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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14D-9
(AMENDMENT NO. 7)
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(D)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
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METROMAIL CORPORATION
(NAME OF SUBJECT COMPANY)
METROMAIL CORPORATION
(NAME OF PERSON FILING STATEMENT)
COMMON STOCK, PAR VALUE $.01 PER SHARE
(TITLE OF CLASS OF SECURITIES)
591680 103
(CUSIP NUMBER OF CLASS OF SECURITIES)
THOMAS J. QUARLES
SENIOR VICE PRESIDENT, GENERAL COUNSEL,
CHIEF ADMINISTRATIVE OFFICER AND SECRETARY
METROMAIL CORPORATION
360 EAST 22ND STREET
LOMBARD, ILLINOIS 60148
(630) 620-3300
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON)
AUTHORIZED TO RECEIVE NOTICE AND COMMUNICATIONS
ON BEHALF OF THE PERSON FILING STATEMENT)
WITH COPIES TO:
CARTER W. EMERSON, P.C.
KIRKLAND & ELLIS
200 EAST RANDOLPH DRIVE
CHICAGO, IL 60601
(312) 861-2000
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ITEM 1. SECURITY AND SUBJECT COMPANY
The name of the subject company is Metromail Corporation, a Delaware
corporation (the "Company" or "Metromail"). The address of the principal
executive offices of the Company is 360 East 22nd Street, Lombard, Illinois
60148. This Amendment No. 7 to Solicitation/Recommendation Statement on
Schedule 14D-9 (this "Statement") relates to the Company's common stock, par
value $.01 per share (including the related Rights issued pursuant to the
Rights Agreement, the "Shares").
This Statement should be read in conjunction with the
Solicitation/Recommendation Statement on Schedule 14D-9 dated March 16, 1998
(the "Original Schedule 14D-9" and, as it has been amended by Amendments No.
1-6, the "Schedule 14D-9"). Unless the context otherwise requires, capitalized
terms used and not otherwise defined in this Statement have the meanings given
to such terms in the Schedule 14D-9.
ITEM 2. TENDER OFFER OF BIDDER
This Statement relates to a tender offer by Great Universal Acquisition
Corp. ("Purchaser"), a Delaware corporation and an indirect wholly owned
subsidiary of The Great Universal Stores P.L.C., a company incorporated under
the laws of England ("Parent"), as set forth in a Tender Offer Statement on
Schedule 14D-1, dated March 16, 1998, as amended and supplemented (the
"Schedule 14D-1"), to purchase all outstanding Shares at a price of $34.50 per
share, net to the seller in cash (the "Purchase Price") subject to the
condition described below and upon the terms and subject to the conditions set
forth in the Offer to Purchase, dated March 16, 1998 (the "Offer to
Purchase"), the Supplement to Offer to Purchase dated March 30, 1998 (the
"Supplement") and the related revised Letter of Transmittal (which, together
with any amendments or supplements thereto, collectively constitute the
"Offer").
The increase in the Purchase Price to $34.50 (from a Purchase Price of
$31.50 contained in the Offer to Purchase) is conditioned upon the Merger
Agreement and the Stock Purchase Agreements continuing in full force and
effect in accordance with their terms. If, at any time prior to the expiration
date set forth in the Offer, the Merger Agreement or any of the Stock Purchase
Agreements does not continue in full force and effect in accordance with its
terms, the Purchase Price shall become $31.50 per Share. The Company will
promptly issue a press release if any of these events occur.
The Offer is being made pursuant to an Agreement and Plan of Merger, dated
as of March 12, 1998 (the "Merger Agreement"), by and among Parent, Purchaser
and the Company. The Offer is subject to certain conditions. The Merger
Agreement provides that, if the Offer is consummated pursuant to its terms,
Purchaser will be merged with and into the Company (the "Merger"), and the
Company will continue as the surviving corporation (the "Surviving
Corporation"). A copy of the Merger Agreement is filed as Exhibit 1 to the
Schedule 14D-9 and is incorporated herein by reference.
As set forth in the Schedule 14D-1, the principal executive offices of
Purchaser are located at the principal executive offices of Experian
Corporation, a wholly-owned subsidiary of Parent, at 505 City Parkway West,
Orange, California 92668. The principal executive offices of Parent are
located at Leconfield House, Curzon Street, London W1Y7FL.
ITEM 3. IDENTITY AND BACKGROUND
(a) The name and business address of the Company, which is the person filing
this Statement, are set forth in Item 1 above.
(b) Except as described herein or in Schedule I attached to the Original
Schedule 14D-9, to the knowledge of the Company, as of the date hereof, there
are no material contracts, agreements, arrangements or understandings, or any
actual or potential conflicts of interest, between the Company or its
affiliates and (i) the Company, its executive officers, directors or
affiliates or (ii) Purchaser, Parent or their respective executive officers,
directors or affiliates.
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THE MERGER AGREEMENT
The information contained under the heading "The Merger Agreement" is hereby
amended and supplemented by the following:
The following is a summary of certain portions of the letter dated March 26,
1998 from Parent to the Company (the "Parent Letter"), and is qualified in its
entirety by reference to the Parent Letter which has been filed with the
Commission as an exhibit to the Schedule 14D-9.
