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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13E-4
ISSUER TENDER OFFER STATEMENT
(PURSUANT TO SECTION 13(E)(1) OF THE SECURITIES EXCHANGE ACT OF 1934)
KEITHLEY INSTRUMENTS, INC.
(NAME OF ISSUER)
KEITHLEY INSTRUMENTS, INC.
(NAME OF PERSON FILING STATEMENT)
COMMON SHARES, WITHOUT PAR VALUE
(TITLE OF CLASS OF SECURITIES)
487584104
(CUSIP NUMBER OF CLASS OF SECURITIES)
JOSEPH P. KEITHLEY
PRESIDENT AND CHIEF EXECUTIVE OFFICER
KEITHLEY INSTRUMENTS, INC.
28775 AURORA ROAD, SOLON, OHIO 44139
(440) 248-0400
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES
AND COMMUNICATIONS ON BEHALF OF THE PERSON(S) FILING STATEMENT)
WITH A COPY TO:
JOHN M. GHERLEIN
BAKER & HOSTETLER LLP
3200 NATIONAL CITY CENTER
1900 EAST 9TH STREET
CLEVELAND, OHIO 44114-3485
(216) 621-0200
NOVEMBER 11, 1998
(DATE TENDER OFFER FIRST PUBLISHED, SENT OR GIVEN TO SECURITY HOLDERS)
CALCULATION OF FILING FEE
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TRANSACTION VALUATION* AMOUNT OF FILING FEE**
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$14,000,000 $2,800
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* For the purpose of calculating the filing fee only, this amount is based on
the purchase of 2,000,000 Common Shares of Keithley Instruments, Inc. at
$7.00 per share.
** The amount of the filing fee equals 1/50th of one percent (1%) of the value
of the securities to be acquired.
[ ] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the form
or schedule and the date of its filing.
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Amount Previously Paid: Not applicable Filing party: Not applicable.
Form or Registration No.: Not applicable Date Filed: Not applicable.
</TABLE>
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This Issuer Tender Offer Statement on Schedule 13E-4 (this "Schedule
13E-4") relates to the offer by Keithley Instruments, Inc., an Ohio corporation
(the "Company"), to purchase up to 2,000,000 (or such lesser number as are
properly tendered) of its common shares, without par value (the "Shares"), at
prices not greater than $7.00 per Share and not less than $5.75 per Share, net
to the seller in cash, without interest thereon, as specified by the
shareholders tendering their Shares, upon the terms and subject to the
conditions set forth in the Offer to Purchase dated November 11, 1998 (the
"Offer to Purchase"), and in the related Letter of Transmittal (the Offer to
Purchase and the Letter of Transmittal, collectively, as amended or supplemented
from time to time, the "Offer"), and is intended to satisfy the reporting
requirements of Section 13(e) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"). The Offer to Purchase and the related Letter of
Transmittal are filed as Exhibits (a)(1) and (a)(2) hereto, respectively.
ITEM 1. SECURITY AND ISSUER.
(a) The name of the issuer is Keithley Instruments, Inc., an Ohio
corporation, and the address of its principal executive offices is 28775 Aurora
Road, Solon, Ohio 44139.
(b) The title of the securities that are the subject of the Offer is the
Company's common shares, without par value. There were 5,093,167 Shares
outstanding on November 10, 1998. The information set forth under the heading
"Introduction" in the Offer to Purchase and in Sections 1-10 of the Offer to
Purchase is incorporated by reference herein.
The Offer is for up to 2,000,000 Shares (or such lesser number of shares as
are properly tendered), at prices not greater than $7.00 per Share and not less
than $5.75 per Share, net to the seller in cash, without interest, as specified
by the shareholders tendering their Shares. The Offer is being made to all
holders of Shares, including directors, officers and affiliates of the Company.
The Company has been advised that none of its directors, executive officers or
affiliates controlled by such persons intends to tender any Shares pursuant to
the Offer.
(c) Information with respect to the principal market for, and the price
range of, the Shares is set forth under the heading "Introduction" in the Offer
to Purchase and in Section 7 of the Offer to Purchase, which is incorporated by
reference herein.
(d) This statement is filed by the Company, the issuer of the securities.
ITEM 2. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) Information with respect to the source and amount of funds to be used
for the purchase of Shares in the Offer is set forth under the heading
"Introduction" in the Offer to Purchase and Section 8 of the Offer to Purchase,
which is incorporated by reference herein.
(b) A summary of each loan agreement or arrangement containing the identity
of the parties, the term, the collateral, the stated and effective interest
rates, and other material terms or conditions relative to such loan agreements
is set forth in Section 8 of the Offer to Purchase, which is incorporated by
reference herein. Other than as described in Section 8 of the Offer to Purchase,
which is incorporated by reference herein, no formal plans or arrangements have
been made to repay such borrowing under the credit agreement described in such
section.
ITEM 3. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE ISSUER OR
AFFILIATE.
Information with respect to the purpose of the Offer and the planned
disposition of the Shares and the possible effects of the Offer is set forth
under the heading "Introduction" in the Offer to Purchase and Section 2 of the
Offer to Purchase, which is incorporated by reference herein. Other than as
indicated herein, the Company has no current plans or proposals that relate to
or would result in: (a) the acquisition by any person of additional securities
of the Company or the disposition of securities of the Company; (b) an
extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving the Company or any of its subsidiaries; (c) a sale or
transfer of a material amount of assets of the Company or any of its
subsidiaries; (d) any change in the present Board of Directors or management of
the Company; (e) any material change in the present dividend rate or policy, or
indebtedness or capitalization of the Company; (f) any other material change in
the Company's corporate structure or business; (g) any change in the
<PAGE> 3
Company's Articles of Incorporation or Code of Regulations or other actions
which may impede the acquisition of control of the Company by any person; (h) a
class of equity security of the Company being delisted from a national
securities exchange or ceasing to be authorized for quotation in an inter-dealer
quotation system of a registered national securities association; (i) a class of
equity security of the Company becoming eligible for termination of registration
pursuant to Section 12(g)(4) of the Exchange Act; or (j) the suspension of the
Company's obligation to file reports pursuant to Section 15(d) of the Exchange
Act.
ITEM 4. INTEREST IN SECURITIES OF THE ISSUER.
Neither the Company nor any of its subsidiaries nor, to the knowledge of
the Company, any of its executive officers or directors or any associate of any
of the foregoing has engaged in any transactions involving the Shares during the
40 business days prior to the date hereof, except as set forth in Section 10 of
the Offer to Purchase, which is incorporated by reference herein.
ITEM 5. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE ISSUER'S SECURITIES.
Neither the Company nor, to the knowledge of the Company, any of its
executive officers, directors, or affiliates is a party to any contract,
arrangement, understanding or relationship relating directly or indirectly to
the Offer and the securities of the Company, except as set forth in Section 2
and Section 10 of the Offer to Purchase.
ITEM 6. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
Information with respect to persons employed, compensated, retained or to
be compensated by the Company to make the solicitations in connection with the
tender offer is set forth in Section 15 of the Offer to Purchase, which is
incorporated by reference herein.
ITEM 7. FINANCIAL INFORMATION.
(a)-(b) The financial and pro forma financial information set forth in
Section 9 of the Offer to Purchase is incorporated by reference herein.
ITEM 8. ADDITIONAL INFORMATION.
(a) To the best of the Company's knowledge, none of its executive officers,
directors or affiliates is a party to any material contract, arrangement,
understanding or relationship between such person and the Company that is
material to a decision by a shareholder whether to hold or tender the Shares in
the Offer.
(b) Information with respect to applicable regulatory requirements is set
forth in Section 12 of the Offer to Purchase, which is incorporated by reference
herein.
(c) The applicability of the margin requirements of Section 7 of the
Exchange Act, and the rules and regulations promulgated thereunder, is described
in Section 11 of the Offer to Purchase, which is incorporated by reference
herein.
(d) There are no material legal proceedings related to the Offer.
(e) The Company believes that it may not satisfy NYSE listing standards
that are expected to be adopted in January 1999. The Company expects, however,
that it will have until January 2002 to satisfy the new listing standards. If
the Company cannot satisfy these new listing standards, the Company could be
delisted from the NYSE. Such a delisting of the Shares could result in a
substantial decrease in the liquidity of the Shares and have a material adverse
effect on the market value of the Shares.
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ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
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(a)(1) Offer to Purchase
(a)(2) Letter of Transmittal
(a)(3) Notice of Guaranteed Delivery
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees
(a)(5) Letter to Clients for use by Brokers, Dealers, Commercial
Banks, Trust Companies and Other Nominees
(a)(6) Letter to Participants in the Keithley Instruments, Inc.
1993 Employee Stock Purchase Plan
(a)(7) Letter to Shareholders from Joseph P. Keithley, President
and Chief Executive Officer of the Company, dated as of
November 11, 1998.
(a)(8) Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9.
(a)(9) Summary Advertisement dated as of November 12, 1998.
(a)(10) Press Release dated as of November 11, 1998.
(b)(1) Credit Agreement dated as of May 31, 1994, by and among the
Company and certain borrowing subsidiaries, and the banks
named therein and NBD Bank, as agent.*
(b)(2) First Amendment dated as of March 28, 1997, to the Credit
Agreement dated as of May 31, 1994.**
(c) Not applicable
(d) Not applicable
(e) Not applicable
(f) Not applicable
</TABLE>
* Incorporated by reference herein from Exhibit 10(u) of the Company's
Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 1994
(File No. 1-9965)
** Incorporated by reference herein from Exhibit 10(y) of the Company's
Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 1997
(File No. 1-9965)
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated as of: November 12, 1998 KEITHLEY INSTRUMENTS, INC.
By: /s/ Joseph P. Keithley
--------------------------------------
Name: Joseph P. Keithley
Title: President and Chief Executive
Officer
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Exhibit(a)(1)
KEITHLEY INSTRUMENTS, INC.
OFFER TO PURCHASE FOR CASH UP TO
2,000,000 OF ITS COMMON SHARES
AT A PURCHASE PRICE NOT IN EXCESS OF $7.00
NOR LESS THAN $5.75 PER SHARE
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW
YORK CITY TIME, ON THURSDAY, DECEMBER 10, 1998, UNLESS THE OFFER IS EXTENDED.
Keithley Instruments, Inc., an Ohio corporation (the "Company"), hereby invites
its shareholders to tender its common shares, without par value (the "Shares"),
to the Company at prices not in excess of $7.00 nor less than $5.75 per Share,
net to the seller in cash, without interest thereon, as specified by
shareholders tendering their Shares, upon the terms and subject to the
conditions set forth herein and in the related Letter of Transmittal (which, as
amended or supplemented from time to time, together constitute the "Offer").
The Company will, upon the terms and subject to the conditions of the Offer,
determine the single per Share price, not in excess of $7.00 nor less than $5.75
per Share, net to the seller in cash, without interest thereon (the "Purchase
Price"), that it will pay for Shares properly tendered pursuant to the Offer,
taking into account the number of Shares so tendered and the prices specified by
tendering shareholders. The Company will select the lowest Purchase Price that
will allow it to buy 2,000,000 Shares (or such lesser number of Shares as are
properly tendered at prices not in excess of $7.00 nor less than $5.75 per
Share). All Shares properly tendered at prices at or below the Purchase Price
and not properly withdrawn will be purchased at the Purchase Price, upon the
terms and subject to the conditions of the Offer, including the proration
provisions. All Shares acquired in the Offer will be acquired at the Purchase
Price. The Company reserves the right, in its sole discretion, to purchase more
than 2,000,000 Shares pursuant to the Offer. Shares tendered at prices in excess
of the Purchase Price and Shares not purchased because of proration will be
returned. See Section 14.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED. THE
OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE SECTION 6.
The Shares are traded on the New York Stock Exchange (the "NYSE") under the
symbol "KEI." On November 10, 1998, the last full trading day prior to the
announcement of the Offer, the closing per Share sales price as reported on the
NYSE was $5.625. SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS FOR
THE SHARES. See Section 7.
THE BOARD OF DIRECTORS OF THE COMPANY HAS APPROVED THE OFFER. HOWEVER, NONE OF
THE COMPANY, ITS BOARD OF DIRECTORS OR THE DEALER MANAGER MAKES ANY
RECOMMENDATION TO SHAREHOLDERS AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING
THEIR SHARES. EACH SHAREHOLDER MUST MAKE THE DECISION WHETHER TO TENDER SUCH
SHAREHOLDER'S SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR
PRICES AT WHICH SUCH SHARES SHOULD BE TENDERED. THE COMPANY HAS BEEN ADVISED
THAT NONE OF ITS DIRECTORS, EXECUTIVE OFFICERS OR AFFILIATES CONTROLLED BY SUCH
PERSONS INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER.
(Continued on next page)
The Dealer Manager for the Offer is:
CREDIT SUISSE/FIRST BOSTON LOGO
November 11, 1998
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IMPORTANT
Any shareholder wishing to tender all or any part of such shareholder's
Shares should either (a) complete and sign a Letter of Transmittal (or a
manually signed facsimile thereof) in accordance with the instructions in the
Letter of Transmittal and mail or deliver such Letter of Transmittal, together
with any required signature guarantee, and any other required documents to First
Chicago Trust Company of New York (the "Depositary"), and mail or deliver the
certificates for such Shares to the Depositary (together with any other
documents required by the Letter of Transmittal) or tender such Shares pursuant
to the procedure for book-entry transfer set forth in Section 3, or (b) request
a broker, dealer, commercial bank, trust company or other nominee to effect the
transaction for such shareholder. Holders of Shares registered in the name of a
broker, dealer, commercial bank, trust company or other nominee should contact
such person if they desire to tender their Shares. Any shareholder who desires
to tender Shares and whose certificates for such Shares are not immediately
available or cannot be delivered to the Depositary or who cannot comply with the
procedure for book-entry transfer or whose other required documents cannot be
delivered to the Depositary, in any case, by the expiration of the Offer must
tender such Shares pursuant to the guaranteed delivery procedure set forth in
Section 3.
TO PROPERLY TENDER SHARES, SHAREHOLDERS MUST VALIDLY COMPLETE THE LETTER OF
TRANSMITTAL, INCLUDING THE SECTION RELATING TO THE PRICE AT WHICH THEY ARE
TENDERING SHARES.
Questions and requests for assistance or for additional copies of this
Offer to Purchase, the Letter of Transmittal or the Notice of Guaranteed
Delivery may be directed to the Information Agent or to the Dealer Manager at
their respective addresses and telephone numbers set forth on the back cover of
this Offer to Purchase.
THE COMPANY HAS NOT AUTHORIZED ANY PERSON TO MAKE ANY RECOMMENDATION ON
BEHALF OF THE COMPANY AS TO WHETHER SHAREHOLDERS SHOULD TENDER OR REFRAIN FROM
TENDERING SHARES PURSUANT TO THE OFFER. THE COMPANY HAS NOT AUTHORIZED ANY
PERSON TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION IN CONNECTION WITH
THE OFFER OTHER THAN THOSE CONTAINED HEREIN OR IN THE RELATED LETTER OF
TRANSMITTAL. IF GIVEN OR MADE, ANY SUCH RECOMMENDATION OR ANY SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY.
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SUMMARY
This general summary is solely for the convenience of the Company's
shareholders and is qualified in its entirety by reference to the full text and
more specific details set forth in this Offer to Purchase.
PURCHASE PRICE The Company will determine a single per Share
net cash price, not more than $7.00 nor less
than $5.75 per Share, that it will pay for
Shares validly tendered at or below the
Purchase Price. The Company will select the
lowest Purchase Price that will allow it to buy
2,000,000 Shares (or such lesser number of
Shares as are validly tendered at prices not
greater than $7.00 nor less than $5.75 per
Share) validly tendered. All Shares purchased
by the Company will be purchased at the
Purchase Price even if tendered at or below the
Purchase Price. Each shareholder desiring to
tender Shares must specify in the Letter of
Transmittal the minimum price (not more than
$7.00 nor less than $5.75 per Share) at which
the shareholder is willing to have such
shareholder's Shares purchased by the Company.
Shareholders wishing to maximize the
possibility that their Shares will be purchased
at the Purchase Price may check the box in the
Letter of Transmittal marked "Shares Tendered
at Price Determined by Dutch Auction." However,
if a shareholder elects to have such
shareholder's Shares purchased at a price
determined by the Dutch Auction tender process,
such Shares could be purchased at the minimum
price of $5.75 per Share.
NUMBER OF SHARES TO BE
PURCHASED 2,000,000 Shares (or such lesser number of
Shares as are properly tendered at prices not
in excess of $7.00 nor less than $5.75 per
Share).
MARKET PRICE OF SHARES On November 10, 1998, the last reported sale
price of the Shares on the NYSE Composite Tape
was $5.625 per Share.
CONDITIONS TO THE OFFER The Offer is subject to certain conditions. See
Section 6.
HOW TO TENDER SHARES See Section 3. Contact the Information Agent,
the Dealer Manager or consult your broker for
assistance.
BROKERAGE COMMISSIONS None for registered shareholders who tender
their Shares directly to the Depositary.
Shareholders holding Shares through brokers or
banks are urged to consult the brokers or banks
to determine whether transaction costs are
applicable if shareholders tender Shares
through the brokers or banks and not directly
to the Depositary.
STOCK TRANSFER TAX None, if payment is made to the registered
holder of Shares.
EXPIRATION AND PRORATION DATES Thursday, December 10, 1998, at 12:00 Midnight,
New York City time, unless the Offer is
extended by the Company.
PAYMENT DATE As soon as practicable after the Expiration
Date.
1
<PAGE> 4
POSITION OF THE COMPANY AND
ITS BOARD OF DIRECTORS The Company's Board of Directors has approved
the Offer. However, none of the Company, its
Board of Directors or the Dealer Manager makes
any recommendation to shareholders as to
whether to tender or refrain from tendering
their Shares. Each shareholder must make the
decision whether to tender Shares and, if so,
how many Shares to tender and the price or
prices at which such Shares should be tendered.
The Company has been advised that none of its
directors, executive officers or affiliates
controlled by such persons intends to tender
any Shares pursuant to the Offer.
WITHDRAWAL RIGHTS Tendered Shares may be withdrawn at any time
prior to 12:00 Midnight, New York City time, on
Thursday, December 10, 1998, unless the Offer
is extended by the Company, and, unless
previously purchased, after 12:00 Midnight, New
York City time, on Monday, January 11, 1999.
See Section 4.
ODD LOTS There will be no proration of Shares tendered
by any shareholder owning beneficially or of
record fewer than 100 Shares as of the close of
business on November 10, 1998, and as of the
Expiration Date, provided, however, that the
shareholder tenders all Shares owned by the
shareholder at or below the Purchase Price
prior to the Expiration Date and completes the
section entitled "Odd Lots" in the Letter of
Transmittal, in which case all such Shares will
be purchased. See Section 1.
FURTHER DEVELOPMENTS REGARDING
THE OFFER Call the Information Agent, Dealer Manager or
consult your broker.
2
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TABLE OF CONTENTS
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SECTION PAGE
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FACTORS THAT MAY AFFECT FUTURE RESULTS...................... 4
INTRODUCTION................................................ 5
THE OFFER................................................... 7
1. Number of Shares; Proration................................. 7
2. Purpose of the Offer; Certain Effects of the Offer.......... 9
3. Procedures for Tendering Shares............................. 10
4. Withdrawal Rights........................................... 14
5. Purchase of Shares and Payment of Purchase Price............ 15
6. Certain Conditions of the Offer............................. 16
7. Price Range of Shares; Dividends............................ 17
8. Source and Amount of Funds.................................. 18
9. Certain Information Concerning the Company.................. 18
10. Interest of Directors and Officers and Principal
Shareholder; Transactions and
Arrangements Concerning Shares.............................. 24
11. Effects of the Offer on the Market for Shares; Registration
Under
the Exchange Act............................................ 24
12. Certain Legal Matters; Regulatory Approvals................. 25
13. Certain United States Federal Income Tax Consequences....... 25
14. Extension of the Offer; Termination; Amendment.............. 27
15. Fees and Expenses........................................... 28
16. Miscellaneous............................................... 28
</TABLE>
3
<PAGE> 6
FACTORS THAT MAY AFFECT FUTURE RESULTS
Certain sections of this Offer to Purchase, including, but not limited to,
Section 2 entitled "Purpose of the Offer; Certain Effects of the Offer" and
Section 9 entitled "Certain Information Concerning the Company" constitute
"forward-looking" statements, as that term is defined in the Private Securities
Litigation Reform Act of 1995. Such statements are subject to certain risks and
uncertainties that could cause actual results to differ materially from those
stated or implied in the forward-looking statements. Some of the factors that
may affect future results are discussed below.
Although the Company operates in a single industry segment, the test and
measurement industry, certain of its products, including its line of parametric
testers, are sold into the semiconductor industry. Growth in demand for
semiconductors, new technology and pricing drive the demand for new
semiconductor capital equipment. Throughout much of the Company's last fiscal
year, orders from this industry have declined, affected by the Asian financial
crisis, low DRAM prices due to supply overcapacity and falling personal computer
prices.
The Company's business relies on the development of new high technology
products and services to provide solutions to customers' complex measurement
needs. This requires anticipation of customers' changing needs and emerging
technology trends. The Company must make long-term investments and commit
significant resources before knowing whether its expectations will eventually
result in products that achieve market acceptance. The Company incurs
significant expenses developing new business opportunities that may or may not
result in significant sources of revenue and earnings in the future.
In many cases the Company's products compete directly with those offered by
other manufacturers. If any of the Company's competitors were to develop
products or services that are more cost-effective or technically superior,
demand for the Company's product offerings could slow.
The Company currently has ten subsidiaries or sales offices located outside
the United States. Non-U.S. sales made up 48 percent of the Company's revenue in
fiscal 1998. The Company's future results could be adversely affected by several
factors, including changes in foreign currency exchange rates, changes in a
country's or region's political or economic conditions, trade protection
measures, import or export licensing requirements, unexpected changes in
regulatory requirements and natural disasters.
The Company recognizes the need to ensure that Year 2000 hardware and
software issues will not adversely impact its operations. With regard to the
Company's own information systems, a substantial portion of Year 2000
information technology compliance will be achieved in connection with the
Company's ongoing program to upgrade its key financial, information and
operational systems. The Company believes that all key systems that are not
already Year 2000 compliant will be modified, upgraded or replaced prior to the
year 2000, and that any related costs will not have a material impact on the
results of operations, financial condition or cash flows of future periods.
Certain of the Company's hardware and software products purchased by customers
or currently being sold to customers will require upgrades or other remediation
to become Year 2000 compliant. Based on an internal assessment of these
products, the Company does not believe that the cost to modify these products
for Year 2000 compliance will have a material effect on the results of
operations, financial condition or cash flows of future periods. Lastly, the
Company is seeking to determine if the information systems of its major
suppliers (insofar as they relate to the Company's business) comply with Year
2000 requirements. The Company has not yet fully determined the extent to which
its business may be impacted by third parties whose products and services may
not be ready for the year 2000. There can be no assurance that the systems of
other companies which the Company deals with will be able to adequately address
the Year 2000 issue, or that the failure to do so will not have an adverse
effect on the Company's operations.
4
<PAGE> 7
TO THE HOLDERS OF COMMON SHARES OF KEITHLEY INSTRUMENTS, INC.:
INTRODUCTION
Keithley Instruments, Inc., an Ohio corporation (the "Company"), invites
its shareholders to tender its common shares, without par value (the "Shares"),
to the Company at prices not in excess of $7.00 nor less than $5.75 per Share,
net to the seller in cash, without interest thereon, as specified by
shareholders tendering their Shares, upon the terms and subject to the
conditions set forth herein and in the related Letter of Transmittal (which, as
amended or supplemented from time to time, together constitute the "Offer").
The Company will, upon the terms and subject to the conditions of the
Offer, determine the single per Share price, not in excess of $7.00 nor less
than $5.75 per Share, net to the seller in cash, without interest thereon (the
"Purchase Price"), that it will pay for Shares properly tendered pursuant to the
Offer, taking into account the number of Shares so tendered and the prices
specified by tendering shareholders. The Company will select the lowest Purchase
Price that will allow it to buy 2,000,000 Shares (or such lesser number of
Shares as are properly tendered at prices not in excess of $7.00 nor less than
$5.75 per Share) pursuant to the Offer. All Shares properly tendered prior to
the Expiration Date (as defined in Section 1) at prices at or below the Purchase
Price and not properly withdrawn will be purchased at the Purchase Price, upon
the terms and subject to the conditions of the Offer, including the proration
provisions. All Shares acquired in the Offer will be acquired at the Purchase
Price. Shares tendered at prices in excess of the Purchase Price and Shares not
purchased because of proration will be returned at the Company's expense to the
shareholders who tendered such Shares. The Company reserves the right, in its
sole discretion, to purchase more than 2,000,000 Shares pursuant to the Offer.
See Section 14.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE
SECTION 6.
THE BOARD OF DIRECTORS OF THE COMPANY HAS APPROVED THE OFFER. HOWEVER, NONE
OF THE COMPANY, ITS BOARD OF DIRECTORS OR THE DEALER MANAGER MAKES ANY
RECOMMENDATION TO SHAREHOLDERS AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING
THEIR SHARES. EACH SHAREHOLDER MUST MAKE THE DECISION WHETHER TO TENDER SHARES
AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH SUCH
SHARES SHOULD BE TENDERED. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS
DIRECTORS, EXECUTIVE OFFICERS OR AFFILIATES CONTROLLED BY SUCH PERSONS INTENDS
TO TENDER ANY SHARES PURSUANT TO THE OFFER. SEE SECTION 10.
Upon the terms and subject to the conditions of the Offer, if at the
Expiration Date more than 2,000,000 Shares (or such greater number of Shares as
the Company may elect to purchase) are properly tendered at or below the
Purchase Price and not properly withdrawn, the Company will buy Shares first
from all Odd Lot Holders (as defined in Section 1) who properly tender all their
Shares at or below the Purchase Price and then on a pro rata basis from all
other shareholders who properly tender Shares at prices at or below the Purchase
Price (and do not properly withdraw them prior to the expiration of the Offer).
