<PAGE> 1
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- - --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------
SCHEDULE 13E-4/A
ISSUER TENDER OFFER STATEMENT
(Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934)
AMENDMENT NO. 2
TRAK AUTO CORPORATION
(Name of Issuer)
TRAK AUTO CORPORATION
(Name of Person(s) Filing Statement)
Common Stock, Par Value $0.01 Per Share
(Title of Class of Securities)
892887100
CUSIP (Number of Class of Securities)
------------------
Robert A. Marmon
Trak Auto Corporation
3300 75th Avenue
Landover, Maryland 20785
(301) 731-1200
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on Behalf of the Person(s) Filing Statement)
Copy to:
Michael R. Klein, Esq.
Thomas W. White, Esq.
Wilmer, Cutler & Pickering
2445 M Street, N.W.
Washington, D.C. 20037
(202) 663-6000
December 21, 1994
(Date Tender Offer First Published, Sent or Given to Security Holders)
Calculation of Filing Fee
<TABLE>
<S> <C>
Transaction valuation* Amount of filing fee
$30,750,000 $6,150
</TABLE>
* Assumes purchase of 1,500,000 shares at $20.50 per share.
/X/ 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.
<TABLE>
<S> <C>
Amount Previously Paid: $5,250 Filing Party: Trak Auto Corporation
Form or Registration No.: Schedule 13E-4 Date Filed: December 21, 1994
</TABLE>
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<PAGE> 2
Trak Auto Corporation hereby amends and supplements its Statement on
Schedule 13E-4 (the "Original Schedule 13E-4") filed with the Securities and
Exchange Commission on December 21, 1994 and amended on January 24, 1995. Unless
otherwise indicated herein, each capitalized term used but not defined herein
shall have the meaning assigned to such term in the Original Schedule 13E-4.
ITEM 1. SECURITY AND ISSUER.
(b) The information set forth in the Supplement, dated February 6, 1995, to
the Offer to Purchase is hereby incorporated by reference.
(c) The information set forth in the Supplement, dated February 6, 1995, to
the Offer to Purchase is hereby incorporated by reference.
ITEM 2. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) The information set forth in the Supplement, dated February 6, 1995, to
the Offer to Purchase is hereby incorporated by reference.
(b) The information set forth in the Supplement, dated February 6, 1995, to
the Offer to Purchase is hereby incorporated by reference.
ITEM 3. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE ISSUER OR
AFFILIATE.
The information set forth in the Supplement, dated February 6, 1995, to the
Offer to Purchase is hereby incorporated by reference.
ITEM 5. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
THE ISSUER'S SECURITIES.
The information set forth in the Supplement, dated February 6, 1995, to the
Offer to Purchase is hereby incorporated by reference.
ITEM 7. FINANCIAL INFORMATION.
(b) The information set forth in the Supplement, dated February 6, 1995, to
the Offer to Purchase is hereby incorporated by reference.
ITEM 8. ADDITIONAL INFORMATION.
(a,d-e) The information set forth in the Supplement, dated February 6,
1995, to the Offer to Purchase is hereby incorporated by reference.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
<S> <C>
99(a)(10) Form of Supplement, dated February 6, 1995, to Offer to Purchase.
99(a)(11) Form of Letter of Transmittal mailed with Supplement.
99(a)(12) Form of Letter to brokers, dealers, commercial banks, trust companies and
other nominees dated February 6, 1995.
99(a)(13) Form of Letter to clients for use by brokers, dealers, commercial banks,
trust companies and other nominees dated February 6, 1995.
99(a)(14) Form of Notice of Guaranteed Delivery mailed with Supplement.
99(a)(15) Form of Press Release dated February 3, 1995.
99(a)(16) Loan Agreement between Dart Group Corporation and Trak Auto Corporation
dated February 6, 1995.
99(a)(17) Form of Summary Advertisement dated February 8, 1995.
</TABLE>
<PAGE> 3
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.
TRAK AUTO CORPORATION
By: /s/ Robert A. Marmon
------------------------------------
Robert A. Marmon
Principal Financial Officer
Dated: February 6, 1995
<PAGE> 4
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- - ----------- --------------------------------------------------------------------------
<S> <C> <C>
99(a)(1)* -- Form of Offer to Purchase dated December 21, 1994.
99(a)(2)* -- Form of Letter of Transmittal.
99(a)(3)* -- Form of Notice of Guaranteed Delivery.
99(a)(4)* -- Form of letter to brokers, dealers, commercial banks, trust companies and
other nominees dated December 21, 1994.
99(a)(5)* -- Form of letter to clients for use by brokers, dealers, commercial banks,
trust companies and other nominees dated December 21, 1994. December 21,
1994.
99(a)(6)* -- Form of letter to shareholders from the Chairman and Chief Executive
Officer of the Company dated December 21, 1994.
99(a)(7)* -- Form of Press Release dated December 20, 1994.
99(a)(8)* -- Form of Summary Advertisement dated December 21, 1994.
99(a)(9)* -- Form of Press Release dated January 23, 1995.
99(a)(10) -- Form of Supplement, dated February 6, 1995, to Offer to Purchase.
99(a)(11) -- Form of Letter of Transmittal mailed with Supplement.
99(a)(12) -- Form of Letter to brokers, dealers, commercial banks, trust companies and
other nominees dated February 6, 1995.
99(a)(13) -- Form of Letter to clients for use by brokers, dealers, commercial banks,
trust companies and other nominees dated February 6, 1995.
99(a)(14) -- Form of Notice of Guaranteed Delivery mailed with Supplement.
99(a)(15) -- Form of Press Release dated February 3, 1995.
99(a)(16) -- Loan Agreement between Dart Group Corporation and Trak Auto Corporation
dated February 6, 1995.
99(a)(17)+ -- Form of Summary Advertisement dated February 8, 1995.
</TABLE>
- - ------------------
* Previously filed.
+ To be filed by amendment.
<PAGE> 1
TRAK AUTO CORPORATION
SUPPLEMENT TO
OFFER TO PURCHASE FOR CASH
UP TO 1,500,000 SHARES OF ITS COMMON STOCK
AT A PURCHASE PRICE OF $20.50 PER SHARE
THE OFFER HAS BEEN EXTENDED. THE OFFER, PRORATION PERIOD
AND WITHDRAWAL RIGHTS NOW EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON TUESDAY, FEBRUARY 21, 1995,
UNLESS THE OFFER IS FURTHER EXTENDED.
The information included in this Supplement amends and supplements the
Offer to Purchase dated December 21, 1994 (the "Offer to Purchase") of Trak Auto
Corporation, a Delaware corporation (the "Company"). This Supplement amends the
Offer to Purchase (which, together with this Supplement and the related Letter
of Transmittal, constitutes the "Offer") by increasing the Purchase Price from
$17.50 per Share to $20.50 per Share, removing the condition that at least
1,500,000 Shares be validly tendered and not withdrawn in response to the Offer,
and making certain other changes. In addition, this Supplement provides
information regarding recent developments relating to the Company and amends
certain information to reflect the revised terms of the Offer. Capitalized terms
not otherwise defined herein have the meaning set forth in the Offer to
Purchase.
------------------------
AS AMENDED BY THIS SUPPLEMENT, THE OFFER IS NO LONGER CONDITIONED UPON ANY
MINIMUM NUMBER OF SHARES BEING TENDERED. THE OFFER REMAINS SUBJECT TO
THERE BEING AT LEAST 500 BENEFICIAL OWNERS OF SHARES FOLLOWING
COMPLETION OF THE OFFER, AND ON CERTAIN OTHER CONDITIONS AS SET FORTH
IN SECTION 6 OF THE OFFER TO PURCHASE AS AMENDED BY THIS SUPPLEMENT.
------------------------
The Shares are quoted on the Nasdaq Stock Market ("Nasdaq"). On February 3,
1995, the last full trading day prior to the announcement of this amendment to
the Offer, the closing per Share sales price as reported by Nasdaq was $16 7/8.
SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS FOR THE SHARES. SEE
SECTION 7 OF THE OFFER TO PURCHASE.
------------------------
NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO
SHAREHOLDERS AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES. DART
GROUP CORPORATION ("DART"), THE BENEFICIAL OWNER OF APPROXIMATELY
3,962,245 SHARES (64.8% OF THE ISSUED AND OUTSTANDING SHARES AS OF
DECEMBER 20, 1994), OFFICERS AND DIRECTORS OF WHICH ARE OFFICERS AND
DIRECTORS OF THE COMPANY, HAS ADVISED THE COMPANY THAT IT DOES NOT
INTEND TO TENDER ANY SHARES IN RESPONSE TO THE OFFER. THE COMPANY
HAS BEEN ADVISED THAT NO DIRECTOR OR EXECUTIVE OFFICER OF THE
COMPANY OR DART INTENDS TO TENDER ANY SHARES PURSUANT TO THE
OFFER. SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO
TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER.
------------------------
Questions and requests for assistance may be directed to the Information
Agent or the Dealer Manager at their addresses and telephone numbers set forth
on the back cover of this Supplement, and additional copies of this Supplement,
the Offer to Purchase, the Letter of Transmittal or the Notice of Guaranteed
Delivery may be obtained from the Information Agent.
------------------------
The Dealer Manager for the Offer is:
WASSERSTEIN PERELLA & CO., INC.
FEBRUARY 6, 1995
<PAGE> 2
TO THE HOLDERS OF COMMON STOCK OF
TRAK AUTO CORPORATION:
The following information amends and supplements the Offer to Purchase of
the Company pursuant to which the Company is (as amended) offering to purchase
up to 1,500,000 Shares at a revised purchase price of $20.50 per Share (the
"Revised Purchase Price"), net to the seller in cash, upon the terms and subject
to the conditions set forth in this Supplement, the Offer to Purchase and the
related Letter of Transmittal.
AS AMENDED BY THIS SUPPLEMENT, THE OFFER IS NO LONGER CONDITIONED ON ANY
MINIMUM NUMBER OF SHARES BEING TENDERED. THE OFFER REMAINS SUBJECT TO THERE
BEING AT LEAST 500 BENEFICIAL OWNERS OF SHARES FOLLOWING COMPLETION OF THE
OFFER, AND ON CERTAIN OTHER CONDITIONS AS SET FORTH IN SECTION 6 OF THE OFFER TO
PURCHASE AS AMENDED BY THIS SUPPLEMENT.
PROCEDURES FOR TENDERING SHARES ARE SET FORTH AT SECTION 3 OF THE OFFER TO
PURCHASE. ALL SHARES THAT PREVIOUSLY HAVE BEEN PROPERLY TENDERED AND NOT
WITHDRAWN REMAIN PROPERLY TENDERED PURSUANT TO THE OFFER AS AMENDED BY THIS
SUPPLEMENT. SHAREHOLDERS WHO HAVE NOT TENDERED AND DESIRE TO DO SO MAY USE
EITHER THE REVISED LETTER OF TRANSMITTAL DELIVERED WITH THIS SUPPLEMENT OR THE
LETTER OF TRANSMITTAL PREVIOUSLY DELIVERED TO THEM WITH THE OFFER TO PURCHASE.
Except as amended by this Supplement, the terms and conditions set forth in
the Offer to Purchase and the Letter of Transmittal are applicable in all
respects to the Offer.
Shareholders are urged to read this Supplement, the Offer to Purchase and
the Letter of Transmittal carefully before deciding to tender their Shares.
PURCHASE PRICE
The Purchase Price set forth in the Offer is amended to be $20.50 per
share. All references to the Purchase Price of $17.50 per Share in the Offer to
Purchase and the Letter of Transmittal initially delivered to shareholders are
hereby amended to read "$20.50" or "the Revised Purchase Price," as appropriate,
except where the context requires otherwise.
EXTENSION OF THE OFFER
The term Expiration Date as defined in Section 1, "Number of Shares;
Proration," of the Offer to Purchase is amended to mean 5:00 p.m., New York City
time, on Tuesday, February 21, 1995, unless the Company, in its sole discretion,
shall have further extended the period of time during which the Offer is 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.
MINIMUM SHARES CONDITION
The condition set forth in paragraph (1) in Section 6, "Certain Conditions
to the Offer," of the Offer to Purchase is removed, and the Company will
purchase up to 1,500,000 Shares pursuant to the Offer even if fewer than
1,500,000 Shares are tendered. All references to 1,500,000 Shares in the Offer
to Purchase and the Letter of Transmittal initially delivered to shareholders
are hereby amended to read "up to 1,500,000 Shares" or, where the context
requires, "1,500,000 Shares or such lesser number of Shares as are properly
tendered and not withdrawn," except where the context requires otherwise. The
provision in the fourth paragraph of Section 1, "Number of Shares; Proration,"
of the Offer to Purchase stating that the Offer will not be completed and Shares
will be returned if fewer than 1,500,000 Shares are tendered or if there would
be fewer than 500 beneficial owners of Shares is amended to delete the reference
to the circumstance in which there are fewer than 1,500,000 Shares tendered.
DETERMINATION OF SATISFACTION OF CERTAIN CONDITIONS
Each place in Section 6, "Certain Conditions of the Offer," in which
reference is made to a determination by the Company in its "sole judgment" as to
whether a condition is satisfied is revised to read "reasonable judgment." The
Company retains sole discretion as to whether to waive conditions, subject to
the requirement that it extend the Offer in the event it waives a material
condition.
2
<PAGE> 3
PRICE RANGE OF SHARES
The table setting forth the price range of shares in Section 7, "Price
Range of Shares; Dividends," of the Offer to Purchase is amended by revising the
last line thereof and adding a line as follows:
<TABLE>
<CAPTION>
QUARTER ENDED HIGH LOW
--------------------------------------------------------- ---- ---
<S> <C> <C>
January 28, 1995......................................... 18 3/4 15
April 30, 1995
(through February 3, 1995)............................. 17 3/4 16 7/8
</TABLE>
On February 3, 1995, the last full trading day prior to the announcement of
this amendment to the Offer, the closing per Share sales price was $16 7/8.
SHAREHOLDERS ARE URGED TO OBTAIN CURRENT
MARKET QUOTATIONS FOR THE SHARES.