Pursuant to the Parent Letter, Parent and the Purchaser amended the Offer in
accordance with the terms of the Merger Agreement to increase the price per
Share offered pursuant to the Offer to $34.50, net to the seller in cash, upon
the terms and subject to the conditions set forth in the Merger Agreement,
provided that the Merger Agreement and the Stock Purchase Agreements continue
in full force and effect in accordance with their terms. If the Merger
Agreement and the Stock Purchase Agreements do not continue in full force and
effect in accordance with their terms, the per Share cash consideration will
be $31.50 per Share, net to the seller in cash, as provided in the Merger
Agreement.
Also pursuant to the Parent Letter, Parent consented under the Merger
Agreement to allow the Board to waive the provisions of any standstill
agreement between the Company and ABI (as defined below) to permit the
negotiation of, and agreement for, a consensual transaction between ABI and
the Company, subject to the terms of the Merger Agreement.
THE LETTER AGREEMENT
The following is a summary of certain portions of the letter agreement dated
March 29, 1998 between Parent and the Company (the "Letter Agreement"), and is
qualified in its entirety by reference to the Letter Agreement which has been
filed with the Commission as an exhibit to the Schedule 14D-9.
Pursuant to the Letter Agreement, Parent has agreed, notwithstanding its
position that the Company's actions with respect to ABI have violated and
continue to violate the Merger Agreement (the Company disagrees with such
position), that, if the Company does not give Parent notice of its intention
to withdraw or modify its approval or recommendation of the Offer or enter
into an agreement with respect to a Superior Proposal (as defined in the
Merger Agreement) prior to 8 p.m. Chicago time on March 30, Parent will not
terminate the Merger Agreement because of such claimed violation occurring
before 8 p.m. Chicago time on March 30, 1998 and the Company has agreed that
it cannot after such time terminate the Merger Agreement by virtue of
accepting a Superior Proposal or withdraw or modify its approval or
recommendation of the Offer or the Merger or enter into any agreement with
respect to any Acquisition Proposal (as defined in the Merger Agreement).
THE STOCK PURCHASE AGREEMENTS AND DONNELLEY COMMERCIAL AGREEMENTS
Please refer to Item 3. "The Stock Purchase Agreements and Donnelley
Commercial Agreements" of the Original Schedule 14D-9 for a summary of certain
provisions of the Stock Purchase Agreements and the Donnelley Commercial
Agreements.
CONFIDENTIALITY AGREEMENT
Please refer to Item 3. "Confidentiality Agreement" of the Original Schedule
14D-9 for a summary of certain provisions of the Confidentiality Agreement.
CERTAIN STOCK OWNERSHIP INFORMATION
Please refer to Item 3. "Certain Stock Ownership Information" of the
Original Schedule 14D-9 for information with respect to the beneficial
ownership of the outstanding Shares as of the date of the Schedule 14D-9 by
the Company's directors, executive officers and affiliates.
ITEM 4. THE SOLICITATION OR RECOMMENDATION
The information contained under this heading is hereby amended and
supplemented by the following:
As of the March 12, 1998 Board meeting, the Company had eight indications of
interest in acquiring the Company from parties or groups other than Parent and
Purchaser. Such indications of interest were communicated to the Board at or
prior to such meeting and discussed at such meeting. One (whose range went as
high as $35.00 per Share) proposed a stock for stock pooling of interests
transaction. Because such transaction
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could not have been initiated until the summer of 1998 for accounting reasons,
such party had not conducted due diligence. The remaining seven had indicated
interest in a cash transaction, with initial indications of price ranging from
$23.70-$34.00 per Share. However, based on discussions with such parties prior
to the March 12 Board meeting, Lehman Brothers reported at such meeting that
none of the seven (including the five who had interviewed management and
conducted due diligence) appeared reasonably likely and currently able to make
a firm offer at a price above $31.50 per Share.
One of the seven was American Business Information, Inc. ("ABI"). ABI sued
the Company, certain of its officers and directors and Parent in Delaware to
enjoin the Offer and the Merger and made an offer, after announcement of the
Offer and the Merger, of at least $33.00 per Share in cash (subsequently
increased as discussed below). Prior to the March 12, 1998 Board meeting, ABI
had proposed a $32.00-34.00 per Share cash offer, subject to its board's
approval, due diligence and documentation, as well as its ability to obtain
financing. In addition, ABI's lawyer had stated in a letter dated February 25,
1998 that ABI would pay at least $0.25 per Share more than any other bona fide
proposal, subject to its board's approval and documentation. However, on March
12, 1998, prior to the Board meeting, Lehman Brothers was told by ABI's
financial advisor that it was sending a letter to the effect that it had
become aware of several items during its due diligence which it and ABI
believed had a negative impact on the Company's value (such letter was
received after the Board meeting). In addition, such advisor told Lehman
Brothers that no time frame had been established for securing ABI's financing.
The Board discussed the status of all of such indications of interest at its
March 12, 1998 Board meeting and decided to recommend Parent's proposal and
approve and cause the Company to enter into the Merger Agreement because the
Board believed that the Offer and the Merger provided a higher cash price and
greater certainty for the Company's stockholders than any of the other
indications of interest.
On March 16, 1998, the Company obtained an irrevocable letter of credit that
satisfies one of the conditions to the obligations of Parent to consummate the
Offer.