See Section 1.
The Purchase Price will be paid net to the tendering shareholder in cash,
without interest thereon, for all Shares purchased. Tendering shareholders who
hold Shares in their own name and who tender their Shares directly to the
Depositary will not be obligated to pay brokerage commissions, solicitation fees
or, subject to Instruction 7 of the Letter of Transmittal, stock transfer taxes
on the purchase of Shares by the Company pursuant to the Offer. Shareholders
holding Shares through brokers or banks are urged to consult the brokers or
banks to determine whether transaction costs are applicable if shareholders
tender Shares through the brokers or banks and not directly to the Depositary.
HOWEVER, ANY TENDERING SHAREHOLDER OR OTHER PAYEE WHO FAILS TO COMPLETE, SIGN
AND RETURN TO THE DEPOSITARY THE SUBSTITUTE FORM W-9 THAT IS INCLUDED AS PART OF
THE LETTER OF TRANSMITTAL MAY BE SUBJECT TO REQUIRED UNITED STATES FEDERAL
INCOME TAX BACK-UP WITHHOLDING OF 31% OF THE GROSS PROCEEDS PAYABLE TO THE
TENDERING SHAREHOLDER OR OTHER PAYEE PURSUANT TO THE OFFER. SEE SECTION 3. The
Company will
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<PAGE> 8
pay all fees and expenses of Credit Suisse First Boston Corporation ("Credit
Suisse First Boston" or the "Dealer Manager"), First Chicago Trust Company of
New York (the "Depositary") and MacKenzie Partners, Inc. (the "Information
Agent") incurred in connection with the Offer. See Section 15.
The Board of Directors has determined that the Company's financial
condition and outlook and current market conditions, including recent trading
prices of Shares, make this an attractive time to repurchase a significant
portion of the outstanding Shares. In the view of the Board of Directors, the
Offer represents an attractive investment for the Company that should benefit
the Company and its shareholders over the long term. In particular, the Board of
Directors believes that the purchase of Shares at this time is consistent with
the Company's long-term corporate goal of seeking to increase shareholder value.
The Offer provides shareholders who are considering a sale of all or a
portion of their Shares with the opportunity to determine the price or prices
(not in excess of $7.00 nor less than $5.75 per Share) at which they are willing
to sell their Shares and, subject to the terms and conditions of the Offer, to
sell those Shares for cash without, where Shares are tendered by the registered
owner thereof directly to the Depositary, the usual transaction costs associated
with open market sales. In addition, the Offer may give shareholders the
opportunity to sell at prices greater than market prices prevailing prior to the
announcement of the Offer. The Offer also allows shareholders to sell a portion
of their Shares while retaining a continuing equity interest in the Company.
Shareholders who determine not to accept the Offer will realize a proportionate
increase in their relative equity interest in the Company, and thus in the
Company's future earnings and assets subject to the Company's right to issue
additional Shares and other equity securities in the future. In determining
whether to tender Shares pursuant to the Offer, shareholders should consider the
possibility that they may be able to sell their Shares in the future on the NYSE
or otherwise, including in connection with a sale of the Company (which is not
currently contemplated), at a net price higher than the Purchase Price.
Shareholders should also consider the possibility that, following completion of
the Offer, they may not be able to sell their Shares in the future on the NYSE
or otherwise at a net price as high as the Purchase Price. In particular,
shareholders should consider that the Company may not satisfy NYSE listing
standards that are expected to be adopted in January 1999. The Company expects,
however, that it will have until January 2002 to satisfy the new listing
standards. See Sections 2 and 11.
As of the close of business on November 10, 1998, the Company had 2,785,378
Class B Common Shares, without par value, issued and outstanding (the "Class B
Shares"), 5,093,167 Shares issued and outstanding, 2,380,824 Shares reserved for
issuance upon the exercise of options to purchase Shares ("Options") granted
under the Company's 1984 Stock Option Plan, the 1992 Stock Incentive Plan, the
1993 Employee Stock Purchase Plan, the 1996 Outside Directors' Deferred Stock
Plan and the 1997 Directors' Stock Option Plan (all such plans collectively, the
"Option Plans"). Each outstanding Share is entitled to one vote and each
outstanding Class B Share is entitled to ten votes. The Class B Shares are
convertible into Shares, at any time, on a share-for-share basis and may be
tendered in the Offer following conversion. Joseph P. Keithley, President and
Chief Executive Officer of the Company, beneficially owns 2,649,586 Class B
Shares. Mr. Keithley has indicated that he will not tender or cause to be
tendered any of these Class B Shares in the Offer. The 2,000,000 Shares that the
Company is offering to purchase pursuant to the Offer represent approximately
40.0% of the Shares (approximately 25.0% of the Shares and the Class B Shares
combined) outstanding on November 10, 1998 (approximately 35.0% assuming
exercise of outstanding exercisable Options). The Company is not offering as
part of the Offer to purchase any Options outstanding under the Option Plans and
tenders of Options will not be accepted. See Section 3. The Shares are listed
and traded on the NYSE under the symbol "KEI." On November 10, 1998, the last
full trading day prior to the announcement of the Offer, the closing per Share
sales price as reported on the NYSE was $5.625. SHAREHOLDERS ARE URGED TO OBTAIN
CURRENT MARKET QUOTATIONS FOR THE SHARES. See Section 7.
Recent Developments. On November 10, 1998, the Company announced the sale
of its Quantox oxide monitoring product line for approximately $9.0 million in
cash. The Quantox product line had been sold to semiconductor manufacturers and
represented approximately 10% of the Company's annual revenues on a consolidated
basis. The historical financial information included in Section 9 includes this
product line, but the pro forma financial information included in Section 9
reflects the sale of this product line.
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<PAGE> 9
THE OFFER
1. NUMBER OF SHARES; PRORATION.
Upon the terms and subject to the conditions of the Offer, the Company will
purchase 2,000,000 Shares or such lesser number of Shares as are properly
tendered (and not properly withdrawn in accordance with Section 4) prior to the
Expiration Date (as defined below) at prices not in excess of $7.00 nor less
than $5.75 per Share, net to the seller in cash, without interest thereon.
The term "Expiration Date" means 12:00 Midnight, New York City time, on
Thursday, December 10, 1998, unless and until the Company, in its sole
discretion, shall have extended the period of time during which the Offer will
remain open, in which event the term "Expiration Date" shall refer to the latest
time and date at which the Offer, as so extended by the Company, shall expire.
See Section 14 for a description of the Company's right to extend, delay,
terminate or amend the Offer. The Company reserves the right, in its sole
discretion, to purchase more than 2,000,000 Shares pursuant to the Offer. In
accordance with applicable regulations of the Securities and Exchange Commission
(the "Commission"), the Company may purchase, pursuant to the Offer, an
additional amount of Shares not to exceed 2% of the outstanding Shares without
amending or extending the Offer. See Section 14. In the event of an
over-subscription of the Offer as described below, Shares tendered at or below
the Purchase Price prior to the Expiration Date will be subject to proration,
except for Odd Lots (as defined below). The proration period also expires on the
Expiration Date. If (i)(a) the Company increases the price to be paid for Shares
above $7.00 per Share or decreases the price to be paid for Shares below $5.75
per Share, (b) the Company materially increases the Dealer Manager fee, (c) the
Company increases the number of Shares being sought in the Offer and such
increase in the number of Shares being sought exceeds 2% of the outstanding
Shares, or (d) the Company decreases the number of Shares being sought, and (ii)
the Offer is scheduled to expire at any time earlier than the expiration of the
period ending on the tenth business day from, and including, the date that
notice of such increase or decrease is first published, sent or given in the
manner specified in Section 14, the Offer will be extended until the expiration
of such period of ten business days.
The Company will, upon the terms and subject to the conditions of the
Offer, determine a single per Share Purchase Price that it will pay for Shares
properly tendered and not properly withdrawn pursuant to the Offer, taking into
account the number of Shares so tendered and the prices specified by tendering
shareholders. The Company will select the lowest Purchase Price that will allow
it to buy 2,000,000 Shares (or such lesser number of Shares as are properly
tendered at prices not in excess of $7.00 nor less than $5.75 per Share). All
Shares properly tendered at prices at or below the Purchase Price and not
properly withdrawn will be purchased at the Purchase Price, upon the terms and
subject to the conditions of the Offer, including the proration provisions. All
Shares acquired in the Offer will be acquired at the Purchase Price.
THE OFFER IS NOT CONDITIONED ON THE TENDER OF ANY MINIMUM NUMBER OF SHARES.
HOWEVER, THE OFFER IS SUBJECT TO CERTAIN OTHER CONDITIONS. SEE SECTION 6.
In accordance with Instruction 5 of the Letter of Transmittal, shareholders
desiring to tender Shares must (i) specify the price, not in excess of $7.00 nor
less than $5.75 per Share, at which they are willing to sell their Shares to the
Company pursuant to the Offer or (ii) elect to have such shareholder's Shares
purchased at a price determined by the Dutch Auction tender process, which could
result in such Shares being purchased at the minimum price of $5.75 per Share.
As promptly as practicable following the Expiration Date, the Company will, in
its sole discretion, determine the Purchase Price that it will pay for Shares
properly tendered pursuant to the Offer and not properly withdrawn, taking into
account the number of Shares tendered and the prices specified by tendering
shareholders. The Company will select the lowest Purchase Price, not in excess
of $7.00 nor less than $5.75 per Share, net to the seller in cash, that will
enable it to purchase 2,000,000 Shares (or such lesser number of Shares as are
properly tendered) pursuant to the Offer. Shares properly tendered pursuant to
the Offer at or below the Purchase Price, and not properly withdrawn, will be
purchased at the Purchase Price, upon the terms and subject to the conditions of
the Offer, including the proration provisions. All Shares tendered and not
purchased pursuant to the Offer, including Shares tendered at prices in excess
of
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<PAGE> 10
the Purchase Price and Shares not purchased because of proration, will be
returned to the tendering shareholders at the Company's expense as promptly as
practicable following the Expiration Date.
If the number of Shares properly tendered at or below the Purchase Price
and not properly withdrawn prior to the Expiration Date is less than or equal to
2,000,000 Shares (or such greater number of Shares as the Company may elect to
purchase pursuant to the Offer), the Company will, upon the terms and subject to
the conditions of the Offer, purchase all Shares so tendered at the Purchase
Price.
Priority of Purchases. Upon the terms and subject to the conditions of the
Offer, if more than 2,000,000 Shares (or such greater number of Shares as the
Company may elect to purchase) have been properly tendered at prices at or below
the Purchase Price and not properly withdrawn prior to the Expiration Date, the
Company will purchase properly tendered Shares on the basis set forth below:
(a) first, all Shares properly tendered and not properly withdrawn
prior to the Expiration Date by any Odd Lot Holder (as defined below) who:
(1) tenders all Shares owned beneficially or of record by such Odd
Lot Holder at a price at or below the Purchase Price (tenders of less
than all the Shares owned by such Odd Lot Holder will not qualify for
this preference); and
(2) completes the section entitled "Odd Lots" in the Letter of
Transmittal and, if applicable, in the Notice of Guaranteed Delivery;
and
(b) second, after the purchase of all of the foregoing Shares, all
other Shares properly tendered at prices at or below the Purchase Price and
not properly withdrawn prior to the Expiration Date, on a pro rata basis
(with appropriate adjustments to avoid purchases of fractional Shares), as
described below.
Odd Lots. For purposes of the Offer, the term "Odd Lots" means all Shares
properly tendered prior to the Expiration Date at prices at or below the
Purchase Price and not properly withdrawn by any person (an "Odd Lot Holder")
who owned beneficially or of record as of the close of business on November 10,
1998 and who continues to own beneficially or of record as of the Expiration
Date, an aggregate of fewer than 100 Shares and so certified in the appropriate
place on the Letter of Transmittal and, if applicable, on the Notice of
Guaranteed Delivery. In order to qualify for this preference, an Odd Lot Holder
must tender all Shares owned by the Odd Lot Holder in accordance with the
procedures described in Section 3. As set forth above, Odd Lots will be accepted
for payment before proration, if any, of the purchase of other tendered Shares.
This preference is not available to partial tenders or to beneficial or record
holders of an aggregate of 100 or more Shares, even if these holders have
separate accounts or certificates representing fewer than 100 Shares. By
accepting the Offer, an Odd Lot Holder who holds Shares in its name and tenders
its Shares directly to the Depositary would not only avoid the payment of
brokerage commissions, but also would avoid any applicable odd lot discount in a
sale of the holder's Shares. Any shareholder wishing to tender all of such
shareholder's Shares pursuant to the Offer should complete the section entitled
"Odd Lots" in the Letter of Transmittal and, if applicable, in the Notice of
Guaranteed Delivery.
The Company also reserves the right, but will not be obligated, to purchase
all Shares duly tendered by any shareholder who tenders any Shares beneficially
owned at or below the Purchase Price and who, as a result of proration, would
then beneficially own an aggregate of fewer than 100 Shares. If the Company
exercises this right, it will increase the number of Shares that it is offering
to purchase in the Offer by the number of Shares purchased through the exercise
of such right.
Proration. In the event that proration of tendered Shares is required, the
Company will determine the proration factor as soon as practicable following the
Expiration Date. Proration for each shareholder tendering Shares, other than Odd
Lot Holders, will be based on the ratio of the number of Shares properly
tendered and not properly withdrawn by such shareholder to the total number of
Shares properly tendered and not properly withdrawn by all shareholders, other
than Odd Lot Holders, at or below the Purchase Price. Because of the difficulty
in determining the number of Shares properly tendered (including Shares tendered
by guaranteed delivery procedures, as described in Section 3) and not properly
withdrawn, and because of the Odd Lot procedure, the Company does not expect
that it will be able to announce the final proration factor or commence payment
for any Shares purchased pursuant to the Offer until approximately five business
days
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<PAGE> 11
after the Expiration Date. The preliminary results of any proration will be
announced by press release as promptly as practicable after the Expiration Date.
Shareholders may obtain preliminary proration information from the Information
Agent or the Dealer Manager and may be able to obtain such information from
their brokers.
As described in Section 13, the number of Shares that the Company will
purchase from a shareholder pursuant to the Offer may affect the United States
federal income tax consequences to the shareholder of the purchase and,
therefore, may be relevant to a shareholder's decision whether or not to tender
Shares.
This Offer to Purchase and the related Letter of Transmittal will be mailed
to shareholders who were record holders of Shares as of November 10, 1998, and
will be furnished to brokers, banks and similar persons whose names, or the
names of whose nominees, appear on the Company's shareholder list or, if
applicable, who are listed as participants in a clearing agency's security
position listing for subsequent transmittal to beneficial owners of Shares.
2. PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER.
The Offer provides shareholders who are considering a sale of all or a
portion of their Shares with the opportunity to determine the price or prices
(not in excess of $7.00 nor less than $5.75 per Share) at which they are willing
to sell their Shares and, subject to the terms and conditions of the Offer, to
sell such Shares for cash without, where Shares are tendered by the registered
owner directly to the Depositary, the usual transaction costs associated with
open market sales. In addition, Odd Lot Holders who hold Shares in their names
and tender their Shares directly to the Depositary and whose Shares are
purchased pursuant to the Offer not only will avoid the payment of brokerage
commissions but also will avoid any applicable odd lot discount payable on a
sale of their Shares in a transaction on the NYSE. The Offer also allows
shareholders to sell a portion of their Shares while retaining a continuing
equity interest in the Company. Shareholders who determine not to accept the
Offer will realize a proportionate increase in their relative equity interest in
the Company, and thus in the Company's future earnings and assets, subject to
the Company's right to issue additional Shares and other equity securities in
the future. Shareholders should consider that the Company believes that the per
Share dividend amount will increase, because the Company intends to pay the same
aggregate amount in dividends on the smaller number of Shares that remain
outstanding after completion of the Offer. Shareholders may be able to sell
non-tendered Shares in the future on the NYSE or otherwise, including in
connection with a sale of the Company (which is not currently contemplated), at
a net price higher than the Purchase Price. The Company can give no assurance,
however, as to the price at which a shareholder may be able to sell Shares in
the future. Shareholders should also consider the possibility that, following
completion of the Offer, they may not be able to sell their Shares in the future
on the NYSE or otherwise at a net price as high as the Purchase Price. In
particular, shareholders should consider that the Company may not satisfy NYSE
listing standards that are expected to be adopted in January 1999. The Company
expects, however, that it will have until January 2002 to satisfy the new
listing standards. Such a delisting of the Shares could result in a substantial
decrease in the liquidity of the Shares and have a material adverse effect on
the market value of the Shares. See Section 11.
The Board of Directors has determined that the Company's financial
condition and outlook and current market conditions, including recent trading
prices of Shares, make this an attractive time to repurchase outstanding Shares.
In the view of the Board of Directors, the Offer represents an attractive
investment that should benefit the Company and its shareholders over the long
term. In particular, the Board of Directors believes that the purchase of Shares
at this time is consistent with the Company's long-term corporate goal of
seeking to increase shareholder value. The funds required to complete the Offer
and pay related expenses will be provided from working capital and cash from
operations and the balance, if necessary, from borrowings incurred by the
Company under its revolving credit facility. See Section 8.
THE BOARD OF DIRECTORS OF THE COMPANY HAS APPROVED THE OFFER. HOWEVER, NONE
OF THE COMPANY, ITS BOARD OF DIRECTORS OR THE DEALER MANAGER MAKES ANY
RECOMMENDATION TO SHAREHOLDERS AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING
THEIR SHARES AND NEITHER HAS AUTHORIZED ANY
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<PAGE> 12
PERSON TO MAKE ANY RECOMMENDATION. SHAREHOLDERS ARE URGED TO EVALUATE CAREFULLY
ALL INFORMATION IN THE OFFER, CONSULT WITH THEIR OWN INVESTMENT AND TAX ADVISORS
AND MAKE THEIR OWN DECISIONS WHETHER TO TENDER SHARES AND, IF SO, HOW MANY
SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH SUCH SHARES SHOULD BE
TENDERED. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS DIRECTORS, EXECUTIVE
OFFICERS OR AFFILIATES CONTROLLED BY SUCH PERSONS INTENDS TO TENDER ANY SHARES
PURSUANT TO THE OFFER. SEE SECTION 10.
The Company may in the future purchase additional Shares on the open
market, in private transactions, through tender offers or otherwise, subject to
the approval of the Board of Directors. In particular, the Company's Board of
Directors intends to repurchase Shares in the open market beginning after the
expiration of the period of ten business days after the Expiration Date
described below. Future purchases by the Company may be on the same terms or on
terms that are more or less favorable to shareholders than the terms of the
Offer. Rule 13e-4 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), prohibits the Company and its affiliates from purchasing any
Shares, other than pursuant to the Offer, until at least ten business days after
the Expiration Date. Any possible future purchases by the Company pursuant to
this intention or otherwise will depend on many factors, including the market
price of the Shares, the results of the Offer, the Company's business and
financial position and general economic and market conditions.
Shares the Company acquires pursuant to the Offer will be held in the
Company's treasury (unless and until the Company determines to retire any such
Shares) and will be available for the Company to issue without further
shareholder action (except as required by applicable law or the rules applicable
to companies with shares traded on the NYSE or any other securities exchange on
which the Shares may be listed) for purposes including, but not limited to, the
acquisition of other businesses, the raising of additional capital for use in
the Company's business and the satisfaction of obligations under existing or
future employee benefit plans. The Company has no current plans for the issuance
of Shares repurchased pursuant to the Offer by the Company. Such Shares will be
authorized but unissued Shares.
Except as disclosed in this Offer to Purchase, the Company currently has no
plans or proposals that relate to or would result in: (a) the acquisition by any
person of additional securities of the Company or the disposition of securities
of the Company; (b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Company or any of its subsidiaries;
(c) a sale or transfer of a material amount of assets of the Company or any of
its subsidiaries; (d) any change in the present Board of Directors or management
of the Company; (e) any material change in the present dividend rate or policy,
or indebtedness or capitalization of the Company; (f) any other material change
in the Company's corporate structure or business; (g) any change in the
Company's Articles of Incorporation or Code of Regulations or other actions
which may impede the acquisition of control of the Company by any person; (h) a
class of equity security of the Company being delisted from a national
securities exchange or ceasing to be authorized for quotation in an inter-dealer
quotation system of a registered national securities association; (i) a class of
equity security of the Company becoming eligible for termination of registration
pursuant to Section 12(g)(4) of the Exchange Act; or (j) the suspension of the
Company's obligation to file reports pursuant to Section 15(d) of the Exchange
Act.
3. PROCEDURES FOR TENDERING SHARES.
Proper Tender of Shares. For Shares to be tendered properly pursuant to the
Offer (a) the certificates for such Shares (or confirmation of receipt of such
Shares pursuant to the procedure for book-entry transfer set forth below),
together with a properly completed and duly executed Letter of Transmittal (or a
manually signed facsimile thereof), including any required signature guarantees,
and any other documents required by the Letter of Transmittal, must be received
prior to 12:00 Midnight, New York City time, on the Expiration Date by the
Depositary at its address set forth on the back cover of this Offer to Purchase,
or (b) the tendering shareholder must comply with the guaranteed delivery
procedure set forth below. IN ACCORDANCE WITH INSTRUCTION 5 OF THE LETTER OF
TRANSMITTAL, SHAREHOLDERS DESIRING TO TENDER SHARES PURSUANT TO THE OFFER MUST
EITHER (A) PROPERLY INDICATE IN
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<PAGE> 13
THE SECTION CAPTIONED "PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING
TENDERED" ON THE LETTER OF TRANSMITTAL THE PRICE (IN MULTIPLES OF $.125) AT
WHICH SHARES ARE BEING TENDERED OR (B) CHECK THE BOX IN THE SECTION OF THE
LETTER OF TRANSMITTAL CAPTIONED "SHARES TENDERED AT PRICE DETERMINED BY DUTCH
AUCTION." HOWEVER, IF A SHAREHOLDER ELECTS TO HAVE SUCH SHAREHOLDER'S SHARES
PURCHASED AT A PRICE DETERMINED BY THE DUTCH AUCTION TENDER PROCESS, SUCH SHARES
COULD BE PURCHASED AT THE MINIMUM PRICE OF $5.75 PER SHARE. Shareholders who
desire to tender Shares at more than one price must complete a separate Letter
of Transmittal for each price at which Shares are tendered, provided that the
same Shares cannot be tendered (unless properly withdrawn previously in
accordance with the terms of the Offer) at more than one price. TO PROPERLY
TENDER SHARES, ONE AND ONLY ONE PRICE BOX MUST BE CHECKED IN THE APPROPRIATE
SECTION ON EACH LETTER OF TRANSMITTAL.
A TENDER OF SHARES WILL BE PROPER IF, AND ONLY IF, ON THE LETTER OF
TRANSMITTAL EITHER THE BOX IN THE SECTION CAPTIONED "SHARES TENDERED AT PRICE
DETERMINED BY DUTCH AUCTION" OR ONE OF THE BOXES IN THE SECTION CAPTIONED
"SHARES TENDERED AT PRICE DETERMINED BY SHAREHOLDER" IS CHECKED.
IN ADDITION, ODD LOT HOLDERS WHO TENDER ALL SHARES MUST COMPLETE THE
SECTION CAPTIONED "ODD LOTS" IN THE LETTER OF TRANSMITTAL AND, IF APPLICABLE, IN
THE NOTICE OF GUARANTEED DELIVERY, TO QUALIFY FOR THE PREFERENTIAL TREATMENT
AVAILABLE TO ODD LOT HOLDERS AS SET FORTH IN SECTION 1.
SHAREHOLDERS WHO HOLD SHARES THROUGH BROKERS OR BANKS ARE URGED TO CONSULT
THE BROKERS OR BANKS TO DETERMINE WHETHER TRANSACTION COSTS ARE APPLICABLE IF
SHAREHOLDERS TENDER SHARES THROUGH THE BROKERS OR BANKS AND NOT DIRECTLY TO THE
DEPOSITARY.
Signature Guarantees and Method of Delivery. No signature guarantee is
required if: (i) the Letter of Transmittal is signed by the registered holder of
the Shares (which term, for purposes of this Section 3, shall include any
participant in The Depository Trust Company (the "Book-Entry Transfer Facility")
whose name appears on a security position listing as the owner of the Shares)
tendered therewith and such holder has not completed the box entitled "Special
Payment Instructions" on the Letter of Transmittal; or (ii) Shares are tendered
for the account of a bank, broker, dealer, credit union, savings association or
other entity which is a member in good standing of the Securities Transfer
Agents Medallion Program or a bank, broker, dealer, credit union, savings
association or other entity which is an "eligible guarantor institution," as
such term is defined in Rule 17Ad-15 under the Securities Exchange Act of 1934,
as amended (each of the foregoing constituting an "Eligible Institution"). See
Instruction 1 of the Letter of Transmittal. If a certificate for Shares is
registered in the name of a person other than the person executing a Letter of
Transmittal, or if payment is to be made, or Shares not purchased or tendered
are to be issued, to a person other than the registered holder, then the
certificate must be endorsed or accompanied by an appropriate stock power, in
either case, signed exactly as the name of the registered holder appears on the
certificate, with the signature guaranteed by an Eligible Institution.
In all cases, payment for Shares tendered and accepted for payment pursuant
to the Offer will be made only after timely receipt by the Depositary of
certificates for such Shares (or a timely confirmation of the book-entry
transfer of the Shares into the Depositary's account at the Book-Entry Transfer
Facility as described above), a properly completed and duly executed Letter of
Transmittal (or a manually signed facsimile thereof) and any other documents
required by the Letter of Transmittal. THE METHOD OF DELIVERY OF ALL DOCUMENTS,
INCLUDING CERTIFICATES FOR SHARES, THE LETTER OF TRANSMITTAL AND ANY OTHER
REQUIRED DOCUMENTS, IS AT THE ELECTION AND RISK OF THE TENDERING SHAREHOLDER. IF
DELIVERY IS BY MAIL, THEN REGISTERED MAIL WITH RETURN RECEIPT REQUESTED,
PROPERLY INSURED, IS RECOMMENDED.
