORATED
To Securities Dealers, Commercial Banks,
Trust Companies and Other Nominees:
Enclosed are a Prospectus, dated September 19, 1994 (the "Prospectus"), and
Instructions as to Use of the Doskocil Companies Incorporated Rights
Certificates (the "Instructions"), relating to the offering of 5,555,556 shares
of common stock, par value $.01 per share (the "Common Stock"), of Doskocil
Companies Incorporated (the "Company"), at a price of $9 per share, in cash,
pursuant to transferable subscription rights (the "Rights") distributed to
holders of record of Common Stock and warrants to purchase Common Stock, as of
the close of business on September 29, 1994 (the "Record Date"). The Rights are
described in the Prospectus and evidenced by a Rights Certificate registered in
your name or the name of your nominee.
Each beneficial owner of Common Stock registered in your name or the name of
your nominee is entitled to .68 Rights for each share of Common Stock owned by
such beneficial owner. All fractional Rights will be rounded up to the nearest
whole number, but only if you deliver to American Stock Transfer & Trust
Company, the Exercise Agent, a certification in the required form prior to 5:00
P.M., New York City time, on October 12, 1994. Each such certification will
require you to certify, among other things, that you are requesting the rounding
up of fractional Rights on behalf of bona fide beneficial owners entitled
thereto.
We are asking you to contact your clients for whom you hold shares of Common
Stock registered in your name or in the name of your nominee to obtain
instructions with respect to the Rights.
You will be reimbursed for customary mailing and handling expenses incurred
by you in forwarding any of the enclosed materials to your clients. Except for
the fees charged by the Exercise Agent (which will be paid by the Company, as
described in the Prospectus) all commissions, fees and other expenses (including
brokerage commissions and transfer taxes) incurred in connection with the
purchase, sale or exercise of Rights will be for the account of the transferor
of the Rights, and none of such commissions, fees or expenses will be paid by
the Company or the Exercise Agent. The Company will pay all transfer taxes, if
any, applicable to the sale of shares of Common Stock upon the exercise of
Rights.
Enclosed are copies of the following documents:
1. The Prospectus;
2. The "Instructions as to Use of the Doskocil Companies Incorporated
Rights Certificate" (including Guidelines For Certification of Taxpayer
Identification on Substitute Form W-9);
3. A form of letter which may be sent to your clients for whose
accounts you hold shares of the Company's Common Stock registered in your
name or the name of your nominee, with space provided for obtaining such
clients' instructions with regard to the Rights;
4. A Notice of Guaranteed Delivery for Exercise of Rights; and
5. A return envelope addressed to American Stock Transfer & Trust
Company, the Exercise Agent.
Your prompt action is requested. The Rights will expire at 5:00 P.M., New
York City time, on October 19, 1994, unless extended by the Company at its
discretion (the "Expiration Date").
To exercise Rights, properly completed and executed Rights Certificates
(unless the guaranteed delivery procedures are complied with) and payment in
full for all Rights exercised must be delivered to the Exercise Agent as
indicated in the Prospectus prior to 5:00 P.M., New York City time, on the
Expiration Date.
<PAGE>
Additional copies of the enclosed materials, and the certification needed to
round up fractional shares, may be obtained from American Stock Transfer & Trust
Company, the Exercise Agent. Their toll-free telephone number is (800) 937-5449.
Very truly yours,
[SIG]
R. Randolph Devening
CHAIRMAN OF THE BOARD OF DIRECTORS,
PRESIDENT
AND CHIEF EXECUTIVE OFFICER
NOTHING HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY
PERSON AS AN AGENT OF DOSKOCIL COMPANIES INCORPORATED, THE EXERCISE AGENT, THE
DEALER MANAGERS OR ANY OTHER PERSON MAKING OR DEEMED TO BE MAKING OFFERS OF THE
COMMON STOCK, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENTS ON
BEHALF OF ANY OF THEM WITH RESPECT TO THE OFFERING, EXCEPT FOR STATEMENTS
EXPRESSLY MADE IN THE PROSPECTUS OR THE RIGHTS CERTIFICATES.
<PAGE>
EXHIBIT 99.2
LETTER OF TRANSMITTAL
SEPTEMBER 29, 1994
IMPORTANT NOTICE AND INSTRUCTIONS
CONCERNING YOUR RIGHT TO SUBSCRIBE FOR COMMON STOCK
To Holders of Common Stock:
Enclosed for your consideration are a Rights Certificate, a Prospectus,
dated September 19, 1994, and the "Instructions as to Use of the Doskocil
Companies Incorporated Rights Certificate" relating to the offer of 5,555,556
shares (the "Underlying Shares") of common stock, $.01 par value per share (the
"Common Stock"), of Doskocil Companies Incorporated (the "Company") at a price
of $9 per share, in cash (the "Exercise Price"), pursuant to transferable
subscription rights (the "Rights") distributed to holders of record ("Record
Holders") of Common Stock and warrants to purchase Common Stock, of the Company,
as of the close of business on September 29, 1994 (the "Record Date").
As described in the accompanying Prospectus, you will receive .68
transferable Rights for every share of Common Stock held of record by you as of
the Record Date. Each Right will entitle you to subscribe for one share of
Common Stock (the "Basic Subscription Privilege") at the Exercise Price. If you
exercise your Basic Subscription Privilege in full, you will also have the right
(the "Oversubscription Privilege") to subscribe for Underlying Shares available
after satisfaction of all subscriptions pursuant to Basic Subscription
Privileges ("Excess Shares"), up to the total number of Underlying Shares but
subject to proration, at the Exercise Price. If there are insufficient Excess
Shares to satisfy all exercised Oversubscription Privileges, Excess Shares will
be allocated pro rata (subject to the elimination of fractional shares) among
those holders of Rights ("Holders") exercising the Oversubscription Privilege in
proportion to the number of Rights exercised by each Holder pursuant to the
Basic Subscription Privilege, relative to the number of Rights exercised
pursuant to the Basic Subscription Privilege by all Holders exercising the
Oversubscription Privilege, provided, however, that if such pro rata allocation
results in any Holder being allocated a greater number of Excess Shares than
such Holder of Rights subscribed for pursuant to the exercise of that Holder's
Oversubscription Privilege, then such Holder will be allocated only that number
of Excess Shares for which such holder oversubscribed, and the remaining Excess
Shares will be allocated among all other Holders exercising the Oversubscription
Privilege on the same basis outlined above; such proration will be repeated
until all Excess Shares have been allocated to the full extent of the
Oversubscription Privileges exercised.
Both the Basic Subscription Privilege and the Oversubscription Privilege are
subject to the potential reduction described in the Prospectus. If the Company
believes that the issuance of Underlying Shares pursuant to the Basic
Subscription Privilege or Oversubscription Privilege will have an adverse effect
upon the Company's ability to utilize certain Federal tax benefits, then the
Company will have the right to reduce the number of Underlying Shares issuable
to the extent necessary in the opinion of the Company to avoid such an adverse
effect.
Information on the Federal income tax treatment of the Rights Certificates
and the Common Stock is provided in the Prospectus.
The net proceeds to the Company of the Rights Offering will be used to repay
undebtedness incurred to finance the acquisition of the Frozen Specialty Foods
division of International Multifoods Corporation and for general corporate
purposes.
Rights are transferable and Holders that wish to sell their Rights may do
so. It is anticipated that the Rights will trade on the NASDAQ National Market
System up to and including the close of business on October 19, 1994, unless
extended at the Company's option (the "Expiration Date").
If you wish to subscribe for Common Stock, your executed Rights Certificate
(unless Notice of Guaranteed Delivery is given), filled out to indicate your
choice of options, must be received along with the
<PAGE>
aggregate Exercise Price by American Stock Transfer & Trust Company (the
"Exercise Agent") by 5:00 p.m., New York City time, on the Expiration Date.
After the Expiration Date, Rights will no longer be exercisable to purchase
shares of Common Stock and will have no value.
If you wish to sell any or all of your Rights through the Exercise Agent,
your executed Rights Certificate, filled out to indicate your choice of options,
must be received by the Exercise Agent by 11:00 a.m., New York City time, on the
Expiration Date. The Exercise Agent's obligation to execute orders is subject to
its ability to find buyers. Rights may also be sold through a bank or broker in
the manner set forth in the Instructions Booklet.
ANY QUESTIONS OR REQUESTS FOR ASSISTANCE CONCERNING THE OFFERING SHOULD BE
DIRECTED TO AMERICAN STOCK TRANSFER & TRUST COMPANY, THE EXERCISE AGENT, AT THE
FOLLOWING TELEPHONE NUMBER: (800) 937-5449.