On March 17, 1998 ABI sued the Company, certain of its officers and
directors and Parent in Delaware seeking to enjoin the Merger and on March 18,
1998 the Company received ABI's offer of at least $33.00 per Share in cash. On
March 18, 1998, three class action suits were filed in Delaware seeking to
enjoin the Offer and the Merger. On March 20, 1998, a fourth such class action
suit was filed in Delaware. The Board of Directors met on March 19, 1998 and
discussed ABI's lawsuit and offer and concluded that the Merger Agreement
permitted the Company to discuss ABI's offer with ABI and authorized the
Company's representatives and advisors to do so, including exploring ABI's
ability to obtain the necessary cash for its offer. The initiation of
discussions with ABI was reported in a press release on the same day, and the
Board's determination at such meeting to postpone the Company's annual meeting
was also disclosed. On March 23, 1998, counsel to Parent delivered a letter to
the Company and its counsel reiterating its position that the Company's
actions with respect to ABI constitute a breach of the Merger Agreement.
Discussions with ABI and its lender, including responding to their additional
due diligence requests, commenced and the Company began responding to
discovery requests of ABI in the litigation, conducting its own discovery and
preparing for the March 27 hearing the Delaware Court had scheduled on ABI's
motion for a preliminary injunction.
The Board met again on March 24, 1998 to review the status of the lawsuit
and the discussions with ABI. At such meeting, the directors compared (i) the
transactions contemplated by the Merger Agreement with Parent and (ii) ABI's
offer. The Board concluded that, although ABI's proposed merger agreement did
not contain a financing condition, the consummation of the ABI proposal was
less certain than the Offer and the Merger because ABI's offer depended on it
borrowing large sums and such offer would remain subject to customary
conditions (such as material adverse change) for at least 20 business days,
whereas Parent had cash on hand (the Company was advised that Parent had $840
million in cash on hand at January 27, 1998) for its offer and most of the
conditions in the Merger Agreement expire on March 30, 1998. As a result, the
Board directed that a letter be sent to ABI setting out what terms and
verifications (such as completion of due diligence) the Board wished to have
as part of the ABI offer, particularly in terms of certainty of completion.
This included a request for a letter of credit or other form of earnest money
payment of $100 million to the Company if the ABI transaction was not
consummated. Parent was not requested to provide a letter of credit because of
the large
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amount of cash it has. Such letter was sent to ABI on March 24, 1998 and
stated that ABI should indicate its highest price by noon on March 26.
On March 25, 1998, ABI provided its initial response to such letter, once
again confirming its offer of at least $33.00 per share and restating its
counsel's February 25, 1998 offer on behalf of ABI to pay $0.25 more than the
next highest bona fide bid. Such letter from ABI, among the things, stated
that while ABI did not believe there was a reasonable basis for the requested
$100 million letter of credit, it would be prepared to post such a letter if
other bidders, including Parent, were required to do so. The Company responded
to such letter on the same day in another letter which requested further
clarification regarding ABI's proposal, pointed out that Parent's transaction
was more certain of completion and told ABI (as it had been told before) that
the Board would not consider bids subject to escalation of the bids of others.
On March 26 and March 27, the Chairman of the Company attempted to reach the
Chairman of ABI to make clear to him the importance of certainty to the
Company's Board. When ABI's Chairman could not be reached, such message was
given to ABI's investment bank and counsel. Mid-day on March 26, the Company
received a letter from ABI reiterating its offer of at least $33.00 per share
or $0.25 more than the next bona fide bid and stating that ABI would supply a
letter of credit in the Company's favor within 72 hours after signing a merger
agreement with the Company. Counsel to the Company told ABI's counsel that
such 72 hour delay would not be acceptable because it would create the risk
that such letter of credit would never be obtained, yet the Company would have
had to terminate the Merger Agreement with Parent and lose the certainty it
provided. During such day, as it had since ABI's offer was made, Lehman
Brothers discussed with ABI's investment bank and its lender how to make ABI's
financing commitments more firm. When the Company was advised by Parent's
representatives early in the evening on March 26, 1998 that Parent would be
sending a letter that evening discussing its offer, the Company advised ABI
that it should make its best offer by 9:30 p.m. Chicago time that night. Prior
to such time, the Company received a letter from Parent stating that Parent
was increasing the Offer to $34.50. Shortly thereafter, such letter was
provided to ABI. At about 9:30 p.m., ABI sent the letter restating its
previous offer price and stating that it would post a $35 million letter of
credit at the time of signing a merger agreement and responding to the
Company's proposed conditions for drawing on such letter of credit with
conditions less favorable to the Company. When questioned on the meaning of
such letter in light of Parent's $34.50 offer, ABI's counsel confirmed that
ABI's offer was $34.75 per share. The Company announced the increased Parent
and ABI offer in a press release on the morning of March 27, 1998. The
Company's Board met again on the morning of March 27 and was informed of the
developments since the preceding Board meeting. Also that morning counsel to
ABI called the Company's counsel and said that ABI was continuing to work with
its lender on financing its increased offer and hoped to provide evidence of
such financing and an agreement reflecting such offer or possibly a higher
offer by the evening of March 27.
On the morning of March 27, 1998, the Delaware Chancery Court held a hearing
on ABI's request for a preliminary injunction to enjoin the Merger. The
shareholder plaintiffs withdrew their request for an injunction in view of
Parent's increased offer of March 26. The Delaware Chancery Court denied ABI's
request for an injunction.
On March 28, 1998, the waiting period under the HSR Act expired with respect
to the Offer and the Merger. Due to the expiration of the waiting period, most
of the conditions to the obligation of Parent to consummate the Offer expired
at 11:59 p.m. on March 30, 1998. The Offer is scheduled to close on April 10,
1998.
