SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 6
TO
SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(D)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
GLEASON CORPORATION
(Name of Subject Company (Issuer))
TORQUE ACQUISITION CO., L.L.C.
(Bidder)
COMMON STOCK, PAR VALUE $1.00 PER SHARE
(Title of Class of Securities)
377339106
(CUSIP Number of Class of Securities)
GLEASON CORPORATION
ATTN: EDWARD J. PELTA, ESQ.
VICE PRESIDENT,
GENERAL COUNSEL AND SECRETARY
1000 UNIVERSITY AVENUE
P.O. BOX 22970
ROCHESTER, NEW YORK 14692
TELEPHONE: (716) 473-1000
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications on Behalf of Bidder)
COPY TO:
BLAINE V. FOGG, ESQ.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
919 THIRD AVENUE
NEW YORK, NEW YORK 10022
TELEPHONE: (212) 735-3000
CALCULATION OF FILING FEE:
Transaction Valuation** Amount of Filing Fee
- -----------------------------------------------------------------------------
$193,509,856 $38,702
- -----------------------------------------------------------------------------
** Estimated for purposes of calculating the amount of the filing fee only.
The amount assumes the purchase of 8,413,472 shares of common stock, par
value $1.00 per share (the "Shares"), of Gleason Corporation, a Delaware
corporation (the "Company"), at a price of $23.00 per Share in cash. As
of November 30, 1999, there were 9,589,195 Shares issued and
outstanding. Certain stockholders of the Company, owning in the
aggregate (1) 1,458,983 Shares and (2) 472,322 unexercised options to
acquire Shares under various employee stock option plans of the Company
as of November 30, 1999, have agreed not to tender their Shares (which
in the aggregate total 1,931,305 Shares, including Shares underlying
options) pursuant to the Offer. Based on the foregoing, the maximum
number of Shares available to be tendered pursuant to the Offer is
8,413,472 Shares, which is equal to the number of Shares outstanding on
a fully diluted basis as of November 30, 1999 less the aggregate number
of Shares and options to acquire Shares owned by the non-tendering
stockholders. The amount of the filing fee calculated in accordance with
Rule 0-11 of the Securities Exchange Act of 1934, as amended, equals
1/50th of one percent of the value of the transaction.
|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.
Amount previously paid: $38,702 Filing party: Torque Acquisition
Co., L.L.C.
Form or registration no.: Schedule 14D-1 Date filed: December 15, 1999
(Continued on following pages)
This Amendment No. 6 to the Tender Offer Statement on
Schedule 14D-1 amends and supplements the Tender Offer Statement on
Schedule 14D-1 originally filed on December 15, 1999 (the "Schedule 14D-1")
by Torque Acquisition Co., L.L.C. ("Acquisition Company"), a Delaware
limited liability company and a wholly owned subsidiary of Vestar Capital
Partners IV, L.P., relating to the joint tender offer by Acquisition
Company and Gleason Corporation, a Delaware corporation (the "Company"), to
purchase all of the outstanding shares of common stock, par value $1.00 per
share, of the Company (the "Common Stock"), together with the associated
preferred share purchase rights (the "Rights" and, together with the Common
Stock, the "Shares"), at a purchase price of $23.00 per Share, net to the
seller in cash, without interest thereon, upon the terms and subject to the
conditions set forth in the Offer to Purchase, dated December 15, 1999, and
the related Letter of Transmittal. Capitalized terms used but not defined
herein shall have the meanings assigned to them in the Schedule 14D-1.
Acquisition Company hereby amends and supplements the Schedule 14D-1 as
follows:
ITEM 10. ADDITIONAL INFORMATION.
On January 26, 2000, Murray Devine & Co., Inc. ("Murray
Devine"), valuation consultants, presented their valuation opinion of the
Company to the Board of Directors of the Company to the effect that, before
giving effect to the Offer and the Merger and the transactions contemplated
thereby, the aggregate value of the Company's net assets, at fair value and
present saleable value, would exceed (a) its total liabilities (including
contingent, subordinated, unmatured and unliquidated liabilities) and (b)
the amount required to pay such liabilities as they become absolute and
matured in the normal course of business, by an amount at least equal to
the funds required to effect the Offer and the Merger and the transactions
contemplated thereby, plus the par value of the stated capital of the
Company. A copy of the Murray Devine opinion is attached hereto as Exhibit
(g)(11) and is incorporated herein by reference.