Very truly yours,
R. Randolph Devening
CHAIRMAN OF THE BOARD OF DIRECTORS,
PRESIDENT
AND CHIEF EXECUTIVE OFFICER
Enclosures
2
<PAGE>
EXHIBIT 99.3
LETTER OF TRANSMITTAL
SEPTEMBER 29, 1994
IMPORTANT NOTICE AND INSTRUCTIONS
CONCERNING YOUR RIGHT TO SUBSCRIBE FOR COMMON STOCK
To the Holders of Common Stock
and Warrants whose addresses are
outside
the Continental United States and
Canada
or who have APO or FPO addresses:
Enclosed for your consideration is a Prospectus, dated September 19, 1994
relating to the offer of 5,555,556 shares (the "Underlying Shares") of common
stock, $.01 par value per share (the "Common Stock"), of Doskocil Companies
Incorporated (the "Company") at a price of $9 per share, in cash (the "Exercise
Price"), pursuant to transferable rights (the "Rights") distributed to holders
of record ("Record Holders") of Common Stock and warrants ("Warrants") to
purchase Common Stock, of the Company, as of the close of business on September
29, 1994 (the "Record Date").
As described in the accompanying Prospectus, you will receive .68
transferable Rights for every share of Common Stock held of record by you as of
the Record Date or acquirable through the exercise of Warrants held of record by
you as of the Record Date. Each Right will entitle you to subscribe for one
share of Common Stock (the "Basic Subscription Privilege") at the Exercise
Price. If you exercise your Basic Subscription Privilege in full, you will also
have the right (the "Oversubscription Privilege") to subscribe for Underlying
Shares available after satisfaction of all subscriptions pursuant to Basic
Subscription Privileges ("Excess Shares"), up to the total number of Underlying
Shares but subject to proration, at the Exercise Price. If there are
insufficient Excess Shares to satisfy all exercised Oversubscription Privileges,
Excess Shares will be allocated pro rata (subject to the elimination of
fractional shares) among those holders of Rights ("Holders") exercising the
Oversubscription Privilege in proportion to the number of Rights exercised by
each Holder pursuant to the Basic Subscription Privilege, relative to the number
of Rights exercised pursuant to the Basic Subscription Privilege by all Holders
exercising the Oversubscription Privilege, provided, however, that if such pro
rata allocation results in any Holder being allocated a greater number of Excess
Shares than such Holder of Rights subscribed for pursuant to the exercise of
that Holder's Oversubscription Privilege, then such Holder will be allocated
only that number of Excess Shares for which such holder oversubscribed, and the
remaining Excess Shares will be allocated among all other Holders exercising the
Oversubscription Privilege on the same basis outlined above; such proration will
be repeated until all Excess Shares have been allocated to the full extent of
the Oversubscription Privileges exercised.
Both the Basic Subscription Privilege and the Oversubscription Privilege are
subject to the potential reduction described in the Prospectus. If the Company
believes that the issuance of Underlying Shares pursuant to the Basic
Subscription Privilege or Oversubscription Privilege will have an adverse effect
upon the Company's ability to utilize certain Federal tax benefits, then the
Company will have the right to reduce the number of Underlying Shares issuable
to the extent necessary in the opinion of the Company to avoid such an adverse
effect.
Information on the Federal income tax treatment of the Rights Certificates
and the Common Stock is provided in the Prospectus.
The net proceeds to the Company of the Rights Offering will be used to repay
indebtedness incurred to finance the acquisition of the Frozen Specialty Foods
division of International Multifoods Corporation and for general corporate
purposes.
<PAGE>
Rights are transferable and Holders that wish to sell their Rights may do
so. It is anticipated that the Rights will trade on the NASDAQ National Market
System up to and including the close of business on October 19, 1994, unless
extended at the Company's option (the "Expiration Date").
Rights Certificates have not been mailed to stockholders whose addresses are
outside the United States and Canada or who have APO or FPO addresses. Instead,
the Rights Certificate will be held by American Stock Transfer & Trust Company
(the "Exercise Agent"), which will follow the instructions of such stockholders
for the exercise or other disposition of such Rights Certificates. To exercise
Rights, you must notify the Exercise Agent on or prior to the Expiration Date.
ANY QUESTIONS OR REQUESTS FOR ASSISTANCE CONCERNING THE OFFERING SHOULD BE
DIRECTED TO AMERICAN STOCK TRANSFER & TRUST COMPANY, THE EXERCISE AGENT, AT THE
FOLLOWING TELEPHONE NUMBER: (800) 937-5449.
Very truly yours,
[SIG]
R. Randolph Devening
CHAIRMAN OF THE BOARD OF DIRECTORS,
PRESIDENT
AND CHIEF EXECUTIVE OFFICER
Enclosures
2
<PAGE>
EXHIBIT 99.4
LETTER OF TRANSMITTAL
SEPTEMBER 29, 1994
IMPORTANT NOTICE AND INSTRUCTIONS
CONCERNING YOUR RIGHT TO SUBSCRIBE FOR COMMON STOCK
To the Holders of Warrants to Acquire Common Stock:
Enclosed for your consideration are a Rights Certificate, a Prospectus,
dated September 19, 1994, and the "Instructions as to Use of the Doskocil
Companies Incorporated Rights Certificate" relating to the offer of 5,555,556
shares (the "Underlying Shares") of common stock, $.01 par value per share (the
"Common Stock"), Doskocil Companies Incorporated (the "Company") at a price of
$9 per share, in cash (the "Exercise Price"), pursuant to transferable
subscription rights (the "Rights") distributed to holders of record ("Record
Holders") of Common Stock and warrants ("Warrants") to purchase Common Stock, of
the Company, as of the close of business on September 29, 1994 (the "Record
Date").
As described in the accompanying Prospectus, you will receive .68
transferable Rights for every share of Common Stock held of record by you as of
the Record Date or acquirable through the exercise Warrants held of record by
you as of the Record Date. Each Right will entitle you to subscribe for one
share of Common Stock (the "Basic Subscription Privilege") at the Exercise
Price. If you exercise your Basic Subscription Privilege in full, you will also
have the right (the "Oversubscription Privilege") to subscribe for Underlying
Shares available after satisfaction of all subscriptions pursuant to Basic
Subscription Privileges ("Excess Shares"), up to the total number of Underlying
Shares but subject to proration, at the Exercise Price. If there are
insufficient Excess Shares to satisfy all exercised Oversubscription Privileges,
Excess Shares will be allocated pro rata (subject to the elimination of
fractional shares) among those holders of Rights ("Holders") exercising the
Oversubscription Privilege in proportion to the number of Rights exercised by
each Holder pursuant to the Basic Subscription Privilege, relative to the number
of Rights exercised pursuant to the Basic Subscription Privilege by all Holders
exercising the Oversubscription Privilege, provided, however, that if such pro
rata allocation results in any Holder being allocated a greater number of Excess
Shares than such Holder of Rights subscribed for pursuant to the exercise of
that Holder's Oversubscription Privilege, then such Holder will be allocated
only that number of Excess Shares for which such holder oversubscribed, and the
remaining Excess Shares will be allocated among all other Holders exercising the
Oversubscription Privilege on the same basis outlined above; such proration will
be repeated until all Excess Shares have been allocated to the full extent of
the Oversubscription Privileges exercised.
Both the Basic Subscription Privilege and the Oversubscription Privilege are
subject to the potential reduction described in the Prospectus. If the Company
believes that the issuance of Underlying Shares pursuant to the Basic
Subscription Privilege or Oversubscription Privilege will have an adverse effect
upon the Company's ability to utilize certain Federal tax benefits, then the
Company will have the right to reduce the number of Underlying Shares issuable
to the extent necessary in the opinion of the Company to avoid such an adverse
effect.
Information on the Federal income tax treatment of the Rights Certificates
and the Common Stock is provided in the Prospectus.
The net proceeds to the Company of the Rights Offering will be used to repay
indebtedness incurred to finance the acquisition of the Frozen Specialty Foods
division of International Multifoods Corporation and for general corporate
purposes.
Rights are transferable and Holders that wish to sell their Rights may do
so. It is anticipated that the Rights will trade on the NASDAQ National Market
System up to and including the close of business on October 19, 1994, unless
extended at the Company's option (the "Expiration Date").
<PAGE>
If you wish to subscribe for Common Stock, your executed Rights Certificate
(unless Notice of Guaranteed Delivery is given), filled out to indicate your
choice of options, must be received along with the aggregate Exercise Price by
American Stock Transfer & Trust Company (the "Exercise Agent") by 5:00 p.m., New
York City time, on the Expiration Date. After the Expiration Date, Rights will
no longer be exercisable to purchase shares of Common Stock and will have no
value.