During the afternoon of March 28, 1998, the Company received a best and
final offer from ABI to acquire all the outstanding Shares for the net price
of $35.00 in cash plus 0.2 shares of ABI Class A Common Stock per Share. The
ABI offer was subject to the same conditions as its previous offer, but, in
addition, it was contingent on ABI's ability to finance the proposed
transaction. As stated in the offer, ABI was "in discussions with [its lender]
regarding the amended transaction structure and [its lender's] willingness to
provide the requisite financing." In addition, if ABI were to obtain its
financing commitments, they would continue to be subject to certain
conditions. ABI also indicated that its capital structure would be changed to
include approximately $40 million of a deferred dividend preferred stock
instrument (commonly known as PIK).
The Board met in the evening of March 28 to discuss the ABI offer as
compared to the Offer. As requested by ABI, the Board agreed to give ABI until
noon on Monday, March 30, 1998 to supply additional information
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concerning its offer, including definitive documentation, and to obtain the
necessary financing commitments. During such time, the Board instructed the
Company to continue its discussions with ABI, particularly in regard to the
Board's concerns about the certainty of ABI's offer to holders of Shares, as
compared to the Offer. As described above, due to the Board's concerns about
the certainty of ABI's offer, it had requested a letter of credit or other
form of earnest money payment of $100 million to the Company if the ABI
transaction is not consummated. As of March 29, ABI had stated that it would
post a $35 million letter of credit which could be drawn upon under conditions
less favorable than those proposed by the Company. As described above, Parent
was not asked to provide a similar letter of credit because of the large
amount of cash it has (the Company has been advised that Parent has $840
million in cash on hand at January 27, 1998). On March 28, the Board also
unanimously approved the increased Offer (from $31.50) and recommended that
stockholders accept the Offer and tender their Shares. At such meeting, Lehman
Brothers rendered verbally its opinion that Parent's increased Offer is fair
to the stockholders of the Company from a financial point of view. Such
opinion was confirmed in Lehman Brothers' written opinion delivered on March
29.
On March 29, the Board met to further discuss the ABI offer and the Offer
and approved (i) giving ABI and Parent notice that the auction would end at
noon, Chicago time, on Monday, March 30 and (ii) taking any other action
necessary to end the auction on March 30. Pursuant to such approval, the
Company entered into the Letter Agreement later that day in which Parent
agreed, notwithstanding its position that the Company's actions with respect
to ABI have violated and continue to violate the Merger Agreement (the Company
disagrees with such position), that, if the Company does not give Parent
notice of its intention to withdraw or modify its approval or recommendation
of the Offer or enter into an agreement with respect to a Superior Proposal
prior to 8 p.m. Chicago time on March 30, Parent will not terminate the Merger
Agreement because of such claimed violation occurring before 8 p.m. Chicago
time on March 30, 1998 and the Company agreed that it cannot after such time
terminate the Merger Agreement by virtue of accepting a Superior Proposal or
withdraw or modify its approval or recommendation of the Offer or the Merger
or enter into any agreement with respect to any Acquisition Proposal.
Early on the morning of March 30, 1998, ABI's investment bank left Lehman
Brothers a message to the effect that ABI would not be participating in the
sale process because there was no possibility of getting its documentation in
place by noon and that ABI was putting out a press release to that effect.
Later that morning ABI's investment bank called Lehman Brothers and said that
ABI had changed its mind and was working on a $36.00 per Share all cash offer
(rather than its March 28 offer) and asked for an extension beyond noon.
Lehman Brothers reminded ABI's investment bank that such noon time for
submission of bids and information had been set by the Board in response to
ABI's March 28 request and could not be waived by Lehman Brothers. Also on
March 30, the Company was advised that ABI had appealed the March 27 ruling of
the Delaware Court of Chancery to the Delaware Supreme Court. Although the
Company believes that it is unlikely that ABI's appeal will be successful, if
it was and the Merger Agreement or the Stock Purchase Agreements were
enjoined, the Offer and Merger price would be reduced pursuant to the terms of
the Offer to $31.50 per Share.
The Board met in the evening of March 30. The Company did not receive any
new documentation by noon on March 30. After noon and prior to the Board
meeting it received through Lehman Brothers a revised draft merger agreement
which contained a $36.00 per Share price, referenced the same $35 million
letter of credit and conditions discussed above and, for the first time,
proposed a $15 million termination fee plus the payment of expenses. The
Company also received through Lehman Brothers ABI's financing commitments for
its offer. Such commitments arrived over the course of the afternoon, right up
to the time of the Board meeting. The commitments appeared to be similar to
those received in the prior week, including the conditions to such
commitments, but added a new condition relating to termination of the Merger
Agreement. The Board once again reviewed ABI's offer and compared it to the
Offer and again unanimously approved the increased $34.50 per Share (subject
to certain conditions) Offer and recommended that the Company's stockholders
accept the Offer and approve the Merger. In reaching this conclusion, the
Board focused on the certainty of the Offer versus the uncertainty of ABI's
offer which was highly leveraged, thereby exposing the stockholders to the
risk of losing the more certain Offer without sufficient assurance that ABI's
offer would be completed. The Board also focused
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on the timing of the ABI offer which could not be consummated any earlier than
the end of April, whereas the Offer is scheduled to close on April 10, 1998
and has, because of passage of the HSR Act period, become largely
unconditional. At such meeting, the Board also received the opinion of Lehman
Brothers that Parent's increased offer is fair to the stockholders of the
Company from a financial point of view.
ITEM 5. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED
The information contained under this heading is hereby amended and
supplemented by the following:
If the transactions contemplated by the Merger Agreement are consummated,
Lehman Brothers will receive aggregate fees of $9.1 million.