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<PAGE> 14
Book-Entry Delivery. The Depositary will establish an account with respect
to the Shares for purposes of the Offer at the Book-Entry Transfer Facility
within two business days after the date of this Offer to Purchase, and any
financial institution that is a participant in the Book-Entry Transfer
Facility's system may make book-entry delivery of the Shares by causing the
Book-Entry Transfer Facility to transfer Shares into the Depositary's account in
accordance with the Book-Entry Transfer Facility's procedures for transfer.
Although delivery of Shares may be effected through a book-entry transfer into
the Depositary's account at the Book-Entry Transfer Facility, either (i) a
properly completed and duly executed Letter of Transmittal (or a manually signed
facsimile thereof) with any required signature guarantees and any other required
documents must, in any case, be transmitted to and received by the Depositary at
its address set forth on the back cover of this Offer to Purchase prior to the
Expiration Date, or (ii) the guaranteed delivery procedure described below must
be followed. DELIVERY OF THE LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED
DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO
THE DEPOSITARY.
United States Federal Income Tax Backup Withholding. Under the United
States federal income tax backup withholding rules, unless an exemption applies
under the applicable law and regulations, 31% of the gross proceeds payable to a
shareholder or other payee pursuant to the Offer must be withheld and remitted
to the United States Internal Revenue Service (the "IRS"), unless the
shareholder or other payee provides its taxpayer identification number (employer
identification number or social security number) to the Depositary (as payor)
and certifies under penalties of perjury that such number is correct. Therefore,
each tendering shareholder should complete and sign the Substitute Form W-9
included as part of the Letter of Transmittal so as to provide the information
and certification necessary to avoid backup withholding. If the Depositary is
not provided with the correct taxpayer identification number, the United States
Holder (as defined in Section 13 herein) also may be subject to a penalty
imposed by the IRS. If withholding results in an overpayment of taxes, a refund
may be obtained. Certain "exempt recipients" (including, among others, all
corporations and certain Non-United States Holders (as defined in Section 13
herein)) are not subject to these backup withholding and information reporting
requirements. In order for a Non-United States Holder to qualify as an exempt
recipient, that shareholder must submit an IRS Form W-8 or a Substitute Form
W-8, signed under penalties of perjury, attesting to that shareholder's exempt
status. Such statements can be obtained from the Depositary. See Instruction 14
of the Letter of Transmittal.
TO PREVENT UNITED STATES FEDERAL INCOME TAX BACKUP WITHHOLDING EQUAL TO 31%
OF THE GROSS PAYMENTS MADE TO SHAREHOLDERS FOR SHARES PURCHASED PURSUANT TO THE
OFFER, EACH SHAREHOLDER WHO DOES NOT OTHERWISE ESTABLISH AN EXEMPTION FROM SUCH
BACKUP WITHHOLDING MUST PROVIDE THE DEPOSITARY WITH THE SHAREHOLDER'S CORRECT
TAXPAYER IDENTIFICATION NUMBER AND PROVIDE CERTAIN OTHER INFORMATION BY
COMPLETING THE SUBSTITUTE FORM W-9 INCLUDED AS PART OF THE LETTER OF
TRANSMITTAL.
Withholding For Non-United States Holders. Even if a Non-United States
Holder has provided the required certification to avoid backup withholding, the
Depositary will withhold United States federal income taxes equal to 30% of the
gross payments payable to a Non-United States Holder or his agent unless the
Depositary determines that a reduced rate of withholding is available pursuant
to a tax treaty or that an exemption from withholding is applicable because the
gross proceeds are effectively connected with the conduct of a trade or business
within the United States. In order to obtain a reduced rate of withholding
pursuant to a tax treaty, a Non-United States Holder must deliver to the
Depositary before the payment a properly completed and executed IRS Form 1001,
copies of which can be obtained from the Information Agent. In order to obtain
an exemption from withholding on the grounds that the gross proceeds paid
pursuant to the Offer are effectively connected with the conduct of a trade or
business within the United States, a Non-United States Holder must deliver to
the Depositary a properly completed and executed IRS Form 4224, copies of which
can be obtained from the Information Agent. The Depositary will determine a
shareholder's status as a Non-United States Holder and eligibility for a reduced
rate of, or exemption from, withholding by reference to any outstanding
certificates or statements concerning eligibility for a reduced rate of, or
exemption from, withholding (e.g., IRS Form 1001 or IRS Form 4224) unless facts
and circumstances
12
<PAGE> 15
indicate that such reliance is not warranted. A Non-United States Holder may be
eligible to obtain a refund of all or a portion of any tax withheld if such
Non-United States Holder meets those tests described in Section 13 that would
characterize the exchange as a sale (as opposed to a dividend) or is otherwise
able to establish that no tax or a reduced amount of tax is due.
NON-UNITED STATES HOLDERS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS
REGARDING THE APPLICATION OF UNITED STATES FEDERAL INCOME TAX WITHHOLDING,
INCLUDING ELIGIBILITY FOR A WITHHOLDING TAX REDUCTION OR EXEMPTION, AND THE
REFUND PROCEDURE.
Guaranteed Delivery. If a shareholder desires to tender Shares pursuant to
the Offer and the shareholder's Share certificates are not immediately available
or cannot be delivered to the Depositary prior to the Expiration Date (or the
procedure for book-entry transfer cannot be completed on a timely basis) or if
time will not permit all required documents to reach the Depositary prior to the
Expiration Date, the Shares may nevertheless be tendered, provided that all of
the following conditions are satisfied:
(a) the tender is made by or through an Eligible Institution;
(b) the Depositary receives by hand, mail, overnight courier, telegram
or facsimile transmission, on or prior to the Expiration Date, a properly
completed and duly executed Notice of Guaranteed Delivery substantially in
the form the Company has provided with this Offer to Purchase (specifying
the price at which the Shares are being tendered), including (where
required) a signature guarantee by an Eligible Institution in the form set
forth in such Notice of Guaranteed Delivery; and
(c) the certificates for all tendered Shares, in proper form for
transfer (or confirmation of book-entry transfer of such Shares into the
Depositary's account at the Book-Entry Transfer Facility), together with a
properly completed and duly executed Letter of Transmittal (or a manually
signed facsimile thereof) and any required signature guarantees or other
documents required by the Letter of Transmittal, are received by the
Depositary within three NYSE trading days after the date of receipt by the
Depositary of the Notice of Guaranteed Delivery.
Return of Tendered Shares. If any tendered Shares are not purchased, or if
less than all Shares evidenced by a shareholder's certificates are tendered,
certificates for unpurchased Shares will be returned as promptly as practicable
after the expiration or termination of the Offer or, in the case of Shares
tendered by book-entry transfer at the Book-Entry Transfer Facility, the Shares
will be credited to the appropriate account maintained by the tendering
shareholder at the Book-Entry Transfer Facility, in each case without expense to
the shareholder.
Company Option Plans. The Company is not offering, as part of the Offer, to
purchase any Options outstanding under the Company's Option Plans, and tenders
of Options will not be accepted. Holders of Options who wish to participate in
the Offer may either (i) comply with the procedure for guaranteed delivery set
forth above without having to exercise their Options until after the results of
the Offer are known (provided, however, that an Option holder will not be
required to make the requisite tender through an Eligible Institution and may
personally execute and deliver the Notice of Guaranteed Delivery to the
Depositary), or (ii) exercise their Options and purchase of the Shares subject
to the Option and then tender the Shares pursuant to the Offer; provided that,
in the case of either (i) or (ii), any exercise of an Option and tender of
Shares is in accordance with the terms of the Option Plans and the Options and
is in compliance with all applicable federal and state securities laws. In no
event are any Options to be delivered to the Depositary in connection with a
tender of Shares hereunder. An exercise of an Option cannot be revoked even if
Shares received upon the exercise and tendered in the Offer are not purchased in
the Offer for any reason.
Determination of Validity; Rejection of Shares; Waiver of Defects; No
Obligation to Give Notice of Defects. All questions as to the number of Shares
to be accepted, the price to be paid for Shares to be accepted and the validity,
form, eligibility (including time of receipt) and acceptance for payment of any
tender of Shares will be determined by the Company, in its sole discretion, and
its determination shall be final and binding on all parties. The Company
reserves the absolute right to reject any or all tenders of any Shares that it
determines are not in proper form or the acceptance for payment of or payment
for which may, in the
13
<PAGE> 16
opinion of the Company's counsel, be unlawful. The Company also reserves the
absolute right to waive any of the conditions of the Offer or any defect or
irregularity in any tender with respect to any particular Shares or any
particular shareholder and the Company's interpretation of the terms of the
Offer will be final and binding on all parties. No tender of Shares will be
deemed to have been properly made until all defects or irregularities have been
cured by the tendering shareholder or waived by the Company. None of the
Company, the Dealer Manager, the Depositary, the Information Agent or any other
person shall be obligated to give notice of any defects or irregularities in
tenders, nor shall any of them incur any liability for failure to give any
notice.
Tendering Shareholder's Representation and Warranty; Company's Acceptance
Constitutes an Agreement. A tender of Shares pursuant to any of the procedures
described above will constitute the tendering shareholder's acceptance of the
terms and conditions of the Offer, as well as the tendering shareholder's
representation and warranty to the Company that (a) the shareholder has a "net
long position" (as defined in Rule 14e-4 promulgated by the Commission under the
Exchange Act) in the Shares or equivalent securities at least equal to the
Shares tendered within the meaning of Rule 14e-4 and (b) the tender of Shares
complies with Rule 14e-4. It is a violation of Rule 14e-4 for a person, directly
or indirectly, to tender Shares for that person's own account unless, at the
time of tender and at the end of the proration period or period during which
Shares are accepted by lot (including any extensions thereof), the person so
tendering (i) has a net long position equal to or greater than the amount of (x)
Shares tendered or (y) other securities immediately convertible into or
exchangeable or exercisable for the Shares tendered and will acquire the Shares
for tender by conversion, exchange or exercise and (ii) will deliver or cause to
be delivered the Shares in accordance with the terms of the Offer. Rule 14e-4
provides a similar restriction applicable to the tender or guarantee of a tender
on behalf of another person. The Company's acceptance for payment of Shares
tendered pursuant to the Offer will constitute a binding agreement between the
tendering shareholder and the Company upon the terms and conditions of the
Offer.
CERTIFICATES FOR SHARES, TOGETHER WITH A PROPERLY COMPLETED LETTER OF
TRANSMITTAL AND ANY OTHER DOCUMENTS REQUIRED BY THE LETTER OF TRANSMITTAL, MUST
BE DELIVERED TO THE DEPOSITARY AND NOT TO THE COMPANY. ANY SUCH DOCUMENTS
DELIVERED TO THE COMPANY WILL NOT BE FORWARDED TO THE DEPOSITARY AND THEREFORE
WILL NOT BE DEEMED TO BE PROPERLY TENDERED.
4. WITHDRAWAL RIGHTS.
Except as otherwise provided in this Section 4, tenders of Shares pursuant
to the Offer are irrevocable. Shares tendered pursuant to the Offer may be
withdrawn at any time prior to the Expiration Date and, unless theretofore
accepted for payment by the Company pursuant to the Offer, may also be withdrawn
at any time after 12:00 Midnight, New York City time, on Thursday, December 10,
1998.
For a withdrawal to be effective, a notice of withdrawal must be in written
form and transmitted by mail, overnight courier, hand-delivery, telegraph, telex
or facsimile and must be received in a timely manner by the Depositary at its
address set forth on the back cover of this Offer to Purchase. Any such notice
of withdrawal must specify the name of the tendering shareholder, the number of
Shares to be withdrawn and the name of the registered holder of such Shares. If
the certificates for Shares to be withdrawn have been delivered or otherwise
identified to the Depositary, then, prior to the release of such certificates,
the tendering shareholder must also submit the serial numbers shown on the
particular certificates for Shares to be withdrawn and the signature(s) on the
notice of withdrawal must be guaranteed by an Eligible Institution (except in
the case of Shares tendered for the account of an Eligible Institution). If
Shares have been tendered pursuant to the procedure for book-entry transfer set
forth in Section 3, the notice of withdrawal also must specify the name and the
number of the account at the Book-Entry Transfer Facility to be credited with
the withdrawn Shares and must otherwise comply with such Book-Entry Transfer
Facility's procedures. All questions as to the form and validity (including the
time of receipt) of any notice of withdrawal will be determined by the Company,
in its sole discretion, which determination will be final and binding. None of
the Company, the Dealer Manager, the Depositary, the Information Agent or any
other person shall be obligated to give notice of any defects or irregularities
in any notice of withdrawal nor shall any of them incur liability for failure to
give any notice.
14
<PAGE> 17
Withdrawals may not be rescinded and any Shares properly withdrawn will
thereafter be deemed not properly tendered for purposes of the Offer unless the
withdrawn Shares are properly retendered prior to the Expiration Date by
following one of the procedures described in Section 3.
If the Company extends the Offer, is delayed in its purchase of Shares or
is unable to purchase Shares pursuant to the Offer for any reason, then, without
prejudice to the Company's rights under the Offer, the Depositary may, subject
to applicable law, retain tendered Shares on behalf of the Company, and such
Shares may not be withdrawn except to the extent tendering shareholders are
entitled to withdrawal rights as described in this Section 4.
5. PURCHASE OF SHARES AND PAYMENT OF PURCHASE PRICE.
Upon the terms and subject to the conditions of the Offer, as promptly as
practicable following the Expiration Date, the Company (i) will determine the
Purchase Price it will pay for the Shares properly tendered and not properly
withdrawn prior to the Expiration Date, taking into account the number of Shares
so tendered and the prices specified by tendering shareholders, and (ii) will
accept for payment and pay for (and thereby purchase) Shares properly tendered
at prices at or below the Purchase Price and not properly withdrawn prior to the
Expiration Date. For purposes of the Offer, the Company will be deemed to have
accepted for payment (and therefore purchased) Shares that are properly tendered
at or below the Purchase Price and not properly withdrawn (subject to the
proration provisions of the Offer) only when and if it gives written notice to
the Depositary of its acceptance of the Shares for payment pursuant to the
Offer.
Upon the terms and subject to the conditions of the Offer, promptly
following the Expiration Date the Company will accept for payment and pay a
single per Share Purchase Price for 2,000,000 Shares (subject to increase or
decrease as provided in Section 14) properly tendered, or such lesser number of
Shares as are properly tendered, at prices not in excess of $7.00 nor less than
$5.75 per Share and not properly withdrawn as permitted in Section 4.
The Company will pay for Shares purchased pursuant to the Offer by
depositing the aggregate Purchase Price therefor with the Depositary, which will
act as agent for tendering shareholders for the purpose of receiving payment
from the Company and transmitting payment to the tendering shareholders.
In the event of proration, the Company will determine the proration factor
and pay for those tendered Shares accepted for payment as soon as practicable
after the Expiration Date; however, the Company does not expect to be able to
announce the final results of any proration and commence payment for Shares
purchased until approximately five business days after the Expiration Date.
Certificates for all Shares tendered and not purchased, including all Shares
tendered at prices in excess of the Purchase Price and Shares not purchased due
to proration, will be returned (or, in the case of Shares tendered by book-entry
transfer, will be credited to the account maintained with the Book-Entry
Transfer Facility by the participant therein who so delivered the Shares) to the
tendering shareholder at the Company's expense as promptly as practicable after
the Expiration Date or termination of the Offer without expense to the tendering
shareholders. UNDER NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE BE PAID
BY THE COMPANY BY REASON OF ANY DELAY IN MAKING PAYMENT. In addition, if certain
events occur, the Company may not be obligated to purchase Shares pursuant to
the Offer. See Section 6.
The Company will pay all stock transfer taxes, if any, payable on the
transfer to it of Shares purchased pursuant to the Offer. If, however, payment
of the Purchase Price is to be made to, or (in the circumstances permitted by
the Offer) if unpurchased Shares are to be registered in the name of, any person
other than the registered holder, or if tendered certificates are registered in
the name of any person other than the person signing the Letter of Transmittal,
the amount of all stock transfer taxes, if any (whether imposed on the
registered holder or the other person), payable on account of the transfer to
the person will be deducted from the Purchase Price unless satisfactory evidence
of the payment of the stock transfer taxes, or exemption therefrom, is
submitted. See Instruction 7 of the Letter of Transmittal.
ANY TENDERING SHAREHOLDER OR OTHER PAYEE WHO FAILS TO COMPLETE FULLY, SIGN
AND RETURN TO THE DEPOSITARY THE SUBSTITUTE FORM W-9 INCLUDED
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<PAGE> 18
WITH THE LETTER OF TRANSMITTAL MAY BE SUBJECT TO REQUIRED FEDERAL INCOME TAX
BACKUP WITHHOLDING OF 31% OF THE GROSS PROCEEDS PAID TO THE SHAREHOLDER OR OTHER
PAYEE PURSUANT TO THE OFFER. SEE SECTION 3. ALSO SEE SECTION 3 REGARDING UNITED
STATES FEDERAL INCOME TAX CONSEQUENCES FOR NON-UNITED STATES HOLDERS.
6. CERTAIN CONDITIONS OF THE OFFER.
Notwithstanding any other provision of the Offer, the Company will not be
required to accept for payment, purchase or pay for any Shares tendered, and may
terminate or amend the Offer or may postpone the acceptance for payment of, or
the purchase of and the payment for Shares tendered, subject to Rule 13e-4(f)
under the Exchange Act, if at any time on or after November 11, 1998, and prior
to the Expiration Date, any of the following events shall have occurred (or
shall have been determined by the Company to have occurred) that, in the
Company's reasonable judgment and regardless of the circumstances giving rise
thereto (including any action or omission to act by the Company), makes it
inadvisable to proceed with the Offer or with acceptance for payment:
(a) there shall have been threatened, instituted or pending any action
or proceeding by any government or governmental, regulatory or
administrative agency, authority or tribunal or any other person, domestic
or foreign, before any court, authority, agency or tribunal that directly
or indirectly (i) challenges the making of the Offer, the acquisition of
some or all of the Shares pursuant to the Offer or otherwise relates in any
manner to the Offer, or (ii) in the Company's reasonable judgment, could
materially and adversely affect the business, condition (financial or
other), income, operations or prospects of the Company and its
subsidiaries, taken as a whole, or otherwise materially impair in any way
the contemplated future conduct of the business of the Company or any of
its subsidiaries or materially impair the contemplated benefits of the
Offer to the Company;
(b) there shall have been any action threatened, pending or taken, or
approval withheld, or any statute, rule, regulation, judgment, order or
injunction threatened, proposed, sought, promulgated, enacted, entered,
amended, enforced or deemed to be applicable to the Offer or the Company or
any of its subsidiaries, by any court or any authority, agency or tribunal
that, in the Company's reasonable judgment, would or might directly or
indirectly (i) make the acceptance for payment of, or payment for, some or
all of the Shares illegal or otherwise restrict or prohibit consummation of
the Offer, (ii) delay or restrict the ability of the Company, or render the
Company unable, to accept for payment or pay for some or all of the Shares,
(iii) materially impair the contemplated benefits of the Offer to the
Company, or (iv) materially and adversely affect the business, condition
(financial or other), income, operations or prospects of the Company and
its subsidiaries, taken as a whole, or otherwise materially impair in any
way the contemplated future conduct of the business of the Company or any
of its subsidiaries;
(c) there shall have occurred (i) any general suspension of trading
in, or limitation on prices for, securities on any national securities
exchange or in the over-the-counter market, (ii) the declaration of a
banking moratorium or any suspension of payments in respect of banks in the
United States, (iii) the commencement of a war, armed hostilities or other
international or national calamity directly or indirectly involving the
United States, (iv) any limitation (whether or not mandatory) by any
governmental, regulatory or administrative agency or authority on, or any
event that, in the Company's reasonable judgment, might affect, the
extension of credit by banks or other lending institutions in the United
States, (v) any significant decrease in the market price of the Shares or
any change in the general political, market, economic or financial
conditions in the United States or abroad that could, in the reasonable
judgment of the Company, have a material adverse effect on the Company's
business, operations or prospects or the trading in the Shares, (vi) in the
case of any of the foregoing existing at the time of the commencement of
the Offer, a material acceleration or worsening thereof, or (vii) any
decline in either the Dow Jones Industrial Average or the Standard and
Poor's Index of 500 Industrial Companies by an amount in excess of 10%
measured from the close of business on November 10, 1998;
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<PAGE> 19
(d) a tender or exchange offer for any or all of the Shares (other
than the Offer), or any merger, business combination or other similar
transaction with or involving the Company or any subsidiary, shall have
been proposed, announced or made by any person;
(e)(i) any entity, person or "group" (as that term is used in Section
13(d)(3) of the Exchange Act) shall have acquired or proposed to acquire
beneficial ownership of more than 5% of the outstanding Shares (other than
any such person, entity or group who has filed a Schedule 13D or Schedule
13G with the Commission on or before November 10, 1998), (ii) any such
entity, group or person who has filed a Schedule 13D or Schedule 13G with
the Commission on or before the Expiration Date shall have acquired or
proposed to acquire beneficial ownership of an additional 2% or more of the
outstanding Shares, or (iii) any person, entity or group shall have filed a
Notification and Report Form under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, or made a public announcement
reflecting an intent to acquire the Company or any of its subsidiaries or
any of their respective assets or securities other than in connection with
a transaction authorized by the Board of Directors of the Company; or
(f) any change or changes shall have occurred in the business,
financial condition, assets, income, operations, prospects or stock
ownership of the Company or its subsidiaries that, in the Company's
reasonable judgment, is or may have a material adverse significance to the
Company or its subsidiaries.
The foregoing conditions are for the sole benefit of the Company and may be
asserted by the Company regardless of the circumstances (including any action or
omission by the Company) giving rise to any such condition, and may be waived by
the Company, in whole or in part, at any time and from time to time in its
reasonable discretion. The Company's failure at any time to exercise any of the
foregoing rights shall not be deemed a waiver of any such right and each such
right shall be deemed an ongoing right which may be asserted at any time and
from time to time. Any determination by the Company concerning the events
described above will be final and binding.
7. PRICE RANGE OF SHARES; DIVIDENDS.
The Shares are listed and traded on the NYSE under the symbol "KEI." The
following table sets forth, for the fiscal quarters indicated, the high and low
closing per Share sales prices on the NYSE as compiled from published financial
sources and the cash dividends paid, or to be paid, per Share in each of such
fiscal quarters.
<TABLE>
<CAPTION>
HIGH LOW DIVIDENDS
------- ------- ---------
<S> <C> <C> <C>
Fiscal Year Ended September 30, 1997:
1st Quarter............................................... $11.125 $ 7.375 $0.3125
2nd Quarter............................................... $ 9.375 $ 7.250 $0.3125
3rd Quarter............................................... $12.000 $ 7.625 $0.3125
4th Quarter............................................... $12.375 $10.125 $0.3125
Fiscal Year Ended September 30, 1998:
1st Quarter............................................... $12.375 $ 8.125 $0.3125
2nd Quarter............................................... $ 9.500 $ 7.500 $0.3125
3rd Quarter............................................... $ 8.563 $ 7.313 $0.3125
4th Quarter............................................... $ 7.375 $ 5.000 $0.3125
Fiscal Year Ended September 30, 1999:
1st Quarter (through November 10, 1998)................... $5.6875 $ 3.750 $0.3125
</TABLE>
On November 10, 1998, the last full trading day prior to the announcement
of the Offer, the closing per Share sales price as reported on the NYSE
Composite Tape was $5.625. SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET
QUOTATIONS FOR THE SHARES.
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<PAGE> 20
8. SOURCE AND AMOUNT OF FUNDS.
Assuming the Company purchases 2,000,000 Shares pursuant to the Offer at a
purchase price of $7.00 per Share, the Company expects the maximum aggregate
cost, including all fees and expenses applicable to the Offer, to be
approximately $14.5 million. The Company expects to fund the purchase of Shares
pursuant to the Offer and the payment of related fees and expenses from
available cash and, if necessary, from borrowings under the Company's existing
credit facility described below. At November 10, 1998, the Company had available
cash and marketable securities of approximately $14.0 million. The Company
therefore may finance part of the aggregate purchase price of the Offer from its
existing revolving credit facility.
The Company has a credit agreement with First Chicago NBD Bank, as agent
for the participating banks thereunder, providing for a $25.0 million unsecured,
mulit-currency revolving credit facility (the "Credit Facility"), with interest
charged at various rates based on prime or a spread in excess of LIBOR or FIBOR.
As of November 10, 1998, the Company had approximately $0.5 million outstanding
under the Credit Facility. The Credit Facility expires on March 28, 2002. The
Company believes that the Credit Facility, along with cash generated from
operations, will be sufficient to finance the Offer, the Company's working
capital needs as well as its capital expenditures, remaining special charges,
and business development needs. The Company has no current plans or arrangements
to refinance or repay borrowings under the Credit Facility, except in the
ordinary course of business.
The preceding summary of the Credit Facility is qualified in its entirety
by reference to the text of the Credit Facility and the first amendment thereto,
which are incorporated by reference into the Issuer Tender Offer Statement on
Schedule 13E-4 (the "Schedule 13E-4") to which this Offer to Purchase is
attached as an exhibit. Copies of the Schedule 13E-4 and the exhibits
incorporated by reference therein may be obtained from the Commission in the
manner provided in Section 10.
9. CERTAIN INFORMATION CONCERNING THE COMPANY.
GENERAL
The Company was incorporated in the State of Ohio in 1955. The Company
provides measurement-based solutions to the wireless communication, automotive
electronics, computer peripherals and semiconductor industries, along with
research laboratories. Engineers and scientists around the world use the
Company's advanced hardware and software for process monitoring, production
testing and basic research. The Company's principal executive office is located
at 28775 Aurora Road, Solon, Ohio 44139.
SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
Following is a summary of certain historical consolidated financial
information with respect to the Company for the periods indicated. The summary
financial information (other than the ratio of earnings to fixed charges and
book value per share) set forth for the years ended September 30, 1997 and 1996
is summarized or prepared from the audited consolidated financial statements set
forth in the Company's Annual Report on Form 10-K for the year ended September
30, 1997 (the "Company's 1997 Annual Report"). The financial information (other
than the ratio of earnings to fixed charges and book value per share) set forth
below for the nine months ended June 30, 1998 and 1997 is summarized or prepared
from the unaudited consolidated financial statements set forth in the company's
Quarterly Report on Form 10-Q for the quarter ended June 30, 1998 (the
"Company's 1998 Third Quarter Report"). The Company's 1997 Annual Report and the
Company's 1998 Third Quarter Report are hereby incorporated herein by reference.
More comprehensive financial information is included in such reports and the
information below is qualified in its entirety by reference to such reports and
all of the financial statements and related notes contained therein, copies of
which may be obtained as set forth below under the caption "Additional
Information."
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<PAGE> 21
KEITHLEY INSTRUMENTS, INC.
SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
(In Thousands of Dollars Except Ratios and Per Share Data)
<TABLE>
<CAPTION>
FOR THE NINE MONTHS
ENDED JUNE 30, FOR THE YEAR
(UNAUDITED) ENDED SEPTEMBER 30,
-------------------- --------------------
1998 1997 1997 1996
-------- -------- -------- --------
<S> <C> <C> <C> <C>
OPERATING STATEMENT DATA:
Net sales....................................... $89,897 $88,444 $123,295 $118,946
Cost of goods sold.............................. 38,182 37,396 51,924 46,140
Selling, general and administrative expenses.... 36,499 37,287 51,011 48,329
Product development expenses.................... 10,271 12,752 17,233 18,337
Special charges................................. 335 739 771 11,645
Net financing expenses.......................... 816 817 1,145 819
------- ------- -------- --------
Income (loss) before income taxes............... 3,794 (547) 1,211 (6,324)
Income taxes (benefit).......................... 1,252 (132) 421 (884)
------- ------- -------- --------
Net income (loss)............................... $ 2,542 $ (415) $ 790 $ (5,440)
======= ======= ======== ========
Basic earnings (loss) per share................. $ 0.33 $ (0.05) $ 0.10 $ (0.74)
======= ======= ======== ========
Diluted earnings (loss) per share............... $ 0.32 $ (0.05) $ 0.10 $ (0.74)
======= ======= ======== ========
Weighted average number of shares outstanding --
Diluted (000)................................. 8,029 7,570 7,867 7,360
======= ======= ======== ========
Ratio of earnings to fixed charges.............. 3.9 -- 1.6 --
======= ======= ======== ========
BALANCE SHEET DATA:
Working capital................................. $20,132 $21,124 $ 21,472 $ 18,679
Total assets.................................... 71,401 74,480 79,113 73,834
Total debt...................................... 12,265 17,896 17,458 13,369
Total shareholders' equity...................... 35,945 31,243 32,683 31,756
Book value per share............................ 4.57 4.09 4.26 4.26
</TABLE>
NOTES TO SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
a) For the purpose of calculating the ratio of earnings to fixed charges or the
deficiency of earnings available to cover fixed charges, "earnings" consists
of earnings before income taxes, net financing expenses and "fixed charges."
"Fixed charges" consist of net financing expenses and the estimated interest
components of rental expenses.
b) Book value per share is calculated as total shareholders' equity divided by
the number of shares outstanding at the end of the period.
c) For additional information relating to the Summary Historical Consolidated
Financial Information, reference is made to the Company's consolidated
financial statements and related notes thereto contained in the Company's
1997 Annual Report and the Company's 1998 Third Quarter Report, each of which
is incorporated by reference herein.
SUMMARY UNAUDITED CONSOLIDATED PRO FORMA FINANCIAL INFORMATION
The following summary unaudited consolidated pro forma financial
information gives effect to the sale of certain assets of the Company's
Radiation Measurements Division ("RMD") to Inovision Radiation Measurements,
L.L.C., which took place in August 1998, the sale of certain assets of the
Company's Quantox
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<PAGE> 22
product line ("Quantox") to KLA-Tencor Corporation, which took place in November
1998, and to the purchase of Shares pursuant to the Offer, based on the
assumptions described in the Notes to Summary Unaudited Consolidated Pro Forma
Financial Information. It is assumed that the above described transactions
occurred on the first date of each of the periods presented with respect to the
operating statement data, and at June 30, 1998 and September 30, 1997, with
respect to the balance sheet data. Each period presented should be treated as a
stand-alone period. The Summary Unaudited Consolidated Pro Forma Financial
Information should be read in conjunction with the Summary Historical
Consolidated Financial Information and does not purport to be indicative of the
results that would have been obtained had the above described transactions been
completed at the dates indicated or the results that may be obtained in the
future.
KEITHLEY INSTRUMENTS, INC.
SUMMARY UNAUDITED CONSOLIDATED PRO FORMA FINANCIAL INFORMATION
(In Thousands of Dollars Except Ratios and Per Share Data)
<TABLE>
<CAPTION>
FOR THE NINE MONTHS FOR THE YEAR
ENDED JUNE 30, 1998 ENDED SEPTEMBER 30, 1997
------------------------------------ ------------------------------------
PRO FORMA PRO FORMA
HISTORICAL ADJUSTMENTS PRO FORMA HISTORICAL ADJUSTMENTS PRO FORMA
---------- ----------- --------- ---------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
OPERATING STATEMENT DATA:
Net sales.................. $89,897 $(15,853) $74,044 $123,295 $(18,094) $105,201
Cost of goods sold......... 38,182 (8,329) 29,853 51,924 (11,345) 40,579
Selling, general and
administrative
expenses................. 36,499 (5,079) 31,420 51,011 (7,410) 43,601
Product development
expenses................. 10,271 (2,276) 7,995 17,233 (4,528) 12,705
Special charges............ 335 (235) 100 771 -- 771
Net financing expenses..... 816 (235) 581 1,145 (297) 848
------- -------- ------- -------- -------- --------
Income before income
taxes.................... 3,794 301 4,095 1,211 5,486 6,697
Income taxes............... 1,252 114 1,366 421 2,084 2,504
------- -------- ------- -------- -------- --------
Net income................. $ 2,542 $ 187 $ 2,729 $ 790 $ 3,402 $ 4,192
======= ======== ======= ======== ======== ========
Basic earnings per share... $ 0.33 $ 0.14 $ 0.47 $ 0.10 $ 0.65 $ 0.75
======= ======== ======= ======== ======== ========
Diluted earnings per
share.................... $ 0.32 $ 0.13 $ 0.45 $ 0.10 $ 0.61 $ 0.71
======= ======== ======= ======== ======== ========
Weighted average number of
shares outstanding --
Diluted (000)............ 8,029 6,029 7,867 5,867
======= ======= ======== ========
Ratio of earnings to fixed
charges.................. 3.9 4.8 1.6 4.8
======= ======= ======== ========
BALANCE SHEET DATA:
Working capital............ $20,132 $(11,579) $ 8,553 $ 21,472 $(11,568) $ 9,904
Total assets............... 71,401 (10,118) 61,283 79,113 (10,759) 68,354
Total debt................. 12,265 (4,683) 7,582 17,458 (4,430) 13,028
Total shareholders'
equity................... 35,945 (10,056) 25,889 32,683 (10,712) 21,971
Book value per share....... 4.57 4.41 4.26 3.88
</TABLE>
20
<PAGE> 23
NOTES TO SUMMARY UNAUDITED CONSOLIDATED PRO FORMA FINANCIAL INFORMATION (IN
THOUSANDS OF DOLLARS EXCEPT PER SHARE INFORMATION)
a) The following assumptions were made in presenting the Summary Unaudited
Consolidated Pro Forma Financial Information:
1) Pro forma adjustments include those relating to the sale of certain assets
of RMD, the sale of certain assets of Quantox, and the effect of
purchasing 2,000,000 Shares to be put in treasury at $7.00 per Share (the
maximum price to be paid per Share under the terms of the Offer). There
can be no assurance that the Company will purchase 2,000,000 Shares or at
what price any Shares will be purchased.
2) Expenses directly related to the Offer are assumed to be $500 and have
been added to the cost of the Shares purchased.
b) Pro forma adjustments for the operating statement data for the nine months
ended June 30, 1998 and the year ended September 30, 1997 include:
1) The actual results of the Radiation Measurements Division for the
applicable reporting period, and the actual results of the Quantox product
line, less fixed costs for shared resources which remain.
2) Financing expenses reflect the interest savings of paying down long-term
debt at an average interest rate of 6.7 percent for the applicable period.
3) The gain resulting from the sale of RMD and Quantox has been excluded from
the unaudited pro forma consolidated statements of income.
c) Pro forma adjustments for the balance sheet data at June 30, 1998 and
September 30, 1997 include:
1) The proceeds received for the sale of the assets of RMD and Quantox per
the terms of the Asset Purchase Agreements would have been $17,771 at June
30, 1998 and $18,203 at September 30, 1997.
2) The elimination of assets sold and liabilities assumed by the buyers under
the terms of the Asset Purchase Agreements for the sales of RMD and
Quantox.
3) Additional liabilities that are directly attributable to sales such as
severance costs, legal and accounting and broker fees.
4) The pay down of long-term debt with the proceeds of the sales, net of the
cost of the Shares purchased.
5) The purchase of 2,000,000 Shares at $7.00 per Share (the maximum price to
be paid per Share under the terms of the Offer) with available cash, and
$500 for costs directly related to the Offer.
6) The pro forma effects of reduced dividend payments are not included
because it is anticipated that the Company will pay out the same dollar
amount in dividend payments by increasing the dividend payment per share.
d) Earnings per share are computed by dividing net income by the weighted
average common shares (basic earnings per share) and common share equivalents
(diluted earnings per share), giving effect in the case of the pro forma
amounts to the Shares repurchased as contemplated herein.
g) For the purpose of calculating the ratio of earnings to fixed charges or the
deficiency of earnings available to cover fixed charges, "earnings" consists
of earnings before income taxes, net financing expenses and "fixed charges."
"Fixed charges" consist of net financing expenses and the estimated interest
components of rental expenses.
h) Book value per share is calculated as total shareholders' equity divided by
the number of shares outstanding at the end of the period, giving effect in
the case of the pro forma amounts to the Shares repurchased as contemplated
herein.
On November 11, 1998, the Company issued a press release announcing fiscal
year financial information for the Company for its fiscal year ended September
30, 1998 (the "Year End Financial Information"). The Year End Financial
Information contained therein is set forth below. Additionally, the financial
information contains a Summary Consolidated Statement of Cash Flows. The Company
intends to file its Annual Report on Form 10-K for the fiscal year ended
September 30, 1998, on or about December 28, 1998. More comprehensive financial
information will be included in such report and the financial information that
follows
21
<PAGE> 24
is qualified in its entirety by reference to such report, as such report may be
amended from time to time, and all the financial statements and related notes
contained therein.
KEITHLEY INSTRUMENTS, INC.
CONSOLIDATED STATEMENT OF INCOME
(In Thousands of Dollars Except for Per Share Data)
(Unaudited)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS FOR THE YEAR
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
-------------------- --------------------
1998 1997 1998 1997
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net sales....................................... $27,879 $34,851 $117,776 $123,295
Cost of goods sold.............................. 12,150 14,528 50,332 51,924
Selling, general and administrative expenses.... 10,257 13,724 46,756 51,011
Product development expenses.................... 2,868 4,481 13,139 17,233
Special charges................................. 837 32 1,172 771
Gain on sale of RMD............................. (2,852) -- (2,852) --
Net financing expenses.......................... 224 328 1,040 1,145
------- ------- -------- --------
Income before income taxes...................... 4,395 1,758 8,189 1,211
Income taxes.................................... 1,933 553 3,185 421
------- ------- -------- --------
Net income...................................... $ 2,462 $ 1,205 $ 5,004 $ 790
======= ======= ======== ========
Basic earnings per share........................ $ 0.31 $ 0.16 $ 0.64 $ 0.10
======= ======= ======== ========
Diluted earnings per share...................... $ 0.31 $ 0.15 $ 0.62 $ 0.10
======= ======= ======== ========
Cash dividends per
Common Share.................................. $ .031 $ .031 $ .125 $ .125
======= ======= ======== ========
Cash dividends per
Class B Common Share.......................... $ .025 $ .025 $ .100 $ .100
======= ======= ======== ========
Weighted average number of shares outstanding --
Diluted (000)................................. 7,989 8,003 8,065 7,867
======= ======= ======== ========
</TABLE>
KEITHLEY INSTRUMENTS, INC.
CONSOLIDATED BALANCE SHEET
(In Thousands of Dollars)
(Unaudited)
<TABLE>
<CAPTION>
SEPTEMBER 30, 1998 SEPTEMBER 30, 1997
------------------ ------------------
<S> <C> <C>
ASSETS
Cash and cash equivalents................................ $ 9,321 $ 1,727
Other current assets..................................... 33,006 44,799
Property, plant and equipment, net....................... 14,611 17,255
Other assets............................................. 14,079 15,332
------- -------
Total assets..................................... $71,017 $79,113
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities...................................... $21,887 $25,054
Long-term debt........................................... 6,099 17,442
Other long-term liabilities.............................. 4,289 3,934
Shareholders' equity..................................... 38,742 32,683
------- -------
Total liabilities and shareholders' equity....... $71,017 $79,113
======= =======
</TABLE>
22
<PAGE> 25
KEITHLEY INSTRUMENTS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(In Thousands of Dollars)
(Unaudited)
<TABLE>
<CAPTION>
FOR THE YEAR
ENDED SEPTEMBER 30,
--------------------
1998 1997
-------- --------
<S> <C> <C>
Cash flows from operating activities:
Net income................................................ $ 5,004 $ 790
Expenses not requiring outlay of cash..................... 4,854 2,363
Gain on sale of RMD....................................... (2,852) --
Changes in working capital................................ 7,080 (5,027)
Other operating activities................................ (1,134) 863
------- -------
Net cash provided by (used in) operating activities......... 12,952 (1,011)
------- -------
Cash flows from investing activities:
Payments for property, plant, and equipment............... (2,753) (5,849)
Proceeds from sale of RMD................................. 8,683 --
Payments made for sale of RMD............................. (759) --
Other investing activities -- net......................... 178 202
------- -------
Net cash provided by (used in) investing activities......... 5,349 (5,647)
------- -------
Cash flows from financing activities:
Net decrease in short-term debt........................... (16) (45)
Net borrowing (repayment) of long-term debt............... (11,315) 4,520
Cash dividends............................................ (907) (882)
Proceeds from sale of Common Shares....................... 1,458 1,144
------- -------
Net cash provided by (used in) financing activities......... (10,780) 4,737
------- -------
Effect of exchange rate changes on cash and cash
equivalents............................................... 73 (347)
------- -------
Increase (decrease) in cash and cash equivalents............ 7,594 (2,268)
Cash and cash equivalents at beginning of period............ 1,727 3,995
------- -------
Cash and cash equivalents at end of period.................. $ 9,321 $ 1,727
======= =======
</TABLE>
Disclosure of accounting policy
For purposes of this statement, the Company considers all highly liquid
investments with maturities of three months or less when purchased to be cash
equivalents.
ADDITIONAL INFORMATION
The Company is subject to the informational requirements of the Exchange
Act and, in accordance therewith files reports, proxy statements and information
statements and other information with the Commission. The Schedule 13E-4, the
exhibits forming a part thereof, the exhibits incorporated by reference therein,
and the reports, proxy statements and other information filed with the
Commission in accordance with the Exchange Act can be inspected and copied at
the public reference facilities maintained by the Commission at 450 Fifth
Street, N.W., Room 2120, Washington, D.C. 20549; at its regional offices located
at 500 West Madison Street, Suite 1400, Chicago, Illinois 60661, and at 7 World
Trade Center, New York, New York 10048. Copies of such material may also be
obtained by mail, upon payment of the Commission's customary charges, from the
Public Reference Section of the Commission at Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549. The Commission also maintains a web site on the
Internet at http://www.sec.gov that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the Commission. Such reports, proxy statements and other information
23
<PAGE> 26
concerning the Company also can be inspected at the offices of the NYSE, 20
Broad Street, New York, New York 10005.
10. INTEREST OF DIRECTORS AND OFFICERS AND PRINCIPAL SHAREHOLDER; TRANSACTIONS
AND ARRANGEMENTS CONCERNING SHARES.
As of the close of business on November 10, 1998, the Company had 2,785,378
Class B Shares issued and outstanding, 5,093,167 Shares issued and outstanding,
and 2,380,824 Shares reserved for issuance upon the exercise of Options granted
under the Option Plans. Each outstanding Share is entitled to one vote and each
outstanding Class B Share is entitled to ten votes. The Class B Shares are
convertible into Shares, at any time, on a share-for-share basis and may be
tendered in the Offer following conversion. Joseph P. Keithley, President and
Chief Executive Officer of the Company, beneficially owns 2,649,586 Class B
Shares. Mr. Keithley has indicated that he will not tender or cause to be
tendered any of these Class B Shares in the Offer. The 2,000,000 Shares that the
Company is offering to purchase pursuant to the Offer represent approximately
40.0% of the Shares (approximately 25.0% of the Shares and the Class B Shares
combined) outstanding on November 10, 1998 (approximately 35.0% assuming
exercise of outstanding exercisable Options).
As of November 10, 1998, the Company's directors and executive officers as
a group (16 persons) beneficially owned an aggregate of 575,858 Shares
representing approximately 10.7% of the outstanding Shares, assuming the
exercise by such persons of Options that are currently exercisable or that are
exercisable within 60 days. Joseph P. Keithley, President and Chief Executive
Officer of the Company, beneficially owns 2,649,586 of the Class B Shares and
exercises voting and dispositive power with respect to such shares. These Class
B Shares represent 95.1% of the outstanding Class B Shares and, including the
Shares, represent approximately 80.7% of the aggregate voting power of the
Company. If the Company purchases 2,000,000 Shares pursuant to the Offer, these
Class B Shares would represent 85.9% of the aggregate voting power of the
Company.
Each of the Company's executive officers and directors has advised the
Company that he or she does not intend to tender any Shares pursuant to the
Offer. If the Company purchases 2,000,000 Shares pursuant to the Offer and none
of the executive officers or directors tenders Shares pursuant to the Offer,
then after the purchase of Shares pursuant to the Offer, the Company's executive
officers and directors as a group would beneficially own approximately 16.9% of
the outstanding Shares immediately after the Offer, assuming the exercise by
such persons of their currently exercisable Options.
On October 23, 1998, the Company purchased 1,310 Shares in the open market
for an aggregate purchase price of $6,468, or $4.938 per Share. These Shares
were purchased under the Company's 1996 Outside Directors' Deferred Stock Plan
for directors who elected to defer all or a portion of their directors' fees
under that plan. Except as described herein, based on the Company's records and
on information provided to the Company by its directors, executive officers and
subsidiaries, neither the Company, nor any associate or subsidiary of the
Company nor, to the best of the Company's knowledge, any of the directors or
executive officers of the Company or any of its subsidiaries, nor any
associates, affiliates or subsidiaries of any of the foregoing, has effected any
transactions involving the Shares during the 40 business days prior to the date
hereof.
Except as otherwise described herein, neither the Company nor, to the best
of the Company's knowledge, any of its affiliates, directors or executive
officers, is a party to any contract, arrangement, understanding or relationship
with any other person relating, directly or indirectly, to the Offer with
respect to any securities of the Company, including, but not limited to, any
contract, arrangement, understanding or relationship concerning the transfer or
the voting of any such securities, joint ventures, loan or option arrangements,
puts or calls, guarantees of loans, guarantees against loss or the giving or
withholding of proxies, consents or authorizations.
11. EFFECTS OF THE OFFER ON THE MARKET FOR SHARES; REGISTRATION UNDER THE
EXCHANGE ACT.
The Company's purchase of Shares pursuant to the Offer will reduce the
number of Shares that might otherwise be traded publicly and may reduce the
number of shareholders. Nonetheless, the Company
24
<PAGE> 27
anticipates that there will be a sufficient number of Shares outstanding and
publicly traded following consummation of the Offer to ensure a continued
trading market for the Shares. Based upon published guidelines of the NYSE, the
Company does not believe that its purchase of Shares pursuant to the Offer will
cause the Company's remaining Shares to be delisted from the NYSE. However,
depending on the number of Shares purchased in the Offer and the trading price
of the Shares after the Expiration Date, the Company may not satisfy one of the
continued listing standards of the NYSE, which would require the Company to
prepare a reasonable plan to meet then-existing listing standards within three
years in order to maintain its listing on the NYSE. Furthermore, the NYSE has
proposed for approval by the Commission new listing standards which are expected
to be effective in January 1999. The Company believes that it will not meet the
new listing standards in the form they have been proposed. The Company
understands that all issuers who do not meet the new listing standards when they
take effect will be given a period of three years to meet the new standards.
There can be no assurance that the Company will be able to meet the new listing
standards during such three year period or otherwise. Such a delisting of the
Shares, together with the substantial decrease in the percentage of Shares held
by shareholders, could result in a substantial decrease in the liquidity of the
Shares, even if the Company continues to be a reporting company under the
Exchange Act and continues to file the periodic reports (including annual and
quarterly reports) required to be filed thereunder. If the Shares are not
permitted to continue to be listed on the NYSE, the American Stock Exchange or
any market of the National Association of Securities Dealers Automated Quotation
System, the Shares may only be able to trade in the over-the-counter market.
Although prices in respect of trades may be published by the National
Association of Securities Dealers, Inc. on its electronic bulletin board and
"pink sheets," quotes for such shares would not be as readily available;
accordingly, the Shares could trade much less frequently than the Shares traded
prior to any such delisting, which could have a material adverse effect on the
market value of the Shares.
The Shares are currently "margin securities" under the rules of the Federal
Reserve Board. This has the effect, among other things, of allowing brokers to
extend credit to their customers using such Shares as collateral. The Company
believes that, following the purchase of Shares pursuant to the Offer, the
Shares will continue to be "margin securities" for purposes of the Federal
Reserve Board's margin regulations.
The Shares are registered under the Exchange Act, which requires, among
other things, that the Company furnish certain information to its shareholders
and the Commission and comply with the Commission's proxy rules in connection
with meetings of the Company's shareholders. The Company believes that its
purchase of Shares pursuant to the Offer will not result in the Shares becoming
eligible for deregistration under the Exchange Act.
12. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS.
The Company is not aware of any license or regulatory permit that appears
to be material to the Company's business that might be adversely affected by the
Company's acquisition of Shares as contemplated herein or of any approval or
other action by any government or governmental, administrative or regulatory
authority or agency, domestic or foreign, that would be required for the
acquisition or ownership of Shares by the Company as contemplated herein. Should
any such approval or other action be required, the Company presently
contemplates that such approval or other action will be sought. The Company is
unable to predict whether it will be required to delay the acceptance for
payment of or payment for Shares tendered pursuant to the Offering pending the
outcome of any such matter. There can be no assurance that any such approval or
other action, if needed, would be obtained or would be obtained without
substantial conditions or that the failure to obtain any such approval or other
action might not result in adverse consequences to the Company's business. The
Company's obligations under the Offer to accept for payment and pay for Shares
is subject to certain conditions. See Section 6.
13. CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES.
The following summary describes the principal United States federal income
tax consequences to United States Holders (as defined below) of an exchange of
Shares pursuant to the Offer. Those Shareholders who do not participate in the
exchange should not incur any United States federal income tax liability from
the exchange. This summary is based upon the Internal Revenue Code of 1986, as
amended to the date hereof
25
<PAGE> 28
(the "Code"), existing United States Treasury Regulations promulgated
thereunder, published rulings, administrative pronouncements and judicial
decisions, changes to which could affect the tax consequences described herein
(possibly on a retroactive basis).
This summary addresses only Shares held as capital assets. It does not
address all of the tax consequences that may be relevant to particular
shareholders in light of their personal circumstances, or to certain types of
shareholders (such as certain financial institutions, dealers or traders in
securities or commodities, insurance companies, tax-exempt organizations or
persons who hold Shares as a position in a "straddle" or as part of a "hedging"
or "conversion" transaction or that have a functional currency other than the
United States dollar). This summary may not be applicable with respect to Shares
acquired as compensation (including Shares acquired upon the exercise of Options
or which were or are subject to forfeiture restrictions). This summary also does
not address the state, local or foreign tax consequences of participating in the
Offer. EACH HOLDER OF SHARES SHOULD CONSULT SUCH HOLDER'S TAX ADVISOR AS TO THE
PARTICULAR CONSEQUENCES TO SUCH HOLDER OF PARTICIPATION IN THE OFFER.
A "United States Holder" is a holder of Shares that for United States
federal income tax purposes is (i) a citizen or resident of the United States,
(ii) a corporation or partnership created or organized in or under the laws of
the United States or any State or division thereof (including the District of
Columbia), (iii) an estate the income of which is subject to United States
federal income taxation regardless of its source, or (iv) a trust (a) the
administration over which a United States court can exercise primary supervision
and (b) all of the substantial decisions of which one or more United States
persons have the authority to control and certain other trusts considered United
States Holders for federal income tax purposes. A "Non-United States Holder" is
a holder of Shares other than a United States Holder.
A United States Holder participating in the exchange will be treated either
as having sold Shares or as having received a dividend distribution from the
Company. In that regard, under Section 302 of the Code, a United States Holder
whose Shares are exchanged pursuant to the Offer will be treated as having sold
Shares if the exchange (i) results in a "complete termination" of all of such
holder's equity interest in the Company, (ii) is a "substantially
disproportionate" redemption with respect to such holder or (iii) is "not
essentially equivalent to a dividend" with respect to such holder. In applying
each of the Section 302 tests, a United States Holder will be treated as owning
Shares actually or constructively owned by certain related individuals and
entities.