PURPOSE OF THE OFFER
As a result of the deletion of the minimum shares condition, less than
1,500,000 shares may be tendered and accepted pursuant to the Offer, in which
case Dart would not own in excess of 80% of the issued and outstanding Shares
following completion of the Offer. In that event, Dart and the Company would not
be consolidated for federal income tax purposes or achieve the benefits of such
consolidation. The Company continues to believe that the Offer (taking into
account the Revised Purchase Price) is an attractive investment of the Company's
cash.
The Company or Dart may determine in the future to acquire additional
Shares, including Shares which would facilitate a consolidation for tax
purposes, but there can be no assurance that either of them will do so. Any such
acquisitions may be on the open market, in privately negotiated transactions,
through tender offers, mergers or otherwise, in such amounts, at such prices and
at such times as the Company or Dart may determine. Rule 13e-4 under the
Exchange Act generally 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. Neither the Company nor Dart will acquire any
additional Shares until at least ten business days after the Expiration Date.
Future acquisitions of Shares, if any, may be on the same terms as, or on terms
more or less favorable than, those of the Offer.
The Offer to Purchase states:
The Company believes that the current market price of the Shares does not
adequately reflect the value of the Company's business, assets and
prospects, and that the purchase of the Shares at this time is an
attractive investment that will benefit the Company and its continuing
shareholders.
As reported in the Offer to Purchase, a pending lawsuit by Ronald S. Haft
against Dart in the Delaware Court of Chancery seeks an order requiring Dart to
issue 197,048 shares of its Class B Common Stock to him pursuant to his exercise
of certain stock options. Dart has engaged Wasserstein Perella & Co., Inc.
("WP&Co.") to estimate the range of fair value of Dart in connection with the
defense of this lawsuit and possibly with respect to certain other issues of
shareholder value confronting Dart. As part of this engagement, WP&Co. is
analyzing the value of the Company as of the date of the issuance of the options
and as of the date the report is to be delivered, based upon methodologies and
certain assumptions deemed appropriate by WP&Co. The primary methodology which
WP&Co. is utilizing for purposes of this valuation is a comparable companies
analysis, i.e., an analysis of the current trading values of the stock of
certain other public companies in the same business as the Company. WP&Co. is
also utilizing, to a lesser extent, two other methodologies, a discounted cash
flow analysis (based on projected free cash flow over approximately a five-year
horizon) and a comparable acquisitions analysis (based on transaction multiples
for selected recently completed acquisitions of retail companies). In conducting
the discounted cash flow analysis, WP&Co. has been provided with
3
<PAGE> 4
certain very preliminary internal estimates of future performance of the Company
prepared by the Company's management (which were not prepared for this purpose,
are subject to change and have not been independently verified by WP&Co.).
WP&Co. has advised the Company that, based upon its analysis to date which is
not yet complete, WP&Co. currently estimates that its valuation will fall in a
range from approximately 5% to approximately 35% above the Revised Purchase
Price (exclusive of any premium that might apply in a sale of control).
This range of estimated value per Share exceeds the range within which the
Shares have traded in recent periods. Neither the Company nor WP&Co. make any
representation or prediction as to whether the market price of the Shares will
increase to the range of value in WP&Co.'s preliminary estimate or as to whether
any holder of Shares would at any time be able to realize an amount in that
range from an investment in the Shares.
SOURCE AND AMOUNT OF FUNDS
If the Company were to purchase 1,500,000 Shares pursuant to the Offer at
the Revised Purchase Price of $20.50 per Share, the aggregate cost of the Offer,
including estimated fees and expenses applicable to the Offer, would be
approximately $31.4 million, which would be paid from the Company's cash on hand
and amounts realizable on the sale of short-term instruments and marketable debt
securities. As of December 24, 1994, the Company had available approximately
$33.3 million in cash, short-term instruments and marketable debt securities.
Dart has agreed to provide a $10 million revolving credit facility to the
Company to fund its short-term working capital needs, including costs of
expanding existing stores and opening new ones. Advances under this facility
would bear interest at the prime rate plus 1%. Advances can be repaid and
reborrowed at any time through May 1, 1996, the expiration date of the facility.
If 1,500,000 shares are purchased pursuant to the Offer, the Company currently
anticipates that it may need to draw on this facility during the first, third
and fourth quarters of the current fiscal year to provide cash for working
capital purposes and to fund expenditures for store closings, expansions and
openings. The Company anticipates that cash generated from operations will be
sufficient to repay these advances. The Company, together with Dart and Crown
Books Corporation (a majority owned subsidiary of Dart), also has available a
$6,000,000 working capital revolving credit facility from First Union Bank,
which expires May 1, 1995.
CERTAIN INFORMATION CONCERNING THE COMPANY
RECENT DEVELOPMENTS
On January 3, 1995, plaintiffs in Alan R. Kahn, et al. v. Herbert Haft, et
al., C.A. No. 13154 (the "Kahn Derivative Lawsuit"), filed a motion seeking the
appointment by the Delaware Court of Chancery of a temporary custodian to manage
the affairs of Dart or of a receiver to sell Dart or to oversee a
recapitalization thereof. Dart intends to oppose this motion to appoint a
temporary custodian.
As previously disclosed in the Offer to Purchase, on September 6, 1994,
Ronald S. Haft sought to exercise options (the "Options") to purchase 197,048
shares (the "Option Shares") of Class B Common Stock of Dart. Dart has rejected
the validity of Ronald S. Haft's purported exercise of the Options, and issuance
of the Option Shares has not been recorded in the stock records of Dart.
On September 14, 1994, Ronald S. Haft filed a lawsuit against Dart in the
Delaware Court of Chancery (the "Options Lawsuit") seeking a court order that
Dart issue the Option Shares to him. Dart is contesting this lawsuit. In
November, 1994, plaintiffs in the Kahn Derivative Lawsuit intervened as
co-defendants in the Options Lawsuit.
On January 19, 1995, Ronald S. Haft and the plaintiffs in the Kahn
Derivative Lawsuit entered into what they referred to as a Stipulation and
Agreement of Compromise, Settlement and Release (the "Settlement Agreement"),
which was filed in the Delaware Court of Chancery on January 20, 1995. The
Settlement Agreement, which has not been approved by the Board of Directors of
Dart and requires approval by the Court, purports to settle the Options Lawsuit
and all claims against Ronald S. Haft in the Kahn Derivative
4
<PAGE> 5
Lawsuit. The Settlement Agreement provides, inter alia, that the Option Shares
would be issued to Ronald S. Haft, that he would cause Dart to retain a national
investment banking firm and that he would "use his best efforts promptly to
select and implement the strategy or strategies proposed by the investment
banker, provided that such strategy or strategies, in the good faith judgment of
the Board of Directors, will achieve the objective of maximizing shareholder
value, which is one of the goals of the settlement." Dart has challenged the
authority of the plaintiffs in the Kahn Derivative Lawsuit to enter into the
Settlement Agreement on behalf of Dart. The parties have agreed that the trial
of the Options Lawsuit previously scheduled for March 1995, will be postponed. A
new trial date has not yet been set.
UNAUDITED PRO FORMA FINANCIAL INFORMATION
The following unaudited pro forma financial information sets forth
historical information as adjusted to give effect to the purchase of 1,500,000
Shares at a Revised Purchase Price of $20.50 per Share. The pro forma
adjustments assume that the transaction occurred, for the purpose of income
statement data, as of the first day of the period presented and, for the purpose
of balance sheet data, as of the balance sheet date. The pro forma information
does not purport to be indicative of the results that may be obtained in the
future or that would actually have been obtained had the transaction occurred
during the periods indicated. The pro forma information should be read in
conjunction with the Company's financial statements and related notes set forth
in the 1994 10-K and the 1994 Third Quarter 10-Q.
5
<PAGE> 6
SUMMARY UNAUDITED PRO FORMA FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE DATA AND RATIOS)
<TABLE>
<CAPTION>
THIRTY-NINE WEEKS ENDED YEAR ENDED
OCTOBER 29, 1994 JANUARY 29, 1994
----------------------------------- ------------------------------------
PRO PRO
HISTORICAL ADJUSTMENTS FORMA HISTORICAL ADJUSTMENTS FORMA
---------- ----------- ----- --------- ----------- -----
<S> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Sales.................... $266,415 $ 0 $266,415 $334,798 $ 0 $334,798
Income (loss) before
income taxes........... 11,853 (1,302)(a) 10,551 (464) (1,574)(e) (2,038)
Income taxes (benefit)... 3,635 (399)(b) 3,236 (545) (290)(b) (835)
Net income............... 8,218 (903) 7,315 81 (1,284) (1,203)
Net income per share..... 1.34 0.24 1.58 0.01 (0.27) (0.26)
Weighted average common
shares and common share
equivalents
outstanding............ 6,111 (1,500)(c) 4,611 6,107 (1,500)(c) 4,607
Ratio of earnings to
fixed charges.......... 2.62 2.41(d) 0.95 0.79(d)
<CAPTION>
OCTOBER 29, 1994 JANUARY 29, 1994
----------------------------------- ------------------------------------
PRO PRO
HISTORICAL ADJUSTMENTS FORMA HISTORICAL ADJUSTMENTS FORMA
---------- ----------- ----- ---------- ----------- -----
<S> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Current assets........... $153,135 $(31,400)(f) $121,735 $129,805 $(25,007)(f) $104,798
Current liabilities...... 90,444 0 90,444 75,737 6,393(g) 82,130
Working capital.......... 62,691 (31,400) 31,291 54,068 (31,400) 22,668
Total assets............. 202,570 (31,400) 171,170 179,149 (25,007) 154,142
Current portion of
obligations under
capital leases......... 211 0 211 211 0 211
Obligations under capital
leases (less current
portion)............... 26,525 0 26,525 26,331 0 26,331
Stockholders' equity..... 78,438 (31,400) 47,038 69,675 (31,400) 38,275
Total capitalization
(stockholders' equity
and long-term
liabilities)........... 112,126 (31,400) 80,726 103,412 (31,400) 72,012
Stockholders' equity per
common share
outstanding............ 12.83 (2.63) 10.20 11.51 (3.10) 8.41
</TABLE>
- - ---------------
Notes to Accompany Pro Forma Financial Information
(a) The reduction in income before income taxes for the thirty-nine weeks ended
October 29, 1994 is due primarily to a reduction in interest income as a
result of lower cash and investment balances and an increase in interest
expense attributable to debt which would have been required if the purchase
of Shares pursuant to the Offer had occurred at the beginning of the period
presented.
(b) Income tax expense is reduced as a result of reduced income before income
taxes.
(c) To reflect the Company's purchase of shares pursuant to the Offer to
Purchase dated December 21, 1994 as amended by the Supplement dated
February 6, 1995.
(d) The reduction in the ratio of earnings to fixed charges is attributable to
reduced net income and increased fixed charges resulting from debt which
would have been required if the purchase of Shares pursuant to the Offer had
occurred at the beginning of the period presented.
(e) The reduction in income before income taxes for the fiscal year ended
January 29, 1994 is due primarily to a reduction in interest income as a
result of lower cash and investment balances and an increase in
6
<PAGE> 7
interest expense attributable to debt which would have been required if the
purchase of Shares pursuant to the Offer had occurred at the beginning of
the period presented.
(f) To reflect the reduction of cash balances resulting from purchase of Shares,
including estimated fees and expenses related to the Offer.
(g) To reflect debt which would have been required if the purchase of Shares had
occurred as of the balance sheet date.
TRAK AUTO CORPORATION
February 6, 1995
7
<PAGE> 8
Facsimile copies of the Letter of Transmittal previously distributed with
the Offer to Purchase will be accepted from Eligible Institutions. The Letter of
Transmittal and certificates for shares and any other required documents should
be sent or delivered by each tendering shareholder or his broker, dealer,
commercial bank, trust company or other nominee to the Depositary at one of its
addresses set forth below.
The Depositary is:
THE BANK OF NEW YORK
<TABLE>
<S> <C> <C>
By Mail: Facsimile Transmission: By Hand or Overnight Courier:
Tender and Exchange Department (for Eligible Institutions Only) Tender & Exchange Department
P.O. Box 11248 (212) 815-6213 101 Barclay Street
Church Street Station Receive and Deliver Window
New York, NY 10286-1248 For Information Telephone: New York, NY 10286
(800) 507-9357
</TABLE>
Any questions or requests for assistance or for additional copies of this
Supplement, the Offer to Purchase, the Letter of Transmittal or the Notice of
Guaranteed Delivery may be directed to the Information Agent at the telephone
numbers and addresses set forth below. You may also contact the Dealer Manager
or your broker, dealer, commercial bank or trust company for assistance
concerning the offer. To confirm the delivery of your shares, you are directed
to contact the Depositary.
The Information Agent is:
D.F. KING & CO., INC.
77 Water Street
New York, NY 10005
CALL COLLECT (212) 269-5550 or
CALL TOLL FREE (800) 207-3158
The Dealer Manager for the Offer is:
WASSERSTEIN PERELLA & CO., INC.
31 West 52nd Street
New York, New York 10019
(212) 969-2700
(call collect)
February 6, 1995
<PAGE> 1
LETTER OF TRANSMITTAL
TO ACCOMPANY SHARES OF COMMON STOCK
OF
TRAK AUTO CORPORATION
TENDERED PURSUANT TO THE OFFER TO PURCHASE
DATED DECEMBER 21, 1994
AS AMENDED BY THE SUPPLEMENT
DATED FEBRUARY 6, 1995
THIS OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 PM, NEW YORK
CITY TIME, ON TUESDAY, FEBRUARY 21, 1995, UNLESS THE OFFER IS FURTHER EXTENDED.
To: THE BANK OF NEW YORK, Depositary
<TABLE>
<S> <C> <C>
By Mail: Facsimile Transmission: By Hand or Overnight
(for Eligible Institutions Only) Courier:
Tender and Exchange (212) 815-6213 Tender and Exchange
Department Department
P.O. Box 11248 101 Barclay Street
Church Street Station Receive & Deliver Window
New York, NY 10286-1248 New York, NY 10286
For Information Telephone:
(800) 507-9357
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------
<CAPTION>
DESCRIPTION OF SHARES TENDERED (SEE INSTRUCTIONS 3 AND 4)
------------------------------------------------------------------------------------------------------------------
NAMES AND ADDRESS(ES) OF REGISTERED HOLDER(S) CERTIFICATE(S) TENDERED
(PLEASE FILL IN EXACTLY AS APPEARS ON CERTIFICATE(S)) (ATTACH SIGNED LIST IF NECESSARY)
------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES NUMBER OF
CERTIFICATE REPRESENTED BY SHARES
NUMBER(S)* CERTIFICATE(S)* TENDERED**
-------------------------------------------------
<S> <C> <C> <C>
-------------------------------------------------
-------------------------------------------------
-------------------------------------------------
-------------------------------------------------
Total Shares Tendered
------------------------------------------------------------------------------------------------------------------
Indicate in this box the order (by certificate number) in which Shares are to be purchased in event of proration.