ITEM 6. RECENT TRANSACTIONS AND INTENT WITH RESPECT TO SECURITIES
(a) Please refer to this heading in the Original Schedule 14D-9 for a
description of any transactions in Shares that have been effected within the
past 60 days by the Company or any executive officer, director, affiliate or
subsidiary of the Company. See also Item 8 of the Original Schedule 14D-9
which sets forth certain information as to certain related matters.
(b) To the knowledge of the Company, its executive officers, directors,
affiliates and subsidiaries presently intend to tender, pursuant to the Offer,
or sell all Shares which are held of record or are beneficially owned by such
persons.
ITEM 7. CERTAIN NEGOTIATIONS AND TRANSACTIONS BY THE SUBJECT COMPANY
(a) Except as set forth in this Statement or in the Schedule 14D-9, the
Company is not engaged in any negotiation in response to the Offer which
relates to or would result in (i) an extraordinary transaction, such as a
merger or reorganization, involving the Company or any subsidiary of the
Company; (ii) a purchase, sale or transfer of a material amount of assets by
the Company or any subsidiary of the Company; (iii) a tender offer for or
other acquisition of securities by or of the Company; or (iv) any material
change in the present capitalization or dividend policy of the Company.
(b) None.
ITEM 8. ADDITIONAL INFORMATION TO BE FURNISHED
Please refer to the information contained under this heading in the Original
Schedule 14D-9 for certain additional information.
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MATERIAL TO BE FILED AS EXHIBITS
The following Exhibits are filed herewith:
Exhibit 1--Agreement and Plan of Merger, dated as of March 12, 1998, by and
among Parent, Purchaser and the Company (filed as an exhibit to the Company's
Current Report on Form 8-K as filed on March 13, 1998, and incorporated herein
by reference).
Exhibit 2--Stock Purchase Agreement, dated as of March 12, 1998, between the
Company and Parent (filed as an exhibit to the Company's Current Report on
Form 8-K as filed on March 13, 1998, and incorporated herein by reference).
Exhibit 3--Stock Purchase Agreement, dated as of March 12, 1998, between
R.R. Donnelley & Sons Company and Parent (filed as an exhibit to the Original
Schedule 14D-9, and incorporated herein by reference).
Exhibit 4--Form of Stock Purchase Agreements, dated as of March 12, 1998,
between Parent and each of Barton L. Faber, Ronald G. Eidell and Thomas J.
Quarles (filed as an exhibit to the Original Schedule 14D-9, and incorporated
herein by reference).
Exhibit 5--Confidentiality Agreement, dated February 6, 1998, by and between
Lehman Brothers, as financial advisor to and on behalf of the Company, and
Experian Corporation (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
Exhibit 6--Letter to Stockholders of the Company, from Barton L. Faber,
dated March 16, 1998 (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
Exhibit 7--Third Restated Certificate of Incorporation of the Company, as
amended (filed as an exhibit to the Company's Annual Report on Form 10-K for
the year ended December 31, 1996, and incorporated herein by reference).
Exhibit 8--Opinion of Lehman Brothers Inc., dated March 12, 1998 (filed as
an exhibit to the Original Schedule 14D-9, and incorporated herein by
reference).
Exhibit 9--Rights Agreement, dated as of February 24, 1997, between the
Company and American Stock Transfer & Trust Company (filed as an exhibit to
the Company's Registration Statement on Form 8-A, filed on February 26, 1997,
and incorporated herein by reference).
Exhibit 10--First Amendment to Rights Agreement, dated as of March 12, 1998
(filed as an exhibit to the Original Schedule 14D-9, and incorporated herein
by reference).
Exhibit 11--Employment Agreement between the Company and Barton L. Faber
(filed as an exhibit to the Company's Registration Statement on Form S-1 (No.
333-2042) that became effective on June 13, 1996, and incorporated herein by
reference).
Exhibit 12--Management Agreement between the Company and Barton L. Faber
(filed as an exhibit to the Company's Annual Report on Form 10-K for the year
ended December 31, 1996, and incorporated herein by reference).
Exhibit 13--Amendment to the Management Agreement between the Company and
Barton L. Faber (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
Exhibit 14--Employment Agreement between the Company and Ronald G. Eidell
(filed as an exhibit to the Company's Annual Report on Form 10-K for the year
ended December 31, 1996 and incorporated herein by reference).
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Exhibit 15--Management Agreement between the Company and Ronald G. Eidell
(filed as an exhibit to the Company's Annual Report on Form 10-K for the year
ended December 31, 1996 and incorporated herein by reference).
Exhibit 16--Amendment to the Management Agreement between the Company and
Ronald G. Eidell (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
Exhibit 17--Employment Agreement between the Company and Thomas J. Quarles
(filed as an exhibit to the Company's Annual Report on Form 10-K for the year
ended December 31, 1996 and incorporated herein by reference).
Exhibit 18--Management Agreement between the Company and Thomas J. Quarles
(filed as an exhibit to the Company's Annual Report on Form 10-K for the year
ended December 31, 1996, and incorporated herein by reference).
Exhibit 19--Amendment to the Management Agreement between the Company and
Thomas J. Quarles (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
Exhibit 20--Employment Agreement between the Company and Tery R. Larrew
(filed as an exhibit to the Company's Registration Statement on Form S-1 (No.
333-2042) that became effective on June 13, 1996, and incorporated herein by
reference).