The receipt of cash by a shareholder will result in a "complete
termination" of the shareholder's interest if either (i) all of the stock of the
Company that is actually and constructively owned by the shareholder is
transferred pursuant to the Offer or (ii) all of the stock of the Company
actually owned by the shareholder is sold pursuant to the Offer and the
shareholder is eligible to waive, and effectively waives, the attribution of
stock of the Company constructively owned by the shareholder in accordance with
the procedures described in the Code. An exchange of Shares will be
"substantially disproportionate" with respect to a United States Holder if the
percentage of the then outstanding Shares actually and constructively owned by
such holder immediately after the exchange of Shares (treating Shares exchanged
pursuant to the Offer as no longer outstanding) pursuant to the Offer is less
than 80% of the percentage of the Shares actually and constructively owned by
such holder immediately before the exchange (treating Shares exchanged pursuant
to the Offer as outstanding). A United States Holder will satisfy the "not
essentially equivalent to a dividend" test if the reduction in such holder's
proportionate interest in the Company constitutes a "meaningful reduction" given
such holder's particular facts and circumstances. The IRS has concluded in a
published ruling that even a minor reduction in the percentage interest of a
shareholder whose relative stock interest in a publicly held corporation is
minimal and who exercises no control over corporate affairs constitutes such a
"meaningful reduction."
If a United States Holder is treated as having sold Shares, such holder
will recognize capital gain or loss equal to the difference between the amount
of cash received and such holder's adjusted tax basis in the Shares sold to the
Company. In the case of an individual United States Holder, the maximum marginal
United States federal income tax rate of 20% applicable to such gain will be
lower than the maximum marginal United
26
<PAGE> 29
States federal income tax rate applicable to ordinary income of 39.6% if such
United States Holder's holding period for such Shares exceeds one year.
If a United States Holder who participates in the Offer is not treated as
having sold Shares, such holder will be treated as receiving a dividend to the
extent of such holder's rateable share of the Company's earnings and profits.
Such a dividend will be includible in the United States Holder's gross income as
ordinary income without reduction for the adjusted tax basis of the Shares
exchanged. In such event, the United States Holder's adjusted tax basis in its
Shares exchanged in the Offer generally will be added to such holder's adjusted
tax basis in the remaining Shares. A dividend received by a corporate United
States Holder may be (i) eligible for a dividends-received deduction (subject to
applicable limitations) and (ii) subject to the "extraordinary dividend"
provisions of the Code. To the extent, if any, that the cash received by a
United States Holder exceeds the Company's earnings and profits, it will be
treated first as a tax-free return of such United States Holder's tax basis in
the Shares and thereafter as capital gain.
See Section 3 with respect to the application of United States federal
income tax withholding to payments made to Non-United States Holders and the
backup withholding tax requirements.
THE TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION
ONLY. EACH SHAREHOLDER IS URGED TO CONSULT SUCH HOLDER'S OWN TAX ADVISOR TO
DETERMINE THE PARTICULAR TAX CONSEQUENCES TO SUCH HOLDER OF THE OFFER, INCLUDING
THE APPLICABILITY AND EFFECT OF STATE, LOCAL AND FOREIGN TAX LAWS.
14. EXTENSION OF THE OFFER; TERMINATION; AMENDMENT.
The Company expressly reserves the right, in its sole discretion, at any
time and from time to time, and regardless of whether or not any of the events
set forth in Section 6 shall have occurred or shall be deemed by the Company to
have occurred, to extend the period of time during which the Offer is open and
thereby delay acceptance for payment of, and payment for, any Shares by giving
oral or written notice of such extension to the Depositary and making a public
announcement thereof. During any such extension, all Shares previously tendered
and not properly withdrawn will remain subject to the Offer and to the rights of
a tendering shareholder to withdraw such shareholder's Shares. The Company also
expressly reserves the right, in its sole discretion, to terminate the Offer and
not accept for payment or pay for any Shares not theretofore accepted for
payment or paid for or, subject to applicable law, to postpone payment for
Shares upon the occurrence of any of the conditions specified in Section 6
hereof by giving oral or written notice of such termination or postponement to
the Depositary and making a public announcement thereof. The Company's
reservation of the right to delay payment for Shares which it has accepted for
payment is limited by Rule 13e-4(f)(5) promulgated under the Exchange Act, which
requires that the Company must pay the consideration offered or return the
Shares tendered promptly after termination or withdrawal of a tender offer.
Subject to compliance with applicable law, the Company further reserves the
right, in its sole discretion, and regardless of whether any of the events set
forth in Section 6 shall have occurred or shall be deemed by the Company to have
occurred, to amend the Offer in any respect (including, without limitation, by
decreasing or increasing the consideration offered in the Offer to holders of
Shares or by decreasing or increasing the number of Shares being sought in the
Offer). Amendments to the Offer may be made at any time and from time to time
effected by public announcement thereof, such announcement, in the case of an
extension, to be issued no later than 9:00 a.m., New York City time, on the next
business day after the last previously scheduled or announced Expiration Date.
Any public announcement made pursuant to the Offer will be disseminated promptly
to shareholders in a manner reasonably designed to inform shareholders of such
change. Without limiting the manner in which the Company may choose to make a
public announcement, except as required by applicable law, the Company shall
have no obligation to publish, advertise or otherwise communicate any such
public announcement other than by making a release to the Dow Jones News
Service.
If the Company materially changes the terms of the Offer or the information
concerning the Offer, or if it waives a material condition of the Offer, the
Company will extend the Offer to the extent required by Rules 13e-4(d)(2) and
13e-4(e)(2) promulgated under the Exchange Act. These rules provide that the
minimum
27
<PAGE> 30
period during which an offer must remain open following material changes in the
terms of the Offer or information concerning the Offer (other than a change in
price or a change in percentage of securities sought) will depend on the facts
and circumstances, including the relative materiality of such terms or
information. If (i)(a) the Company increases or decreases the price to be paid
for Shares, (b) materially increases the Dealer Manager fee, (c) increases the
number of Shares being sought in the Offer and, in the event of an increase in
the number of Shares being sought, such increase exceeds 2% of the outstanding
Shares, or (d) decreases the number of Shares being sought, and (ii) the Offer
is scheduled to expire at any time earlier than the expiration of a period
ending on the tenth business day from, and including, the date that such notice
of an increase or decrease is first published, sent or given in the manner
specified in this Section 14, the Offer will be extended until the expiration of
such period of ten business days. For the purposes of the Offer, a "business
day" means any day other than a Saturday, Sunday or Federal holiday and consists
of the time period from 12:01 a.m. through 12:00 Midnight, New York City time.
15. FEES AND EXPENSES.
The Company has retained Credit Suisse First Boston to act as its financial
advisor, as well as the Dealer Manager, in connection with the Offer. Credit
Suisse First Boston will receive a fee for its services of the greater of (i)
$125,000 or (ii) $0.12 per Share tendered. The Company also has agreed to
reimburse Credit Suisse First Boston for certain reasonable out-of-pocket
expenses incurred in connection with the Offer, including reasonable fees and
expenses of counsel, and to indemnify Credit Suisse First Boston against certain
liabilities in connection with the Offer, including liabilities under the
federal securities laws. Credit Suisse First Boston has not rendered investment
banking or other advisory services to the Company in the past, but it may render
such services to the Company in the future.
The Company has retained MacKenzie Partners, Inc. to act as Information
Agent and First Chicago Trust Company of New York to act as Depositary in
connection with the Offer. The Information Agent may contact holders of Shares
by mail, telephone, telegraph and personal interviews and may request brokers,
dealers and other nominee shareholders to forward materials relating to the
Offer to beneficial owners. The Information Agent and the Depositary will each
receive reasonable and customary compensation for their respective services,
will be reimbursed by the Company for certain reasonable out-of-pocket expenses
and will be indemnified against certain liabilities in connection with the
Offer, including certain liabilities under the federal securities laws.
No fees or commissions will be payable by the Company to brokers, dealers
or other persons (other than fees to the Dealer Manager and the Information
Agent as described above) for soliciting tenders of Shares pursuant to the
Offer. Shareholders holding Shares through brokers or banks are urged to consult
the brokers or banks to determine whether transaction costs are applicable if
shareholders tender Shares through such brokers or banks and not directly to the
Depositary. The Company, however, upon request, will reimburse brokers, dealers
and commercial banks for customary mailing and handling expenses incurred by
them in forwarding the Offer and related materials to the beneficial owners of
Shares held by them as a nominee or in a fiduciary capacity. No broker, dealer,
commercial bank or trust company has been authorized to act as the agent of the
Company, the Dealer Manager, the Information Agent or the Depositary for
purposes of the Offer. The Company will pay or cause to be paid all stock
transfer taxes, if any, on its purchase of Shares except as otherwise provided
in Instruction 7 in the Letter of Transmittal.
16. MISCELLANEOUS.
The Company is not aware of any jurisdiction where the making of the Offer
is not in compliance with applicable law. If the Company becomes aware of any
jurisdiction where the making of the Offer or the acceptance of Shares pursuant
thereto is not in compliance with any valid applicable law, the Company will
make a good faith effort to comply with the applicable law. If, after such good
faith effort, the Company cannot comply with the applicable law, the Offer will
not be made to (nor will tenders be accepted from or on behalf of) the holders
of Shares in such jurisdiction. In any jurisdiction the securities, blue sky or
other laws require the Offer to be made by a licensed broker or dealer, the
Offer shall be deemed to be made on the
28
<PAGE> 31
Company's behalf by the Dealer Manager or one or more registered brokers or
dealers licensed under the laws of the jurisdiction.
Pursuant to Rule 13e-4 of the General Rules and Regulations of the
Commission under the Exchange Act, the Company has filed with the Commission a
Schedule 13E-4 that contains additional information with respect to the Offer.
Such Schedule 13E-4, including the exhibits and any amendments thereto, may be
examined, and copies may be obtained, at the same places and in the same manner
as is set forth in Section 9 with respect to information concerning the Company.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION ON BEHALF OF THE COMPANY OR THE DEALER MANAGER IN CONNECTION WITH
THE OFFER OTHER THAN THOSE CONTAINED IN THIS OFFER TO PURCHASE OR IN THE RELATED
LETTER OF TRANSMITTAL. IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE DEALER
MANAGER.
KEITHLEY INSTRUMENTS, INC.
November 11, 1998
29
<PAGE> 32
Manually signed facsimile copies of the Letter of Transmittal will be
accepted. The Letter of Transmittal, certificates for Shares and any other
required documents should be sent or delivered by each shareholder of the
Company or such shareholder's broker, dealer, commercial bank, trust company or
other nominee to the Depositary at one of its addresses set forth below.
The Depositary for the Offer is
FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
<S> <C> <C>
By Mail: By Overnight Delivery: By Hand:
First Chicago Trust Company of First Chicago Trust Company First Chicago Trust Company of
New York of New York New York
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
P.O. Box 2569 14 Wall Street, 8th Floor c/o Securities Transfer & Reporting
Suite 4660 Suite 4680 Services, Inc.
Jersey City, NJ 07303-2569 New York, NY 10005 100 William Street, Galleria
New York, NY 10038
</TABLE>
Questions and requests for assistance or for additional copies of this
Offer to Purchase, the Letter of Transmittal, the Notice of Guaranteed Delivery
or any other tender offer materials may be directed to the Information Agent or
the Dealer Manager at their respective addresses and telephone numbers listed
below. You may also contact your broker, dealer, commercial bank, trust company
or other nominee for assistance concerning the Offer.
The Information Agent for the Offer is:
MACKENZIE LOGO
156 Fifth Avenue
New York, New York 10010
(212) 929-5500 (Call Collect)
or
CALL TOLL-FREE (800) 322-2885
The Dealer Manager for the Offer is:
CREDIT SUISSE FIRST BOSTON CORPORATION
Eleven Madison Avenue
New York, New York 10010-3629
CALL TOLL FREE (800) 646-4543
<PAGE> 1
Exhibit(a)(2)
LETTER OF TRANSMITTAL
To Tender Common Shares
of
KEITHLEY INSTRUMENTS, INC.
Pursuant to the Offer to Purchase dated November 11, 1998
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW
YORK CITY TIME, ON THURSDAY, DECEMBER 10, 1998, UNLESS THE OFFER IS EXTENDED.
The Depositary for the Offer is:
First Chicago Trust Company of New York
<TABLE>
<S> <C> <C>
By Mail: By Overnight Courier: By Hand:
First Chicago Trust Company First Chicago Trust Company First Chicago Trust Company
of New York of New York of New York
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
Suite 4660 14 Wall Street c/o Securities Transfer & Reporting
P.O. Box 2569 8th Floor, Suite 4680 Services Inc.
Jersey City, NJ 07303-2569 New York, NY 10005 100 William Street, Galleria
New York, NY 10038
</TABLE>
THIS LETTER OF TRANSMITTAL, INCLUDING THE ACCOMPANYING INSTRUCTIONS, SHOULD
BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
- --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(Please fill in, if blank, exactly as name(s) appear(s) on Share certificate(s))
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
(Attach additional signed list, if necessary)
- -----------------------------------------------------------------------------------------------------------------
Total Number of Shares
Share Certificate Number(s)* Evidenced by Share Certificate(s) Number of Shares Tendered**
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
Total Shares........................................................
- -----------------------------------------------------------------------------------------------------------------
* DOES NOT need to be completed by shareholders tendering Shares by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares evidenced by each certificate delivered to
the Depositary are being tendered hereby. See Instruction 4.
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 2
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER THAN AS
SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. DELIVERIES TO THE COMPANY
WILL NOT BE FORWARDED TO THE DEPOSITARY AND THEREFORE WILL NOT CONSTITUTE VALID
DELIVERY. DELIVERIES TO THE BOOK-ENTRY TRANSFER FACILITY WILL NOT CONSTITUTE
VALID DELIVERY TO THE DEPOSITARY.
This Letter of Transmittal is to be completed only if (a) certificates
representing Shares (as defined below) are to be forwarded herewith, or (b) a
tender of Shares is to be made concurrently by book-entry transfer to the
account maintained by the Depositary at The Depository Trust Company
(hereinafter referred to as the "Book-Entry Transfer Facility") pursuant to
Section 3 of the Offer to Purchase (as defined below). Shareholders who desire
to tender Shares pursuant to the Offer (as defined below), but whose Share
certificates are not immediately available or who cannot deliver such
certificates and all other documents required by this Letter of Transmittal to
the Depositary on or prior to the Expiration Date (as defined in the Offer to
Purchase), or who cannot comply with the procedure for book-entry transfer on a
timely basis, may nevertheless tender their Shares pursuant to the guaranteed
delivery procedure set forth in Section 3 of the Offer to Purchase. See
Instruction 2.
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER TO
AN ACCOUNT MAINTAINED BY THE DEPOSITARY AT THE BOOK-ENTRY TRANSFER FACILITY
AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:
-----------------------------------------------------------------------------
Account Number:
-----------------------------------------------------------------------------
Transaction Code Number:
-----------------------------------------------------------------------------
[ ]CHECK HERE IF SHARES ARE BEING TENDERED PURSUANT TO A NOTICE OF GUARANTEED
DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING:
Name(s) of Registered Holder(s):
-----------------------------------------------------------------------------
Date of Execution of Notice of Guaranteed Delivery:
-------------------------------------------------------------------
Name of Institution that Guaranteed Delivery:
--------------------------------------------------------------------------
Window Ticket Number (if any):
-----------------------------------------------------------------------------
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
To First Chicago Trust Company of New York:
The undersigned hereby tenders to Keithley Instruments, Inc., an Ohio
corporation (the "Company"), the above-described common shares, without par
value, of the Company (the "Shares"), at the price per Share indicated in this
Letter of Transmittal, net to the seller in cash, without interest thereon, upon
the terms and subject to the conditions set forth in the Offer to Purchase dated
November 11, 1998 (the "Offer to Purchase"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal (which, as amended or
supplemented from time to time, together constitute the "Offer").
Subject to, and effective upon, acceptance for payment of the Shares
tendered hereby in accordance with the terms and subject to the conditions of
the Offer (including, if the Offer is extended or amended, the terms and
conditions of such extension or amendment), the undersigned hereby sells,
assigns and transfers to, or upon the order of, the Company all right, title and
interest in and to all Shares tendered hereby and orders the registration of all
such Shares if tendered by book-entry transfer and hereby irrevocably
constitutes and appoints the Depositary as the true and lawful agent and
attorney-in-fact of the undersigned with respect to such Shares (with full
knowledge that the Depositary also acts as the agent of the Company) with
respect to such Shares, with full power of substitution (such power of attorney
being deemed to be an irrevocable power coupled with an interest), to: (a)
deliver certificate(s) representing such Shares or transfer ownership of such
Shares on the account books maintained by the Book-Entry Transfer Facility,
together, in either such case, with all accompanying evidences of transfer and
authenticity, to or upon the order of the Company upon receipt by the
Depositary, as the undersigned's agent, of the Purchase Price (as defined below)
with respect to such Shares; (b) present certificates for such Shares for
cancellation and transfer on the Company's books; and (c) receive all benefits
and otherwise exercise all rights of beneficial ownership of such Shares,
subject to the next paragraph, all in accordance with the terms and subject to
the conditions of the Offer.
The undersigned hereby covenants, represents and warrants to the Company
that:
(a) the undersigned has full power and authority to tender, sell, assign
and transfer the Shares tendered hereby and that when and to the extent the
same are accepted for payment by the Company, the Company will acquire good,
marketable and unencumbered title thereto, free and clear of all security
interests, liens, restrictions, charges, encumbrances, conditional sales
agreements or other obligations relating to the sale or transfer of such
Shares, and not subject to any adverse claims;
<PAGE> 3
(b) the undersigned understands that tenders of Shares pursuant to any
one of the procedures described in Section 3 of the Offer to Purchase and in
the instructions hereto will constitute the undersigned's acceptance of the
terms and conditions of the Offer, including the undersigned's
representation and warranty that (i) the undersigned has a net long position
in the Shares or equivalent securities at least equal to the Shares tendered
within the meaning of Rule 14e-4 under the Securities Exchange Act of 1934,
as amended ("Rule 14e-4"), and (ii) such tender of Shares complies with Rule
14e-4;
(c) the undersigned will, upon request, execute and deliver any
additional documents deemed by the Depositary or the Company to be necessary
or desirable to complete the sale, assignment and transfer of the Shares
tendered hereby; and
(d) the undersigned has read, understands and agrees to all of the terms
of the Offer.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
instructions hereto will constitute a binding agreement between the undersigned
and the Company, upon the terms and subject to the conditions of the Offer. The
undersigned acknowledges that no interest will be paid on the Purchase Price for
tendered Shares regardless of any extension of the Offer or any delay in making
such payment.
All authority herein conferred or agreed to be conferred shall survive the
death or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, personal representatives, executors,
administrators, successors, assigns, trustees in bankruptcy and legal
representatives of the undersigned. Except as stated in the Offer to Purchase,
this tender is irrevocable.
The name(s) and address(es) of the registered holder(s) should be printed,
if they are not already printed above, exactly as they appear on the
certificates representing Shares tendered hereby. The certificate numbers, the
number of Shares represented by such certificates and the number of Shares that
the undersigned wishes to tender should be set forth in the appropriate boxes
above. The price at which such Shares are being tendered should be indicated in
the box below.
The undersigned understands that the Company will, upon the terms and
subject to the conditions of the Offer, determine a single per Share price (not
in excess of $7.00 nor less than $5.75 per Share) net to the seller in cash,
without interest thereon (the "Purchase Price"), that it will pay for Shares
properly tendered and not properly withdrawn prior to the Expiration Date
pursuant to the Offer, taking into account the number of Shares so tendered and
the prices (in multiples of $.125) specified by tendering shareholders. The
undersigned understands that the Company will select the lowest Purchase Price
that will allow it to buy 2,000,000 Shares (or such lesser number of Shares as
are properly tendered at prices not in excess of $7.00 nor less than $5.75 per
share) pursuant to the Offer. The undersigned understands that all Shares
properly tendered prior to the Expiration Date at prices at or below the
Purchase Price and not properly withdrawn will be purchased at the Purchase
Price, upon the terms and subject to the conditions of the Offer, including its
proration provisions, and that the Company will return all other Shares not
purchased pursuant to the Offer, including Shares tendered at prices greater
than the Purchase Price and not properly withdrawn prior to the Expiration Date
and Shares not purchased because of proration.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may
postpone the acceptance for payment of, or the payment for, Shares tendered or
may accept for payment fewer than all of the Shares tendered hereby. In any such
event, the undersigned understands that certificate(s) for any Shares not
tendered or not purchased will be returned to the undersigned at the address
indicated above, unless otherwise indicated under the box entitled "Special
Payment Instructions" or the box entitled "Special Delivery Instructions" below.
The undersigned understands that acceptance of Shares by the Company for
payment will constitute a binding agreement between the undersigned and the
Company upon the terms and subject to the conditions of the Offer.
The check for the aggregate net Purchase Price for such of the Shares
tendered hereby as are purchased will be issued to the order of the undersigned
and mailed to the address indicated above, unless otherwise indicated under the
box entitled "Special Payment Instructions" or the box entitled "Special
Delivery Instructions" below. The undersigned acknowledges that the Company has
no obligation, pursuant to the "Special Payment Instructions," to transfer any
Shares from the name of its registered holder(s) thereof, or to order the
registration or transfer of any Shares tendered by book-entry transfer, if the
Company does not purchase any of such Shares.
<PAGE> 4
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 6, 7 AND 10.)
To be completed ONLY if certificate(s) for Shares not tendered or not purchased
and any check for the Purchase Price are to be issued in the name of someone
other than the undersigned, or if Shares tendered hereby and delivered by
book-entry transfer which are not purchased are to be returned by credit to an
account at the Book-Entry Transfer Facility other than that designated above.
Issue Check and Share Certificate to:
Name:
- -----------------------------------------------
(Please Print)
Address:
- ---------------------------------------------
- -------------------------------------------------------
(Zip Code)
- -------------------------------------------------------
(Taxpayer Identification or Social Security Number)
(See Substitute Form W-9 on reverse side.)
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 6, 7 AND 10.)
To be completed ONLY if certificate(s) for Shares not tendered or not purchased
and any check for the Purchase Price are to be mailed or sent to someone other
than the undersigned, or to the undersigned at an address other than that
designated above.
Mail Check and Share Certificate to:
Name:
- -----------------------------------------------
(Please Print)
Address:
- ---------------------------------------------
- -------------------------------------------------------
(Zip Code)
- -------------------------------------------------------
(Taxpayer Identification or Social Security Number)
(See Substitute Form W-9 on reverse side.)
SHARES TENDERED AT PRICE DETERMINED BY DUTCH AUCTION
[ ] The undersigned wants to maximize the chance of having Keithley
Instruments, Inc. purchase all the Shares the undersigned is tendering (subject
to the possibility of proration). Accordingly, by checking this ONE box INSTEAD
OF ONE OF THE PRICE BOXES BELOW, the undersigned hereby tenders Shares and is
willing to accept the Purchase Price resulting from the Dutch Auction tender
process. This action will result in receiving a price per Share as low as $5.75
or as high as $7.00.
**CHECK EITHER THE BOX ABOVE OR CHECK ONE BOX BELOW**
SHARES TENDERED AT PRICE DETERMINED BY SHAREHOLDER
(SEE INSTRUCTION 5.)
By checking ONE of the boxes below INSTEAD OF THE BOX ABOVE, the undersigned
hereby tenders Shares at the price checked. This action could result in none of
the Shares being purchased if the Purchase Price for the Shares is less than the
price checked. A shareholder who desires to tender Shares at more than one price
must complete a separate letter of transmittal for each price at which Shares
are tendered. The same Shares cannot be tendered at more then one price. IF MORE
THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED, THERE IS NO VALID TENDER OF
SHARES.
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED
(SEE INSTRUCTION 5.)
<TABLE>
<S> <C> <C> <C>
[ ] $5.750 [ ] $ 6.500
[ ] $5.875 [ ] $ 6.625
[ ] $6.000 [ ] $ 6.750
[ ] $6.125 [ ] $ 6.875
[ ] $6.250 [ ] $ 7.000
[ ] $6.375
</TABLE>
<PAGE> 5
ODD LOTS
(SEE INSTRUCTION 8.)
To be completed ONLY if Shares are being tendered by or on behalf of a
person owning, beneficially or of record, as of the close of business on
November 10, 1998 and who continues to own, beneficially or of record, as of the
Expiration Date, an aggregate of fewer than 100 Shares. The undersigned either
(check one box):
[ ] was the beneficial or record owner of, as of the close of business on
November 10, 1998, and continues to own beneficially or of record as of the
Expiration Date, an aggregate of fewer than 100 Shares, all of which are
being tendered; or
[ ] is a broker, dealer, commercial bank, trust company, or other nominee that
(a) is tendering, for the beneficial owner(s) thereof, Shares with respect
to which it is the record holder, and (b) believes, based upon
representations made to it by such beneficial owner(s), that each such
person was the beneficial or record owner of, as of the close of business on
November 10, 1998, and continues to own beneficially or of record as of the
Expiration Date, an aggregate of fewer than 100 Shares and is tendering all
of such Shares.
<PAGE> 6
IMPORTANT
SHAREHOLDERS SIGN HERE
(PLEASE COMPLETE AND RETURN THE ATTACHED SUBSTITUTE FORM W-9.)
(Must be signed by the registered holder(s) exactly as such holder(s) name(s)
appear(s) on certificate(s) for Shares or on a security position listing or by
person(s) authorized to become the registered holder(s) thereof by certificates
and documents transmitted with this Letter of Transmittal. If signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or any other person acting in a fiduciary or representative
capacity, please set forth full title and see Instruction 6.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
Dated:
- ------------------------------------------------
Name(s):
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title):
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Daytime Area Code and Telephone Number:
- --------------------------------------------------------------------------------
Taxpayer Identification or Social Security Number:
- -------------------------------------------------------------------------
(SEE SUBSTITUTE FORM W-9)
GUARANTEE OF SIGNATURE(S)
(REQUIRED IN CERTAIN INSTANCES -- SEE INSTRUCTIONS 1 AND 6.)