(Attach additional signed list if necessary.):*** See Instruction 9.
</TABLE>
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
* Need not be completed if Shares are delivered by book-entry transfer.
** If you desire to tender fewer than all Shares evidenced by any certificates
listed above, please indicate in this column the number of Shares you wish
to tender. Otherwise, all Shares evidenced by such certificates will be
deemed to have been tendered. See Instruction 4.
*** If you do not designate an order, in the event less than all Shares tendered
are purchased due to proration, Shares will be selected for purchase by the
Depositary.
<PAGE> 2
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN ONE OF THOSE SHOWN
ABOVE, OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN ONE OF
THOSE LISTED ABOVE, DOES NOT CONSTITUTE A VALID DELIVERY.
This Letter of Transmittal is to be used only if (a) certificates for
Shares (as defined below) are to be forwarded with it or (b) a tender of Shares
is to be made by book-entry transfer to the account maintained by the Depositary
at The Depository Trust Company, the Midwest Securities Trust Company or the
Philadelphia Depository Trust Company (collectively, the "Book-Entry Transfer
Facilities") pursuant to Section 3 of the Offer to Purchase.
Shareholders who desire to tender Shares pursuant to the Offer and who
cannot deliver their certificates for their Shares (or who are unable to comply
with the procedures for book-entry transfer on a timely basis) and all other
documents required by this Letter of Transmittal to the Depositary at or before
the Expiration Date (as defined in the Offer to Purchase) may tender their
Shares according to the guaranteed delivery procedures set forth in Section 3 of
the Offer to Purchase. See Instruction 2. Delivery of documents to one of the
Book-Entry Transfer Facilities does not constitute delivery to the Depositary.
<TABLE>
<S> <C>
/
/TRANSFER
MADE
TO
AN
ACCOUNT
MAINTAINED
BY
THE
DEPOSITARY
WITH
ONE
OF
THE
BOOK-
ENTRY
TRANSFER
FACILITIES
AND
COMPLETE
THE
FOLLOWING:
Name of Tendering Institution:
Check Box of Applicable Book-Entry Transfer Facility:
DTC / / MSTC / / PDTC / /
Account Number:
Transaction Code Number:
/
/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 available):
If Delivery is by Book-Entry Transfer:
Check Box of Applicable Book-Entry Transfer Facility:
DTC / / MSTC / / PDTC / /
Account Number:
Transaction Code Number:
</TABLE>
ODD LOTS
(SEE INSTRUCTION 7)
This section is to be completed ONLY if Shares are being tendered by or on
behalf of a person owning beneficially as of the close of business on December
20, 1994, and continuing to own beneficially until the Expiration Date, an
aggregate of fewer than 100 Shares.
The undersigned either (check one box):
/ / was the beneficial owner as of the close of business on December
20, 1994, and will continue to be the beneficial owner until the
Expiration Date, of 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 (i) is tendering, for the beneficial owners thereof,
Shares with respect to which it is the record owner, and (ii)
believes, based upon representations made to it by each such
beneficial owner, that such beneficial owner owned beneficially as
of the close of business on December 20, 1994, and will continue
to own beneficially until the Expiration Date, an aggregate of
fewer than 100 Shares, and is tendering all of such Shares,
and, in either case, hereby represents that the above indicated
information is true and correct as to the undersigned.
ODD LOT SHARES CANNOT BE CONDITIONALLY TENDERED
<PAGE> 3
CONDITIONAL TENDER
(SEE INSTRUCTION 9)
/ / CHECK HERE IF TENDER OF SHARES IS CONDITIONED ON THE COMPANY
PURCHASING ALL OR A MINIMUM NUMBER OF THE TENDERED SHARES, AND
COMPLETE THE FOLLOWING:
Minimum Number of Shares to be sold: .
LADIES AND GENTLEMEN:
The undersigned hereby tenders to Trak Auto Corporation, a Delaware
corporation (the "Company"), the above-described shares of the Company's Common
Stock, par value $0.01 per share (the "Shares"), at the price of $20.50 per
Share, net to the seller in cash, upon the terms and subject to the conditions
set forth in the Company's Offer to Purchase dated December 21, 1994 and the
Supplement dated February 6, 1995, receipt of both of which is hereby
acknowledged, and in this Letter of Transmittal (which together constitute the
"Offer").
Subject to and effective upon acceptance for payment of the Shares tendered
hereby in accordance with the terms of the Offer (including, if the Offer is
further extended or amended, the terms or conditions of any 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 or orders the registration of such Shares tendered by book-entry transfer
that are purchased pursuant to the Offer to or upon the order of the Company and
hereby irrevocably constitutes and appoints the Depositary as attorney-in-fact
of the undersigned with respect to such Shares, with full power of substitution
(such power of attorney being an irrevocable power coupled with an interest),
to:
(a) deliver certificates for Shares, or transfer ownership of such
Shares on the account books maintained by a 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 of the Offer as amended by the Supplement.
The undersigned hereby represents and warrants to the Company that:
(a) 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 as amended by the Supplement, including
the undersigned's representation and warranty that (i) the undersigned has a
net long position in 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, and (ii) such tender of Shares complies
with Rule 14e-4;
(b) when and to the extent the Company accepts the Shares for purchase,
the Company will acquire good, marketable and unencumbered title to them,
free and clear of all security interests, liens, charges, encumbrances,
conditional sales agreements or other obligations relating to their sale or
transfer, and not subject to any adverse claim;
(c) on request, the undersigned will execute and deliver any additional
documents the Depositary or the Company deems necessary or desirable to
complete the assignment, transfer and purchase of the Shares tendered
hereby; and
(d) the undersigned has read, understands and agrees with all of the
terms of the Offer as amended by the Supplement.
The names and addresses of the registered holders 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 undersigned understands that, if he tenders all of his Shares, he may
condition his tender of Shares upon the acceptance by the Company of all or a
minimum number of Shares tendered hereby, as described in Section 3 of the Offer
to Purchase. Such a conditional tender may be made by completing the section
under the heading "Conditional Tender" above. If such section is not completed,
the tender will be deemed unconditional.
The undersigned understands that the Company seeks to purchase up to
1,500,000 of its Shares at the price of $20.50 per Share. The undersigned
understands that Shares properly tendered and not withdrawn will be purchased at
the Revised Purchase Price, net to the seller in cash, upon the terms and
subject to the conditions of the Offer as amended by the Supplement, including
its proration provisions, minimum beneficial owners condition and conditional
tender provisions, and that the Company will return all other Shares, including
Shares not purchased because of proration or conditional tenders.
The undersigned recognizes that under certain circumstances set forth in the
Offer to Purchase as amended by the Supplement, 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 either 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 "Special Payment Instructions" or "Special Delivery Instructions" below. The
undersigned recognizes that the Company has no obligation, pursuant to the
Special Payment Instructions, to transfer any certificate for Shares from the
name of their registered holder, or to order the registration or transfer of
such Shares tendered by book-entry transfer, if the Company purchases none of
the Shares represented by such certificate or tendered by such book-entry
transfer.
<PAGE> 4
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 as amended by
the Supplement.
The check for the Purchase Price for such of the tendered Shares as are
purchased will be issued to the order of the undersigned and mailed to the
address indicated above unless otherwise indicated under the Special Payment
Instructions or the Special Delivery Instructions below.
All authority conferred or agreed to be conferred in this Letter of
Transmittal shall survive the death or incapacity of the undersigned and any
obligations of the undersigned under this Letter of Transmittal shall be binding
upon the heirs, personal representatives, successors and assigns of the
undersigned. Except as stated in the Offer to Purchase, this tender is
irrevocable.
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 5, 6, 8, AND 10)
To be completed ONLY if certificate(s) for Shares not tendered or not purchased
and/or any check for the Revised Purchase Price of Shares purchased are to be
issued in the name of someone other than the undersigned, or if Shares delivered
by book-entry transfer that are not purchased are to be returned by credit to an
account maintained by a Book-Entry Transfer Facility.
Issue / / Check
/ / Certificate(s) to:
Name:
(PLEASE PRINT)
Address:
- - ---------------------------------------------------------
- - ---------------------------------------------------------
(INCLUDE ZIP CODE)
- - ---------------------------------------------------------
(TAXPAYER IDENTIFICATION OR SOCIAL SECURITY NUMBER)
/ / Credit Shares tendered by book-entry transfer and not purchased to the
account set forth below:
Name of account party:
Account number:
Check Box of Applicable Book-Entry Transfer Facility:
/ / DTC
/ / MSTC
/ / PDTC
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 5, 6, 8 AND 10)
To be completed ONLY if certificates for Shares not tendered or not purchased
and/or any check for the Revised Purchase Price of Shares purchased are to be
sent to someone other than the undersigned or to the undersigned at an address
other than that shown above.
Deliver / / Check
/ / Certificate(s) to:
Name:
(PLEASE PRINT)
Address:
- - ---------------------------------------------------------
- - ---------------------------------------------------------
(INCLUDE ZIP CODE)
<PAGE> 5
SHAREHOLDER(S) SIGN HERE
(SEE INSTRUCTIONS 1 AND 5)
(PLEASE COMPLETE ENCLOSED FORM W-9)
Must be signed by the registered holder(s) exactly as name(s) appear(s) on
certificate(s) or on a security position listing or by persons(s) authorized to
become registered holder(s) by certificate(s) and documents transmitted with
this Letter of Transmittal. If signature is by attorney-in-fact, executor,
administrator, trustee, guardian, officer of a corporation or another acting in
a fiduciary or representative capacity, please set forth the full title. See
Instruction 6.
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
(SIGNATURE(S) OF OWNER(S))
Name(s):
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title):
Address:
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
Area Code and Telephone Number:
Dated: , 1995 Tax ID No. or Social Security No.:
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 1 AND 5)
Authorized Signature:
Name(s):
(PLEASE PRINT)
Title:
Name of Firm:
Address:
- - --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number:
Dated: , 1995 Tax ID No. or Social Security No.:
<PAGE> 6
INSTRUCTIONS
FORMING PART OF THE TERMS 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 exactly as the name of the registered holder appears on the
certificate (which term, for purposes of this document, shall include any
participant in a Book-Entry Transfer Facility whose name appears on a
security position listing as the owner of Shares) tendered with this Letter
of Transmittal and payment and delivery are to be made directly to such
owner unless such owner has completed either the box entitled "Special
Payment Instructions" or "Special Delivery Instructions" above; or
(b) such Shares are tendered for the account of a financial
institution that is a member of the Securities Transfer Agents Medallion
Program (STAMP), the Stock Exchange Medallion Program (SEMP) or the New
York Stock Exchange, Inc. Medallion Signature Program (MSP) (each such
entity, 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 used only if certificates are
delivered with it to the Depositary (or such certificates are being delivered
pursuant to a Notice of Guaranteed Delivery previously sent to the Depositary)
or if tenders are to be made 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 a Book-Entry Transfer Facility of Shares tendered
electronically, together in each case with a facsimile of the Letter of
Transmittal 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.
Shareholders whose certificates are not immediately available or who cannot
deliver 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, may tender their Shares by or through
any Eligible Institution by properly completing and duly executing and
delivering a Notice of Guaranteed Delivery (or facsimile of it) and by otherwise
complying with the guaranteed delivery procedure set forth in Section 3 of the
Offer to Purchase. Pursuant to such procedure, the certificates for all
physically tendered Shares or book-entry confirmation, as the case may be, as
well as a properly completed and duly executed Letter of Transmittal and all
other documents required by this Letter of Transmittal, must be received by the
Depositary within five business 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 a telegram, facsimile transmission or mail to the Depositary and must include
a guarantee by an Eligible Institution in the form set forth in such Notice. 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 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 photocopy of it), waive any right to receive any notice of the acceptance
of their tender.
<PAGE> 7
3. INADEQUATE SPACE. If the space provided in the box captioned
"Description of Shares Tendered" 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 which are to be
tendered in the column entitled "Number of Shares Tendered." In such case, if
any tendered Shares are purchased, a new certificate for the remainder of the
Shares evidenced by the old certificate(s) will be issued and sent to the
registered holder(s), unless otherwise specified in either the "Special Payment
Instructions" or "Special Delivery Instructions" box on this Letter of
Transmittal, as soon as practicable after the Expiration Date. Unless otherwise
indicated, all Shares represented by the certificates listed and delivered to
the Depositary will be deemed to have been tendered.
5. 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 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 photocopies of it) as there are
different registrations of certificates.
(d) When this Letter of Transmittal is signed by the registered
holder(s) of the Shares listed and transmitted hereby, no endorsement(s) of
certificate(s) representing such Shares or separate stock powers 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). Signatures on such certificates or powers must be
guaranteed by an Eligible Institution. If this Letter of Transmittal is
signed by any person other than the registered holder(s) of the
certificate(s) listed, the certificate(s) must be endorsed or accompanied
by appropriate stock powers, 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 powers must be guaranteed by
an Eligible Institution. See Instruction 1.
(e) If this Letter of Transmittal or any certificates or stock powers
are signed by trustees, executors, administrators, guardians,
attorneys-in-fact, officers of corporations or others acting in a fiduciary
or representative capacity, such person should so indicate when signing and
must submit proper evidence satisfactory to the Company of their authority
so to act.
6. STOCK TRANSFER TAXES. Except as provided in this Instruction 6, no
stock transfer tax stamps or funds to cover such stamps need accompany this
Letter of Transmittal. The Company will pay or cause to be paid any stock
transfer taxes payable on the transfer to it of Shares purchased pursuant to the
Offer. If, however:
(a) payment of the Revised Purchase Price is to be made to any person
other than the registered holder(s);
(b) Shares not tendered or not accepted for purchase are to be
registered in the name of any person other than the registered holder(s);
or
(c) tendered certificates are registered in the name of any person
other than the person(s) signing this Letter of Transmittal;
then the Depositary will deduct from the Revised Purchase Price the amount of
any stock transfer taxes (whether imposed on the registered holder, such other
person or otherwise) payable on account of the transfer to such person unless
satisfactory evidence of the payment of such taxes or an exemption from them is
submitted.