Exhibit 21--Amendment to the Employment Agreement between the Company and
Tery R. Larrew (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
Exhibit 22--Management Agreement between the Company and Tery R. Larrew
(filed as an exhibit to the Company's Annual Report on Form 10-K for the year
ended December 31, 1996, and incorporated herein by reference).
Exhibit 23--Amendment to the Management Agreement between the Company and
Tery R. Larrew (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
Exhibit 24--Management Agreement between the Company and Philip H. Bonello
(filed as an exhibit to the Original Schedule 14D-9, and incorporated herein
by reference).
Exhibit 25--Amendment to the Management Agreement between the Company and
Philip H. Bonello (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
Exhibit 26--Management Agreement between the Company and James R. Drake
(filed as an exhibit to the Original Schedule 14D-9, and incorporated herein
by reference).
Exhibit 27--Amendment to the Management Agreement between the Company and
James R. Drake (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
Exhibit 28--Management Agreement between the Company and Prabhuling Patel
(filed as an exhibit to the Original Schedule 14D-9, and incorporated herein
by reference).
Exhibit 29--Amendment to the Management Agreement between the Company and
Prabhuling Patel (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
Exhibit 30--Management Agreement between the Company and Mac Rodgers (filed
as an exhibit to the Original Schedule 14D-9, and incorporated herein by
reference).
Exhibit 31--Amendment to the Management Agreement between the Company and
Mac Rodgers (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
8
<PAGE>
Exhibit 32--Management Agreement between the Company and Kenneth A. Glowacki
(filed as an exhibit to the Original Schedule 14D-9, and incorporated herein
by reference).
Exhibit 33--Amendment to the Management Agreement between the Company and
Kenneth A. Glowacki (filed as an exhibit to the Original Schedule 14D-9, and
incorporated herein by reference).
Exhibit 34--Registration Rights Agreement, dated as of February 24, 1997,
between the Company and R. R. Donnelley & Sons Company (filed as an exhibit to
the Company's Current Report on Form 8-K, dated February 24, 1997, and
incorporated herein by reference).
Exhibit 35--Acknowledgment and Agreement, dated as of February 24, 1997,
between the Company and R. R. Donnelley & Sons Company (filed as an exhibit to
the Company's Current Report on Form 8-K, dated February 24, 1997, and
incorporated herein by reference).
Exhibit 36--Letter Agreement dated March 12, 1998 between the Company and
R. R. Donnelley & Sons Company (filed as an exhibit to the Original Schedule
14D-9, and incorporated herein by reference).
Exhibit 37--Transition Services Agreement between the Company and R. R.
Donnelley & Sons Company (filed as an exhibit to the Company's Registration
Statement on Form S-1 (No. 333-2042) that became effective on June 13, 1996,
and incorporated herein by reference).
Exhibit 38--Sales Agreement between the Company and R. R. Donnelley & Sons
Company (filed as an exhibit to the Company's Registration Statement on Form
S-1 (No. 333-2042) that became effective on June 13, 1996, and incorporated
herein by reference).
Exhibit 39--Amendment dated March 12, 1998 to Sales Agreement between the
Company and R. R. Donnelley & Sons Company (filed as an exhibit to the
Original Schedule 14D-9, and incorporated herein by reference).
Exhibit 40--Data Center Services Agreement between the Company and R. R.
Donnelley & Sons Company (filed as an Exhibit to the Company's Registration
Statement on Form S-1 (No. 333-2042) that became effective on June 13, 1996,
and incorporated herein by reference).
Exhibit 41--Amendment dated March 12, 1998 to Data Center Services Agreement
between the Company and R. R. Donnelley & Sons Company (filed as an exhibit to
the Original Schedule 14D-9, and incorporated herein by reference).
Exhibit 42--Tax Allocation and Indemnification Agreement between the Company
and R. R. Donnelley & Sons Company (filed as an Exhibit to the Company's
Registration Statement on Form S-1 (No. 333-2042) that became effective on
June 13, 1996, and incorporated herein by reference).
Exhibit 43--Press Release dated March 12, 1998 (filed as an exhibit to the
Company's Current Report on Form 8-K as filed on March 13, 1998, and
incorporated herein by reference).
Exhibit 44--Press Release dated March 18, 1998 (filed as an exhibit to
Amendment No. 1 to Schedule 14D-9 Solicitation/Recommendation Statement of the
Company, and incorporated herein by reference.)
Exhibit 45--Press Release dated March 20, 1998 (filed as an exhibit to
Amendment No. 2 to Schedule 14D-9 Solicitation/Recommendation Statement of the
Company, and incorporated herein by reference.)
Exhibit 46--Press Release dated March 23, 1998 (filed as an exhibit to
Amendment No. 3 to Schedule 14D-9 Solicitation/Recommendation Statement of the
Company, and incorporated herein by reference.)
Exhibit 47--Press Release dated March 23, 1998 (filed as an exhibit to
Amendment No. 3 to Schedule 14D-9 Solicitation/Recommendation Statement of the
Company, and incorporated herein by reference.)
9
<PAGE>
Exhibit 48--Letter from Parent to Company (filed as an exhibit to Amendment
No. 5 to Schedule 14D-9 Solicitation/Recommendation Statement of the Company,
and incorporated herein by reference.)
Exhibit 49--Press Release dated March 26, 1998 (filed as an exhibit to
Amendment No. 5 to Schedule 14D-9 Solicitation/Recommendation Statement of the
Company, and incorporated herein by reference.)