Authorized Signature:
- --------------------------------------------------------------------------------
Name:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Title:
- --------------------------------------------------------------------------------
Name of Firm:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number:
- --------------------------------------------------------------------------------
Dated:
- ------------------------------------------------
<PAGE> 7
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. Guarantee of Signatures. No signature guarantee is required if either:
(a) this Letter of Transmittal is signed by the registered holder of the
Shares (which term, for purposes hereof, shall include any participant in the
Book-Entry Transfer Facility whose name appears on a security position listing
as the owner of such Shares) tendered hereby exactly as the name of such
registered holder appears on the certificate(s) for such Shares tendered with
this Letter of Transmittal and payment and delivery are to be made directly to
such owner unless such owner has completed the box entitled "Special Payment
Instructions" above; or
(b) such Shares are tendered for the account of a bank, broker, dealer,
credit union, savings association or other entity which is a member in good
standing of the Securities Transfer Agents Medallion Program or a bank, broker,
dealer, credit union, savings association or other entity which is an "eligible
guarantor institution," as such term is defined in Rule 17Ad-15 under the
Securities Exchange Act of 1934, as amended (each of the foregoing constituting
an "Eligible Institution").
In all other cases, an Eligible Institution must guarantee all signatures on
this Letter of Transmittal. See Instruction 6.
2. Delivery of Letter of Transmittal and Certificates; Guaranteed Delivery
Procedures. This Letter of Transmittal is to be completed only if certificates
for Shares are delivered with it to the Depositary (or such certificates will be
delivered pursuant to a Notice of Guaranteed Delivery previously sent to the
Depositary) or if a tender for Shares is being made concurrently pursuant to the
procedure for tender by book-entry transfer set forth in Section 3 of the Offer
to Purchase. Certificates for all physically tendered Shares or confirmation of
a book-entry transfer into the Depositary's account at the Book-Entry Transfer
Facility of Shares tendered electronically, together in each case with a
properly completed and duly executed Letter of Transmittal (or manually signed
facsimile hereof), and any other documents required by this Letter of
Transmittal, should be mailed or delivered to the Depositary at the appropriate
address set forth herein and must be delivered to the Depositary on or before
the Expiration Date. DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY
IN ACCORDANCE WITH SUCH BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES NOT
CONSTITUTE DELIVERY TO THE DEPOSITARY.
Shareholders whose certificates are not immediately available or who cannot
deliver certificates for their Shares and all other required documents to the
Depositary before the Expiration Date, or whose Shares cannot be delivered on a
timely basis pursuant to the procedures for book-entry transfer, must, in any
such case, tender their Shares by or through any Eligible Institution by
properly completing and duly executing and delivering a Notice of Guaranteed
Delivery (or facsimile thereof) and by otherwise complying with the guaranteed
delivery procedure set forth in Section 3 of the Offer to Purchase. Pursuant to
such procedure, certificates for all physically tendered Shares or book-entry
confirmations, as the case may be, as well as a properly completed and duly
executed Letter of Transmittal (or manually signed facsimile hereof) and all
other documents required by this Letter of Transmittal, must be received by the
Depositary within three (3) New York Stock Exchange trading days after receipt
by the Depositary of such Notice of Guaranteed Delivery, all as provided in
Section 3 of the Offer to Purchase.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted by
telegram, facsimile transmission or mail to the Depositary and must include a
signature guarantee by an Eligible Institution in the form set forth therein.
For Shares to be tendered validly pursuant to the guaranteed delivery procedure,
the Depositary must receive the Notice of Guaranteed Delivery on or before the
Expiration Date.
THE METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING CERTIFICATES FOR SHARES,
IS AT THE OPTION AND RISK OF THE TENDERING SHAREHOLDER. IF DELIVERY IS BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE DELIVERY.
The Company will not accept any alternative, conditional or contingent
tenders, nor will it purchase any fractional Shares, except as expressly
provided in the Offer to Purchase. All tendering shareholders, by execution of
this Letter of Transmittal (or a facsimile hereof), waive any right to receive
any notice of the acceptance of their tender.
3. Inadequate Space. If the space provided in the box entitled "Description
of Shares Tendered" above is inadequate, the certificate numbers and/or the
number of Shares should be listed on a separate signed schedule and attached to
this Letter of Transmittal.
4. Partial Tenders and Unpurchased Shares. (Not applicable to shareholders
who tender by book-entry transfer.) If fewer than all of the Shares evidenced by
any certificate are to be tendered, fill in the number of Shares that are to be
tendered in the column entitled "Number of Shares Tendered" in the box entitled
"Description of Shares Tendered" above. In such case, if any tendered Shares are
purchased, a new certificate for the remainder of the Shares (including any
Shares not purchased) evidenced by the old certificate(s) will be issued and
sent to the registered holder(s) thereof, unless otherwise specified in either
the box entitled "Special Payment Instructions" or the box entitled "Special
Delivery Instructions" in this Letter of Transmittal, as soon as practicable
after the Expiration Date. Unless otherwise indicated, all Shares represented by
the certificate(s) set forth above and delivered to the Depositary will be
deemed to have been tendered.
<PAGE> 8
5. Indication of Price at Which Shares Are Being Tendered. For Shares to be
properly tendered, the shareholder MUST either (A) check the box under "Shares
Tendered at Price Determined by Dutch Auction" or (B) check the box indicating
the price per Share at which such holder is tendering Shares under "Shares
Tendered at Price Determined by Shareholder" in this Letter of Transmittal. By
checking the box under "Shares Tendered at Price Determined by Dutch Auction"
the shareholder agrees to accept the Purchase Price that results form the Dutch
Auction tender process, which may be as low as $5.75 or as high as $7.00 per
Share. By checking the box under "Shares Tendered at Price Determined by
Shareholder," the shareholder acknowledges that doing so could result in none of
the Shares being purchased if the Purchase Price for the Shares is less than the
price you check. ONLY ONE BOX MAY BE CHECKED. IF MORE THAN ONE BOX IS CHECKED OR
IF NO BOX IS CHECKED, THERE IS NO PROPER TENDER OF SHARES. A shareholder wishing
to tender a portion(s) of such holder's Shares at different prices must complete
a separate Letter of Transmittal for each price at which such holder wishes to
tender each such portion of such holder's Shares. The same Shares cannot be
tendered (unless previously properly withdrawn as provided in Section 4 of the
Offer to Purchase) at more than one price.
6. Signatures on Letter Of Transmittal; Stock Powers and Endorsements.
(a) If this Letter of Transmittal is signed by the registered holder(s) of
the Shares tendered hereby, the signature(s) must correspond exactly with the
name(s) as written on the face of the certificate(s) without any change
whatsoever.
(b) If the Shares tendered hereby are registered in the names of two or more
joint holders, each such holder must sign this Letter of Transmittal.
(c) If any tendered Shares are registered in different names on several
certificates, it will be necessary to complete, sign and submit as many separate
Letters of Transmittal (or facsimiles hereof) as there are different
registrations of certificates.
(d) When this Letter of Transmittal is signed by the registered holder(s) of
the Shares tendered hereby, no endorsement(s) of certificate(s) representing
such Shares or separate stock power(s) are required unless payment is to be made
or the certificate(s) for Shares not tendered or not purchased are to be issued
to a person other than the registered holder(s) thereof. SIGNATURE(S) ON SUCH
CERTIFICATE(S) MUST BE GUARANTEED BY AN ELIGIBLE INSTITUTION. If this Letter of
Transmittal is signed by a person other than the registered holder(s) of the
certificate(s) listed, or if payment is to be made or certificate(s) for Shares
not tendered or not purchased are to be issued to a person other than the
registered holder(s) thereof, such certificate(s) must be endorsed or
accompanied by appropriate stock power(s), in either case signed exactly as the
name(s) of the registered holder(s) appears on the certificate(s), and the
signature(s) on such certificate(s) or stock power(s) must be guaranteed by an
Eligible Institution. See Instruction 1.
(e) If this Letter of Transmittal or any certificate(s) or stock power(s)
are signed by a trustee, executor, administrator, guardian, attorney-in- fact,
officer of a corporation or any other person acting in a fiduciary or
representative capacity, such person should so indicate when signing this Letter
of Transmittal and must submit proper evidence satisfactory to the Company of
their authority so to act.
7. Stock Transfer Taxes. Except as provided in this Instruction 7, no stock
transfer tax stamps or funds to cover such stamps need accompany this Letter of
Transmittal. The Company will pay any stock transfer taxes payable on the
transfer to it of Shares purchased pursuant to the Offer. If, however, either
(a) payment of the Purchase Price for Shares tendered hereby and accepted for
purchase is to be made to any person other than the registered holder(s); or (b)
Shares not tendered or not accepted for purchase are to be registered in the
name(s) of any person(s) other than the registered holder(s); or (c)
certificate(s) representing tendered Shares are registered in the name(s) of any
person(s) other than the person(s) signing this Letter of Transmittal, then the
Depositary will deduct from such Purchase Price the amount of any stock transfer
taxes (whether imposed on the registered holder(s), such other person(s) or
otherwise) payable on account of the transfer to such person, unless
satisfactory evidence of the payment of such taxes or any exemption therefrom is
submitted.
8. Odd Lots. As described in Section 1 of the Offer to Purchase, if the
Company is to purchase fewer than all Shares properly tendered before the
Expiration Date and not properly withdrawn, the Shares purchased first will
consist of all Shares properly tendered by any shareholder who owned,
beneficially or of record, as of the close of business on November 11, 1998 and
as of the Expiration Date, an aggregate of fewer than 100 Shares, and who
tenders all of such holder's Shares at or below the Purchase Price (an "Odd Lot
Holder"). This preference will not be available unless the box captioned "Odd
Lots" is completed.
9. Special Payment and Delivery Instructions. If certificate(s) for Shares
not tendered or not purchased and/or check(s) are to be issued in the name of a
person other than the signer of this Letter of Transmittal or if such
certificates and/or checks are to be sent to someone other than the person
signing this Letter of Transmittal or to the signer at a different address, the
box entitled "Special Payment Instructions" and/or the box entitled "Special
Delivery Instructions" on this Letter of Transmittal should be completed as
applicable and signatures must be guaranteed as described in Instruction 1.
10. Irregularities. All questions as to the number of Shares to be accepted,
the price to be paid therefor and the validity, form, eligibility (including
time of receipt) and acceptance for payment of any tender of Shares will be
resolved by the Company in its sole discretion, which determination shall be
final and binding on all parties. The Company reserves the absolute right to
reject any or all tenders of Shares it determines not to be in proper form or
the acceptance of which or payment for which may, in the opinion of the
Company's counsel, be unlawful. The Company also reserves the absolute right to
waive any of the conditions of the Offer or any defect or irregularity in any
tender with respect to any particular Shares or any particular shareholder, and
the Company's interpretation of the terms of the Offer (including these
Instructions) will be final and binding on all parties. No tender of Shares will
be deemed to be properly made until all defects and irregularities have been
cured by the tendering shareholder or waived by the Company. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as the Company shall determine. None of the Company, the Dealer Manager (as
defined in the Offer to Purchase), the Depositary, the Information Agent (as
defined in the Offer to Purchase) or any other person is or will be obligated to
give notice of any defects or irregularities in tenders and none of them will
incur any liability for failure to give any such notice.
<PAGE> 9
11. Questions and Requests for Assistance and Additional Copies. Questions
and requests for assistance may be directed to, or additional copies of the
Offer to Purchase, this Letter of Transmittal, the Notice of Guaranteed Delivery
and other related materials may be obtained from, the Information Agent or the
Dealer Manager at their addresses and telephone numbers set forth on the back
cover of the Offer to Purchase or from brokers, dealers, commercial banks or
trust companies.
12. Tax Identification Number and Backup Withholding. Federal income tax law
generally requires that a shareholder whose tendered Shares are accepted for
purchase, or such shareholder's assignee (in either case, the "Payee"), provide
the Depositary with such Payee's correct Taxpayer Identification Number ("TIN"),
which, in the case of a Payee who is an individual, is such Payee's social
security number. If the Depositary is not provided with the correct TIN or an
adequate basis for an exemption, such Payee may be subject to a $50 penalty
imposed by the Internal Revenue Service and backup withholding in an amount
equal to 31% of the gross proceeds received pursuant to the Offer. If
withholding results in an overpayment of taxes, a refund may be obtained.
To prevent backup withholding, each Payee must provide such Payee's correct
TIN by completing the Substitute Form W-9 set forth herein, certifying that the
TIN provided is correct (or that such Payee is awaiting a TIN) and that (i) the
Payee is exempt from backup withholding, (ii) the Payee has not been notified by
the Internal Revenue Service that such Payee is subject to backup withholding as
a result of a failure to report all interest or dividends, or (iii) the Internal
Revenue Service has notified the Payee that such Payee is no longer subject to
backup withholding.
If the Payee does not have a TIN, such Payee should (i) consult the enclosed
Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9 for instructions on applying for a TIN, (ii) write "Applied For" in the
space provided in Part 1 of the Substitute Form W-9, and (iii) sign and date the
Substitute Form W-9 and the Certificate of Awaiting Taxpayer Identification
Number set forth herein. If the Payee does not provide such Payee's TIN to the
Depositary within sixty (60) days, backup withholding will begin and continue
until such Payee furnishes such Payee's TIN to the Depositary. Note that writing
"Applied For" on the Substitute Form W-9 means that the Payee has already
applied for a TIN or that such Payee intends to apply for one in the near
future.
If Shares are held in more than one name or are not in the name of the
actual owner, consult the W-9 Guidelines for information on which TIN to report.
Exempt Payees (including, among others, all corporations and certain foreign
individuals) are not subject to backup withholding and reporting requirements.
To prevent possible erroneous backup withholding, an exempt Payee should write
"Exempt" in Part 2 of Substitute Form W-9. See the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions. In order for a nonresident alien or foreign entity to
qualify as exempt, such person must submit a completed Form W-8 Certificate of
Foreign Status, signed under penalty of perjury attesting to such exempt status.
Such form may be obtained from the Depositary.
13. Withholding On Non-United States Holder. Even if a Non-United States
Holder (as defined below) has provided the required certification to avoid
backup withholding, the Depositary will withhold United States federal income
taxes equal to 30% of the gross payments payable to a Non-United States Holder
or such holder's agent unless the Depositary determines that a reduced rate of
withholding is available pursuant to a tax treaty or that an exemption from
withholding is applicable because such gross proceeds are effectively connected
with the conduct of a trade or business within the United States. For this
purpose, a "Non-United States Holder" is any shareholder that for United States
federal income tax purposes is not (i) a citizen or resident of the United
States, (ii) a corporation or partnership created or organized in or under the
laws of the United States or any State or division thereof (including the
District of Columbia), (iii) an estate the income of which is subject to United
States federal income taxation regardless of the source of such income, or (iv)
a trust (a) the administration over which a United States court can exercise
primary supervision and (b) all of the substantial decisions of which one or
more United States persons have the authority to control. Notwithstanding the
foregoing, to the extent provided in United States Treasury Regulations, certain
trusts in existence on August 20, 1996, and treated as United States persons
prior to such date, that elect to continue to be treated as United States
persons also will not be Non-United States Holders. In order to obtain a reduced
rate of withholding pursuant to a tax treaty, a Non-United States Holder must
deliver to the Depositary before the payment a properly completed and executed
IRS Form 1001. In order to obtain an exemption from withholding on the grounds
that the gross proceeds paid pursuant to the Offer are effectively connected
with the conduct of a trade or business within the United States, a Non-United
States Holder must deliver to the Depositary a properly completed and executed
IRS Form 4224. The Depositary will determine a shareholder's status as a
Non-United States Holder and eligibility for a reduced rate of, or an exemption
from, withholding by reference to outstanding certificates or statements
concerning eligibility for a reduced rate of, or exemption from, withholding
(e.g., IRS Form 1001 or IRS Form 4224) unless facts and circumstances indicate
that such reliance is not warranted. A Non-United States Holder may be eligible
to obtain a refund of all or a portion of any tax withheld if such Non-United
States Holder meets those tests described in Section 13 of the Offer to Purchase
that would characterize the exchange as a sale (as opposed to a dividend) or is
otherwise able to establish that no tax or a reduced amount of tax is due.
NON-UNITED STATES HOLDERS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS
REGARDING THE APPLICATION OF UNITED STATES FEDERAL INCOME TAX WITHHOLDING,
INCLUDING ELIGIBILITY FOR A WITHHOLDING TAX REDUCTION OR EXEMPTION, AND THE
REFUND PROCEDURE.
14. Lost, Stolen, Destroyed or Mutilated Certificates. If any certificate(s)
representing Shares has been lost, stolen, destroyed or mutilated, the
shareholder should promptly notify the Depositary by calling (800) 446-2617.
Such shareholder will then be instructed by the Depositary as to the steps that
must be taken in order to replace the certificate. This Letter of Transmittal
and related documents cannot be processed until the procedures for replacing
lost, stolen, destroyed or mutilated certificates have been followed.
<PAGE> 10
THIS LETTER OF TRANSMITTAL, PROPERLY COMPLETED AND DULY EXECUTED (OR
MANUALLY SIGNED FACSIMILE HEREOF), TOGETHER WITH CERTIFICATES REPRESENTING
SHARES BEING TENDERED OR CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL OTHER
REQUIRED DOCUMENTS, OR A NOTICE OF GUARANTEED DELIVERY, MUST BE RECEIVED PRIOR
TO 12:00 MIDNIGHT, NEW YORK CITY TIME, ON THE EXPIRATION DATE. SHAREHOLDERS ARE
ENCOURAGED TO COMPLETE AND RETURN THE SUBSTITUTE FORM W-9 BELOW.
<TABLE>
<S> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
PAYOR: FIRST CHICAGO TRUST COMPANY OF NEW YORK
- ----------------------------------------------------------------------------------------------------------------------------------
SUBSTITUTE PART 1--Taxpayer Identification Number--for all ac-
FORM W-9 counts, enter taxpayer identification number in the TIN: ____________
box at right and certify by signing and dating below. Social Security Number
or Employer
Department of the Identification Number
Treasury, Internal Note: If the account is in more than one name, see the (If awaiting TIN, write
Revenue Service chart in the enclosed Guidelines to determine which "Applied For")
number to give the payer.
-----------------------------------------------------------------------------------------------
PAYER'S REQUEST FOR TAXPAYER PART 2--For payees exempt from backup withholding, please write "EXEMPT"
IDENTIFICATION NUMBER ("TIN") here (see the enclosed Guidelines):
PART 3--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 because: (a) I am exempt from backup withholding, or (b) I have
not been notified by the Internal Revenue Service (the "IRS") that I am subject to backup withholding as a
result of a failure to report all interest or dividends or (c) the IRS has notified me that I am no longer subject
to backup withholding.
Certification Instructions--You must cross out item (2) above if you have been notified by the IRS that you are
currently subject to backup withholding because of underreporting interest or dividends on your tax return and
you have not been notified by the IRS that you are no longer subject to backup withholding. (Also see
instructions in the enclosed Guidelines.)
SIGNATURE: ______________________________ DATE: ________________
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU ARE AWAITING (OR WILL
SOON APPLY FOR) A TAXPAYER IDENTIFICATION NUMBER.
<TABLE>
<S> <C>
- ----------------------------------------------------------------------------------------------------------
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and
that I mailed or delivered an application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office (or I intend to mail or deliver
an application in the near future). I understand that, notwithstanding the information I provided in Part
III of the Substitute Form W-9 above (and the fact that I have completed this Certificate of Awaiting
Taxpayer Identification Number), if I do not provide a taxpayer identification number to the Depositary
within sixty (60) days, the Depositary is required to withhold 31% of all cash payments made to me
thereafter until I provide a number.
SIGNATURE: ______________________________ DATE: ________________
- ----------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 11
The Information Agent for the Offer is:
MACKENZIE LOGO
156 Fifth Avenue
New York, New York 10010
(212) 929-5500 (Call Collect) or
Call Toll-Free (800) 322-2885
The Dealer Manager for the Offer is:
Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010-3629
(800) 646-4543 (toll free)
<PAGE> 1
Exhibit(a)(3)
KEITHLEY INSTRUMENTS, INC.
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF COMMON SHARES
This Notice of Guaranteed Delivery, or one substantially in the form
hereof, must be used to accept the Offer (as defined below) if certificates
evidencing common shares, without par value (the "Shares"), of Keithley
Instruments, Inc., an Ohio corporation (the "Company"), are not immediately
available, or if the procedure for book-entry transfer set forth in the Offer to
Purchase dated November 11, 1998 (the "Offer to Purchase"), and the related
Letter of Transmittal (which, as amended or supplemented from time to time,
together constitute the "Offer") cannot be completed on a timely basis or time
will not permit all required documents, including a properly completed and duly
executed Letter of Transmittal (or a manually signed facsimile thereof), to
reach the Depositary prior to the Expiration Date (as defined in the Offer to
Purchase).
This Notice of Guaranteed Delivery, properly completed and duly executed,
may be delivered by hand, mail or facsimile transmission to the Depositary. See
Section 3 of the Offer to Purchase.
The Depositary for the Offer is:
FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
<CAPTION>
<S> <C> <C>
By Mail: By Overnight Delivery: By Hand Delivery:
First Chicago Trust Company First Chicago Trust Company First Chicago Trust Company
of New York of New York of New York
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
Suite 4660 14 Wall Street c/o Securities Transfer &
P.O. Box 2569 8th Floor, Suite 4680 Reporting
Jersey City, NJ 07303-2569 New York, NY 10005 Services Inc.
100 William Street, Galleria
New York, NY 10038
Facsimile Transmission:
(201) 222-4720 or (201) 222-4721
</TABLE>
Confirm Receipt of Facsimile by Telephone:
(201) 222-4707
---------------------------
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER
THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. DELIVERIES TO THE
COMPANY WILL NOT BE FORWARDED TO THE DEPOSITARY AND THEREFORE WILL NOT
CONSTITUTE VALID DELIVERY. DELIVERIES TO THE BOOK-ENTRY TRANSFER FACILITY WILL
NOT CONSTITUTE VALID DELIVERY TO THE DEPOSITARY.
This Notice of Guaranteed Delivery form is not to be used to guarantee
signatures. If a signature on the Letter of Transmittal is required to be
guaranteed by an Eligible Institution (as defined in the Offer to Purchase)
under the instructions thereto, such signature guarantee must appear in the
applicable space provided in the signature box on the Letter of Transmittal.
<PAGE> 2
Ladies and Gentlemen:
The undersigned hereby tenders to the Company at the price per Share
indicated in this Notice of Guaranteed Delivery, upon the terms and subject to
the conditions set forth in the Offer to Purchase and the related Letter of
Transmittal, receipt of which is hereby acknowledged, the number of Shares
specified below pursuant to the guaranteed delivery procedure set forth in
Section 3 of the Offer to Purchase.
ODD LOTS
To be completed ONLY if Shares are being tendered by or on behalf of a
person owning beneficially or of record as of the close of business on November
10, 1998 and who continues to own, beneficially or of record, as of the
Expiration Date, an aggregate of fewer than 100 Shares. The undersigned either
(check one box):
[ ] was the beneficial or record owner of, as of the close of business on
November 10, 1998, and continues to own beneficially or of record as of the
Expiration Date, an aggregate of fewer than 100 Shares, all of which are
being tendered; or
[ ] is a broker, dealer, commercial bank, trust company, or other nominee that
(a) is tendering, for the beneficial owner(s) thereof, Shares with respect
to which it is the record holder, and (b) believes, based upon
representations made to it by such beneficial owner(s), that each such
person was the beneficial or record owner of, as of the close of business on
November 10, 1998, and continues to own beneficially or of record as of the
Expiration Date, an aggregate of fewer than 100 Shares and is tendering all
of such Shares.
2
<PAGE> 3
SHARES TENDERED AT PRICE DETERMINED BY DUTCH AUCTION
[ ] The undersigned wants to maximize the chance of having Keithley
Instruments, Inc. purchase all the Shares the undersigned is tendering (subject
to the possibility of proration). Accordingly, by checking this ONE box INSTEAD
OF ONE OF THE PRICE BOXES BELOW, the undersigned hereby tenders Shares and is
willing to accept the Purchase Price resulting from the Dutch Auction tender
process. This action will result in receiving a price per Share as low as $5.75
or as high as $7.00.
**CHECK EITHER THE BOX ABOVE OR CHECK ONE BOX BELOW**
SHARES TENDERED AT PRICE DETERMINED BY SHAREHOLDER
(SEE INSTRUCTION 5.)
By checking ONE of the boxes below INSTEAD OF THE BOX ABOVE, the
undersigned hereby tenders Shares at the price checked. This action could result
in none of the Shares being purchased if the Purchase Price for the Shares is
less than the price checked. A shareholder who desires to tender Shares at more
than one price must complete a separate notice of guaranteed delivery for each
price at which Shares are tendered. The same Shares cannot be tendered at more
than one price. IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED, THERE
IS NO VALID TENDER OF SHARES.
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED
<TABLE>
<S> <C> <C> <C>
[ ] $5.750 [ ] $ 6.500
[ ] $5.875 [ ] $ 6.625
[ ] $6.000 [ ] $ 6.750
[ ] $6.125 [ ] $ 6.875
[ ] $6.250 [ ] $ 7.000
[ ] $6.375
</TABLE>
Signature(s):
- ---------------------------------------
- ---------------------------------------
Name(s) of
Record Holder(s):
- ---------------------------------
PLEASE TYPE OR PRINT
- ------------------------------------------------------
- ------------------------------------------------------
Certificates Nos.
(if available):
- --------------------------------------
- ------------------------------------------------------
Address:
- --------------------------------------------
- ------------------------------------------------------
ZIP CODE
Area Code and
Telephone No.:
- ------------------------------------
If Shares will be delivered by book-entry transfer, provide the following
information:
Account Number:
- ----------------------------------
Date:
- ------------------------------------------------
3
<PAGE> 4
DELIVERY GUARANTEE
(NOT TO BE USED FOR A SIGNATURE GUARANTEE.)