<PAGE> 8
7. ODD LOTS. As described in Section 1 of the Offer to Purchase, if the
Company is to purchase fewer than all Shares tendered before the Expiration Date
and not withdrawn, the Shares purchased first will under certain circumstances
consist of all Shares tendered by any shareholder who owned of record or owned
beneficially, as of the close of business on December 20, 1994, an aggregate of
fewer than 100 Shares, and who tenders all of his Shares (an "Odd Lot Owner").
This preference will not be available unless the box captioned "Odd Lots" is
completed.
8. CONDITIONAL TENDERS. As described in Section 3 of the Offer to
Purchase, shareholders may condition their tenders on all or a minimum number of
their tendered Shares being purchased ("Conditional Tenders"). If the Company is
to purchase less than all Shares tendered before the Expiration Date and not
withdrawn, any Shares tendered pursuant to a Conditional Tender for which the
condition was not satisfied shall be deemed withdrawn, subject to reinstatement
if such Conditionally Tendered Shares are all the Shares held by the person
tendering and the Conditionally Tendered Shares are subsequently selected by lot
for purchase subject to Section 1 of the Offer to Purchase. All tendered Shares
shall be deemed unconditionally tendered unless the Conditional Tender section
is completed. The Conditional Tender alternative is made available so that
shareholders may assure that any gain that they realize will be capital gain
rather than ordinary income for federal income tax purposes. Odd Lot Shares, in
order to be eligible for preferential treatment, cannot be conditionally
tendered. It is the tendering shareholder's responsibility to calculate the
minimum number of Shares, and each shareholder is urged to consult his own tax
advisor.
9. ORDER OF PURCHASE IN EVENT OF PRORATION. As described in Section 1 of
the Offer to Purchase, shareholders may designate the order in which their
Shares are to be purchased in the event of proration. The order of purchase may
have an effect on the federal income tax classification of any gain or loss on
the Shares purchased. See Sections l and 14 of the Offer to Purchase.
10. 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 the Letter of Transmittal or if such
certificate(s) and/or check(s) are to be sent to someone other than the person
signing the Letter of Transmittal or to the signer at a different address, the
boxes captioned "Special Payment Instructions" and/or "Special Delivery
Instructions" on this Letter of Transmittal should be completed as applicable
and signatures must be guaranteed as described in Instruction 1.
11. IRREGULARITIES. All questions as to the number of 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, which determinations 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 and any defect or irregularity in the tender of any particular Shares, and
the Company's interpretation of the terms of the Offer as amended by the
Supplement (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 or waived. 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, 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.
12. 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, the Notice of Guaranteed Delivery and this Letter of
Transmittal may be obtained from, the Information Agent or the Dealer Manager at
their addresses and telephone numbers set forth at the end of this Letter of
Transmittal or from your broker, dealer, commercial bank or trust company.
13. FORM W-9 AND FORM W-8. Shareholders other than corporations and
certain foreign individuals may be subject to backup federal income tax
withholding. Each such tendering shareholder or other payee who does not
otherwise establish to the satisfaction of the Depositary an exemption from
backup federal income tax withholding is required to provide the Depositary with
a correct taxpayer identification number
<PAGE> 9
("TIN") on Form W-9 which is provided with this Letter of Transmittal, and to
indicate that the shareholder or other payee is not subject to backup
withholding. For an individual, his TIN will generally be his social security
number. Failure to provide the information on the form may subject the tendering
shareholder or other payee to 31% backup federal income tax withholding on the
payments made to the shareholder or other payee with respect to Shares purchased
pursuant to the Offer and up to a $50.00 penalty imposed by the Internal Revenue
Service. Backup withholding is not an additional tax. Rather, the tax liability
of persons subject to backup withholding will be reduced by the amount of tax
withheld. If withholding results in an overpayment of taxes, a refund may be
obtained. You may submit the form if you have applied for, but have not yet
received, a TIN. If the Depositary is not provided a TIN within sixty (60) days,
the Depositary will withhold 31% on all payments thereafter until a TIN is
provided to the Depositary. Shareholders who are foreign individuals should
submit Form W-8 to certify that they are exempt from backup withholding, unless
Instruction 14 applies. Form W-8 may be obtained from the Depositary. For
additional information concerning Form W-9, see the accompanying instructions
thereto.
14. WITHHOLDING ON FOREIGN SHAREHOLDERS. The Depositary will withhold
federal income tax equal to 30% of the gross proceeds payable to a foreign
shareholder 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 such gross proceeds are effectively connected
with the conduct of a trade or business in the United States. For this purpose,
a foreign shareholder is any shareholder that is not (i) a citizen or resident
of the United States, (ii) a corporation, partnership or other entity created or
organized in or under the laws of the United States or any political subdivision
thereof or (iii) an estate or trust the income of which is subject to United
States federal income taxation regardless of the source of such income. In order
to apply for a reduced rate of withholding pursuant to a tax treaty, a foreign
shareholder must deliver to the Depositary a properly completed Form 1001. In
order to apply for exemption from withholding on the basis that the gross
proceeds are effectively connected with the conduct of a trade or business in
the United States, a foreign shareholder must deliver to the Depositary a
properly completed Form 4224. (Exemption from backup withholding does not exempt
a foreign shareholder from the 30% withholding.) These forms can be obtained
from the Depositary, the Information Agent, or the Dealer Manager. The
Depositary will determine a shareholder's status as a foreign shareholder and
eligibility for a reduced rate of, or an exemption from, withholding by
reference to the shareholder's address and to any submitted certificates or
statements concerning eligibility for a reduced rate of, or exemption from,
withholding, unless facts and circumstances indicate that reliance is not
warranted or applicable law requires some other method for determining
eligibility for determining whether a reduced rate of withholding is applicable.
A foreign shareholder with respect to whom tax has been withheld may be eligible
to obtain a refund of all or a portion of the withheld tax if such shareholder
meets one of the exceptions for capital gain or loss treatment described in
Section 14 of the Offer to Purchase or is otherwise able to establish that no
tax or a reduced amount of tax was due. Foreign shareholders are urged to
consult their tax advisors regarding the application of federal income tax
withholding, including eligibility for a withholding tax reduction or exemption
and the refund procedures.
<PAGE> 10
<TABLE>
<S> <C> <C> <C>
Form W-9
(Rev. January 1993) GIVE THIS FORM
REQUEST FOR TAXPAYER TO
Department of the IDENTIFICATION NUMBER AND CERTIFICATION THE REQUESTER.
Treasury DO NOT SEND TO
Internal Revenue IRS.
Service
- - -----------------------------------------------------------------------------------------------------------------
Name (if joint names, list first and circle the name of the person or entity whose number you enter in Part
1 below. SEE INSTRUCTIONS ON PAGE 2 IF YOUR NAME HAS CHANGED.)
--------------------------------------------------------------------------------------------------------------
Business name (Sole proprietors SEE instructions on page 2). (IF YOU ARE EXEMPT FROM BACKUP WITHHOLDING,
COMPLETE THIS FORM AND ENTER "EXEMPT" IN PART II BELOW.)
--------------------------------------------------------------------------------------------------------------
List account numbers(s) here
Address (number and street) (optional)
-----------------------------------------------------------------------
City, state, and ZIP code
- - -----------------------------------------------------------------------------------------------------------------
PART 1 TAXPAYER IDENTIFICATION NUMBER (TIN)
- - ----------------------------------------------------------
Enter your TIN in the appropriate box. For
individuals, this is your social security number
(SSN). For sole proprietors, see the instructions Social Security number
on page 2. For other entities, it is your employer
identification number (EIN). If you do not have a
number, see HOW TO OBTAIN A TIN below. - -
-----------------------------
NOTE: If the account is in more than one name,
see the chart on page 2 for guidelines on whose OR
number to enter.
Employee identification number
-
-----------------------------
- - --------------------------------------------------------------------------------------------
<CAPTION>
PART 1 TAXPAYER IDENTIFICATION NUMBER (TIN) PART II For Payees Exempt From
<S> <C>
- - ----------------------------------------------------------
Enter your TIN in the appropriate box. For Backup Withholding (See
individuals, this is your social security number Exempt Payees and Payments on page
(SSN). For sole proprietors, see the instructions 2)
on page 2. For other entities, it is your employer ---------------------------------------------
identification number (EIN). If you do not have a
number, see HOW TO OBTAIN A TIN below.
---------------------------------------------
NOTE: If the account is in more than one name, Requester's name and address (optional)
see the chart on page 2 for guidelines on whose
number to enter.
- - --------------------------------------------------------------------------------------------
</TABLE>
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
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. For real estate
transactions, item 2 does not apply. For mortgage interest paid, the acquisition
or abandonment of secured property, contributions to an individual retirement
arrangement (IRA), and generally payments other than interest and dividends, you
are not required to sign the Certification, but you must provide your correct
TIN. (Also see SIGNING THE CERTIFICATION on page 2).
<TABLE>
<S> <C> <C>
- - --------------------------------------------------------------------------------
SIGN
HERE SIGNATURE DATE
- - ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Section references are to the Internal Revenue Code.
PURPOSE OF FORM.-- A person who is required to file an information return with
the IRS must obtain your correct TIN to report income paid to you, real estate
transactions, mortgage interest you paid, the acquisition or abandonment of
secured property, or contributions you made to an IRA. Use Form W-9 to furnish
your correct TIN to the requester (the person asking you to furnish your TIN)
and, when applicable, (1) to certify that the TIN you are furnishing is correct
(or that you are waiting for a number to be issued), (2) to certify that you are
not subject to backup withholding, and (3) to claim exemption from backup
withholding if you are an exempt payee. Furnishing your correct TIN and making
the appropriate certifications will prevent certain payments from being subject
to backup withholding.
NOTE: If a requester gives you a form other than a W-9 to request your TIN, you
must use the requester's form.
HOW TO OBTAIN A TIN.-- If you do not have a TIN, apply for one immediately. To
apply, get FORM SS-5, Application for a Social Security Card (for individuals),
from your local office of the Social Security Administration, or FORM SS-4,
Application for Employer Identification Number (for businesses and all other
entities), from your local IRS office.
To complete Form W-9 if you do not have a TIN, write "Applied for" in the space
for the TIN in Part 1, sign and date the form, and give it to the requester.
Generally, you will then have 60 days to obtain a TIN and furnish it to the
requester. If the requester does not receive your TIN within 60 days, backup
withholding, if applicable, will begin and continue until you furnish your TIN
to the requester. For reportable interest or dividend payments, the payer must
exercise one of the following options concerning backup withholding during this
60-day period. Under option (1), a payer must backup withhold on any withdrawals
you make from your account after 7 business days after the requester receives
this form back from you. Under option (2), the payer must backup withhold on any
reportable interest or dividend payments made to your account, regardless of
whether you make any withdrawals. The backup withholding under option (2) must
begin no later than 7 business days after the requester receives this form back.
Under option (2), the payer is required to refund the amounts withheld if your
certified TIN is received within the 60-day period and you were not subject to
backup withholding during that period.
NOTE: Writing "Applied for" on the form means that you have already applied for
a TIN OR that you intend to apply for one in the future.
As soon as you receive your TIN, complete another Form W-9, include your TIN,
sign and date the form, and give it to the requester.
WHAT IS BACKUP WITHHOLDING?-- Persons making certain payments to you after 1992
are required to withhold and pay to the IRS 31% of such payments under certain
conditions. This is called "backup withholding." Payments that could be subject
to backup withholding include interest, dividends, broker and barter exchange
transactions, rents, royalties, nonemployee compensation, and certain payments
from fishing boat operators, but do not include real estate transactions.
If you give the requester your correct TIN, make the appropriate
certifications, and report all your taxable interest and dividends on your tax
return, your payments will not be subject to backup withholding. Payments you
receive will be subject to backup withholding if:
1. You do not furnish your TIN to the requester, or
2. The IRS notifies the requester that you furnished an incorrect TIN, or
3. You are notified by the IRS that you are subject to backup withholding
because you failed to report all your interest and dividends on your tax return
(for reportable interest and dividends only), or
4. You do not certify to the requester that you are not subject to backup
withholding under 3 above (for reportable interest and dividend accounts opened
after 1983 only), or
5. You do not certify your TIN. This applies only to reportable interest,
dividend, broker, or barter exchange accounts opened after 1983, or broker
accounts considered inactive in 1983.
Except as explained in 5 above, other reportable payments are subject to backup
withholding only if 1 or 2 above applies. Certain payees and payments are exempt
from backup withholding and information reporting. See PAYEES AND PAYMENTS
EXEMPT FROM
- - --------------------------------------------------------------------------------
1/11/93 Cat. No. 10231X Form W-9 (Rev. 1-93)
<PAGE> 11
Form W-9 (Rev. 1-93) Page 2
- - --------------------------------------------------------------------------------
BACKUP WITHHOLDING, below, and Exempt PAYEES AND PAYMENTS under Specific
Instructions, below, if you are an exempt payee.
PAYEES AND PAYMENTS EXEMPT FROM BACKUP WITHHOLDING.-- The following is a list of
payees exempt from backup withholding and for which no information reporting is
required. For interest and dividends, all listed payees are exempt except item
(9). For broker transactions, payees listed in (1) through (13) and a person
registered under the Investment Advisers Act of 1940 who regularly acts as a
broker are exempt. Payments subject to reporting under sections 6041 and 6041A
are generally exempt from backup withholding only if made to payees described in
items (1) through (7), except a corporation that provides medical and health
care services or bills and collects payments for such services is not exempt
from backup withholding or information reporting. Only payees described in items
(2) through (6) are exempt from backup withholding for barter exchange
transactions, patronage dividends, and payments by certain fishing boat
operators.