If you wish to sell any or all of your Basic Subscription Right through the
Exercise Agent, your executed Rights Certificate, filled out to indicate your
choice of options, must be received by the Exercise Agent by 11:00 a.m., New
York City time, on October 19, 1994. Rights may also be sold through a bank or
broker in the manner set forth in the Instructions Booklet.
ANY QUESTIONS OR REQUESTS FOR ASSISTANCE CONCERNING THE OFFERING SHOULD BE
DIRECTED TO AMERICAN STOCK TRANSFER & TRUST COMPANY, THE EXERCISE AGENT, AT THE
FOLLOWING TELEPHONE NUMBER: (800) 937-5449.
Very truly yours,
[SIG]
R. Randolph Devening
CHAIRMAN OF THE BOARD OF DIRECTORS,
PRESIDENT
AND CHIEF EXECUTIVE OFFICER
Enclosures
2
<PAGE>
EXHIBIT 99.5
5,555,556 SHARES OF COMMON STOCK OF DOSKOCIL COMPANIES INCORPORATED
OFFERED PURSUANT TO RIGHTS
DISTRIBUTED TO STOCKHOLDERS AND WARRANTHOLDERS
OF DOSKOCIL COMPANIES INCORPORATED
To Our Clients:
Enclosed for your consideration are a Prospectus, dated September 19, 1994,
and the "Instructions as to Use of the Doskocil Companies Incorporated Rights
Certificates" relating to the offer of 5,555,556 shares (the "Underlying
Shares") of common stock, par value $.01 per share (the "Common Stock"), of
Doskocil Companies Incorporated (the "Company"), at a price of $9 per share, in
cash, pursuant to transferable subscription rights (the "Rights") distributed to
holders of record ("Record Holders") of Common Stock and warrants to purchase
Common Stock, of the Company, as of the close of business on September 29, 1994
(the "Record Date").
As described in the accompanying Prospectus, you will receive .68
transferable Rights for every share of Common Stock carried by us in your
account as of the Record Date. Each Right will entitle you to subscribe for one
share of Common Stock (the "Basic Subscription Privilege") at an exercise price
of $9 per share (the "Exercise Price"), subject to reduction as described below.
If you exercise your Basic Subscription Privilege in full, you will also have
the right (the "Oversubscription Privilege") to subscribe for Underlying Shares
available after satisfaction of all subscriptions pursuant to Basic Subscription
Privileges ("Excess Shares"), up to the total number of Underlying Shares but
subject to reduction and proration, at the Exercise Price. If there are
insufficient Excess Shares to satisfy all exercised Oversubscription Privileges,
Excess Shares will be allocated pro rata (subject to the elimination of
fractional shares) among those holders of Rights ("Holders") exercising the
Oversubscription Privilege in proportion to the number of Rights exercised by
each Holder pursuant to the Basic Subscription Privilege, relative to the number
of Rights exercised pursuant to the Basic Subscription Privilege by all Holders
exercising the Oversubscription Privilege, provided, however, that if such pro
rata allocation results in any Holder being allocated a greater number of Excess
Shares than such Holder of Rights subscribed for pursuant to the exercise of
that Holder's Oversubscription Privilege, then such Holder will be allocated
only that number of Excess Shares for which such holder oversubscribed, and the
remaining Excess Shares will be allocated among all other Holders exercising the
Oversubscription Privilege on the same basis outlined above; such proration will
be repeated until all Excess Shares have been allocated to the full extent of
the Oversubscription Privileges exercised. Both the Basic Subscription Privilege
and the Oversubscription Privilege are subject to the potential reduction
described in the Prospectus.
If the Company believes that the issuance of Underlying Shares pursuant to
the Basic Subscription Privilege or the Oversubscription Privilege will have an
adverse effect upon its ability to utilize its net operating loss carryforwards
(including its built-in losses), then the Company will have the right to reduce
the number of Underlying Shares issuable to all Holders exercising the Basic
Subscription Privilege or the Oversubscription Privilege, pro rata, or, to any
individual Holder whose exercise of the Basic Subscription Privilege or
Oversubscription Privilege may create such adverse effect, to the extent
necessary in the sole opinion of the Company to avoid such adverse effect.
Rights are transferable and Holders that wish to sell their Rights may do
so. It is anticipated that the Rights will trade on the NASDAQ National Market
System up to and including the close of business on October 19, 1994, unless
extended at the Company's option (the "Expiration Date").
The materials enclosed are being forwarded to you as the beneficial owner of
shares of the Common Stock carried by us in your account but not registered in
your name. Exercises and sales of Rights may be made by only us as the Record
Holder and pursuant to your instructions. Accordingly, we request instructions
as to whether you wish us to elect to subscribe for any shares of Common Stock,
or sell (or direct the Exercise Agent to endeavor to sell) any Rights, to which
you are entitled pursuant to the terms and subject to the conditions set forth
in the enclosed Prospectus and Instructions as to Use of Rights Certificate.
However, we urge you to read these documents carefully before instructing us to
exercise or sell Rights.
<PAGE>
Your instructions to us should be forwarded as promptly as possible in order
to permit us to exercise or sell Rights on your behalf in accordance with the
provisions of the offering. The offering will expire at 5:00 P.M., New York City
time, on October 19, 1994, unless the offering is extended by the Company at its
option. Once you have exercised a Right, such exercise may not be revoked.
If you wish to have us, on your behalf, exercise the Rights for any shares
of Common Stock to which you are entitled, or sell (or direct the Exercise Agent
to endeavor to sell) such Rights, please so instruct us by completing, executing
and returning to us the instruction form on the reverse side of this letter.
ANY QUESTIONS OR REQUESTS FOR ASSISTANCE CONCERNING THE OFFERING SHOULD BE
DIRECTED TO AMERICAN STOCK TRANSFER & TRUST, THE EXERCISE AGENT, AT THE
FOLLOWING TELEPHONE NUMBER: (800) 937-5449.
<PAGE>
INSTRUCTIONS
The undersigned acknowledge(s) receipt of your letter and the enclosed
materials referred to therein relating to the offering of shares of Common
Stock.
This will instruct you whether to exercise or sell (or direct the Exercise
Agent to endeavor to sell) Rights to purchase Common Stock distributed with
respect to the Common Stock held by you for the account of the undersigned,
pursuant to the terms and subject to the conditions set forth in the Prospectus
and the related Instructions as to Use of Rights Certificate.
Box 1. / / Please DO NOT EXERCISE RIGHTS for shares of Common Stock.
Box 2. / / Please EXERCISE RIGHTS for shares of Common Stock as set forth
below.
<TABLE>
<CAPTION>
NUMBER OF EXERCISE
RIGHTS PRICE PAYMENT
---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Basic Subscription
Right: X $9.00 = $ (Line 1)
---------- ---------
Oversubscription
Right: X $9.00 = $ (Line 2)
---------
----------
Total Payment Required = $
---------
(Sum of Lines 1 and 2; must
equal total of amounts in
Boxes 3 and 4)
</TABLE>
Box 3. / / Payment in the following amount is enclosed: $______.
Box 4. / / Please deduct payment from the following account maintained by
you as follows:
--------------------------------------------
--------------------------------------------
Type of Account Account No.
Amount to be deducted: $
--------------------------------------------
Box 5. Please indicate on the Rights Certificate the name of the dealer, if
any, that solicited the exercise of the Rights exercised in Box 2
(check one Box only):
/ / Merrill Lynch, Pierce, Fenner & Smith Incorporated
/ / Johnson Rice & Company, L.L.C.
/ / Other:
--------------------------------------
(Write in name of Soliciting Dealer)
Box 6. / / Please DIRECT THE EXERCISE AGENT TO ENDEAVOR TO SELL ALL RIGHTS
held for my account.
Box 7. / / Please SELL RIGHTS other than through the Exercise Agent as set
forth below:
Sell ______ Rights.