THE UNDERSIGNED, A BANK, BROKER, DEALER, CREDIT UNION, SAVINGS ASSOCIATION
OR OTHER ENTITY WHICH IS A MEMBER IN GOOD STANDING OF THE SECURITIES TRANSFER
AGENTS MEDALLION PROGRAM OR A BANK, BROKER, DEALER, CREDIT UNION, SAVINGS
ASSOCIATION OR OTHER ENTITY WHICH IS AN "ELIGIBLE GUARANTOR INSTITUTION," AS
SUCH TERM IS DEFINED IN RULE 17AD-15 UNDER THE SECURITIES EXCHANGE ACT OF 1934,
AS AMENDED (EACH OF THE FOREGOING CONSTITUTING AN "ELIGIBLE INSTITUTION"),
GUARANTEES THE DELIVERY TO THE DEPOSITARY OF THE SHARES TENDERED HEREBY, IN
PROPER FORM FOR TRANSFER, OR A CONFIRMATION THAT THE SHARES TENDERED HEREBY HAVE
BEEN DELIVERED PURSUANT TO THE PROCEDURE FOR BOOK-ENTRY TRANSFER SET FORTH IN
THE OFFER TO PURCHASE INTO THE DEPOSITARY'S ACCOUNT AT THE BOOK-ENTRY TRANSFER
FACILITY, TOGETHER WITH A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF
TRANSMITTAL (OR A MANUALLY SIGNED FACSIMILE THEREOF) AND ANY OTHER REQUIRED
DOCUMENTS, ALL WITHIN THREE (3) NEW YORK STOCK EXCHANGE, INC. TRADING DAYS OF
THE DATE HEREOF.
The Eligible Institution that completes this form must communicate the
guarantee to the Depositary and must deliver the Letter of Transmittal and
certificates representing Shares to the Depositary within the time period set
forth herein. Failure to do so could result in a financial loss to such Eligible
Institution.
Name of Firm:
- ----------------------------------
Address:
- -----------------------------------------
- ---------------------------------------------------
ZIP CODE
Area Code and
Telephone No.:
- ---------------------------------
---------------------------------------------------
AUTHORIZED SIGNATURE
Name:
- -------------------------------------------
PLEASE PRINT
Title:
- --------------------------------------------
Date:
- --------------------------------------------
NOTE: DO NOT SEND SHARE CERTIFICATES WITH THIS FORM. CERTIFICATES FOR SHARES
SHOULD BE SENT WITH THE LETTER OF TRANSMITTAL.
4
<PAGE> 1
Exhibit(a)(4)
CREDIT SUISSE/FIRST BOSTON LOGO
CREDIT SUISSE FIRST BOSTON CORPORATION
Eleven Madison Avenue Telephone 212 325 2000
New York, NY 10010-3629
KEITHLEY INSTRUMENTS, INC.
OFFER TO PURCHASE FOR CASH UP TO
2,000,000 OF ITS COMMON SHARES
AT A PURCHASE PRICE NOT IN EXCESS OF $7.00
NOR LESS THAN $5.75 PER SHARE
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW
YORK CITY TIME, ON THURSDAY, DECEMBER 10, 1998, UNLESS THE OFFER IS EXTENDED.
November 11, 1998
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
Keithley Instruments, Inc., an Ohio corporation (the "Company"), has
engaged us to act as Dealer Manager in connection with its offer to purchase up
to 2,000,000 shares (or such lesser number of shares as are properly tendered)
of its common shares, without par value (the "Shares"), at prices not in excess
of $7.00 nor less than $5.75 per Share, net to the seller in cash, without
interest thereon, as specified by shareholders tendering their Shares, upon the
terms and subject to the conditions set forth in the Offer to Purchase dated
November 11, 1998 (the "Offer to Purchase"), and in the related Letter of
Transmittal (which, as amended or supplemented from time to time, together
constitute the "Offer").
The Company will, upon the terms and subject to the conditions of the
Offer, determine the single per Share price, not in excess of $7.00 nor less
than $5.75 per Share, net to the seller in cash, without interest thereon (the
"Purchase Price"), that it will pay for Shares properly tendered pursuant to the
Offer, taking into account the number of Shares so tendered and the prices
specified by tendering shareholders. The Company will select the lowest Purchase
Price that will allow it to buy 2,000,000 Shares (or such lesser number of
Shares as are properly tendered at prices not in excess of $7.00 nor less than
$5.75 per Share). All Shares properly tendered prior to the Expiration Date (as
defined in the Offer to Purchase) at prices at or below the Purchase Price and
not properly withdrawn, will be purchased at the Purchase Price, upon the terms
and subject to the conditions of the Offer, including the proration provisions.
All Shares acquired in the Offer will be acquired at the Purchase Price. Shares
tendered at prices in excess of the Purchase Price, and Shares not purchased
because of proration, will be returned at the Company's expense to the
shareholders who tendered such Shares. The Company reserves the right, in its
sole discretion, to purchase more than 2,000,000 Shares pursuant to the Offer.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS.
Upon the terms and subject to the conditions of the Offer, if at the
Expiration Date more than 2,000,000 Shares (or such greater number of Shares as
the Company may elect to purchase) are properly tendered at or below the
Purchase Price and not properly withdrawn, the Company will buy Shares first
from any person (an "Odd Lot Holder") who owned beneficially or of record as of
the close of business on November 10, 1998 and who continue to own beneficially
or of record as of the Expiration Date, an aggregate of fewer than 100 Shares
and so certified in the appropriate place in the Letter of Transmittal (and, if
applicable, on a notice of guaranteed delivery), who properly tender all their
Shares at or below the Purchase Price, and then on a pro rata basis from all
other shareholders who properly tender Shares at prices at or below the Purchase
Price (and do not properly withdraw such Shares prior to the Expiration Date).
For your information and for forwarding to those of your clients for whom
you hold Shares registered in your name or in the name of your nominee, we are
enclosing the following documents:
1. The Offer to Purchase dated November 11, 1998;
2. The Letter of Transmittal for your use and for the information of
your clients (together with the accompanying Substitute Form W-9).
Facsimile copies of the Letter of Transmittal (with manual signatures) may
be used to tender Shares;
<PAGE> 2
3. A letter to the shareholders of the Company dated November 11, 1998
from Joseph P. Keithley, President and Chief Executive Officer of the
Company;
4. The Notice of Guaranteed Delivery to be used to accept the Offer
and tender Shares pursuant to the Offer if none of the procedures for
tendering Shares set forth in the Offer to Purchase can be completed on a
timely basis;
5. A printed form of letter which may be sent to your clients for
whose accounts you hold Shares registered in your name or in the name of
your nominee, with an instruction form provided for obtaining such clients'
instructions with regard to the Offer;
6. Guidelines of the Internal Revenue Service for Certification of
Taxpayer Identification Number on Substitute Form W-9; and
7. A return envelope addressed to First Chicago Trust Company of New
York, as Depositary for the Offer (the "Depositary").
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS
PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER, PRORATION PERIOD AND
WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON
THURSDAY, DECEMBER 10, 1998, UNLESS THE OFFER IS EXTENDED.
In order to take advantage of the Offer, a duly executed and properly
completed Letter of Transmittal (or a manually signed facsimile thereof)
including any required signature guarantees and any other required documents
should be sent to the Depositary together with either certificate(s)
representing tendered Shares or timely confirmation of their book-entry
transfer, in accordance with the instructions set forth in the Offer to Purchase
and the related Letter of Transmittal.
Holders of Shares whose certificate(s) for such Shares are not immediately
available or who cannot deliver such certificate(s) and all other required
documents to the Depositary, or complete the procedures for book-entry transfer,
prior to the Expiration Date must tender their Shares according to the procedure
for guaranteed delivery set forth in Section 3 of the Offer to Purchase.
No fees or commissions will be payable by the Company or any officer,
director, shareholder, agent or other representative of the Company to any
broker, dealer or other person for soliciting tenders of Shares pursuant to the
Offer (other than fees paid to Credit Suisse First Boston Corporation, as Dealer
Manager, or MacKenzie Partners, Inc., as Information Agent, as described in the
Offer to Purchase). The Company will, however, upon request, reimburse you for
customary mailing and handling expenses incurred by you in forwarding any of the
enclosed materials to your clients whose Shares held by you as a nominee or in a
fiduciary capacity. The Company will pay any stock transfer taxes applicable to
its purchase of Shares, except as otherwise provided in the Letter of
Transmittal.
Any inquiries you may have with respect to the Offer should be addressed to
Credit Suisse First Boston Corporation, as Dealer Manager, Eleven Madison
Avenue, New York, New York 10010-3629, (800) 646-4543 (toll free), or to
MacKenzie Partners, Inc., as Information Agent, 156 Fifth Avenue, New York, New
York 10010, (212) 929-5500 (call collect) or (800) 322-2885 (toll free).
Requests for additional copies of the enclosed materials may be directed to the
Dealer Manager or the Information Agent at their respective addresses and
telephone numbers set forth above.
Very truly yours,
Credit Suisse First Boston Corporation
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON AS AN AGENT OF THE COMPANY, THE DEALER MANAGER, THE
INFORMATION AGENT OR THE DEPOSITARY OR ANY AFFILIATE OF ANY OF THE FOREGOING, OR
AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENT ON
BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE DOCUMENTS
ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED THEREIN.
<PAGE> 1
Exhibit(a)(5)
KEITHLEY INSTRUMENTS, INC.
OFFER TO PURCHASE FOR CASH UP TO
2,000,000 OF ITS COMMON SHARES
AT A PURCHASE PRICE NOT IN EXCESS OF $7.00
NOR LESS THAN $5.75 PER SHARE
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW
YORK CITY TIME, ON THURSDAY, DECEMBER 10, 1998, UNLESS THE OFFER IS EXTENDED.
November 11, 1998
To Our Clients:
Enclosed for your consideration are the Offer to Purchase dated November
11, 1998 (the "Offer to Purchase") and the related Letter of Transmittal (which,
as amended or supplemented from time to time, together constitute the "Offer")
in connection with the offer by Keithley Instruments, Inc., an Ohio corporation
(the "Company"), to purchase up to 2,000,000 shares (or such lesser number of
shares as are properly tendered) of its common shares, without par value (the
"Shares"), at prices not in excess of $7.00 nor less than $5.75 per Share, net
to the seller in cash, without interest thereon, as specified by shareholders
tendering their Shares, upon the terms and subject to the conditions of the
Offer.
The Company will, upon the terms and subject to the conditions of the
Offer, determine the single per Share price, not in excess of $7.00 nor less
than $5.75 per Share, net to the seller in cash, without interest thereon (the
"Purchase Price"), that it will pay for Shares properly tendered pursuant to the
Offer, taking into account the number of Shares so tendered and the prices
specified by tendering shareholders. The Company will select the lowest Purchase
Price that will allow it to buy 2,000,000 Shares (or such lesser number of
Shares as are properly tendered at prices not in excess of $7.00 nor less than
$5.75 per Share). All Shares properly tendered prior to the Expiration Date (as
defined in the Offer to Purchase) at prices at or below the Purchase Price, and
not properly withdrawn, will be purchased at the Purchase Price upon the terms
and subject to the conditions of the Offer, including the proration provisions.
All Shares acquired in the Offer will be acquired at the Purchase Price. Shares
tendered at prices in excess of the Purchase Price, and Shares not purchased
because of proration will be returned at the Company's expense to the
shareholders who tendered such Shares. The Company reserves the right, in its
sole discretion, to purchase more than 2,000,000 Shares pursuant to the Offer.
Upon the terms and subject to the conditions of the Offer, if at the
Expiration Date more than 2,000,000 Shares (or such greater number of Shares as
the Company may elect to purchase) are properly tendered at or below the
Purchase Price and not properly withdrawn, the Company will buy Shares first
from any person (an "Odd Lot Holder") who owned beneficially or of record as of
the close of business on November 10, 1998, and who continue to own beneficially
or of record as of the Expiration Date, an aggregate of fewer than 100 Shares
and so certified in the appropriate place in the attached Instruction Form (and,
if applicable, on a notice of guaranteed delivery), who properly tender all
their Shares at or below the Purchase Price and then on a pro rata basis from
all other shareholders who properly tender Shares at prices at or below the
Purchase Price (and do not properly withdraw such Shares prior to the Expiration
Date).
A TENDER OF YOUR SHARES CAN BE MADE ONLY BY US AS THE HOLDER OF RECORD
THEREOF AND PURSUANT TO YOUR INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS
FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER
YOUR SHARES HELD BY US FOR YOUR ACCOUNT.
Accordingly, we request instructions as to whether you wish to tender any
or all of the Shares held by us for your account, upon the terms and subject to
the conditions of the Offer.
Please note the following:
1. Shares may be tendered at prices not in excess of $7.00 nor less
than $5.75 per Share, as indicated in the attached Instruction Form, net to
the seller in cash, without interest thereon.
<PAGE> 2
2. The Offer is not conditioned on any minimum number of Shares being
tendered. The Offer is, however, subject to certain other conditions set
forth in the Offer to Purchase.
3. The Offer, proration period and withdrawal rights will expire at
12:00 Midnight, New York City time, on Thursday, December 10, 1998, unless
the Offer is extended.
4. The Offer is for 2,000,000 Shares, constituting approximately 40.0%
of the Shares outstanding as of November 10, 1998.
5. The Board of Directors of the Company has approved the Offer.
However, none of the Company, its Board of Directors or the Dealer Manager
makes any recommendation to shareholders as to whether to tender or refrain
from tendering their Shares. Each shareholder must make the decision
whether to tender such shareholder's Shares and, if so, how many Shares to
tender and at the price or prices at which such Shares should be tendered.
6. Tendering shareholders will not be obligated to pay any brokerage
fees or commissions or solicitation fees to the Dealer Manager, Depositary,
Information Agent or the Company or, except as set forth in the Letter of
Transmittal, stock transfer taxes on the transfer of Shares pursuant to the
Offer.
If (i) you owned beneficially or of record as of the close of business on
November 10, 1998, and continue to own beneficially or of record as of the
Expiration Date, an aggregate of fewer than 100 Shares; (ii) you instruct us to
tender on your behalf all such Shares at or below the Purchase Price prior to
the Expiration Date; and (iii) you complete the section entitled "Odd Lots" in
the attached Instruction Form, the Company, upon the terms and subject to the
conditions of the Offer, will accept all such Shares for purchase before
proration, if any, of the purchase of other Shares properly tendered at or below
the Purchase Price.
If you wish to tender portions of your Shares at different prices, you must
complete a separate Instruction Form for each price at which you wish to tender
each such portion of your Shares. We must submit separate Letters of Transmittal
on your behalf for each such price you will accept for each such portion
tendered.
If you wish to have us tender any or all of your Shares, please so instruct
us by completing, executing, detaching and returning to us the attached
Instruction Form. An envelope to return your Instruction Form to us is enclosed.
If you authorize us to tender your Shares, all such Shares will be tendered
unless otherwise indicated on the attached Instruction Form.
PLEASE FORWARD YOUR INSTRUCTION FORM TO US AS SOON AS POSSIBLE TO ALLOW US
AMPLE TIME TO TENDER YOUR SHARES ON YOUR BEHALF PRIOR TO THE EXPIRATION OF THE
OFFER.
As described in the Offer to Purchase, if more than 2,000,000 Shares (or
such greater number of Shares as the Company may elect to purchase) have been
properly tendered at or below the Purchase Price and not properly withdrawn
prior to the Expiration Date, the Company will purchase tendered Shares on the
basis set forth below:
1. first, all Shares tendered and not withdrawn prior to the
Expiration Date by any Odd Lot Holder who:
(a) tenders all Shares owned beneficially or of record by such Odd
Lot Holder at a price at or below the Purchase Price (tenders of less
than all Shares owned by such Odd Lot Holder will not qualify for this
preference); and
(b) completes the box captioned "Odd Lots" in the attached
Instruction Form and, if applicable, on the Notice of Guaranteed
Delivery; and
2. second, after purchase of all of the foregoing Shares, all other
Shares properly tendered at prices at or below the Purchase Price and not
properly withdrawn prior to the Expiration Date, on a pro rata basis (with
appropriate adjustments to avoid purchases of fractional Shares) as
described in the Offer to Purchase.
The Offer is being made solely pursuant to the Offer to Purchase and the
related Letter of Transmittal and is being made to all holders of Shares who
were record holders as of November 10, 1998. The Offer is not being made to, nor
will tenders be accepted from or on behalf of, holders of Shares residing in any
jurisdiction in which the making of the Offer or acceptance thereof would not be
in compliance with the securities laws of such jurisdiction.
2
<PAGE> 3
INSTRUCTION FORM
INSTRUCTIONS FOR TENDER OF SHARES OF KEITHLEY INSTRUMENTS, INC.
The undersigned acknowledge(s) receipt of your letter and the enclosed
Offer to Purchase dated November 11, 1998 (the "Offer to Purchase") and the
related Letter of Transmittal (which, as amended or supplemented from time to
time, together constitute the "Offer") in connection with the offer by Keithley
Instruments, Inc., an Ohio corporation (the "Company"), to purchase up to
2,000,000 shares (or such lesser number of shares as are properly tendered) of
its common shares, without par value (the "Shares"), at prices not in excess of
$7.00 nor less than $5.75 per Share, net to the seller in cash, without interest
thereon, as specified by shareholders tendering their Shares, upon the terms and
subject to the conditions of the Offer.
This will instruct you to tender to the Company, on (our) (my) behalf, the
number of Shares indicated below (or if no number is indicated below, all
Shares) which are beneficially owned by (us) (me) and registered in your name,
upon terms and subject to the conditions of Offer.
NUMBER OF SHARES TO BE TENDERED: __________________ SHARES*
ODD LOTS
[ ]By checking this box the undersigned represents that the undersigned owned
beneficially or of record as of the close of business on November 10, 1998
and continues to own beneficially or of record as of the Expiration Date, an
aggregate of fewer than 100 Shares and is tendering all of such Shares.
- -------------------------
* Unless otherwise indicated, it will be assumed that all Shares held by us for
your account are to be tendered.
<PAGE> 4
SHARES TENDERED AT PRICE DETERMINED BY DUTCH AUCTION
[ ] The undersigned wants to maximize the chance of having Keithley
Instruments, Inc. purchase all the shares the undersigned is tendering (subject
to the possibility of proration). Accordingly, by checking this ONE box INSTEAD
OF ONE OF THE PRICE BOXES BELOW, the undersigned hereby tenders Shares and is
willing to accept the Purchase Price resulting from the Dutch Auction tender
process. This action will result in receiving a price per Share as low as $5.75
or as high as $7.00.
**CHECK EITHER THE BOX ABOVE OR CHECK ONE BOX BELOW**
SHARES TENDERED AT PRICE DETERMINED BY SHAREHOLDER
(SEE INSTRUCTION 5.)
By checking ONE of the boxes below INSTEAD OF THE BOX ABOVE, the
undersigned hereby tenders Shares at the price checked. This action could result
in none of the Shares being purchased if the Purchase Price for the Shares is
less than the price checked. A shareholder who desires to tender Shares at more
than one price must complete a separate letter of transmittal for each price at
which Shares are tendered. The same Shares cannot be tendered at more then one
price. IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED, THERE IS NO
VALID TENDER OF SHARES.
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED
<TABLE>
<S> <C> <C> <C>
[ ] $5.750 [ ] $6.500
[ ] $5.875 [ ] $6.625
[ ] $6.000 [ ] $6.750
[ ] $6.125 [ ] $6.875
[ ] $6.250 [ ] $7.000
[ ] $6.375
</TABLE>
THE METHOD OF DELIVERY OF THIS DOCUMENT IS AT THE OPTION AND RISK OF THE
TENDERING SHAREHOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN
RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT
TIME SHOULD BE ALLOWED TO ASSURE DELIVERY.
SIGN HERE:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Signature(s)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Print Name(s)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Address(es)
- --------------------------------------------------------------------------------
Area Code and Telephone Number
- --------------------------------------------------------------------------------
Taxpayer Identification or Social Security Number
THIS FORM MUST BE RETURNED TO THE
BROKERAGE FIRM MAINTAINING YOUR ACCOUNT
<PAGE> 1
Exhibit(a)(6)
KEITHLEY INSTRUMENTS, INC.
OFFER TO PURCHASE FOR CASH UP TO
2,000,000 OF ITS COMMON SHARES
AT A PURCHASE PRICE NOT IN EXCESS OF $7.00
NOR LESS THAN $5.75 PER SHARE
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW
YORK CITY TIME, ON THURSDAY, DECEMBER 10, 1998, UNLESS THE OFFER IS EXTENDED;
HOWEVER, YOUR INSTRUCTION FORM MUST BE COMPLETED, SIGNED, DATED AND RECEIVED BY
THE ADMINISTRATOR NO LATER THAN 5:00 P.M., NEW YORK CITY TIME, ON TUESDAY,
DECEMBER 8, 1998.
November 11, 1998
To Participants in the Keithley Instruments, Inc. 1993 Employee Stock Purchase
Plan:
Enclosed for your consideration are the Offer to Purchase dated November
11, 1998 (the "Offer to Purchase") and the related Letter of Transmittal (which,
as amended or supplemented from time to time, together constitute the "Offer")
in connection with the offer by Keithley Instruments, Inc., an Ohio corporation
(the "Company"), to purchase up to 2,000,000 shares (or such lesser number of
shares as are properly tendered) of its common shares, without par value (the
"Shares"), at prices not in excess of $7.00 nor less than $5.75 per Share, net
to the seller in cash, without interest thereon, as specified by shareholders
tendering their Shares, upon the terms and subject to the conditions of the
Offer. The materials enclosed herein are being forwarded to you as the
beneficial owner of Shares credited to your account under the Company's 1993
Employee Stock Purchase Plan (the "Plan").
The Company will, upon the terms and subject to the conditions of the
Offer, determine the single per Share price, not in excess of $7.00 nor less
than $5.75 per Share, net to the seller in cash, without interest thereon (the
"Purchase Price"), that it will pay for Shares properly tendered pursuant to the
Offer, taking into account the number of Shares so tendered and the prices
specified by tendering shareholders. The Company will select the lowest Purchase
Price that will allow it to buy 2,000,000 Shares (or such lesser number of
Shares as are properly tendered at prices not in excess of $7.00 nor less than
$5.75 per Share). All Shares properly tendered prior to the Expiration Date (as
defined in the Offer to Purchase) at prices at or below the Purchase Price, and
not properly withdrawn, will be purchased at the Purchase Price, upon the terms
and subject to the conditions of the Offer, including the proration provisions.
All Shares acquired in the Offer will be acquired at the Purchase Price. Shares
tendered at prices in excess of the Purchase Price and Shares not purchased
because of proration will be credited back to your Employee Stock Purchase Plan
account. The Company reserves the right, in its sole discretion, to purchase
more than 2,000,000 Shares pursuant to the Offer.
Upon the terms and subject to the conditions of the Offer, if at the
Expiration Date more than 2,000,000 Shares (or such greater number of Shares as
the Company may elect to purchase) are properly tendered at or below the
Purchase Price and not properly withdrawn, the Company will buy Shares first
from any person (an "Odd Lot Holder") who owned beneficially or of record as of
the close of business on November 10, 1998 and who continue to own beneficially
or of record as of the Expiration Date, an aggregate of fewer than 100 Shares
and so certified in the appropriate place in the attached Instruction Form (and,
if applicable, on a notice of guaranteed delivery), who properly tender all
their Shares at or below the Purchase Price and then on a pro rata basis from
all other shareholders who properly tender Shares at prices at or below the
Purchase Price (and do not properly withdraw such Shares prior to the Expiration
Date).
A TENDER OF YOUR SHARES CAN BE MADE ONLY BY US AS THE HOLDER OF RECORD
THEREOF AND PURSUANT TO YOUR INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS
FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER
YOUR SHARES HELD BY US FOR YOUR ACCOUNT.
Accordingly, we request instructions as to whether you wish to tender any
or all of the Shares held by us for your account, upon the terms and subject to
the conditions of the Offer.
<PAGE> 2
Please note the following:
1. Shares may be tendered at prices not in excess of $7.00 nor less
than $5.75 per Share, as indicated in the attached Instruction Form, net to
the seller in cash, without interest thereon.
2. The Offer is not conditioned on any minimum number of Shares being
tendered. The Offer is, however, subject to certain other conditions set
forth in the Offer to Purchase.
3. The Offer, proration period and withdrawal rights will expire at
12:00 Midnight, New York City time, on Thursday, December 10, 1998, unless
the Offer is extended; however, your instruction form must be completed,
signed, dated and received by First Chicago Trust Company of New York, as
administrator of the Plan (the "Administrator") no later than 5:00 P.M.,
New York City time, on Tuesday, December 8, 1998.
4. The Offer is for 2,000,000 Shares, constituting approximately 40.0%
of the Shares outstanding as of November 10, 1998.
5. The Board of Directors of the Company has approved the Offer.
However, none of the Company, its Board of Directors or the Dealer Manager
makes any recommendation to shareholders as to whether to tender or refrain
from tendering their Shares. Each shareholder must make the decision
whether to tender such shareholder's Shares and, if so, how many Shares to
tender and at the price or prices at which such Shares should be tendered.
6. Tendering shareholders will not be obligated to pay any brokerage
fees or commissions or solicitation fees to the Dealer Manager, the
Administrator (either as the Administrator or as the depositary for the
Offer), Information Agent or the Company or, except as set forth in the
Letter of Transmittal, stock transfer taxes on the transfer of Shares
pursuant to the Offer.
If (i) you owned beneficially as of the close of business on November 11,
1998 and continue to own beneficially as of the Expiration Date, an aggregate of
fewer than 100 Shares; (ii) you instruct us to tender on your behalf all such
Shares at or below the Purchase Price prior to the Expiration Date; and (iii)
you complete the section entitled "Odd Lots" in the attached Instruction Form,
the Company, upon the terms and subject to the conditions of the Offer, will
accept all such Shares for purchase before proration, if any, of the purchase of
other Shares properly tendered at or below the Purchase Price.