(1) A corporation. (2) An organization exempt from tax under section 501(a), or
an IRA or a custodial account under section 403(b)(7). (3) The United States or
any of its agencies or instrumentalities. (4) A state, the District of Columbia,
a possession of the United States, or any of their political subdivisions or
instrumentalities. (5) A foreign government or any of its political
subdivisions, agencies, or instrumentalities. (7) A foreign central bank of
issue. (8) A dealer in securities or commodities required to register in the
United States or a possession of the United States. (9) A futures commission
merchant registered with the Commodity Futures Trading Commission. (10) A real
estate investment trust. (11) An entity registered at all times during the tax
year under the Investment Company Act of 1940. (12) A common trust fund operated
by a bank under section 584(a). (13) A financial institution. (14) A middleman
known in the investment community as a nominee or listed in the most recent
publication of the American Society of Corporate Secretaries, Inc., Nominee
List. (15) A trust exempt from tax under section 664 or described in section
4947.
Payments of dividends and patronage dividends generally not subject to backup
withholding include the following:
- - - Payments to nonresident aliens subject to withholding under section 1441.
- - - Payments to partnerships not engaged in a trade or business in the United
States and that have at least one nonresident partner.
- - - Payments of patronage dividends not paid in money.
- - - Payments made by certain foreign organizations.
Payments of Interest generally not 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 TIN to the payer.
- - - Payments of tax-exempt interest (including exempt-interest dividends under
section 852).
- - - Payments described in section 6049(b)(5) to nonresident aliens.
- - - Payments on tax-free covenant bonds under section 1451.
- - - Payments made by certain foreign organizations.
- - - Mortgage interest paid to you.
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, and their regulations.
PENALTIES
FAILURE TO FURNISH TIN.-- If you fail to furnish your correct TIN to a
requester, 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.
CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.-- If you make a
false statement with no reasonable basis that results in no backup withholding,
you are subject to a $500 penalty.
CRIMINAL PENALTY FOR FALSIFYING INFORMATION.-- Willfully falsifying
certifications or affirmations may subject you to criminal penalties including
fines and/or imprisonment.
MISUSE OF TINS.-- If the requester discloses or uses TINs in violation of
Federal law, the requester may be subject to civil and criminal penalties.
SPECIFIC INSTRUCTIONS
NAME.-- If you are an individual, you must generally provide the name shown on
your social security card. However, if you have changed your last name, for
instance, due to marriage, without informing the Social Security Administration
of the name change, please enter your first name, the last name shown on your
social security card, and your new last name.
If you are a sole proprietor, you must furnish your individual name and either
your SSN or EIN. You may also enter your business name or "doing business as"
name on the business name line. Enter your name(s) as shown on your social
security card and/or as it was used to apply for your EIN on Form SS-4.
SIGNING THE CERTIFICATION.--
1. INTEREST, DIVIDEND, AND BARTER EXCHANGE ACCOUNTS OPENED BEFORE 1984 AND
BROKER ACCOUNTS CONSIDERED ACTIVE DURING 1983. You are required to furnish your
correct TIN, but you are not required to sign the certification.
2. INTEREST, DIVIDEND, BROKER, AND BARTER EXCHANGE ACCOUNTS OPENED AFTER 1983
AND BROKER ACCOUNTS CONSIDERED INACTIVE DURING 1983. You must sign the
certification or backup withholding will apply. If you are subject to backup
withholding and you are merely providing your correct TIN to the requester, you
must cross out item 2 in the certification before signing the form.
3. REAL ESTATE TRANSACTIONS. You must sign the certification. You may cross out
item 2 of the certification.
4. OTHER PAYMENTS.You are required to furnish your correct TIN, but you are not
required to sign the certification unless you have been notified of an incorrect
TIN. Other payments include payments made in the course of the requester's trade
or business for rents, royalties, goods (other than bills for merchandise),
medical and health care services, payments to a nonemployee for services
(including attorney and accounting fees), and payments to certain fishing boat
crew members.
5. MORTGAGE INTEREST PAID BY YOU, ACQUISITION OR ABANDONMENT OF SECURED
PROPERTY, OR IRA CONTRIBUTIONS. You are required to furnish your correct TIN,
but you are not required to sign the certification.
6. EXEMPT PAYEES AND PAYMENTS. If you are exempt from backup withholding, you
should complete this form to avoid possible erroneous backup withholding. Enter
your correct TIN in Part 1, write "EXEMPT" in the block in Part II, and sign and
date the form. If you are a nonresident alien or foreign entity not subject to
backup withholding, give the requester a completed Form W-8, Certificate of
Foreign Status.
7. TIN "APPLIED FOR". Follow the instructions under How To Obtain a TIN, on
page 1, and sign and date this form.
SIGNATURE.-- For a joint account, only the person whose TIN is shown in Part I
should sign.
PRIVACY ACT NOTICE.-- Section 6109 requires you to furnish your correct TIN to
persons who must file information returns with IRS to report interest,
dividends, and certain other income paid to you, mortgage interest you paid, the
acquisition or abandonment of secured property, or contributions you made to an
IRA. The IRS uses the numbers for identification purposes and to help verify the
accuracy of your tax return. You must provide your TIN whether or not you are
required to file a tax return. Payers must generally withhold 31% of taxable
interest, dividend, and certain other payments to a payee who does not furnish a
TIN to a payer. Certain penalties may also apply.
WHAT NAME AND NUMBER TO GIVE THE REQUESTER
<TABLE>
<S> <C>
- - -------------------------------------------
FOR THIS TYPE OF ACCOUNT: GIVE NAME AND SSN OF:
- - -------------------------------------------
1. Individual The individual
2. Two or more The actual owner of the
individuals (joint account or, if combined
account) funds, the first
individual on the
account.(1)
3. Custodian account of The minor(2)
a minor (Uniform
Gift to Minors Act)
4. a. The usual The grantor-trustee(1)
revocable savings
trust (grantor is
also trustee)
b. So-called trust The actual owner(1)
account that is
not a legal or
valid trust under
state law
5. Sole proprietorship The owner(3)
- - -------------------------------------------
FOR THIS TYPE OF ACCOUNT: GIVE NAME AND EIN OF:
- - -------------------------------------------
6. Sole proprietorship The owner(3)
7. A valid trust, Legal entity(4)
estate, or pension
trust
8. Corporate The corporation
9. Association, club, The organization
religious,
charitable,
educational, or
other tax-exempt
organization
10. Partnership The partnership
11. A broker or The broker or nominee
registered nominee
12. 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 SSN.
(3) Show your individual name. You may also enter your business name. You may
use your SSN or EIN.
(4) List first and circle the name of the legal trust, estate, or pension trust.
(Do not furnish the TIN of the personal representative or trustee unless the
legal entity itself is not designated in the account title.)
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.
W-9.2
<PAGE> 12
Facsimile copies of the Letter of Transmittal will be accepted from
Eligible Institutions. The Letter of Transmittal and certificates for shares and
any other required documents should be sent or delivered by each tendering
shareholder or his broker, dealer, commercial bank, trust company or other
nominee to the Depositary at one of its addresses set forth below.
The Depositary is:
THE BANK OF NEW YORK
<TABLE>
<S> <C> <C>
By Mail: Facsimile Transmission: By Hand or Overnight Courier:
Tender and Exchange Department (for Eligible Institutions Only) Tender & Exchange Department
P.O. Box 11248 (212) 815-6213 101 Barclay Street
Church Street Station Receive and Deliver Window
New York, NY 10286-1248 For Information Telephone: New York, NY 10286
(800) 507-9357
</TABLE>
Any questions or requests for assistance or for additional copies of the
Supplement, the Offer to Purchase, the Letter of Transmittal or the Notice of
Guaranteed Delivery may be directed to the Information Agent at the telephone
numbers and addresses set forth below. You may also contact the Dealer Manager
or your broker, dealer, commercial bank or trust company for assistance
concerning the offer. To confirm the delivery of your shares, you are directed
to contact the Depositary.
The Information Agent is:
D.F. KING & CO., INC.
77 Water Street
New York, NY 10005
CALL COLLECT (212) 269-5550 or
CALL TOLL FREE (800) 207-3158
The Dealer Manager for the Offer is:
WASSERSTEIN PERELLA & CO., INC.
31 West 52nd Street
New York, New York 10019
(212) 969-2700
(call collect)
February 6, 1995
<PAGE> 1
WASSERSTEIN PERELLA & CO., INC.
31 WEST 52ND STREET
NEW YORK, NY 10019
TRAK AUTO CORPORATION
AMENDED OFFER TO PURCHASE FOR CASH UP TO 1,500,000 SHARES OF ITS COMMON STOCK AT
A PURCHASE PRICE OF $20.50 PER SHARE
THE OFFER HAS BEEN EXTENDED. THE OFFER, PRORATION PERIOD AND
WITHDRAWAL RIGHTS NOW EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON TUESDAY, FEBRUARY 21, 1995, UNLESS THE
OFFER IS FURTHER EXTENDED.
February 6, 1995
To: Brokers, Dealers, Commercial Banks,
Trust Companies, and Other Nominees
Trak Auto Corporation, a Delaware corporation (the "Company"), has amended
and supplemented its Offer to Purchase dated December 21, 1994 (the "Offer to
Purchase") with a Supplement dated February 6, 1995 (which, together with the
Offer to Purchase and the related revised Letter of Transmittal, now constitutes
the "Offer").
The Supplement amends the Offer to Purchase by increasing the Purchase
Price from $17.50 per Share to $20.50 per Share, removing the condition that at
least 1,500,000 Shares be validly tendered and not withdrawn in response to the
Offer, and making certain other changes. In addition, the Supplement provides
information regarding recent developments relating to the Company and amends
certain information to reflect the revised terms of the Offer.
AS AMENDED BY THE SUPPLEMENT, THE OFFER IS NO LONGER CONDITIONED UPON ANY
MINIMUM NUMBER OF SHARES BEING TENDERED. THE OFFER REMAINS SUBJECT TO THERE
BEING AT LEAST 500 BENEFICIAL OWNERS OF SHARES FOLLOWING COMPLETION OF THE
OFFER, AND ON CERTAIN OTHER CONDITIONS AS SET FORTH IN SECTION 6 OF THE OFFER TO
PURCHASE AS AMENDED BY THE SUPPLEMENT.
We are asking you to contact your clients for whom you hold Shares
registered in your name (or in the name of your nominee). Please bring the
amendment to the Offer to their attention as promptly as possible. In connection
with the Offer, enclosed for your information and for forwarding to your clients
for whom you hold Shares registered in your name or in the name of your nominee
are copies of the Supplement to the Offer to Purchase.
WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. THE OFFER,
PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON TUESDAY, FEBRUARY 21, 1995, UNLESS THE OFFER IS FURTHER EXTENDED.
<PAGE> 2
No fees or commissions will be payable to brokers, dealers or any person
for soliciting tenders of Shares pursuant to the Offer, other than fees paid to
the Depositary, the Information Agent and the Dealer Manager 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 the beneficial owners of Shares held by you as a nominee
or in a fiduciary capacity. The Company will pay your costs and will pay any
stock transfer taxes applicable to its purchase of Shares, except as otherwise
provided in Instruction 6 of the Letter of Transmittal.
In order to take advantage of the Offer as amended by the Supplement, a
duly executed and properly completed Letter of Transmittal and any other
required documents should be sent to the Depositary with either the
certificate(s) representing the tendered Shares or confirmation of their
book-entry transfer all in accordance with the instructions set forth in the
Letter of Transmittal and the Offer to Purchase.
As described in Section 3, "Procedure for Tendering Shares," of the Offer
to Purchase, tenders may be made without the concurrent deposit of stock
certificates or concurrent compliance with the procedure for book-entry transfer
if such tenders are made by or through a broker or dealer which is a financial
institution that is a member of the Securities Transfer Agents Medallion Program
(STAMP), the Stock Exchange Medallion Program (SEMP) or the New York Stock
Exchange Medallion Signature Program (MSP). Certificates for Shares so tendered
(or confirmation of a book-entry transfer of such Shares to the Depositary or
deposited to its account at one of the book-entry transfer facilities described
in the Offer to Purchase), together with a properly completed and duly executed
Letter of Transmittal and any other documents required by the Letter of
Transmittal, must be received by the Depositary within five (5) business days
after timely receipt by the Depositary of a properly completed and duly executed
Notice of Guaranteed Delivery. Any questions or requests for assistance or
additional copies of the Offer to Purchase and the Letter of Transmittal may be
directed to the Dealer Manager or the Information Agent.
Very truly yours,
WASSERSTEIN PERELLA & CO., INC.
-------------------------------------------------------------------------
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON AS AN AGENT OF THE COMPANY OR ANY OF ITS AFFILIATES, THE
DEALER MANAGER, THE DEPOSITARY OR THE INFORMATION AGENT, OR AUTHORIZE YOU OR ANY
OTHER PERSON TO USE ANY DOCUMENTS OR MAKE ANY STATEMENT ON BEHALF OF ANY OF THEM
IN CONNECTION WITH THE OFFER OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH.
2
<PAGE> 1
TRAK AUTO CORPORATION
AMENDED OFFER TO PURCHASE FOR CASH UP TO
1,500,000 SHARES OF ITS COMMON STOCK,
AT A PURCHASE PRICE OF $20.50 PER SHARE
February 6, 1995
To Our Clients:
Enclosed for your consideration is a Supplement dated February 6, 1995 (the
"Supplement") to the Offer to Purchase dated December 21, 1994 and a related
revised Letter of Transmittal (which, together with the initial Offer to
Purchase, constitute the "Offer") in connection with the Offer by Trak Auto
Corporation, a Delaware corporation (the "Company"), to purchase for cash up to
1,500,000 shares of its Common Stock, par value $0.01 per share (the "Shares"),
at a price, net to the seller in cash, of $20.50 per Share, upon the terms and
subject to the conditions of the Offer as amended by the Supplement.
THE SUPPLEMENT AMENDS AND SUPPLEMENTS THE OFFER BY INCREASING THE PURCHASE
PRICE FROM $17.50 PER SHARE TO $20.50 PER SHARE, REMOVING THE CONDITION THAT AT
LEAST 1,500,000 SHARES BE VALIDLY TENDERED AND NOT WITHDRAWN IN RESPONSE TO THE
OFFER, AND MAKING CERTAIN OTHER CHANGES. IN ADDITION, THE SUPPLEMENT PROVIDES
INFORMATION REGARDING RECENT DEVELOPMENTS RELATING TO THE COMPANY AND AMENDS
CERTAIN INFORMATION TO REFLECT THE REVISED TERMS OF THE OFFER. THE OFFER REMAINS
SUBJECT TO THE CONDITION THAT THERE BE AT LEAST 500 BENEFICIAL OWNERS OF SHARES
FOLLOWING COMPLETION OF THE OFFER, AND ON CERTAIN OTHER CONDITIONS AS SET FORTH
IN SECTION 6 OF THE OFFER TO PURCHASE AS AMENDED BY THE SUPPLEMENT.