Date: ______________, 1994
--------------------------------------
--------------------------------------
Signature(s)
Please type or print name(s) below
--------------------------------------
--------------------------------------
<PAGE>
EXHIBIT 99.6
INSTRUCTIONS AS TO USE OF THE DOSKOCIL COMPANIES
INCORPORATED RIGHTS CERTIFICATES
-------------------
CONSULT THE EXERCISE AGENT, YOUR BANK OR BROKER
AS TO ANY QUESTIONS
The following instructions relate to a rights offering (the "Rights
Offering") by Doskocil Companies Incorporated, a Delaware corporation (the
"Company"), to the holders of its Common Stock, par value $.01 per share (the
"Common Stock"), and warrants to acquire Common Stock (the "Warrants"), as
described in the Company's Prospectus dated September 19, 1994 (the
"Prospectus"). Holders of record of Common Stock and Warrants at the close of
business on September 29, 1994 (the "Record Date") are receiving .68
transferable subscription rights (the "Rights") for each share of Common Stock
held or acquirable upon exercise of Warrants by them on the Record Date. An
aggregate of approximately 5,555,556 Rights exercisable to purchase an aggregate
of approximately 5,555,556 shares of Common Stock (the "Underlying Shares") are
being distributed in connection with the Rights Offering. The Rights will expire
at 5:00 p.m., New York City time, on October 19, 1994, unless extended as
described in the Prospectus (the "Expiration Date"). The Rights will be traded
on the National Association of Securities Dealers' Automated Quotation
System/National Market System up to and including the Expiration Date.
Each Right is exercisable, upon payment of $9 in cash (the "Exercise
Price"), to purchase one share of Common Stock (the "Basic Subscription
Privilege"), subject to possible reduction described below. In addition, subject
to the allotment and possible reduction described below, each Right also carries
the right to subscribe at the Exercise Price for additional shares of Common
Stock up to the total number of Underlying Shares (the "Oversubscription
Privilege"); provided that the holder of such Right (a "Holder") exercises such
Holder's Basic Subscription Privilege in full. Underlying Shares will be
available for purchase pursuant to the Oversubscription Privilege only to the
extent that all the Underlying Shares are not subscribed for through the
exercise of the Basic Subscription Privilege by the Expiration Date or are not
issuable pursuant to the Basic Subscription Privilege as a result of a reduction
in the number of shares issuable to a holder of Rights as described below. If
the Underlying Shares so available (the "Excess Shares") are not sufficient to
satisfy all subscriptions pursuant to the Oversubscription Privilege, the Excess
Shares will be allocated pro rata (subject to the elimination of fractional
shares) among the holders of Rights who exercise the Oversubscription Privilege
in proportion to the number of Rights exercised by such Holder pursuant to the
Basic Subscription Privilege, relative to the number of Rights exercised
pursuant to the Basic Subscription Privilege by all Holders exercising the
Oversubscription Privilege; provided, however, that if such pro rata allocation
results in any holder being allocated a greater number of Excess Shares than
such Holder subscribed for pursuant to the exercise of such Holder's
Oversubscription Privilege, then such Holder will be allocated only such number
of Excess Shares as such Holder oversubscribed for and the remaining Excess
Shares will be allocated among all other Holders exercising Oversubscription
Privileges on the same pro rata basis outlined above; such proration will be
repeated until all Excess Shares have been allocated to the full extent of the
Oversubscription Privileges exercised. If a proration of the Excess Shares
results in a Holder receiving fewer Excess Shares than such Holder subscribed
for pursuant to the Oversubscription Privilege, or a reduction of the number of
Underlying Shares issuable to a Holder or Holders pursuant to the Basic
Subscription Privilege or Oversubscription Privilege occurs as described below,
then the excess funds paid by that Holder as the Exercise Price for shares not
issued will be returned without interest or deduction. See "The Rights Offering"
in the Prospectus.
If the Company believes that the issuance of Underlying Shares pursuant to
the Basic Subscription Privilege or the Oversubscription Privilege will have an
adverse effect upon its ability to utilize its net operating loss carryforwards,
then the Company will have the right to reduce the number of Underlying Shares
issuable to all Holders exercising the Basic Subscription Privilege or the
Oversubscription Privilege, pro rata, or, to any individual Holder whose
exercise of the Basic Subscription Privilege or Oversubscription Privilege may
create such adverse effect, to the extent necessary in the sole opinion of the
Company to avoid such adverse effect. See "Risk Factors -- Continuation of Net
Operating Loss Carryforwards" in the Prospectus. Such opinion of the Company
shall be conclusive and binding.
<PAGE>
No fractional Rights or cash in lieu thereof will be issued or paid. The
number of Rights distributed by the Company has been rounded up to the nearest
whole number in order to avoid issuing fractional Rights.
The number of Rights to which you are entitled is printed on the face of
your Rights Certificate. You should indicate your wishes with regard to the
exercise or sale of your Rights by completing the appropriate form or forms on
your Rights Certificate and returning the certificate to the Exercise Agent in
the envelope provided.
Once a Holder has properly exercised the Basic Subscription Privilege and/or
the Oversubscription Privilege, such exercise may not be revoked.
YOUR RIGHTS CERTIFICATE MUST BE RECEIVED BY THE EXERCISE AGENT, OR
GUARANTEED DELIVERY REQUIREMENTS WITH RESPECT TO YOUR RIGHTS CERTIFICATES MUST
BE COMPLIED WITH, AND PAYMENT OF THE EXERCISE PRICE, INCLUDING FINAL CLEARANCE
OF ANY CHECKS, MUST BE RECEIVED BY THE EXERCISE AGENT, ON OR BEFORE 5:00 P.M.,
NEW YORK CITY TIME, ON THE EXPIRATION DATE. YOU MAY NOT REVOKE ANY EXERCISE OF A
RIGHT.
1. SUBSCRIPTION PRIVILEGE.
To exercise Rights, complete Form 1 and send your properly completed and
executed Rights Certificate, together with payment in full of the Exercise Price
for each Underlying Share subscribed for pursuant to the Basic Subscription
Privilege and the Oversubscription Privilege, to the Exercise Agent. Payment of
the Exercise Price must be made in U.S. dollars for the full number of
Underlying Shares being subscribed for (a) by check or bank draft drawn upon a
U.S. bank or postal, telegraphic or express money order payable to American
Stock Transfer & Trust Company, as Exercise Agent, or (b) by wire transfer of
funds to the account maintained by the Exercise Agent for the purpose of
accepting subscriptions at Chemical Bank Account No. 61-093-045; ABA No.
021-000-128 or (c) a combination of the foregoing. The Exercise Price will be
deemed to have been received by the Exercise Agent only upon (i) the clearance
of any uncertified check, (ii) the receipt by the Exercise Agent of any
certified check or bank draft drawn upon a U.S. bank or any postal, telegraphic
or express money order or (iii) the receipt of good funds in the Exercise
Agent's account designated above. If paying by uncertified personal check,
please note that the funds paid thereby may take at least five business days to
clear. Accordingly, Holders who wish to pay the Exercise Price by means of
uncertified personal check are urged to make payment sufficiently in advance of
the Expiration Date to ensure that such payment is received and clears by such
date and are urged to consider payment by means of certified or cashier's check,
money order or wire transfer of funds.
You may also transfer your Rights Certificate to your bank or broker in
accordance with the procedures specified in Section 3(a) below, make
arrangements for the delivery of funds on your behalf and request such bank or
broker to exercise the Rights Certificate on your behalf. Alternatively, you may
cause a written guarantee substantially in the form of Exhibit A to these
instructions (the "Notice of Guaranteed Delivery") from a member firm of a
registered national securities exchange or a member of the National Association
of Securities Dealers, Inc., or from a commercial bank or trust company having
an office or correspondent in the United States (each of the foregoing being an
"Eligible Institution"), to be received by the Exercise Agent at or prior to the
Expiration Date together with payments in full of the applicable Exercise Price.
Such Notice of Guaranteed Delivery must state your name, the number of Rights
represented by your Rights Certificate and the number of Rights being exercised
pursuant to the Basic Subscription Privilege and the number of Underlying
Shares, if any, being subscribed for pursuant to the Oversubscription Privilege,
and will guarantee the delivery to the Exercise Agent of your properly completed
and executed Rights Certificates within five NASDAQ/NMS trading days following
the date of the Notice of Guaranteed Delivery. If this procedure is followed,
your Rights Certificates must be received by the Exercise Agent within five
NASDAQ/NMS trading days of the Notice of Guaranteed Delivery. Additional copies
of the Notice of Guaranteed Delivery may be obtained upon request from the
Information Agent at the address, or by calling the telephone number, indicated
below.
2
<PAGE>
Banks, brokers and other nominee Holders who exercise Rights and the
Oversubscription Privilege on behalf of beneficial owners of Rights will be
required to certify to the Exercise Agent and the Company the aggregate number
of Rights as to which the Oversubscription Privilege has been exercised, and the
number of Underlying Shares thereby subscribed for by each beneficial owner of
Rights on whose behalf such nominee holder is acting. If more Underlying Shares
are subscribed for pursuant to the Oversubscription Privilege than are available
for sale, Underlying Shares will be allocated as described above.