If you wish to tender portions of your Shares at different prices, you must
complete a separate Instruction Form for each price at which you wish to tender
each such portion of your Shares. We must submit separate Letters of Transmittal
on your behalf for each such price you will accept for each such portion
tendered.
If you wish to have us tender any or all of your Shares, please so instruct
us by completing, executing, detaching and returning to us the attached
Instruction Form. An envelope to return your Instruction Form to us is enclosed.
If you authorize us to tender your Shares, all such Shares will be tendered
unless otherwise indicated on the attached Instruction Form.
In order to be assured that your instruction to the Administrator, will be
followed, your instruction form must be completed, signed, dated and received by
the Administrator no later than 5:00 p.m., New York City time, on Tuesday,
December 8, 1998. This time is two business days prior to the expiration of the
Offer, which is scheduled at 12:00 Midnight, New York City time, on Thursday,
December 10, 1998. If the expiration of the Offer is extended, the time by which
the Administrator must receive your instruction will be extended automatically
to two business days prior to such extended expiration time. Please remember to
return your instruction to the Administrator in the enclosed envelope, and not
to the Company or any other party.
Tenders of Shares made pursuant to the Offer are irrevocable, except that
Shares tendered pursuant to the Offer may be withdrawn at any time on or prior
to the expiration of the Offer. See Section 4 of the Offer to Purchase.
Therefore, any instruction you furnish to the Administrator will be irrevocable
if not withdrawn by 5:00 p.m., New York City time on Tuesday, December 8, 1998.
This time is two business days prior to the expiration of the Offer. If the
expiration of the Offer is extended beyond its scheduled expiration time, the
time by which you may withdraw such instruction will be extended automatically
to two business days prior to such extended expiration time. To withdraw any
instruction, you should send a statement to the Administrator that you are
withdrawing your prior instruction and request another form. You must sign the
form and print your name, address and social security number under your
signature. This statement may be sent by mail or
2
<PAGE> 3
express mail to the address below, with attention to the Keithley Instruments,
Inc. 1993 Employee Stock Purchase Plan -- Tender Offer.
By Mail:
First Chicago Trust Company of New York
Tenders & Exchanges
Suite 4660
P.O. Box 2569
Jersey City, New Jersey 07303-2569
By Overnight Delivery:
First Chicago Trust Company of New York
Tenders & Exchanges
14 Wall Street
8th Floor, Suite 4680
New York, New York 10005
As described in the Offer to Purchase, if more than 2,000,000 Shares (or
such greater number of Shares as the Company may elect to purchase) have been
properly tendered at or below the Purchase Price and not properly withdrawn
prior to the Expiration Date, the Company will purchase tendered Shares on the
basis set forth below:
1. first, all Shares tendered and not withdrawn prior to the
Expiration Date by any Odd Lot Holder who:
(a) tenders all Shares owned beneficially or of record by such Odd
Lot Holder at a price at or below the Purchase Price (tenders of less
than all Shares owned by such Odd Lot Holder will not qualify for this
preference); and
(b) completes the box captioned "Odd Lots" in the attached
Instruction Form and if applicable on the Notice of Guaranteed Delivery;
and
2. second, after purchase of all of the foregoing Shares, all other
Shares properly tendered at prices at or below the Purchase Price and not
properly withdrawn prior to the Expiration Date, on a pro rata basis (with
appropriate adjustments to avoid purchases of fractional Shares) as
described in the Offer to Purchase.
The Offer is being made solely pursuant to the Offer to Purchase and the
related Letter of Transmittal and is being made to all holders of Shares who
were record holders as of November 11, 1998. The Offer is not being made to, nor
will tenders be accepted from or on behalf of, holders of Shares residing in any
jurisdiction in which the making of the Offer or acceptance thereof would not be
in compliance with the securities laws of such jurisdiction.
THE FIRST CHICAGO TRUST
COMPANY OF NEW YORK, AS
ADMINISTRATOR UNDER THE
KEITHLEY INSTRUMENTS, INC.
1993 EMPLOYEE STOCK PURCHASE
PLAN
3
<PAGE> 4
[This Page Intentionally Left Blank]
<PAGE> 5
[This Page Intentionally Left Blank]
<PAGE> 6
[This Page Intentionally Left Blank]
<PAGE> 7
PLEASE DETACH AND RETURN IN THE ENCLOSED ENVELOPE
INSTRUCTION FORM
INSTRUCTIONS FOR TENDER OF SHARES OF KEITHLEY INSTRUMENTS, INC.
The undersigned acknowledge(s) receipt of your letter and the enclosed
Offer to Purchase dated November 11, 1998 (the "Offer to Purchase") and the
related Letter of Transmittal (which, as amended or supplemented from time to
time, together constitute the "Offer") in connection with the offer by Keithley
Instruments, Inc., an Ohio corporation (the "Company"), to purchase up to
2,000,000 shares (or such lesser number of shares as are properly tendered) of
its common shares, without par value (the "Shares"), at prices not in excess of
$7.00 nor less than $5.75 per Share, net to the seller in cash, without interest
thereon, as specified by shareholders tendering their Shares, upon the terms and
subject to the conditions of the Offer.
This will instruct you to tender to the Company, on (our) (my) behalf, the
number of Shares indicated below (or if no number is indicated below, all
Shares) which are beneficially owned by (us) (me) and registered in your name,
upon terms and subject to the conditions of Offer.
NUMBER OF SHARES TO BE TENDERED: ________________ SHARES*
ODD LOTS
[ ]By checking this box the undersigned represents that the undersigned owned
beneficially or of record as of the close of business on November 10, 1998
and continues to own beneficially or of record as of the Expiration Date, an
aggregate of fewer than 100 Shares and is tendering all of such Shares.
- -------------------------
* Unless otherwise indicated, it will be assumed that all Shares held by us for
your account are to be tendered.
SHARES TENDERED AT PRICE DETERMINED BY DUTCH AUCTION
[ ] The undersigned wants to maximize the chance of having Keithley
Instruments, Inc. purchase all the shares the undersigned is tendering (subject
to the possibility of proration). Accordingly, by checking this ONE box INSTEAD
OF ONE OF THE PRICE BOXES BELOW, the undersigned hereby tenders Shares and is
willing to accept the Purchase Price resulting from the Dutch Auction tender
process. This action will result in receiving a price per Share as low as $5.75
or as high as $7.00.
**CHECK EITHER THE BOX ABOVE OR CHECK ONE BOX BELOW**
SHARES TENDERED AT PRICE DETERMINED BY SHAREHOLDER
By checking ONE of the boxes below INSTEAD OF THE BOX ABOVE, the
undersigned hereby tenders Shares at the price checked. This action could result
in none of the Shares being purchased if the Purchase Price for the Shares is
less than the price checked. A shareholder who desires to tender Shares at more
than one price must complete a separate instruction form for each price at which
Shares are tendered. the same Shares cannot be tendered at more then one price.
IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED, THERE IS NO VALID
TENDER OF SHARES.
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED
<TABLE>
<S> <C> <C> <C>
[ ] $5.750 [ ] $6.500
[ ] $5.875 [ ] $6.625
[ ] $6.000 [ ] $6.750
[ ] $6.125 [ ] $6.875
[ ] $6.250 [ ] $7.000
[ ] $6.375
</TABLE>
<PAGE> 8
THE METHOD OF DELIVERY OF THIS DOCUMENT IS AT THE OPTION AND RISK OF THE
TENDERING SHAREHOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN
RECEIPT REQUESTED IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE
ALLOWED TO ASSURE DELIVERY.
SIGN HERE:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Signature(s)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Print Name(s)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Address(es)
- --------------------------------------------------------------------------------
Area Code and Telephone Number
- --------------------------------------------------------------------------------
Taxpayer Identification or Social Security Number
THIS FORM MUST BE RETURNED TO FIRST CHICAGO TRUST COMPANY OF NEW YORK, AS
ADMINISTRATOR OF THE PLAN
PLEASE DETACH AND RETURN IN THE ENCLOSED ENVELOPE
<PAGE> 1
Exhibit(a)(7)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
KEITHLEY LOGO KEITHLEY INSTRUMENTS, INC.
28775 Aurora Road
Solon, Ohio 44139
(440) 248-0400
Fax (440) 248-6168
</TABLE>
November 11, 1998
To Our Shareholders:
Keithley Instruments, Inc. (the "Company") is offering to purchase up to
2,000,000 of its common shares, without par value (the "Shares"), from existing
shareholders. The purchase price will not be in excess of $7.00 nor less than
$5.75 per Share. The Company is conducting the offer through a procedure
commonly referred to as a "Dutch Auction." This procedure allows you to select
the price within the range of $5.75 to $7.00 at which you are willing to sell
your Shares to the Company. The actual purchase price will be determined by the
Company in accordance with the terms of the offer. The Offer represents
approximately 40.0% of the currently outstanding Shares.
The Company's Class B Common Shares, without par value (the "Class B
Shares"), are convertible into Shares at any time, on a share-for-share basis
and may be tendered in the Offer following conversion. In addition, I
beneficially own 2,649,586 Class B Shares and do not intend to tender or cause
to be tendered any such shares in the Offer.
Any shareholder whose Shares are properly tendered directly to First
Chicago Trust Company of New York, the Depositary for the offer, and purchased
pursuant to the offer will receive the net purchase price in cash, without
interest, and will not incur the usual transaction costs associated with open
market sales. Shareholders who own fewer than 100 shares should note that the
offer represents an opportunity for them to sell some or all of their shares
without having to pay brokerage commissions or odd lot discounts.
The terms and conditions of the offer are explained in detail in the
enclosed Offer to Purchase and the related Letter of Transmittal. I encourage
you to read these materials carefully before making any decision with respect to
the offer. The instructions on how to tender Shares are also explained in detail
in the accompanying materials.
Neither the Company nor the Board of Directors of the Company makes any
recommendation to shareholders as to whether to tender or refrain from tendering
their Shares. Each shareholder must make the decision whether to tender such
shareholder's Shares and, if so, how many Shares to tender and the price or
prices at which such Shares should be tendered. The Company has been advised
that none of its directors, executive officers or affiliates controlled by such
persons intends to tender any Shares pursuant to the offer.
The offer will expire at 12:00 Midnight, New York City time, on Thursday,
December 10, 1998, unless extended by the Company. If you have any questions
regarding the offer or need assistance in tendering your Shares, please contact
MacKenzie Partners, Inc., the Information Agent for the offer, at (800) 322-2885
or Credit Suisse First Boston Corporation, the Dealer Manager for the offer, at
(800) 646-4543.
Sincerely,
/s/ Joseph P. Keithley
Joseph P. Keithley
President and Chief Executive Officer
<PAGE> 1
Exhibit(a)(8)
GUIDELINES FOR CERTIFICATION 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.,
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen: i.e., 00-0000000. The table below will help determine the number to
give the payer.
- ------------------------------------------------------------
- ------------------------------------------------------------
<TABLE>
<CAPTION>
GIVE THE SOCIAL
FOR THIS TYPE OF ACCOUNT: SECURITY NUMBER OF:
- ----------------------------------------------------
<S> <C>
1. An individual's The individual
account
2. Two or more The actual owner of the
individuals account or, if combined
(joint account) funds, any one of other
individuals(1)
3. Husband and wife The actual owner of the
(joint account) account or, if joint
funds, either person(1)
4. Custodian account of The minor(2)
a minor (Uniform Gift
to Minors Act)
5. Adult and minor The adult or, if the
(joint account) minor is the only
contributor, the
minor(1)
6. Account in the name The ward, minor, or
of guardian or incompetent person(3)
committee for a
designated ward,
minor, or incompetent
person
7. a. The usual The grantor-trustee(1)
revocable savings
trust account
(grantor is also
trustee)
b. So-called trust The actual owner(1)
account that is
not a legal or
valid trust under
State law
8. Sole proprietorship The owner(4)
account
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------
FOR THIS TYPE OF ACCOUNT: GIVE THE EMPLOYER
IDENTIFICATION
NUMBER OF:
<S> <C>
9. A valid trust, The legal entity (do
estate, or pension not furnish the
trust identification number
of the personal
representative or
trustee unless the
legal entity itself is
not designated in the
account title)(5)
10. Corporate account The organization
11. Religious, The corporation
charitable, or
educational
organization account
12. Partnership account The partnership
13. Association, club or The organization
other tax-exempt
organization
14. A broker or The broker or nominee
registered nominee
15. Account with the The public entity
Department of
Agriculture in the
name 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) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) List first and circle the name of the legal trust, estate, or pension trust.
NOTE: If no name is circled when there is more than one name, the number will be
considered to be that of the first name listed.
<PAGE> 2
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER OF SUBSTITUTE FORM W-9
PAGE 2
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you 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 including
the following:
- - A corporation.
- - A financial institution.
- - An organization exempt from tax under section 501(a) of the Internal Revenue
Code of 1986, as amended (the "Code"), or an individual retirement plan.
- - 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.
- - An international organization or any agency or instrumentality thereof.
- - A registered dealer in securities or commodities registered in the U.S. or a
possession of the U.S.
- - A real estate investment trust. A common trust fund operated by a bank under
section 584(a) of the Code.
- - An exempt charitable remainder trust, or a non-exempt trust described in
section 4947(a)(1) of the Code.
- - An entity registered at all times under the Investment Company Act of 1940.
- - A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to
backup withholding include the following:
- - Payments to nonresident aliens subject to withholding under section 1441 of
the Code.
- - Payments to partnerships not 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 renewed 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) of the Code.
- - Payments described in section 6049(b)(5) of the Code to non-resident aliens.
- - Payments on tax-free covenant bonds under section 1451 of the Code.
- - Payments made by certain foreign organizations. Payments made to a nominee.
EXEMPT PAYEES DESCRIBED ABOVE MUST STILL COMPLETE THE SUBSTITUTE FORM W-9
ENCLOSED HEREWITH TO AVOID POSSIBLE ERRONEOUS BACKUP WITHHOLDING. FILE
SUBSTITUTE FORM W-9 WITH THE PAYER, REMEMBERING TO CERTIFY YOUR TAXPAYER
IDENTIFICATION NUMBER ON PART III OF THE FORM, WRITE "EXEMPT" ON THE FACE OF THE
FORM AND 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 sections 6041, 6041A(a), 6042, 6044,
6045, 6049, 6050A, and 6050N of the Code and their regulations.
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 a tax return.
Payers must generally withhold 31% 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 YOUR TAX CONSULTANT OR THE INTERNAL REVENUE
SERVICE.
<PAGE> 1
Exhibit(a)(9)
This announcement is neither an offer to purchase nor a solicitation of an offer
to sell Shares. The Offer is made solely by the Offer to Purchase dated November
11, 1998 and the related Letter of Transmittal, and any amendments or
supplements thereto, which are being mailed to all holders of Shares. The
Company is not aware of any jurisdiction where the making of the Offer is not in
compliance with applicable law. If the Company becomes aware of any jurisdiction
where the making of the Offer or the acceptance of Shares pursuant thereto is
not in compliance with applicable law, the Company will make a good faith effort
to comply with the applicable law. If, after such good faith effort, the Company
cannot comply with the applicable law, the Offer will not be made to (nor will
tenders be accepted from or on behalf of) the holders of Shares in such
jurisdiction. In any jurisdiction where the securities, blue sky or other laws
require the Offer to be made by a licensed broker or dealer, the Offer shall be
deemed to be made on behalf of the Company by Credit Suisse First Boston
Corporation ("Credit Suisse First Boston" or the "Dealer Manager") or one or
more registered brokers or dealers licensed under the laws of such jurisdiction.
NOTICE OF OFFER TO PURCHASE FOR CASH
BY
KEITHLEY INSTRUMENTS, INC.
UP TO 2,000,000 OF ITS COMMON SHARES
AT A PURCHASE PRICE NOT IN EXCESS OF $7.00
NOR LESS THAN $5.75 PER SHARE IN CASH
Keithley Instruments, Inc., an Ohio corporation (the "Company"), invites
its shareholders to tender up to 2,000,000 common shares, without par value
(the "Shares"), to the Company at prices not in excess of $7.00 nor less than
$5.75 per Share, net to the seller in cash, without interest thereon, as
specified by shareholders tendering their Shares, upon the terms and subject to
the conditions set forth in the Offer to Purchase dated November 11, 1998 and
in the related Letter of Transmittal (which, as amended or supplemented from
time to time, together constitute the "Offer").
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 12:00
MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, DECEMBER 10, 1998,
UNLESS THE OFFER IS EXTENDED.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS SET FORTH
IN THE OFFER TO PURCHASE.
THE BOARD OF DIRECTORS OF THE COMPANY HAS APPROVED THE OFFER. HOWEVER,
NONE OF THE COMPANY, ITS BOARD OF DIRECTORS OR THE DEALER MANAGER MAKES ANY
RECOMMENDATION TO SHAREHOLDERS AS TO WHETHER TO TENDER OR REFRAIN FROM
TENDERING THEIR SHARES. EACH SHAREHOLDER MUST MAKE THE DECISION WHETHER TO
TENDER SUCH SHAREHOLDER'S SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE
PRICE OR PRICES AT WHICH SUCH SHARES SHOULD BE TENDERED. THE COMPANY HAS BEEN
ADVISED THAT NONE OF ITS DIRECTORS OR EXECUTIVE OFFICERS INTENDS TO TENDER ANY
SHARES PURSUANT TO THE OFFER.
The Company will, upon the terms and subject to the conditions of the
Offer, determine the single per Share price, not in excess of $7.00 nor less
than $5.75 per Share, net to the seller in cash, without interest thereon (the
"Purchase Price"), that it will pay for Shares properly tendered pursuant to
the Offer, taking into account the number of Shares so tendered and the prices
specified by tendering shareholders. The Company will select the lowest
Purchase Price that will allow it to buy 2,000,000 Shares (or such lesser
number of Shares as are properly tendered at prices not in excess of $7.00 nor
less than $5.75 per Share). All Shares properly tendered prior to the
Expiration Date (as defined below) at prices at or below the Purchase Price and
not properly withdrawn will be purchased at the Purchase Price, upon the terms
and subject to the conditions of the Offer, including the proration provisions.
UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE FOR THE
SHARES, REGARDLESS OF ANY DELAY IN MAKING SUCH PAYMENT. All Shares acquired in
the Offer will be acquired at the Purchase Price. The term "Expiration Date"
means 12:00 Midnight, New York City time, on Thursday, December 10, 1998,
unless and until the Company, in its sole discretion, shall have extended the
period of time during which the Offer will remain open, in which event the term
"Expiration Date" shall refer to the latest time and date at which the Offer,
as so extended by the Company, shall expire. The Company reserves the right, in
its sole discretion, to purchase more than 2,000,000 Shares pursuant to the
Offer. For purposes of the Offer, the Company will be deemed to have accepted
for payment (and therefore purchased) Shares properly tendered at or below the
Purchase Price and not properly withdrawn (subject to the proration provisions
of the Offer) only when, as and if the Company gives oral or written notice to
First Chicago Trust Company of New York (the "Depositary") of its acceptance of
such Shares for payment pursuant to the Offer. Payment for Shares tendered and
accepted for payment pursuant to the Offer will be made only after timely
receipt by the Depositary of certificates for such Shares (or a timely
confirmation of a book-entry transfer of such Shares into the Depositary's
account at the Book-Entry Transfer Facility (as defined in the Offer to
Purchase)), a properly completed and duly executed Letter of Transmittal (or a
manually signed facsimile thereof) and any other documents required by the
Letter of Transmittal.
The Board of Directors of the Company has determined that the Company's
financial condition and outlook and current market conditions, including recent
trading prices of the Shares, make this an attractive time to repurchase a
significant portion of the outstanding Shares. In the view of the Board of
Directors, the Offer represents an attractive investment for the Company that
should benefit the Company and its shareholders over the long term. In
particular, the Board of Directors believes that the purchase of Shares at this
time is consistent with the Company's long-term corporate goal of seeking to
increase shareholder value. Accordingly, the Company is providing shareholders
with the opportunity to determine the price or prices (not greater than $7.00
nor less than $5.75 per Share) at which they are willing to sell their Shares,
subject to the terms and conditions of the Offer, and without the usual
transaction costs associated with open market sales. The Offer also allows
shareholders to sell a portion of their Shares while retaining a continuing
equity position in the Company if they so desire. Shareholders should consider
that the Company may not satisfy NYSE listing standards that are expected to be
adopted in January 1999. The Company expects, however, that it will have until
January 2002 to satisfy the new listing standards.
Upon the terms and subject to the conditions of the Offer, if more than
2,000,000 Shares (or such greater number of Shares as the Company may elect to
purchase) have been properly tendered at prices at or below the Purchase Price
and not properly withdrawn prior to the Expiration Date, the Company will
purchase properly tendered Shares on the following basis: (a) FIRST, all Shares
properly tendered and not properly withdrawn prior to the Expiration Date by
any Odd Lot Holder (as defined in the Offer to Purchase) who: (1) tenders all
Shares owned beneficially or of record by such Odd Lot Holder at a price at or
below the Purchase Price (partial tenders will not qualify for this
preference); and (2) completes the section entitled "Odd Lots" in the Letter of
Transmittal and, if applicable, in the Notice of Guaranteed Delivery; and (b)
SECOND, after the purchase of all of the foregoing Shares, all other Shares
properly tendered at prices at or below the Purchase Price and not properly
withdrawn prior to the Expiration Date, on a pro rata basis (with appropriate
adjustments to avoid purchases of fractional Shares).
The Company expressly reserves the right, in its sole discretion, at any
time and from time to time, and regardless of whether or not any of the events
set forth in Section 6 of the Offer to Purchase shall have occurred or shall be
deemed by the Company to have occurred, to extend the period of time during
which the Offer is open and thereby delay acceptance for payment of, and
payment for, any Shares by giving oral or written notice of such extension to
the Depositary and making a public announcement thereof. During any such
extension, all Shares previously tendered and not properly withdrawn will
remain subject to the Offer and to the rights of a tendering shareholder to
withdraw such shareholder's Shares.
Tenders of Shares pursuant to the Offer are irrevocable except that such
Shares may be withdrawn at any time prior to the Expiration Date and, unless
theretofore accepted for payment by the Company pursuant to the Offer, may also
be withdrawn at any time after 12:00 Midnight, New York City time, on Thursday,
December 10, 1998. For such withdrawal to be effective, a written, telegraphic,
telex or facsimile transmission notice of withdrawal must be timely received by
the Depositary at its address set forth on the back cover of the Offer to
Purchase. Any such notice of withdrawal must specify the name of the tendering
shareholder, the number of Shares to be withdrawn and the name of the
registered holder of such Shares. If the certificates for Shares to be
withdrawn have been delivered or otherwise identified to the Depositary, then,
prior to the release of such certificates, the serial numbers shown on such
certificates must be submitted to the Depositary and the signature(s) on the
notice of withdrawal must be guaranteed by an Eligible Institution (as defined
in the Offer to Purchase), unless such Shares have been tendered for the
account of an Eligible Institution. If Shares have been tendered pursuant to
the procedure for book-entry transfer set forth in the Offer to Purchase, any
notice of withdrawal also must specify the name and the number of the account
at the Book-Entry Transfer Facility to be credited with the withdrawn Shares
and must otherwise comply with such Book-Entry Transfer Facility's procedures.
All questions as to the form and validity (including the time of receipt) of
any notice of withdrawal will be determined by the Company, in its sole
discretion, which determination will be final and binding. None of the Company,
the Depositary, the Information Agent, the Dealer Manager or any other person
will be under any duty to give notification of any defects or irregularities in
any tender or notice of withdrawal or incur any liability for failure to give
any such notification.
The information required to be disclosed by Rule 13e-4(d)(1) under the
Securities Exchange Act of 1934, as amended, is contained in the Offer to
Purchase and is incorporated herein by reference.
The Offer to Purchase and the related Letter of Transmittal are being
mailed to record holders of Shares whose names appear on the Company's
shareholder list and will be furnished to brokers, dealers, commercial banks,
trust companies and similar persons whose names, or the names of whose
nominees, appear on the shareholder list or, if applicable, who are listed as
participants in a clearing agency's security position listing for subsequent
transmittal to beneficial owners of Shares.
THE OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE ANY DECISION WITH
RESPECT TO THE OFFER IS MADE.
Questions and requests for assistance or for copies of the Offer to
Purchase and the related Letter of Transmittal, and other Offer materials, may
be directed to the Dealer Manager or the Information Agent as set forth below,
and copies will be furnished promptly at the Company's expense. No fees or
commissions will be paid to brokers, dealers or other persons (other than the
Dealer Manager and the Information Agent) for soliciting tenders of Shares
pursuant to the Offer.
The Information Agent for the Offer is:
MACKENZIE
PARTNERS, INC.
156 Fifth Avenue
New York, New York 10010
(212) 929-5500 (Call Collect)
or
Call Toll Free (800) 322-2885
The Dealer Manager for the Offer is:
CREDIT | FIRST
SUISSE | BOSTON
Eleven Madison Avenue
New York, New York 10010-3629
(800) 664-4543 (toll free)
November 11, 1998
<PAGE> 1
Exhibit(a)(10)
Wednesday November 11, 9:44 am Eastern Time
Keithley to buy back up to 2 mln
shares
CLEVELAND, Nov 11 - Keithley Instruments Inc.
said Wednesday it plans to buy back up to 2 million shares, or about 40 percent
of its outstanding common stock, through a "Dutch auction."
Shareholders will be allowed to tender shares at prices not exceeding $7 per
share and not less than $5.75 per share, Keithley said in a statement.
A majority of the stock purchased through the tender offer will be bought with
available cash from the sale of two units, it said.
Following the tender, the company intends to buy back an additional
"unspecified" number of shares on the open market, a company spokeswoman said.
"The repurchase program will have no impact on our new product development
programs," the company said.
Keithley makes electronic test and measurement instruments and data acquisition
software. Its shares last traded at 5-5/8 on the New York Stock Exchange.