WE ARE THE HOLDER OF RECORD OF SHARES HELD FOR YOUR ACCOUNT. AS SUCH, WE
ARE THE ONLY ONES WHO CAN TENDER YOUR SHARES, AND THEN ONLY PURSUANT TO
INSTRUCTIONS. WE ARE SENDING YOU THE LETTER OF TRANSMITTAL FOR YOUR INFORMATION
ONLY; YOU CANNOT USE IT TO TENDER SHARES WE HOLD FOR YOUR ACCOUNT.
If you have previously instructed us to tender any or all of the Shares we
hold for your account on the terms and subject to the conditions of the Offer,
they remain properly tendered pursuant to the Offer as amended and you will
receive the Revised Purchase Price for any and all of your Shares purchased
pursuant to the Offer. If you have not previously so instructed us and you would
like us to tender any or all of the Shares we hold for your account on the terms
and subject to the conditions of the Offer as amended, please do so by 5:00 PM
on Tuesday, February 21, 1995.
We call your attention to the following:
1. The tender price has been increased to $20.50 per Share, net to the
seller in cash.
2. You may condition your tender of Shares on the Company purchasing
all or a minimum number of your Shares.
3. You may designate the priority in which your shares shall be
purchased in the event of proration.
4. The Offer, proration period, and withdrawal rights will expire at
5:00 P.M., New York City Time, on Tuesday, February 21, 1995, unless the
Company further extends the Offer.
5. The Offer is for up to 1,500,000 Shares, constituting approximately
25% of the Shares outstanding as of December 20, 1994.
6. Tendering shareholders will not be obligated to pay any brokerage
commissions, solicitation fees or, subject to Instruction 6 of the Letter
of Transmittal, stock transfer taxes on the Company's purchase of Shares
pursuant to the Offer.
7. If you beneficially held, as of the close of business on December
20, 1994, an aggregate of fewer than 100 Shares, and you instruct us to
tender on your behalf all such Shares before the Expiration Date and check
the box captioned "Odd Lots" in the attached Instruction Form, the Company,
upon the terms and subject to the conditions of the Offer as amended, may
accept all such Shares for purchase before proration, if any, of the
purchase of other Shares properly tendered as described below.
8. If you wish to have us tender any or all of your Shares, please so
instruct us by completing, executing and returning to us the attached
Instruction Form. An envelope to return your instructions to us is
enclosed. If you authorize us to tender your Shares, we will tender all
such Shares unless you specify otherwise on the attached Instruction Form.
<PAGE> 2
YOUR INSTRUCTION FORM SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT US
TO SUBMIT A TENDER ON YOUR BEHALF ON OR BEFORE THE EXPIRATION OF THE OFFER AS
AMENDED. THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 PM,
NEW YORK CITY TIME, ON TUESDAY, FEBRUARY 21, 1995, UNLESS THE OFFER IS FURTHER
EXTENDED.
As described in Section 1 of the Offer to Purchase, if before the
Expiration Date more than 1,500,000 Shares (or such greater number of Shares as
the Company elects to purchase) are properly tendered and not withdrawn, the
Company will accept Shares for purchase at the Revised Purchase Price in the
following order of priority:
(a) first, all Shares properly tendered prior to the Expiration Date
(and not withdrawn) by any Odd Lot Owner (as defined in the Offer to
Purchase) who:
(1) tenders all Shares beneficially owned by such Odd Lot Owner
(partial tenders and conditional tenders will not qualify for this
preference); and
(2) completes the section entitled "Odd Lots" on the Letter of
Transmittal and, if applicable, on the Notice of Guaranteed Delivery;
and
(b) then, after purchase of all the foregoing Shares, all other Shares
properly and unconditionally tendered, and all other Shares properly and
conditionally tendered for which the condition can be satisfied on the
basis of the number of Shares tendered and the conditions thereto, in each
case before the Expiration Date (and not withdrawn), on a pro rata basis,
if necessary (with adjustments to avoid purchases of fractional Shares);
and
(c) then, if all the foregoing Shares are less than the number of
Shares the Company will accept for payment and no tenders have been
accepted on a pro rata basis, such additional number of Shares properly and
conditionally tendered before the Expiration Date (and not withdrawn) as to
which the condition was not satisfied as are necessary to reach the number
of Shares the Company will accept for payment. If such conditional tenders
are accepted, the Company will select conditional tenders by lot only from
shareholders who tender all Shares owned by them and will limit its
purchase in each case to the designated minimum number of Shares to be
purchased.
Notwithstanding the foregoing, the Company reserves the right not to accept
Shares tendered by Odd Lot Owners on a preferential basis (and instead to accept
such Shares on a pro rata basis with Shares tendered by other owners) if the
Company, in its sole discretion, determines that accepting such Shares on a
preferential basis would cause the minimum beneficial owners condition not to be
satisfied.
You may condition your tender on the Company purchasing a minimum number of
your tendered Shares. In such case, if as a result of the number of Shares
tendered, the Company would purchase less than the minimum number of your Shares
specified, then the Company will not purchase any of your Shares, except as
provided in (c) above.
The Offer is not being made to, nor will the Company accept tenders from,
owners of Shares in any jurisdiction in which the Offer or its acceptance would
not comply with the securities or Blue Sky law of such jurisdiction. The Company
is not aware of any jurisdiction in which the making of the Offer or the tender
of Shares would not be in compliance with the laws of such jurisdiction in which
it is asserted that the Offer cannot lawfully be made. So long as the Company
makes a good faith effort to comply with any state law deemed applicable to the
Offer, the Company believes that the exclusion of holders residing in such
jurisdiction is permitted under Rule 13e-4(f)(9) promulgated under the Exchange
Act. In any jurisdiction in which the securities or Blue Sky laws require the
Offer to be made by a licensed broker or dealer, the Offer is being made on the
Company's behalf by the Dealer Manager or one or more registered brokers or
dealers licensed under the law of such jurisdiction.
2
<PAGE> 3
TRAK AUTO CORPORATION
INSTRUCTION FORM WITH RESPECT TO THE AMENDED
OFFER TO PURCHASE FOR CASH UP TO 1,500,000 SHARES OF ITS COMMON STOCK
AT A PURCHASE PRICE OF $20.50 PER SHARE
The undersigned acknowledge(s) receipt of your letter and the enclosed
Supplement dated February 6, 1995 amending the Offer to Purchase dated December
21, 1994, and the related revised Letter of Transmittal (which, together with
the initial Offer to Purchase, constitute the "Offer") in connection with the
offer by Trak Auto Corporation, a Delaware corporation (the "Company"), to
purchase up to 1,500,000 shares of its Common Stock, par value $0.01 per share
(the "Shares"), at a price, net to the seller in cash, of $20.50 per Share, upon
the terms and subject to the conditions of the Offer as amended by the
Supplement.
The undersigned understands that shares properly tendered and not withdrawn
will be purchased at the Revised Purchase Price of $20.50 per Share, net to the
seller in cash, upon the terms and subject to the conditions of the Offer as
amended by the Supplement, including the proration terms and the minimum
beneficial owners condition described in the Offer to Purchase. The Company will
return all other Shares, including Shares not purchased because of proration or
conditional tenders. See Section 1 of the Offer to Purchase.
The undersigned hereby instruct(s) you to tender to the Company the number
of Shares indicated below, or if no number is indicated, all Shares you hold for
the account of the undersigned, pursuant to the terms and subject to the
conditions of the Offer as amended by the Supplement. The Company will return
Shares not purchased because of proration.
AGGREGATE NUMBER OF SHARES TO BE TENDERED
BY YOU FOR THE ACCOUNT OF THE UNDERSIGNED; *
---------------------- SHARES
* Unless otherwise indicated, all of the Shares held for the account of the
undersigned will be tendered.
3
<PAGE> 4
ODD LOTS
/ / By checking this box, the undersigned represents that the undersigned owned
beneficially as of the close of business on December 20, 1994 an aggregate
of fewer than 100 Shares and is instructing the holder to tender all such
Shares.
SHARES TENDERED PURSUANT TO THE FOREGOING
PROCEDURE CANNOT BE CONDITIONALLY TENDERED
CONDITIONAL TENDER
SEE INSTRUCTION 8 TO THE LETTER OF TRANSMITTAL
/ / Check here if tender of Shares is conditioned on the Company purchasing
all or a minimum number of the tendered Shares, and complete the
following:
Minimum number of Shares to be sold:
------------
SIGNATURE BOX
Signature(s)
---------------------------------------------------------------
Dated
---------------------------------------------------------------------
Name(s) and Address(es)
----------------------------------------------------
- - ---------------------------------------------------------------------------
(PLEASE PRINT)
Area Code and Telephone Number
---------------------------------------------
Taxpayer Identification or Social Security Number
--------------------------
4
<PAGE> 1
NOTICE OF GUARANTEED DELIVERY
OF
SHARES OF COMMON STOCK
OF
TRAK AUTO CORPORATION
A form substantially equivalent to that set forth below must be used to
accept the Offer (as defined below) if certificates for shares of Common Stock,
par value $0.01 per share ("Shares"), of Trak Auto Corporation are not
immediately available, or if the procedures for book-entry transfer, as set
forth in the Offer to Purchase as amended by the Supplement dated February 6,
1995, cannot be completed on a timely basis, or time will not permit the Letter
of Transmittal and other required documents to reach the Depositary by the
Expiration Date (as defined in the Offer to Purchase as amended by the
Supplement dated February 6, 1995). Such form may be delivered by hand, mail,
telegram, telex or facsimile transmission to the Depositary. See Section 3,
"Procedure for Tendering Shares," of the Offer to Purchase.
To The Depositary:
THE BANK OF NEW YORK
<TABLE>
<S> <C> <C>
By Mail: Facsimile Transmission: By Hand or Overnight Courier:
Tender and Exchange (for Eligible Institutions Tender & Exchange Department
Department Only) 101 Barclay Street
P.O. Box 11248 (212) 815-6213 Receive and Deliver Window
Church Street Station New York, NY 10286
New York, NY 10286-1248 For Information Telephone:
(800) 507-9357
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN THOSE SHOWN ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE NUMBER OTHER THAN THOSE LISTED ABOVE
DOES NOT CONSTITUTE A VALID DELIVERY.
Ladies and Gentlemen:
The undersigned hereby tenders to Trak Auto Corporation, a Delaware
corporation, upon the terms and subject to the conditions set forth in its Offer
to Purchase dated December 21, 1994 as amended by the Supplement dated February
6, 1995 and the related revised Letter of Transmittal (which together constitute
the "Offer"), receipt of which is hereby acknowledged,
- - ---------- Shares at the price of $20.50 per Share pursuant to the guaranteed
delivery procedures set forth in Section 3 of the Offer to Purchase.
<TABLE>
<S> <C>
Share Certificate Nos. (if available): Signature(s)
- - -------------------------------------------- ----------------------------------------
- - -------------------------------------------- Name(s):
If Shares will be delivered by book-entry -------------------------------------------
transfer. Address:
(Check one) --------------------------------------------
/ / The Depository Trust Company --------------------------------------------
/ / Midwestern Securities Trust Company Area Code and Telephone Number:
/ / Philadelphia Depository Trust Company --------------------------------------------
Account Number:
- - ----------------------------------
</TABLE>
<PAGE> 2
GUARANTEE
The undersigned, a financial institution that is a member of the Securities
Transfer Agents Medallion Program (STAMP), the Stock Exchange Medallion Program
(SEMP) or the New York Stock Exchange Medallion Signature Program (MSP),
guarantees (a) that the above-named person(s) "own(s)" the Shares tendered
hereby within the meaning of Rule 14e-4 under the Securities Exchange Act of
1934, as amended, (b) that such tender of Shares complies with Rule 14e-4 and
(c) that we will deliver to the Depositary either certificates representing the
Shares tendered hereby, in proper form for transfer, or confirmation of the
book-entry transfer of such Shares into the Depositary's account at The
Depository Trust Company, the Midwest Securities Trust Company or the
Philadelphia Depository Trust Company pursuant to the procedures for book-entry
tender set forth in the Offer to Purchase, in either case, together with a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof) with any required signature guarantees and any other documents required
by the Letter of Transmittal, within five (5) business days after the date of
receipt hereof by the Depositary.
Firm:
--------------------------------------
Sign Here:
--------------------------------------
(Authorized Signature)
--------------------------------------
(Title)
Name:
--------------------------------------
(Please Print or Type)
Address:
--------------------------------------
---------------------------------
Area Code and
Telephone Number:
-----------------------------------------------------------------------------
Dated:
- - ------------------------------------,
1995
2
<PAGE> 1
[TRAK AUTO NEWS RELEASE LETTERHEAD]
February 3, 1995
TRAK AUTO CORPORATION ANNOUNCES INCREASE IN OFFER PRICE
Trak Auto Corporation (Nasdaq: TRKA) today announced that it was
increasing the price at which it is offering to purchase shares of its common
stock pursuant to a tender offer that commenced December 21, 1994 from $17.50
per share to $20.50 per share. The Company also announced that it was
removing as a condition to the offer that at least 1,500,000 shares be tendered
and that instead, the Company would purchase as many shares as are tendered, up
to a maximum of 1,500,000 shares. The offer remains subject to the condition
that there be at least 500 beneficial owners of shares after completion of the
offer, and other conditions. The offer, which was set to expire at 5:00 p.m.,
Monday, February 6, 1995 has been extended until 5:00 p.m., Tuesday, February
21, 1995. The Company is distributing to all shareholders additional materials
describing the changes and including additional information relevant to the
offer. Shareholders are urged to review these materials completely.
As of 4:00 p.m., Friday, a total of 257,714 shares had been
validly tendered and not withdrawn in response to the offer.
Wasserstein Perella & Co. is the Dealer Manager and The Bank of
New York is the Depositary for the Offer. D.F. King & Co. serves as the
Information Agent.