The address and telephone numbers of the Exercise Agent are as follows:
IF BY HAND OR BY OVERNIGHT COURIER:
AMERICAN STOCK TRANSFER & TRUST COMPANY
40 WALL STREET
46TH FLOOR
NEW YORK, NEW YORK 10005
TELEPHONE: (800) 937-5449
(212) 936-5100
TELECOPIER: (718) 234-5001
If you exercise less than all of the Rights evidenced by your Rights
Certificate by so indicating in Form 1 of your Rights Certificate, the Exercise
Agent will issue to you a new Rights Certificate evidencing the unexercised
Rights or, if you so indicate in Form 3 of your Rights Certificate, will
endeavor to sell such unexercised Rights for you. However, if you choose to have
a new Rights Certificate sent to you, you may not receive any such new Rights
Certificate in sufficient time to permit you to sell or exercise the Rights
evidenced thereby. If you have not indicated the number of Rights being
exercised, or if you have not forwarded full payment of the Exercise Price for
the number of Rights that you have indicated are being exercised, you will be
deemed to have exercised the Basic Subscription Privilege with respect to the
maximum number of whole Rights which may be exercised for the aggregate Exercise
Price payment delivered by you and to the extent that the aggregate Exercise
Price payment delivered by you exceeds the product of the Exercise Price
multiplied by the number of Rights evidenced by the Rights Certificates
delivered by you (such excess being the "Exercise Excess"), you will be deemed
to have exercised your Oversubscription Privilege to purchase, to the extent
available, that number of whole Excess Shares equal to the quotient obtained by
dividing the Exercise Excess by the Exercise Price.
2. DELIVERY OF STOCK CERTIFICATES, ETC.
The following deliveries and payments will be made to the address shown on
the face of your Rights Certificate unless you provide instructions to the
contrary on Form 4.
(A) BASIC SUBSCRIPTION PRIVILEGE. As soon as practicable after the
Expiration Date and the valid exercise of Rights, the Exercise Agent will mail
to each exercising Holder certificates representing shares of Common Stock
purchased pursuant to the Basic Subscription Privilege.
(B) OVERSUBSCRIPTION PRIVILEGE. As soon as practicable after the
Expiration Date, the Exercise Agent will mail to each Holder who validly
exercises the Oversubscription Privilege the number of shares allocated to such
Holder pursuant to the Oversubscription Privilege. See "The Rights Offering --
Subscription Privileges -- Oversubscription Privilege" in the Prospectus.
(C) CASH PAYMENTS. As soon as practicable after the Expiration Date, the
Exercise Agent will mail to each Holder who exercises the Basic Subscription
Privilege and/or the Oversubscription Privilege any excess funds received in
payment of the Exercise Price for Underlying Shares that are subscribed for by
such Holder but not allocated to such Holder as a result of proration or
reduction as described above, without interest or deduction.
Promptly following any sale of the Rights through the Exercise Agent, the
Exercise Agent will mail a check for any Rights sold to the holder of such
Rights, less any applicable brokerage commissions, taxes and other direct
expenses or sale charges.
3. TO SELL OR TRANSFER RIGHTS.
(A) SALE OF RIGHTS THROUGH A BANK OR BROKER. To sell all Rights evidenced
by a Rights Certificate through your bank or broker, so indicate on Form 2 and
deliver your properly completed and executed
3
<PAGE>
Rights Certificate to your bank or broker. Your Rights Certificate should be
delivered to your bank or broker in ample time for it to be exercised. If Form 2
is completed without designating a transferee, the Exercise Agent may thereafter
treat the bearer of the Rights Certificate as the absolute owner of all of the
Rights evidenced by such Rights Certificate for all purposes, and the Exercise
Agent shall not be affected by any notice to the contrary. Because your bank or
broker cannot issue Rights Certificates, if you wish to sell less than all of
the Rights evidenced by a Rights Certificate, either you or your bank or broker
must instruct the Exercise Agent as to the action to be taken with respect to
the Rights not sold, or you or your bank or broker must first have your Rights
Certificate divided into Rights Certificates of appropriate denominations by
following the instructions in paragraph 4 of these instructions. The Rights
Certificates evidencing the number of Rights you intend to sell and then be
transferred by your bank or broker in accordance with the instructions in this
paragraph 3(a).
(B) TRANSFER OF RIGHTS TO A DESIGNATED TRANSFEREE. To transfer all of your
Rights to a transferee other than a bank or broker, you must complete Form 2 in
its entirety, execute the Rights Certificate and have your signature guaranteed
by an Eligible Institution. A Rights Certificate that has been properly
transferred in its entirety may be exercised by a new Holder without having a
new Rights Certificate issued. Because only the Exercise Agent can issue Rights
Certificates, if you wish to transfer less than all of the Rights evidenced by
your Rights Certificate to a designated transferee, you must instruct the
Exercise Agent as to the action to be taken with respect to the Rights not sold
or transferred, or you must divide your Rights Certificate into Rights
Certificates of appropriate smaller denominations by following the instructions
in paragraph 4 below. The Rights Certificate evidencing the number of Rights you
intend to transfer can then be transferred by following the instructions in this
paragraph 3(b).
(C) SALE OF RIGHTS THROUGH EXERCISE AGENT. To sell some or all of your
Rights evidenced by the Rights Certificate, your Rights Certificate should be
delivered to the Exercise Agent in ample time for it to be sold and exercised,
but in no event later than 11:00 a.m., New York City time, on the Expiration
Date. The Exercise Agent's obligation to execute orders is subject to its
ability to find buyers. If you wish to sell less than all of your Rights, you
and your bank or broker must instruct the Exercise Agent as to the action to be
taken with respect to the Rights not sold. Promptly following any sale of your
Rights through the Exercise Agent, the Exercise Agent will send you a check for
the net proceeds of such sale as described in the Prospectus. If you wish to
sell Rights through the Exercise Agent, you should also complete the Substitute
Form W-9 referred to in Paragraph 7 below.
4. TO HAVE A RIGHTS CERTIFICATE DIVIDED INTO SMALLER DENOMINATIONS.
Send your Rights Certificate, together with complete separate instructions
(including specification of the denominations into which you wish your Rights to
be divided) signed by you, to the Exercise Agent, allowing a sufficient amount
of time for new Rights Certificates to be issued and returned so that they can
be used prior to the Expiration Date. Alternatively, you may ask a bank or
broker to effect such actions on your behalf. Your signature must be guaranteed
by an Eligible Institution if any of the new Rights Certificates are to be
issued in a name other than that in which the old Rights Certificate was issued.
Rights Certificates may not be divided into fractional Rights, and any
instruction to do so will be rejected. As a result of delays in the mail, the
time of the transmittal, the necessary processing time and other factors, you or
your transferee may not receive such new Rights Certificates in time to enable
the Holder to complete a sale or exercise by the Expiration Date. Neither the
Company nor the Exercise Agent will be liable to either a transferor or
transferee for any such delays.
5. EXECUTION.
(A) EXECUTION BY REGISTERED HOLDER. The signature on the Rights Certificate
must correspond with the name of the registered Holder exactly as it appears on
the face of the Rights Certificate without any alteration or change whatsoever.
Persons who sign the Rights Certificate in a representative or other fiduciary
capacity must indicate their capacity when signing and, unless waived by the
Exercise Agent in its sole and absolute discretion, must present to the Exercise
Agent satisfactory evidence of their authority to so act.
4
<PAGE>
(B) EXECUTION BY PERSON OTHER THAN REGISTERED HOLDER. If the Rights
Certificate is executed by a person other than the Holder named on the face of
the Rights Certificate, proper evidence of authority of the person executing the
Rights Certificate must accompany the same unless, for good cause, the Exercise
Agent dispenses with proof of authority.
(C) SIGNATURE GUARANTEES. Your signature must be guaranteed by an Eligible
Institution if you wish to transfer your Rights, as specified in 3(b) above, to
a transferee other than a bank or broker, or if you specify special payment,
issuance or delivery instructions pursuant to Form 4.
6. METHOD OF DELIVERY.
The method of delivery of Rights Certificates and payment of the Exercise
Price to the Exercise Agent will be at the election and risk of the Holder, but,
if sent by mail, it is recommended that they be sent by registered mail,
properly insured, with return receipt requested, and that sufficient number of
days be allowed to ensure delivery to the Exercise Agent and the clearance of
any checks sent in payment of the Exercise Price prior to 5:00 p.m., New York
City time, on the Expiration Date.