Exhibit 50--Press Release dated March 27, 1998 (filed as an exhibit to
Amendment No. 5 to Schedule 14D-9 Solicitation/Recommendation Statement of the
Company, and incorporated herein by reference.)
Exhibit 51--Letter dated March 28, 1998 (filed as an exhibit to Amendment No.
6 to Schedule 14D-9 Solicitation/Recommendation Statement of the Company, and
incorporated herein by reference.)
Exhibit 52--Press Release dated March 29, 1998 (filed as an exhibit to
Amendment No. 6 to Schedule 14D-9 Solicitation/Recommendation Statement of the
Company, and incorporated herein by reference.)
Exhibit 53--Opinion of Lehman Brothers Inc., dated March 29, 1998 (filed as
an exhibit to Amendment No. 6 to Schedule 14D-9 Solicitation/Recommendation
Statement of the Company, and incorporated herein by reference.)
Exhibit 54--Letter Agreement dated March 29, 1998 between Parent and the
Company (filed as an exhibit to Amendment No. 6 to Schedule 14D-9
Solicitation/Recommendation Statement of the Company, and incorporated herein
by reference.)
Exhibit 55--Press Release dated March 29, 1998 (filed as an exhibit to
Amendment No. 6 to Schedule 14D-9 Solicitation/Recommendation Statement of the
Company, and incorporated herein by reference.)
Exhibit 56--Letter to Stockholders of the Company, from Barton L. Faber,
dated March 31, 1998 (filed herewith).
Exhibit 57--Opinion of Lehman Brothers Inc., dated March 30, 1998 (filed
herewith).
Exhibit 58--Press Release dated March 30, 1998 (filed herewith).
10
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of its knowledge and belief, the
undersigned certifies that the information set forth in this statement is
true, complete and correct.
Metromail Corporation
/s/ Thomas J. Quarles
By: _________________________________
Name: Thomas J. Quarles
Title: Senior Vice President,
General Counsel,
Chief Administrative Officer
and Secretary
Dated: March 31, 1998
11
<PAGE>
EXHIBIT 56
[LOGO]
METROMAIL
360 East 22nd Street
Lombard, Illinois 60148
Dear Stockholder:
We are pleased to inform you that pursuant to a merger agreement between
Metromail Corporation ("Metromail" or the "Company") and The Great Universal
Stores P.L.C. ("GUS"), a subsidiary of GUS has increased the price of its
offer to purchase all of the outstanding Metromail shares to $34.50 per share
in cash, subject to the limited conditions described in the enclosed document.
The offer is to be followed by a merger of the GUS subsidiary into the Company
in which each share not purchased in the offer will be converted into the
right to receive the same cash consideration per share as is paid to
stockholders in the offer.
YOUR BOARD OF DIRECTORS HAS DETERMINED THAT THE GUS TENDER OFFER AND THE
MERGER ARE FAIR TO AND IN THE BEST INTERESTS OF THE COMPANY AND ITS
STOCKHOLDERS AND RECOMMENDS THAT ALL STOCKHOLDERS ACCEPT THE GUS OFFER AND
TENDER THEIR SHARES PURSUANT TO THE GUS OFFER.
In addition to the benefits of this transaction to our stockholders, we
believe the combination of Metromail and GUS will be a dynamic one that will
greatly benefit both companies and will provide great opportunities for
Metromail's customers. Metromail's employees will benefit from being part of a
larger, stronger company with exciting new growth opportunities.
GUS's Supplement to its Offer to Purchase, together with related materials
including a Revised Letter of Transmittal to be used in tendering your shares,
has previously been sent to you. These documents set forth the terms and
conditions of GUS's offer. Also enclosed is a copy of the Company's Amended
Schedule 14D-9 filed with the Securities and Exchange Commission, which
supplements the Schedule 14D-9 previously sent to you, and a copy of the
opinion of Lehman Brothers Inc., Metromail's financial advisor, that the
increased price of $34.50 per share is fair to the stockholders of the Company
from a financial point of view. We urge you to read these documents carefully.
Your Board of Directors, management and employees thank you for your loyal
support.
On behalf of the Board of Directors,
Sincerely
/s/ Barton L. Faber
Barton L. Faber
Chairman
Lombard, Illinois
March 31, 1997
<PAGE>
EXHIBIT 57
LEHMAN BROTHERS
March 30, 1998
Board of Directors
Metromail Corporation
360 East 22nd Street
Lombard, Illinois 60148
Members of the Board:
We understand that Metromail Corporation (the "Company"), The Great Universal
Stores P.L.C. ("GUS") and GUS Acquisition Corp., a subsidiary of GUS ("Newco,"
and, together with GUS, the "Bidder"), have entered into an Agreement and Plan
of Merger (the "Merger Agreement") and related Stock Purchase Agreements (the
"Stock Purchase Agreements"), each dated as of March 12, 1998, which provide,
among other things, for (i) the tender offer by Newco for all outstanding shares
of common stock, together with certain associated rights, of the Company for
consideration of $34.50 net per share in cash (the "Tender Offer"), and (ii) the
subsequent merger (the "Merger," and together with the Tender Offer, the
"Proposed Transaction") of Newco with and into the Company, pursuant to which
each outstanding share of the common stock of the Company (other than shares
held in treasury or held by the Bidder or any of its affiliates or as to which
dissenters' rights are exercised) will be converted into the right to receive
consideration of $34.50 net per share in cash. The terms and conditions of the
Proposed Transaction are set forth in more detail in the Merger Agreement.