<PAGE> 1
LOAN AGREEMENT
THIS LOAN AGREEMENT (this "Agreement") is made this 6th day of
February 1995, by and among TRAK AUTO CORPORATION (the "Borrower") and DART
GROUP CORPORATION (the "Lender");
WITNESSETH:
The Borrower has requested the Lender to make available to the
Borrower a revolving credit facility (the "Revolving Credit Facility") in the
principal amount not to exceed $10,000,000 at any one time outstanding. The
Revolving Credit Facility shall be used by the Borrower for short-term working
capital purposes. The Lender has agreed to make such Revolving Credit Facility
available to the Borrower upon and subject to the provisions of this Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. The Revolving Credit Facility.
1.1 Advances. Subject to and upon the provisions of this
Agreement and relying upon the representations and warranties herein set forth,
the Lender agrees at any time and from time to time upon request of the
Borrower to make advances (each an "Advance" and collectively the "Advances")
to the Borrower from the date hereof until the earlier of May 1, 1996 (the
"Revolving Credit Expiration Date") or the date on which this Revolving Credit
Facility is terminated pursuant to Section 7 hereof, in an aggregate principal
amount at any time outstanding not to exceed Ten Million Dollars ($10,000,000)
(the "Revolving Credit Amount"). No Advances shall be made hereunder if after
giving effect thereto the sum of the aggregate principal amount of all
outstanding Advances would exceed the Revolving Credit Amount. In no event
shall the Lender be obligated to make an Advance hereunder if an Event of
Default (as hereinafter defined) shall have occurred and be continuing. Unless
sooner terminated pursuant to the provisions of this Agreement, this Revolving
Credit Facility and the obligation of the Lender to make Advances hereunder
shall automatically terminate on the Revolving Credit Expiration Date without
further action by, or notice of any kind from, the Lender. Within the
limitations set forth herein and subject to the provisions of this Agreement,
the Borrower may borrow, repay and reborrow under this Revolving Credit
Facility. The fact that there may be no Advances outstanding at any particular
time shall not affect the continuing validity of this Agreement.
<PAGE> 2
1.2. Use of proceeds. Each Advance shall be advanced by the
Lender not later than the Business Day (as hereinafter defined) following the
day (which shall be a Business Day) of the Borrower's request therefor. The
proceeds of each Advance will be deposited by the Lender in a bank account
designated by the Borrower and shall be used by the Borrower for the purpose of
supporting short-term working capital needs of the Borrower.
1.3. Notes. Each Advance shall be evidenced by an individual
promissory Note (each a "Note" and collectively, the "Notes") made payable to
the Lender, from the Borrower in the principal amount of such Advance, each of
which Notes shall be substantially in the form attached hereto as Exhibit A.
1.4. Interest on and Principal of Advances. Until maturity
(whether by acceleration, declaration, extension or otherwise), the unpaid
principal amount of each Advance shall bear interest from the date of such
Advance until paid in full at an annual rate equal to the "prime rate" as set
forth in the "Money Rates" column of the Wall Street Journal, as such rate may
change from time to time, plus one percent (1%). Interest shall be shall be
payable monthly in arrears on the first day of each month. The unpaid
principal balance of each Advance, if not previously repaid, shall be due and
payable on the Revolving Credit Expiration Date.
1.5. Voluntary Prepayments of Advances. Within the limitations
set forth herein and subject to the provisions of this Agreement, the Borrower
may prepay any Advance at any time in whole or in part from time to time
without premium or penalty, and any such prepayment need not be accompanied by
payment of interest on the amount prepaid except that any prepayment of
Advances which constitutes a final payment of all Advances shall be accompanied
by payment of all interest thereon accrued through the date of prepayment.
1.6. Interest Calculation. All interest and fees payable under
the provisions of this Agreement or the Notes or shall be computed on the basis
of actual number of days elapsed over a year of 360 days.
1.7. Late Charges. If the Borrower fails to make any payment
of principal, interest, prepayments, fees or any other amount becoming due
pursuant to the provisions of this Agreement or the Notes, within ten days of
the date due and payable, the Borrower shall pay to the Lender, upon demand, a
late charge equal to five percent (5.0%) of the amount of such payment. Such
ten-day period shall not be construed in any way to extend the due date of any
such payment. Late charges are imposed for the purpose of defraying the
Lender's expenses incident to the handling of delinquent payments, and are in
addition to, and not in lieu of, the exercise by the Lender of any rights and
remedies hereunder or under applicable laws and
<PAGE> 3
any fees and expenses of any agents or attorneys which the Lender may employ
upon Default.
1.8. Advance Payments. Whenever any payment to be made by
the Borrower under the provisions of this Agreement or any of the Notes is due
on a day which is not a Business Day (as hereinafter defined), the due date
thereof shall be extended to the next succeeding Business Day and, in the case
of any payment which bears interest, such extension of time shall be included
in computing interest on such payment. "Business Day" as used herein means any
day other than Saturday, Sunday or other day on which commercial banks in the
State of Maryland are authorized to close. All payments of principal,
interest, fees or other amounts to be made by the Borrower under the provisions
of this Agreement or the Notes be paid without setoff or counterclaim to the
Lender at the Lender's office specified herein in lawful money of the United
States of America in immediately available good funds.
1.9. Definition of Obligations and Financing Documents. As
used in this Agreement, the term "Obligations" means collectively and includes
all present and future indebtedness, liabilities and obligations of any kind
and nature whatsoever of the Borrower to the Lender both now existing and
hereafter arising under, as a result of, on account of, or in connection with,
this Agreement and any and all amendments thereto, restatements thereof,
supplements thereto and modifications thereof made at any time and from time to
time hereafter, the Notes, any and all extensions, renewals or replacements
thereof, amendments thereto and restatements or modifications thereof made at
any time or from time to time hereafter, or the other Financing Documents (as
hereinafter defined), including, without limitation, future advances,
principal, interest, indemnities, fees, late charges, enforcement costs (as
hereinafter defined) and other costs and expenses whether direct, contingent,
joint, several, matured or unmatured. The term "Financing Documents" as used
herein means collectively and includes this Agreement, the Notes, and any other
instrument, document or agreement both now and hereafter executed, delivered or
furnished by the Borrower or any other person (as hereinafter defined)
evidencing, guaranteeing, securing or in connection with this Agreement or all
or any part of the Revolving Credit Facility.
SECTION 2. Conditions Precedent.
2.1. Initial Advance. The Lender may not make the initial
Advance hereunder unless the following conditions precedent have been satisfied
in a manner acceptable to the Lender:
(a) Borrower's Corporate Documents. The Lender shall have
received (i) a copy, certified as of a recent date by the Delaware Secretary of
State of the Articles of Incorporation
<PAGE> 4
of the Borrower, (ii) a long form Certificate of Good Standing for the Borrower
issued by the Delaware Secretary of State, and (iii) a copy, certified to the
Lender as true and correct as of the date hereof by the Secretary of the
Borrower, of the by-laws of the Borrower and the resolutions of the Borrower's
board at directors authorizing the execution and delivery of this Agreement and
the other Financing Documents to which the Borrower is a party and designating
by name and title the officer or officers of the Borrower who are authorized to
sign this Agreement and such other Financing Documents for and on behalf of the
Borrower and to make the borrowings hereunder.
(b) Financing Documents. The execution and delivery of each
of the Financing Documents required by the Lender to be executed and delivered
prior to the making of the initial Advance.
(c) Additional Documents. The furnishing in form and content
acceptable to the Lender of any additional documents, agreements,
certifications, record searches, insurance policies or opinions which the
Lender may deem necessary or desirable.
2.2. All Advances. The Lender may not make any Advance
hereunder if:
(a) Representations and Warranties. Any representation or
warranty made in or in connection with this Agreement and the other Financing
Documents is not true, correct and complete in all material respects on and as
of the date at any Advance as if made on such date;
(b) Revolving Credit Amount Exceeded. The total of the
aggregate amount of all outstanding Advances exceeds the Revolving Credit
Amount;
(c) Event of Default or Default. Any event of Default or
Default shall have occurred and be continuing.
SECTION 3. Representations and Warranties. The Borrower
represents and warrants to the Lender that the following statements are true,
correct and complete as of the date hereof and as of each date an Advance is or
is to be made hereunder:
3.1. Authority, Etc. The Borrower is a corporation duly
organized, existing and in good standing under the laws of the jurisdiction of
its incorporation and is qualified to do business in all states where it
conducts business. The Borrower has the full power and authority to execute,
deliver and perform this Agreement and the full power and authority to execute,
deliver and perform any other Financing Documents to which the Borrower is a
party. Neither such execution, delivery and performance, nor compliance by the
Borrower with the provisions of this Agreement and of the other Financing
Documents to which the Borrower is a party will
<PAGE> 5
conflict with or result in a breach or violation of the Borrower's articles of
incorporation or by-laws, or any judgment, order, regulation, ruling or law to
which the Borrower is subject or any contract or agreement to which the
Borrower is a party or to which any of the Borrower's assets and properties is
subject, or constitute a default thereunder. The execution, delivery and
performance of this Agreement and all other Financing Documents to which the
Borrower is a party have been duly authorized and approved by all necessary
corporate action by the Borrower and constitute the legal, valid and binding
obligations of the Borrower enforceable in accordance with their terms.
3.2. Litigation. There is no litigation or proceeding
pending or, to the knowledge of any representative of the borrower signing this
Agreement on behalf of the Borrower, threatened against or affecting the
Borrower which might materially adversely affect the business, financial
condition or operations of the Borrower or the ability of the Borrower to
perform and comply with this Agreement or the other Financing Documents to
which the Borrower is a party.
3.3. Financial Condition. The Borrower has heretofore
furnished to the Lender certain financial statements and other financial
information. Such financial statements and all other financial statements and
information furnished or to be furnished to the Lender hereunder have been and
will be prepared in accordance with generally accepted accounting principles
and fairly present the financial condition of the borrower at such date and the
results of the operations of the Borrower for the period then ended.
3.4. Taxes. The Borrower has filed all federal, state and
local income, excise, property and other tax returns which are required to be
filed and has paid all taxes as shown on such returns or assessments received
by the Borrower (including, without limitation, all F.I.C.A. payments and
withholding taxes, if appropriate), except for such taxes, if any, as are
being contested in good faith and as to which adequate reserves have been
provided. No tax liens have been filed and no claims are being asserted with
respect to such taxes or assessments.
3.5. Title to Properties. The Borrower has good and
marketable title to all of its assets and properties.
3.6. Material Agreements. The Borrower is not in default or
breach in the performance, observance or fulfillment or any of the terms,
conditions or provisions of any instrument, agreement or document to which the
Borrower is a party (including, without limitation, any instrument or agreement
evidencing or made in connection with any indebtedness or liabilities) which
default or breach might have a material adverse effect on the financial
condition of the Borrower.
<PAGE> 6
3.7. Licenses, etc. The Borrower has obtained and now holds
all licenses, permits, franchises, patents, trademarks, copyrights and trade
names which are necessary to the conduct of the business of the Borrower as now
conducted.
3.8. Accuracy of Information. No information, exhibit,
report, statement or document furnished by the Borrower or any other person to
the Lender in connection with the Advances, this Agreement or the other
Financing Documents or the negotiation thereof contains any material
misstatement of fact or omitted to state a material fact or any fact necessary
to make the statements contained herein or therein not misleading.
SECTION 4. Affirmative Covenants. The Borrower covenants and
agrees with the Lender that so long as any of the obligations shall be
outstanding, the Borrower shall:
4.1. Financial Statements and Other Reports. Maintain at all
times a system of accounting established and administered in accordance with
sound business practices, and will deliver, or cause to be delivered, to the
Lender (a) as soon as available but in no event more than 90 days after the end
of each fiscal quarter in each fiscal year of the Borrower, the Borrower's 10Q
statements, (b) as soon as available, but in no event more than 150 days after
the end of each fiscal year of the Borrower, the Borrower's 10K statements, and
(c) promptly upon request of the Lender such other information, reports or
documents in the possession of the Borrower or the Borrower's agents,
respecting the business, properties, operation or financial condition of the
Borrower as the Lender may at any time and from time to time reasonably
request.
4.2. Conduct of Business and Maintenance of Existence.
Continue to engage in business of the same general type as now being conducted
by it, and do and cause to be done all things necessary to maintain and keep in
full force and effect its corporate existence in good standing in each
jurisdiction in which it continues to conduct business.
4.3. Compliance with Laws. Comply with all laws, rules,
regulations and decrees to which the Borrower may be subject, a violation of
which may have a material adverse effect on the business, operation or
financial condition of the Borrower.
4.4. Payment of Liabilities and Taxes. Pay, when due, all of
its indebtedness and liabilities (including, without limitation, the
Obligations), and pay and discharge promptly all taxes, assessments and
governmental charges and levies (including, without limitation. F.I.C.A.
payments and withholding taxes) upon the Borrower or upon the income, profits
or property of the Borrower, except to the extent the amount or validity of any
tax or other governmental charge is contested in good faith or the amount of
any other indebtedness or liability is contested
<PAGE> 7
in good faith, so long as adequate reserves have been set aside therefor.
4.5. Contractual Obligations. Comply with any agreement or
undertaking to which the Borrower is a party and maintain in full force and
effect all contracts and leases to which the Borrower is or becomes a party
unless the failure to do so would not have a material adverse effect on the
business, operation, properties or financial condition of the Borrower.
4.6. Maintenance of Properties. Do all things necessary to
maintain, preserve, protect and keep its properties in good repair, working
order and condition, and make all necessary and proper repairs, renewals and
replacements so that the business of the Borrower may be properly conducted at
all times, unless the failure to do so would not have a material adverse effect
on the business, operation or financial condition of the Borrower.
4.7. Insurance. Maintain with financially sound, well rated
and reputable insurance companies insurance in such amounts and covering such
risks as is consistent with sound business practice, and in any event as is
ordinarily and customarily carried by companies similarly situated and in the
same or similar businesses as the Borrower. The Borrower will, pay, when due,
all premiums on such insurance and will furnish to the Lender, upon request,
evidence of payment of such premiums and other information as to the insurance
carried by the Borrower. Such insurance shall include, without limitation,
comprehensive fire and extended coverage insurance on the physical assets and
properties at the Borrower against such risks, with such loss deductible
amounts and in such amounts not less than those which may be satisfactory to
the Lender but in all events conforming to prudent business practices and in
such minimum amounts that the Borrower will not be deemed a co-insurer under
applicable insurance laws, regulations, policies and practices.