7. SUBSTITUTE FORM W-9.
Each Holder who elects either to exercise Rights or to have the Exercise
Agent endeavor to sell such holder's Rights should provide the Exercise Agent
with a correct Taxpayer Identification Number ("TIN") on Substitute Form W-9,
which is included as Exhibit B hereto. Additional copies of Substitute Form W-9
may be obtained upon request from the Exercise Agent at the address, or by
calling the telephone number, indicated above. Failure to provide the
information on the form may subject such holder to 31% federal income tax
withholding with respect to (i) dividends that may be paid by the Company on
shares of Common Stock purchased upon the exercise of Rights (for those holders
exercising Rights), or (ii) funds to be remitted to Rights holders in respect of
Rights sold by the Exercise Agent (for those holders electing to have the
Exercise Agent sell their Rights).
5
<PAGE>
EXHIBIT A
NOTICE OF GUARANTEED DELIVERY
FOR
RIGHTS CERTIFICATES
ISSUED BY
DOSKOCIL COMPANIES INCORPORATED
This form, or one substantially equivalent hereto, must be used to exercise
Rights pursuant to the Rights Offering described in the Prospectus dated
September 19, 1994 (the "Prospectus") of Doskocil Companies Incorporated, a
Delaware corporation (the "Company"), if a Holder of Rights cannot deliver the
certificate(s) evidencing the rights (the "Rights Certificate(s)"), to the
Exercise Agent listed below at or prior to 5:00 p.m. New York City time on
October 19, 1994, or such later date to which the Rights Offering may have been
extended at the option of the Company (the "Expiration Date"). Such form must be
delivered by hand or mail or may be transmitted by telegram or facsimile
transmission, to the Exercise Agent, and must be received by the Exercise Agent
on or prior to the Expiration Date. See "The Rights Offering -- Exercise of
Rights" in the Prospectus. Payment of the Exercise Price of $9 per share for
each share of the Company's Common Stock subscribed for upon exercise of such
Right must be received by the Exercise Agent in the manner specified in the
Prospectus at or prior to 5:00 p.m. New York City time on the Expiration Date
even if the Rights Certificate is being delivered pursuant to the procedure for
guaranteed delivery thereof. Consummation of the Rights Offering is subject to
the terms and conditions set forth in the Prospectus.
THE EXERCISE AGENT IS:
American Stock Transfer & Trust Company
GENERAL INFORMATION
(800) 937-5449
(212) 936-5100
<TABLE>
<S> <C> <C>
FACSIMILE
BY MAIL: TRANSMISSION: BY HAND:
(718) 234-5001
American Stock Transfer American Stock Transfer
& Trust Company & Trust Company
40 Wall Street 40 Wall Street
46th Floor 46th Floor
New York, New York 10005 New York, New York 10005
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE OR TELEGRAM OTHER THAN AS SET FORTH
ABOVE DOES NOT CONSTITUTE A VALID DELIVERY.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby represents that he or she is the holder of Rights
Certificate(s) representing Rights and that such Rights Certificate(s)
cannot be delivered to the Exercise Agent at or before 5:00 p.m. New York City
time on the Expiration Date. Upon the terms and subject to the conditions set
forth in the Prospectus, receipt of which is hereby acknowledged, the
undersigned hereby elects to exercise (i) the Basic Subscription Privilege to
subscribe for one share of Common Stock per Right with respect to each of
Rights represented by such Rights Certificate and (ii) the
Oversubscription Privilege relating to each such Right to subscribe, to the
extent that Excess Shares (as defined in the Prospectus) are available therefor,
for an aggregate of up to Excess Shares. The undersigned understands that
payment of the Exercise Price of $9 per share for each share of Common Stock
subscribed for pursuant to the Basic Subscription Privilege and Oversubscription
Privilege must be received by the Exercise Agent at or before 5:00 p.m. New York
City time on the Expiration Date and represents that such payment, in the
aggregate amount of $ , either (check appropriate box):
/ / is being delivered to the Exercise Agent herewith;
/ / has been delivered separately to the Exercise Agent;
and is or was delivered in the manner set forth below (check appropriate box(es)
and complete information relating thereto
/ / wire transfer of funds
-- name of transferor institutions .......................................
-- date of transfer ......................................................
-- confirmation number (if available) ....................................
/ / uncertified check (Payment by uncertified check will not be deemed to
have been received by the Exercise Agent until such check has cleared.
Holders paying by such means are urged to make payment sufficiently in
advance of the Expiration Date to ensure that such payment clears by
such date.)
/ / certified check
/ / bank draft (cashier's check) -- money order ..........................
-- name of maker ........................................................
-- date of check, draft or money order ..................................
-- check, draft or money order number ...................................
-- bank on which check is drawn or issuer of money order ................
<TABLE>
<S> <C>
Signature(s) .............................. Address ...................................
........................................... ............................................
Name(s) ................................... ............................................
........................................... ............................................
........................................... ............................................
Please Type or Print
Area Code and Tel. No(s) ..................
............................................
Rights Certificate No(s). (if available) ................................................
</TABLE>
A-2
<PAGE>
GUARANTEE OF DELIVERY
(Not to be used for Rights Certificate Signature guarantee)
The undersigned, a member firm of a registered national securities exchange
or of the National Association of Securities Dealers, Inc. or a commercial bank
or trust company having an office or correspondent in the United States,
guarantees that the undersigned will deliver to the Exercise Agent the
certificates representing the Rights being exercised hereby, with any required
signature guarantees and any other required documents, all within five NASDAQ
trading days after the date hereof
<TABLE>
<S> <C>
........................................... Dated: ......................................
........................................... ..............................................
(Name of Firm)
...........................................
(Address)
........................................... ..............................................
(Area Code and Telephone Number) (Authorized Signature)
</TABLE>
The institution which completes this form must communicate the guarantee to
the Exercise Agent and must deliver the Rights Certificate(s) to the Exercise
Agent within the time period shown herein. Failure to do so could result in a
financial loss to such institution.
A-3
<PAGE>
EXHIBIT B
IMPORTANT TAX INFORMATION
Under the federal income tax law, (i) dividend payments that may be made by
the Company on shares of Common Stock issued upon the exercise of Rights, and
(ii) payments that may be remitted by the Exercise Agent to Holders in respect
of Rights sold on such Holders' behalf by the Exercise Agent, may be subject to
backup withholding, and each Holder who either exercises Rights or requests the
Exercise Agent to sell Rights should provide the Exercise Agent (as Company's
agent, in respect of exercised Rights, and as payer with respect to Rights sold
by the Exercise Agent) with such Holder's correct taxpayer identification number
on Substitute Form W-9 below. If such Holder is an individual, the taxpayer
identification number is his social security number. If the Exercise Agent is
not provided with the correct taxpayer identification number in connection with
such payments, the Rights holder may be subject to a $50 penalty imposed by the
Internal Revenue Service.
Exempt Holders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and reporting
requirements. In general, in order for a foreign individual to qualify as an
exempt recipient, that Holder must submit a statement, signed under the
penalties of perjury, attesting to that individual's exempt status. Such
statements can be obtained from the Exercise Agent. See the enclosed Guidelines
for Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If backup withholding applies, the Company or the Exercise Agent, as the
case may be, will be required to withhold 31% of any such payments made to the
Holder. Backup withholding is not an additional tax. Rather, the tax liability
of persons subject to backup withholding will be reduced by the amount of tax
withheld. If withholding results in an overpayment of taxes, a refund may be
obtained.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding, the Holder is required to notify the Exercise
Agent of his correct taxpayer identification number by completing the form below
certifying that the taxpayer identification number provided on Substitute Form
W-9 is correct (or that such Holder is awaiting a taxpayer identification
member).
WHAT NUMBER TO GIVE THE EXERCISE AGENT
The Holder is required to give the Exercise Agent the social security number
or employer identification number of the record owner of the Rights. If the
Rights are in more than one name or are not in the name of the actual owner,
consult the enclosed Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9 for additional guidelines on which number to
report.
<PAGE>
PAYER'S NAME: AMERICAN STOCK TRANSFER & TRUST COMPANY
<TABLE>
<S> <C> <C> <C>
PART II - FOR
PAYEES
PART I - TAXPAYER IDENTIFICATION NO.