On January 28, 2000, Acquisition Company and the Company
announced that they are extending the Offer until 12:00 midnight, New York
City time, on Thursday, February 10, 2000. The Offer had originally been
scheduled to expire at midnight on January 27, 2000. The terms of the
extended Offer are the same as the original Offer as set forth in the
Schedule 14D-1 filed with the Securities and Exchange Commission on
December 15, 1999.
According to ChaseMellon Shareholder Services, L.L.C., the
depositary for the Offer, as of midnight on January 27, 2000, 5,186,109
Shares (including 160,620 Shares tendered pursuant to notices of guaranteed
delivery), or approximately 64.4% of the public Shares available to be
tendered, have been validly tendered and not withdrawn pursuant to the
Offer. A copy of the press release release is attached hereto as Exhibit
(g)(12) and is incorporated herein by reference.
ITEM 11. MATERIALS TO BE FILED AS EXHIBITS.
Item 11 is hereby amended and supplemented by the addition
of the following exhibits thereto:
(g)(11) Opinion from Murray, Devine & Co., Inc., dated January 26, 2000.
(g)(12) Press release, dated January 28, 2000.
SIGNATURE
After due 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.
Dated: January 28, 2000
TORQUE ACQUISITION CO., L.L.C.
By: /s/ SANDER M. LEVY
-------------------
Name: Sander M. Levy
Title: President
EXHIBIT INDEX
Exhibits Description
-------- -----------
(g) (11) Opinion from Murray, Devine & Co., Inc., dated January 26, 2000.
(g) (12) Press release, dated January 28, 2000.
Murray, Devine & Co, Inc.
One Logan Square, Suite 2800
Philadelphia, Pa. 19103
January 26, 2000
Board of Directors
GLEASON CORPORATION
1000 University Avenue
P.O. Box 22970
Rochester, NY 14692
Ladies and Gentlemen:
This letter is furnished at the request of the Board of Directors of
Gleason Corporation (the "Company") in connection with the Agreement and
Plan of Merger (the "Merger Agreement"), dated December 8, 1999, by and
among the Company, Torque Acquisition Co., L.L.C. ("Acquisition Co."), and
Torque Merger Sub, Inc. ("Merger Subsidiary"). Unless defined herein, all
defined terms are as defined in the Merger Agreement.
Pursuant to the Merger Agreement, the Company and Acquisition Co.
commenced a joint tender offer to purchase all of the outstanding common
stock of the Company for a per share price of $23.00 (the "Tender Offer").
In connection with the Tender Offer, substantially all of the Company's
existing indebtedness of approximately $32.1 million will be retired. The
Tender Offer will be followed by a second step merger (the "Merger") at
which time those shares not tendered, except certain shares held by Vestar
Capital Partners IV, L.P. ("Vestar"), management and the Gleason
Foundation, will be converted into the right to receive $23.00 per share in
cash. Upon completion of the Merger, Vestar, management and the Gleason
Foundation will own, on a fully diluted basis, approximately 50%, 34% and
16%, respectively. The Tender Offer and Merger are collectively referred to
as the "Transactions."
The Transactions will be financed by proceeds provided from: (a) a
$250.0 senior credit facility (the "Credit Agreement") of which
approximately $185.9 million will be drawn on the Closing Date (as
hereinafter defined); (b) $54.7 million from the issuance of preferred
stock (the "Preferred Stock") to Vestar and the Gleason Foundation; (c)
$25.2 million from the issuance of common equity to management, Vestar, and
the Gleason Foundation; (d) $7.5 million of existing cash from the
Company's balance sheet; and (e) $7.3 million from option proceeds. The
proceeds from above will be used: (a) to pay the common equity purchase
price of $234.6 million; (b) to repay existing indebtedness of
approximately $32.1 million; and (c) pay transaction fees and expenses
incurred in connection with the Transactions of approximately $14.0
million.