We have been requested by the Board of Directors of the Company to render our
opinion with respect to the fairness, from a financial point of view, to the
Company's stockholders of the consideration to be offered to such stockholders
in the Proposed Transaction. We have not been requested to opine as to, and
our opinion does not in any manner address, the Company's underlying business
decision to proceed with or effect the Proposed Transaction.
In arriving at our opinion, we reviewed and analyzed: (i) the Merger
Agreement, the Stock Purchase Agreements and the specific terms of the
Proposed Transaction, (ii) publicly available information concerning the
Company that we believe to be relevant to our analysis, (iii) financial and
operating information with respect to the business, operations and prospects
of the Company furnished to us by the Company, (iv) a trading history of the
Company's common stock from June 13, 1996, its initial public offering date,
to the present and a comparison of that trading history with those of other
companies that we deemed relevant, (v) a comparison of the historical
financial results and present financial condition of the Company with those of
other companies that we deemed relevant, and (vi) a comparison of the
financial terms of the Proposed Transaction with the financial terms of
certain other recent transactions that we deemed relevant. We also have had
discussions with the management of the Company concerning its business,
operations, assets, financial condition and prospects and have undertaken such
other studies, analyses and investigations as we deemed appropriate.
LEHMAN BROTHERS INC.
190 SOUTH LASALLE STREET CHICAGO, IL 60603 PHONE 312 609 7200
<PAGE>
In addition, in arriving at our opinion, we have considered the results of
efforts to solicit indications of interest from third parties with respect to
the purchase of the Company and reviewed and analyzed (i) the terms of the
most recent offer to purchase the Company received from American Business
Information, Inc., (ii) the risks of such offeror being unable to consummate
its proposed acquisition of the Company, and (iii) the time that may be
required for such offeror to consummate its proposed acquisition of the
Company.
In arriving at our opinion, we have assumed and relied upon the accuracy and
completeness of the financial and other information provided by the Company
and used by us without assuming any responsibility for independent
verification of such information and have further relied upon the assurances
of management of the Company that they are not aware of any facts or
circumstances that would make such information inaccurate or misleading. With
respect to the financial projections of the Company, upon advice of the
Company we have assumed that such projections have been reasonably prepared on
a basis reflecting the best currently available estimates and judgments of the
management of the Company as to the future financial performance of the
Company and that the Company will perform substantially in accordance with
such projections. In arriving at our opinion, we have not conducted a physical
inspection of the properties and facilities of the Company and have not made
or obtained any evaluations or appraisals of the assets or liabilities of the
Company. Our opinion necessarily is based upon market, economic and other
conditions as they exist on, and can be evaluated as of, the date of this
letter.
Based upon and subject to the foregoing, we are of the opinion as of the date
hereof that, from a financial point of view, the consideration to be offered
to the stockholders of the Company in the Proposed Transaction is fair to such
stockholders.
We have acted as financial advisor to the Company in connection with the
Proposed Transaction and will receive a fee for our services which is
contingent upon the consummation of the Proposed Transaction. In addition, the
Company has agreed to indemnify us for certain liabilities that may arise out
of the rendering of this opinion. We also have performed various investment
banking services for the Company in the past (including acting as co-manager
for the Company's initial public offering and as financial advisor to the
Company in its acquisition of Atlantes Corporation) and have received
customary fees for such services. In the ordinary course of our business, we
actively trade in the equity securities of the Company for our own account and
for the accounts of our customers and, accordingly, may at any time hold a
long or short position in such securities.
This opinion is for the use and benefit of the Board of Directors of the
Company and is rendered to the Board of Directors in connection with its
consideration of the Proposed Transaction. This opinion is not intended to be
and does not constitute a recommendation to any stockholder of the Company as
to whether to accept the consideration to be offered to the stockholders in
connection with the Proposed Transaction.
Very truly yours,
/s/ Lehman Brothers
Lehman Brothers
<PAGE>
EXHIBIT 58
[LOGO OF METROMAIL]
NEWS RELEASE
METROMAIL BOARD CLOSES AUCTION AND REAFFIRMS ITS
RECOMMENDATION OF THE $34.50 GREAT UNIVERSAL STORES OFFER
LOMBARD, Ill/March 30, 1998/Metromail Corporation (NYSE:ML) announced tonight
that its Board of Directors met and unanimously reaffirmed its decision
approving and recommending the offer of The Great Universal Stores P.L.C.
(GUS) to acquire all of the outstanding shares of Metromail Corporation common
stock at a cash purchase price of $34.50 per share subject to certain limited
conditions. Such decision was made following the close of the auction at 12
noon today as previously announced.
"The process we began on February 10th was designed to maximize value for our
shareholders. The Board has unanimously recognized that the GUS offer
represents the greatest value and certainty for our shareholders" said Barton
L. Faber, Metromail chairman, president and chief executive officer. "The
combination of Metromail and GUS will provide great opportunities for
Metromail's employees, customers and prospects."
Metromail Corporation (www.metromail.com) is a leading provider of direct
marketing, database marketing and reference products and services in the United
States and United Kingdom. Metromail helps its customers identify and reach
targeted audiences, utilizing its comprehensive, proprietary consumer database
encompassing 95 percent of U.S. households, as well as providing database
marketing software and related services. Sales for the year ended December 31,
1997 increased almost 17 percent over the prior year to approximately $328
million. The company has 3,200 employees and is headquartered in Lombard,
Illinois.
For more information contact:
Julie Springer (Media Relations)
Director of Corporate Communications
Metromail Corporation
(630) 932-2627