</TABLE>
SUBSTITUTE
<TABLE>
<S> <C> <C> <C>
EXEMPT FROM BACKUP
WITHHOLDING (SEE
ENCLOSED
GUIDELINES)
</TABLE>
FORM W-9
DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE
PAYER'S REQUEST FOR TAXPAYER
IDENTIFICATION NUMBER (TIN)
<TABLE>
<S> <C> <C> <C>
ENTER YOUR TAXPAYER
IDENTIFICATION NUMBER
IN THE APPROPRIATE
BOX. FOR
</TABLE>
____________________
<TABLE>
<S> <C> <C> <C>
MOST INDIVIDUALS, THIS
IS
</TABLE>
SOCIAL SECURITY NUMBER
<TABLE>
<S> <C> <C> <C>
YOUR SOCIAL SECURITY
</TABLE>
OR
<TABLE>
<S> <C> <C> <C>
NUMBER. IF YOU DO NOT
HAVE A NUMBER, SEE HOW
TO OBTAIN A "TIN" IN
THE ENCLOSED
GUIDELINES.
NOTE: IF THE ACCOUNT
IS IN MORE THAN ONE
NAME, SEE THE CHART ON
PAGE 2 OF ENCLOSED
GUIDELINES TO
DETERMINE WHAT NUMBER
TO GIVE. EMPLOYER
IDENTIFICATION
NUMBER
CERTIFICATION -- UNDER PENALTIES OF PERJURY, I CERTIFY THAT:
(1) THE NUMBER SHOWN ON THIS FORM IS MY CORRECT TAXPAYER IDENTIFICATION NUMBER (OR I AM
WAITING FOR A NUMBER TO BE ISSUED TO ME), AND
(2) I AM NOT SUBJECT TO BACKUP WITHHOLDING EITHER BECAUSE I HAVE NOT BEEN NOTIFIED BY THE
INTERNAL REVENUE SERVICE ("IRS") THAT I AM SUBJECT TO BACKUP WITHHOLDING AS A RESULT OF A
FAILURE TO REPORT ALL INTEREST OR DIVIDENDS, OR THE IRS HAS NOTIFIED ME THAT I AM SO
LONGER SUBJECT TO BACKUP WITHHOLDING.
CERTIFICATION GUIDELINES -- YOU MUST CROSS OUT ITEM (2) ABOVE IF YOU HAVE BEEN NOTIFIED BY
THE IRS THAT YOU ARE SUBJECT TO BACKUP WITHHOLDING BECAUSE OF UNDERREPORTING INTEREST OR
DIVIDENDS ON YOUR TAX RETURN. HOWEVER, IF AFTER BEING NOTIFIED BY THE IRS THAT YOU WERE
SUBJECT TO BACKUP WITHHOLDING YOU RECEIVED ANOTHER NOTIFICATION FROM THE IRS THAT YOU ARE NO
LONGER SUBJECT TO BACKUP WITHHOLDING, DO NOT CROSS OUT ITEM (2).
SIGNATURE: DATE , 1994
NOTE: FAILURE TO COMPLETE THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS
MADE TO YOU. PLEASE REVIEW ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
</TABLE>
B-2
<PAGE>
GUIDELINES FOR CERTIFICATE OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE PAYER.
SOCIAL SECURITY NUMBERS HAVE NINE DIGITS SEPARATED BY TWO HYPHENS: I.E.
000-000-0000. EMPLOYER IDENTIFICATION NUMBERS HAVE NINE DIGITS SEPARATED BY ONLY
ON HYPHEN: I.E. 00-0000000. THE TABLE BELOW WILL HELP DETERMINE THE NUMBER TO
GIVE THE PAYER.
<TABLE>
<S> <C>
FOR THIS TYPE OF ACCOUNT: GIVE THE NAME AND
SOCIAL SECURITY
NUMBER OF
1. INDIVIDUAL THE INDIVIDUAL
2. TWO OR MORE INDIVIDUALS (JOINT ACCOUNT)
THE ACTUAL OWNER OF THE ACCOUNT
OR, IF COMBINED FUNDS, THE
FIRST INDIVIDUAL ON THE
ACCOUNT(1)
3. CUSTODIAN ACCOUNT OF A MINOR (UNIFORM GIFT TO MINORS
ACT) THE MINOR(2)
4. A. THE USUAL REVOCABLE SAVINGS TRUST (GRANTOR IS ALSO
TRUSTEE) THE GRANTOR-TRUSTEE(1)
B. THE SO-CALLED TRUST ACCOUNT THAT IS NOT A LEGAL OR
VALID TRUST UNDER STATE LAW THE ACTUAL OWNER(1)
5. SOLE PROPRIETORSHIP THE OWNER(4)
GIVE THE NAME AND
EMPLOYER IDENTIFICATION
FOR THIS TYPE OF ACCOUNT: NUMBER OF
6. A VALID TRUST, ESTATE OR PENSION TRUST LEGAL ENTITY (DO NOT FURNISH
THE IDENTIFICATION NUMBER OF
THE PERSONAL REPRESENTATIVE OR
TRUSTEE UNLESS THE LEGAL ENTITY
ITSELF IS NOT DESIGNATED IN THE
ACCOUNT TITLE) (3)
7. CORPORATION THE CORPORATION
8. ASSOCIATION, CLUB, RELIGIOUS, CHARITABLE, EDUCATIONAL
OR OTHER TAX-EXEMPT ORGANIZATION THE ORGANIZATION
9. PARTNERSHIP THE PARTNERSHIP
10. A BROKER OR REGISTERED NOMINEE THE BROKER OR NOMINEE
11. ACCOUNT WITH THE DEPARTMENT OF AGRICULTURE IN THE NAME THE PUBLIC ENTITY
OF A PUBLIC ENTITY (SUCH AS A STATE OR LOCAL
GOVERNMENT, SCHOOL DISTRICT, OR PRISON) THAT RECEIVES
AGRICULTURAL PROGRAM PAYMENTS
</TABLE>
- ------------------------
(1) LIST FIRST AND CIRCLE THE NAME OF THE PERSON WHOSE NUMBER YOU FURNISH.
(2) CIRCLE THE MINOR'S NAME AND FURNISH THE MINOR'S SOCIAL SECURITY NUMBER.
(3) LIST FIRST AND CIRCLE THE NAME OF THE LEGAL TRUST, ESTATE OR PENSION TRUST.
(4) SHOW THE NAME OF THE OWNER.
NOTE: IF NO NAME IS CIRCLED WHEN THERE IS MORE THAN ONE NAME, THE NUMBER WILL BE
CONSIDERED TO BE THAT OF THE FIRST NAMED LISTED.
B-3
<PAGE>
OBTAINING A NUMBER
If you don't have a taxpayer identification number of your don't know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include
the following:
- A corporation.
- A financial institution.
- An organization exempt from tax under section 501(a), or an individual
retirement plan, or a custodial account under section 403(b)(7).
- The United States or any agency or instrumentality thereof.
- A State, the District of Columbia, a possession of the United States, or
any subdivision or instrumentality thereof.
- A foreign government, a political subdivision of a foreign government, or
any agency or instrumentality thereof.
- A foreign government, a political subdivision of a foreign government, or
any agency or instrumentality thereof.
- An international organization or any agency or instrumentality thereof.
- A dealer in securities or commodities registered in the United States or a
possession of the United States.
- A real estate investment trust.
- A common trust fund operated by a bank under section 584(a).
- As exempt charitable remainder trust, or a non-exempt trust described in
section 4947(a)(1).
- An entity registered at all times under the Investment Company Act of
1940.
- A foreign central bank issue.
Payment of dividends and patronage dividends not generally subject to backup
withholding include the following:
- Payments to nonresident aliens subject to withholding under section 1441.
- Payments to partnerships non engaged in a trade or business in the United
States and which have at least one nonresident partner.
- Payments of patronage dividends where the amount received is not paid in
money.
- Payments made by certain foreign organizations.
- Payments made to a nominee.
Payments of interest not generally subject to backup withholding include the
following:
- Payments of interest on obligations issued by individuals. Note: You may
be subject to backup withholding if this interest is $600 or more and is
paid in the course of the payer's trade or business and you have not
provided your correct taxpayer identification number to the payer.
- Payments of tax-exempt interest (including exempt-interest dividends under
section 852).
- Payments described in section 6049(b)(5) to nonresident aliens.
- Payments on tax-free covenant bonds under section 1451.
- Payments made by certain foreign organizations.
- Payments made to a nominee.
B-4
<PAGE>
Exempt payees described above should file Form W-9 to avoid possible erroneous
backup withholding. FILL THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER
IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, SIGN AND DATE THE
FORM AND RETURN IT TO THE PAYER.
Payments that are not subject to information reporting are also not subject
to backup withholding. For details, see the regulations under sections 6041,
6041(a), 6042, 6044, 6045, 6049, 6050A and 6050N. Privacy Act Notice. Section
6109 requires most recipients of dividends, interest, or other payments to give
taxpayer identification numbers to payers who must report the payments to IRS.