4.8. Inspection. Permit the Lender, upon reasonable notice
to the Borrower, by its representatives and agents, to inspect any of the
properties, books and financial records of the Borrower, to examine and make
copies of the books of accounts and other financial records of the Borrower,
and to discuss the affairs, finances and accounts of the Borrower with, and to
be advised as to the same by, the Borrower at such reasonable times and
intervals as the Lender may designate.
SECTION 5. Negative Covenants. The Borrower covenants and
agrees with the Lender that so long as any of the Obligations shall be
outstanding, the Borrower shall not, directly or indirectly:
5.1. Mergers, Acquisitions, Etc.. Without the prior written
consent of the Lender, enter into any merger or
<PAGE> 8
consolidation agreement or transfer all or substantially all of its assets,
properties or stock to any other person.
5.2. Sale of Assets and Liquidation. Sell, lease or
otherwise dispose of in one transaction or a series of transactions, all or any
substantial part of its business, assets or properties outside of the ordinary
course of businesses or take any action to liquidate, dissolve or wind up the
Borrower or its business.
SECTION 6. Default. The occurrence of any one or more of the
following events shall constitute a default under the provisions of this
Agreement, and the term "Default" shall mean, whenever it is used in this
Agreement, any one or more of the following events (and the term "Event of
Default" as used herein means one or more of the following events, whether or
not any requirement for the giving of notice, the lapse of time, or both has
been satisfied):
6.1. Payment of Obligations. The failure of the Borrower to
pay any of the obligations as and when due and payable in accordance with the
provisions of this Agreement, the Notes, and/or any of the other Financing
Documents, whether at the due date thereof or at a date fixed for prepayment
thereof or by acceleration thereof or otherwise, and such failure is not cured
within five (5) business days after written notice by the Lender to the
Borrower of such failure;
6.2. Perform, etc. Provisions of This Agreement. The failure
of the Borrower to perform, observe or comply with any of the provisions of
Section 5 of this Agreement.
6.3. Perform, etc. Other Provisions of This Agreement. The
failure of the Borrower to perform, observe or comply with any of the
provisions of this Agreement other than those covered by Sections 6.1 and 6.2
above, and such failure is not cured to the satisfaction of the Lender within a
period of thirty (30) days after the date of written notice thereof by the
Lender to the Borrower;
6.4. Representations and Warranties. If any representation
and warranty contained herein or any statement or representation made in any
certificate or any other information at any time given by or on behalf of the
Borrower or furnished in connection with this Agreement or any of the other
Financing Documents shall prove to be false, incorrect or misleading in any
material respect on the date as of which made;
6.5. Default under Other Financing Documents. The
occurrence of a default (as defined and described therein) under the provisions
or any of the Notes or any of the other Financing Documents which is not cured
within applicable cure periods, if any;
<PAGE> 9
6.6. Liquidation, Termination, Dissolution, etc. If the
Borrower shall liquidate, dissolve or terminate its existence;
6.7. Default under Other Indebtedness. If the Borrower shall
default in any payment of any indebtedness owing to the Lender (other than the
Obligations under the Financing Documents,) or in the observance or performance
of any other agreement or condition relating to any such indebtedness, beyond
the period of grace, if any, provided in the instrument or agreement under
which such indebtedness was created.
6.8. Bankruptcy. If proceedings in bankruptcy, or for
reorganization of the Borrower, or for the readjustment of any of its debts,
under the United States Bankruptcy Code (as amended) or any part thereof, or
under any other applicable laws, whether state or federal, for the relief of
debtors, now or hereafter existing, shall be commenced against or by the
Borrower and such proceedings shall not be dismissed within a period of sixty
(60) days after commencement;
6.9. Receiver, etc. A receiver or trustee shall be appointed
for the Borrower or for any substantial part of its assets, or any proceedings
shall be instituted for the dissolution or the full or partial liquidation of
the Borrower, and such receiver or trustee shall not be dismissed within a
period of sixty (60) days after such appointment;
SECTION 7. Rights and Remedies.
7.1. Rights and Remedies. If any Default shall occur and be
continuing, the Lender may (i) declare the Revolving Credit Facility hereunder
to be terminated, whereupon the same shall forthwith terminate, and (ii)
declare the unpaid principal amount of the Notes, together with accrued and
unpaid interest thereon, and all other Obligations then outstanding to be
immediately due and payable, whereupon the same shall become and be forthwith
due and payable by the Borrower to the Lender, without presentment, demand,
protest or notice of any kind, all of which are expressly waived by the
Borrower; provided, that, in the case of any Default referred to in Sections
6.8 and 6.9 above, the Revolving Credit Facility hereunder and any obligation
or commitment of the Lender hereunder to make Advances to the Borrower shall
immediately and automatically terminate and the unpaid principal amount of the
Notes, together with accrued and unpaid interest thereon, and all other
Obligations then outstanding, shall be automatically and immediately due and
payable by the Borrower to the Lender without notice, presentment, demand,
protest or other action of any kind, all of which are expressly waived by the
Borrower.
7.2. Default Rate. Notwithstanding the entry of any decree,
order, judgment or other judicial action, upon the occurrence of a Default
hereunder, the unpaid principal amount of
<PAGE> 10
the Notes and all other monetary Obligations outstanding or becoming
outstanding while such Default exists shall bear interest from the date of such
Default until such Default has been cured to the satisfaction of the Lender, at
a per annum rate of interest three percent above the otherwise applicable
rates.
7.3. Enforcement Costs. The Borrower agrees to pay to the
Lender on demand (a) all enforcement costs paid, incurred or advanced by or on
behalf of the Lender and (b) interest on such enforcement costs from the date
paid, incurred or advanced until paid in full at a per annum rate of interest
equal at all times to the Default Rate. As used herein, the term "enforcement
costs" shall mean and include collectively all expenses, charges, recordation
or other taxes, costs and fees (including attorneys' fees and expenses) of any
nature whatsoever advanced, paid or incurred by or on behalf or the Lender in
connection with (a) the collection or enforcement of this Agreement or any of
the other Financing Documents, and (b) the exercise by the Lender of any rights
or remedies available to it under the provisions of this Agreement, or any of
the other Financing documents. All enforcement costs, with interest as above
provided, shall be a part of the Obligations hereunder.
7.4. Remedies, Etc. Cumulative. Each right, power and remedy
of the Lender as provided for in this Agreement or in the other Financing
Documents or now or hereafter existing under applicable laws or otherwise shall
be cumulative and concurrent and shall be in addition to every other right,
power or remedy provided for in this Agreement or in the other Financing
Documents or now or hereafter existing under applicable laws or otherwise, and
the exercise or beginning of the exercise by the Lender of any one or more of
such rights, powers or remedies shall not preclude the simultaneous or later
exercise by the Lender of any or all such other rights, powers or remedies.
7.5. No Waiver Etc. No failure or delay by the Lender to
insist upon the strict performance of any term, condition, covenant or
agreement of this Agreement or of the other Financing Documents, or to exercise
any right, power or remedy consequent upon a breach thereof, shall constitute a
waiver of any such term, condition, covenant or agreement or of any such
breach, or preclude the Lender from exercising any such right, power or remedy
at any later time or times. By accepting payment after the due date of any
amount payable under this Agreement or under any of the other Financing
Documents, the Lender shall not be deemed to waive the right either to require
prompt payment when due of all other amounts payable under this Agreement or
under any of the other Financing Documents, or to declare a Default for failure
to effect such prompt payment of any such other amount. The payment by the
Borrower or any other person and the acceptance by the Lender of any amount due
and payable under the provisions of this Agreement or the other Financing
Documents at any time during which a Default exists shall not in any way or
manner be construed as a waiver of such
<PAGE> 11
Default by the Lender or preclude the Lender from exercising any right of power
or remedy consequent upon such Default.
SECTION 8. Miscellaneous.
8.1. Course of Dealing; Amendment. No course of dealing
between the Lender and the Borrower shall be effective to amend, modify or
change any provision of this Agreement or the other Financing Documents. This
Agreement and the other Financing Documents to which the Borrower is a party
may not be amended, modified, or changed in any respect except by an agreement
in writing signed by the Lender and the Borrower.
8.2. Waiver of Default. The Lender may, at any time and from
time to time, execute and deliver to the Borrower a written instrument waiving,
on such terms and conditions as the Lender may specify in such written
instrument, any of the requirements of this Agreement or of the other Financing
Documents or any event of Default or Default and its consequences, provided,
that any such waiver shall be for such period and subject to such conditions as
shall be specified in any such instrument. In the case of any such waiver, the
Borrower and the Lender shall be restored to their former positions prior to
such Event of Default or Default and shall have the same rights as they had
hereunder. No such waiver shall extend to any subsequent or other Event of
Default or Default, or impair any right consequent thereto and shall be
effective only in the specific instance and for the specific purpose for which
given.
8.3. Notices. All notices, requests and demands to or upon
the parties to this Agreement shall be deemed to have been given or made when
delivered by hand, or when deposited in the mail, postage prepaid by registered
or certified mail, return receipt requested, or, in the case of notice by
facsimile transmission, when properly transmitted, addressed as follows or to
such other address as may be hereafter designated in writing by one party to
the other:
Borrower: Trak Auto Corporation
3300 75th Avenue
Landover, Maryland 20785
Attention: President
Facsimile: (301) 731-1311
Lender: Dart Group Corporation
3300 75th Avenue
Lanover, Maryland 20785
Attention: Chief Financial Officer
Facsimile: (301) 772-3910
except in cases where it is expressly herein provided that such notice, request
or demand is not effective until received by the party to whom it is addressed.
<PAGE> 12
8.4. Right to Perform. If the Borrower shall fail to make
any payment or to otherwise perform, observe or comply with the provisions of
this Agreement or any of the other Financing Documents within any applicable
notice or cure period, then and in each such case, the Lender may (but shall be
under no obligation whatsoever to) without notice to or demand upon the
Borrower remedy any such failure by advancing funds or taking such action as it
deems appropriate for the account and at the expense of the Borrower. The
advance of any such funds or the taking of any such action by the Lender shall
not be deemed or construed to cure a Default or waive performance by the
Borrower of any provisions of this Agreement. The Borrower shall pay to the
Lender on demand, together with interest thereon from the date advanced or
incurred until paid in full at a per annum rate of interest equal at all times
to the Default Rate, any such funds so advanced by the Lender and any costs and
expenses advanced or incurred by or on behalf or the Lender in taking any such
action, all of which shall be a part of the obligations hereunder.
8.5. Costs and Expenses. The Borrower agrees to pay to the
Lender on demand all attorney's fees and disbursements, which the Lender may
incur or which are payable in connection with the closing of the Revolving
Credit Facility, and all costs and expenses in connection with the
administration of the Revolving Credit Facility. All such fees and costs shall
be a part of the Obligations hereunder.
8.6. Consent to Jurisdiction. The Borrower irrevocably (a)
consents and submits to the jurisdiction and venue of any state or federal
court sitting in the State of Maryland over any suit, action or proceeding
arising out of or relating to this Agreement or any of the other Financing
Documents, (b) waives, to the fullest extent permitted by law, any objection
that the Borrower may now or hereafter have to the laying of the venue of any
such suit, action or proceeding brought in any such court and any claim that
any such suit, action or proceeding brought in any such court has been brought
in an inconvenient forum, and (c) consents to the service of process in any
such suit, action or proceeding in any such court by the mailing of copies of
such process to the Borrower by certified or registered mail at the Borrower's
address set forth herein for the purpose of giving notice.
8.7. Certain Definitional Provisions. The term "person" as
used in this Agreement means and includes any natural person, individual,
company, corporation, partnership, joint venture, unincorporated association,
government or political subdivision or agency thereof, or any other entity of
whatever nature. All terms defined in this Agreement shall have such defined
meanings when used in any of the other Financing Documents. Accounting terms
used in this Agreement shall have the respective meanings given to them under
generally accepted accounting principles in effect from time to time in the
United
<PAGE> 13
States of America. The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement. As used herein,
the singular number shall include the plural, the plural, the singular and the
use of the masculine, feminine or neuter gender shall include all genders, as
the context may require. Unless otherwise defined herein, all terms used
herein which are defined by the Maryland Uniform Commercial Code shall have the
same meanings as assigned to them by the Maryland Uniform Commercial Code
unless and to the extent varied by this Agreement.
8.8. Severability. The invalidity, illegality or
unenforceability of any provision of this Agreement shall not affect the
validity, legality or enforceability of any of the other provisions of this
Agreement which shall remain effective.
8.9. Survival. All representations, warranties and covenants
contained among the provisions of this Agreement shall survive the execution
and delivery of this Agreement and all other Financing Documents.
8.10. Binding Effect. This Agreement and all other Financing
Documents shall be binding upon and inure to the benefit or the Borrower and
the Lender and their successors and assigns, except that the Borrower shall not
have the right to assign their rights hereunder or any interest herein without
the prior written consent of the Lender.
8.11. Applicable Law and Time of Essence. This Agreement and
the rights and obligations of the parties hereunder shall be construed and
interpreted in accordance with the laws of the State of Maryland, both in
interpretation and performance. Time is of the essence in connection with all
obligations of the Borrower hereunder and under any of the other Financing
Documents.
8.12. Duplicate Originals and Counterparts. This Agreement
may be executed in any number of duplicate originals or counterparts, each of
such duplicate originals or counterparts shall be deemed to be an original and
all taken together shall constitute but one and the same instrument.
8.13. Headings. Section and subsection headings in this
Agreement are included herein for convenience of reference only, shall not
constitute a part of this Agreement for any other purpose and shall not be
deemed to affect the meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, each of the parties hereto have executed and
delivered this Agreement under their respective seals as of the day and year
first written above.
<PAGE> 14
WITNESS/ATTEST: TRAK AUTO CORPORATION
By: \s\ R. Keith Green (Seal)
- - ------------------------- --------------------------
Name: R. Keith Green
Title: President
WITNESS/ATTEST: DART GROUP CORPORATION
By: \s\ Robert A. Marmon (Seal)
- - ------------------------- --------------------------
Name: Robert A. Marmon
Title: Chief Financial Officer
February 6, 1995