The IRS uses the numbers for identification purposes and to help verify the
accuracy of your tax return. Payers must be given the numbers whether or not
recipients are required to file tax returns. Payers must generally withhold 30%
of taxable interest, dividends, and certain other payments to a payee who does
not furnish a taxpayer identification number to a payer. Certain penalties may
also apply.
PENALTIES
(1) Penalty for Failure to Furnish Taxpayer Identification Number. If you fail
to furnish your taxpayer identification number to a payer, you are subject
to a penalty of $50 for each such failure unless your failure is due to
reasonable cause and not to willful neglect.
(2) Civil Penalty for False Information With Respect to Withholding. If you make
a false statement with no reasonable basis which results in no imposition of
backup withholding, you are subject to a penalty of $500.
(3) Criminal Penalty for Falsifying Information. Falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION, CONTACT YOU TAX CONSULTANT OR THE INTERNAL REVENUE
SERVICE.
B-5
<PAGE>
EXHIBIT 99.7
NOTICE OF GUARANTEED DELIVERY
FOR
RIGHTS CERTIFICATES
ISSUED BY
DOSKOCIL COMPANIES INCORPORATED
This form, or one substantially equivalent hereto, must be used to exercise
Rights pursuant to the Rights Offering described in the Prospectus dated
September 19, 1994 (the "Prospectus") of Doskocil Companies Incorporated, a
Delaware corporation (the "Company"), if a Holder of Rights cannot deliver the
certificate(s) evidencing the rights (the "Rights Certificate(s)"), to the
Exercise Agent listed below at or prior to 5:00 p.m. New York City time on
October 19, 1994, or such later date to which the Rights Offering may have been
extended at the option of the Company (the "Expiration Date"). Such form must be
delivered by hand or mail or may be transmitted by telegram or facsimile
transmission, to the Exercise Agent, and must be received by the Exercise Agent
on or prior to the Expiration Date. See "The Rights Offering -- Exercise of
Rights" in the Prospectus. Payment of the Exercise Price of $9 per share for
each share of the Company's Common Stock subscribed for upon exercise of such
Right must be received by the Exercise Agent in the manner specified in the
Prospectus at or prior to 5:00 p.m. New York City time on the Expiration Date
even if the Rights Certificate is being delivered pursuant to the procedure for
guaranteed delivery thereof. Consummation of the Rights Offering is subject to
the terms and conditions set forth in the Prospectus.
THE EXERCISE AGENT IS:
American Stock Transfer & Trust Company
GENERAL INFORMATION
(800) 937-5449
(212) 936-5100
<TABLE>
<S> <C> <C>
FACSIMILE
BY MAIL: TRANSMISSION: BY HAND:
(718) 234-5001
American Stock Transfer American Stock Transfer
& Trust Company & Trust Company
40 Wall Street 40 Wall Street
46th Floor 46th Floor
New York, New York 10005 New York, New York 10005
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE OR TELEGRAM OTHER THAN AS SET FORTH
ABOVE DOES NOT CONSTITUTE A VALID DELIVERY.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby represents that he or she is the holder of Rights
Certificate(s) representing Rights and that such Rights Certificate(s)
cannot be delivered to the Exercise Agent at or before 5:00 p.m. New York City
time on the Expiration Date. Upon the terms and subject to the conditions set
forth in the Prospectus, receipt of which is hereby acknowledged, the
undersigned hereby elects to exercise (i) the Basic Subscription Privilege to
subscribe for one share of Common Stock per Right with respect to each of
Rights represented by such Rights Certificate and (ii) the
Oversubscription Privilege relating to each such Right to subscribe, to the
extent that Excess Shares (as defined in the Prospectus) are available therefor,
for an aggregate of up to Excess Shares. The undersigned understands
that payment of the Exercise Price of $9 per share for each share of Common
Stock subscribed for pursuant to the Basic Subscription Privilege and
Oversubscription Privilege must be received by the Exercise Agent at or before
5:00 p.m. New York City time on the Expiration Date and represents that such
payment, in the aggregate amount of $ , either (check appropriate box):
/ / is being delivered to the Exercise Agent herewith;
/ / has been delivered separately to the Exercise Agent;
and is or was delivered in the manner set forth below (check appropriate box(es)
and complete information relating thereto
/ / wire transfer of funds
-- name of transferor institutions .......................................
-- date of transfer ......................................................
-- confirmation number (if available) ....................................
/ / uncertified check (Payment by uncertified check will not be deemed to
have been received by the Exercise Agent until such check has cleared.
Holders paying by such means are urged to make payment sufficiently in
advance of the Expiration Date to ensure that such payment clears by
such date.)
/ / certified check
/ / bank draft (cashier's check)
/ / money order
-- name of maker ........................................................
-- date of check, draft or money order ..................................
-- check, draft or money order number ...................................
-- bank on which check is drawn or issuer of money order ................
<TABLE>
<S> <C>
Signature(s) .............................. Address ...................................
........................................... ............................................
Name(s) ................................... ............................................
........................................... ............................................
........................................... ............................................
Please Type or Print
Area Code and Tel. No(s) ..................
............................................
Rights Certificate No(s). (if available) ................................................
</TABLE>
2
<PAGE>
GUARANTEE OF DELIVERY
(Not to be used for Rights Certificate Signature guarantee)
The undersigned, a member firm of a registered national securities exchange
or of the National Association of Securities Dealers, Inc. or a commercial bank
or trust company having an office or correspondent in the United States,
guarantees that the undersigned will deliver to the Exercise Agent the
certificates representing the Rights being exercised hereby, with any required
signature guarantees and any other required documents, all within five NASDAQ
trading days after the date hereof
<TABLE>
<S> <C>
........................................... Dated: ......................................
........................................... ..............................................
(Name of Firm)
...........................................
(Address)
........................................... ..............................................
(Area Code and Telephone Number) (Authorized Signature)
</TABLE>
The institution which completes this form must communicate the guarantee to
the Exercise Agent and must deliver the Rights Certificate(s) to the Exercise
Agent within the time period shown herein. Failure to do so could result in a
financial loss to such institution.
3
<PAGE>
EXHIBIT 99.8
CERTIFICATION AND REQUEST FOR ADDITIONAL RIGHTS
To the Exercise Agent:
The undersigned hereby certifies that it is a broker-dealer registered with
the Securities and Exchange Commission, commercial bank or trust company,
securities depository or participant therein, or nominee therefor, holding of
record shares of Common Stock of Doskocil Companies Incorporated (the
"Company") on behalf of beneficial owners as of the close of business
on September 29, 1994, the Record Date for the offering by the Company of
5,555,556 shares of Common Stock of the Company pursuant to subscription rights
(the "Rights") being distributed to certain holders of Common Stock of the
Company, all as described in a Prospectus dated September 19, 1994 a copy of
which the undersigned has received. For each share of Common Stock of the
Company held of record as of the close of business on the Record Date, .68
Rights are being distributed, and any fractional Right will be rounded up to the
nearest whole number. The undersigned further certifies that beneficial
owners on whose behalf it held, as of the close of business on the Record Date,
shares of Common Stock of the Company registered in the name of the
undersigned are each entitled to an additional Right in accordance with the
principle that any fractional Right to which a beneficial owner would otherwise
be entitled should be rounded up to the nearest whole number. Accordingly, the
undersigned requests that, upon surrender of its Rights Certificate evidencing
Rights, a Rights Certificate evidencing Rights (including
additional Rights) be issued. The undersigned further certifies that
such beneficial ownership is reflected on the undersigned's records and that all
shares of Common Stock of the Company which, to the undersigned's knowledge, are
beneficially owned by any such beneficial owner through the undersigned have
been aggregated in calculating the foregoing. The undersigned agrees to provide
the Company or its designee with such additional information as the Company
deems necessary to verify the foregoing.
--------------------------------------
Name of Record Holder
By:
--------------------------------------
Name:
Title:
Address:
Telephone Number:
Dated: ______________ , 1994
IMPORTANT: THIS CERTIFICATE MUST BE RECEIVED BY THE EXERCISE AGENT PRIOR TO
5:00 P.M., NEW YORK CITY TIME, ON OCTOBER 12, 1994, FOR ADDITIONAL RIGHTS TO BE
ISSUED AS REQUESTED. ANY QUESTIONS OR REQUESTS FOR ASSISTANCE SHOULD BE DIRECTED
TO AMERICAN STOCK TRANSFER & TRUST COMPANY, THE EXERCISE AGENT, AT THE FOLLOWING
TELEPHONE NUMBER: (800) 937-5449.