The Credit Agreement provides for: (a) an $80.0 million Term A Loan
(the "Term A Loan"); (b) a $100.0 million Term B Loan (the "Term B Loan",
and together with the Term A Loan, the "Term Loans") and (c) a $70.0
million revolving credit facility (the "Revolving Facility) of which
approximately $5.9 million will be drawn on the Closing Date. The proceeds
of the Term Loans will be used to finance the Transactions and to pay
related fees and expenses. The proceeds from the Revolving Facility will be
used for the working capital requirements and other general corporate
purposes of the Company and its subsidiaries, provided that no more that
$12.5 million of the Revolving Facilities may be used on the Closing Date
(as hereinafter defined) to finance the Transactions and pay related fees
and expenses.
Loans under the Revolving Facility will bear interest on the unpaid
principal amount at a variable rate per annum equal at any time to the sum
of: (a) the higher of (i) 1/2 of 1% in excess of the Federal Funds rate and
(ii) the rate that Bankers Trust Company announces from time to time as its
prime lending rate, in effect at such time (the "Base Rate"); plus (b)
2.00%, such interest to be payable quarterly in arrears on the last
business day of each quarter, and at maturity. The Revolving Facility will
mature on the sixth anniversary of the Closing Date. The Term A Loan, in an
aggregate principal amount of $80.0 million, will bear interest on the
unpaid principal amount at a rate per annum equal at any time to the sum
of: (a) the Base Rate in effect at such time; plus (b) 3.00%, such interest
to be payable quarterly in arrears on the last business day of each
quarter, and at maturity. The Term A Loan will mature on the sixth
anniversary of the Closing Date. The Term B Loan, in an aggregate principal
amount of $100.0 million, will bear interest on the unpaid principal amount
at a rate per annum equal at any time to the sum of: (a) the Base Rate in
effect at such time; plus (b) 3.50%, such interest to be payable quarterly
in arrears on the last business day of each quarter, and at maturity. The
Term B Loan will mature on the eighth anniversary of the Closing Date.
The obligations of the Company and the Guarantors (as defined in the
Credit Agreement) under the Credit Agreement shall be secured by a first
priority perfected security interest (subjectto permitted liens) in (a) all
limited liability company interests and stock of each direct and indirect
domestic subsidiary of the Company and 65% of the stock of each foreign
subsidiary of the Company and (b) all other tangible and intangible assets
of the Company and each Guarantor, in each case, after giving effect to the
Transactions. The obligations under the Credit Agreement shall also be
unconditionally guaranteed by the Company and the Guarantors.
The Preferred Stock issued by the Company will have an original issue
price of $20.70 per share (the "Issue Price"). Holders of the Preferred
Stock shall be entitled to receive, when, as and if declared by the Board
of Directors, out of funds legally available therefor, dividends on each
share of Preferred Stock (i) until the fifth anniversary of the closing, at
a rate per annum equal to 13.17% of the Issue Price thereof, payable in
cash, and (ii) after the fifth anniversary of the closing, at a rate per
annum equal to 11% of the Issue Price thereof, payable in cash. All
dividends shall be fully cumulative, shall accumulate whether or not earned
or declared and whether or not there are funds legally available for
payment thereof. The Preferred Stock will be redeemable at the Company's
option, in whole or in part, at any time, for the Redemption Price (as
defined in the Company's Amended and Restated Certificate of Incorporation)
plus accrued and unpaid dividends, and redeemable at the holders' option
for common stock or cash on an event of initial public offering. The
Preferred Stock is also redeemable at the option of the holders, in certain
amounts, after the fifth, sixth and seventh anniversary of the issue date,
as set forth in the Company's Amended and Restated Certificate of
Incorporation.
We have been provided with an estimated September 30, 1999 pro forma
closing balance sheet (the "Pro Forma Balance Sheet") of the Company,
included in the Confidential Information Memorandum dated January 2000 (the
"Confidential Information Memorandum), which has been prepared by
management of the Company. The Pro Forma Balance Sheet indicates that the
Company capitalization, on the closing date (the "Closing Date"), after
giving effect to the Transactions, will be comprised of approximately $96.2
million of current liabilities, $185.9 million of long-term debt, $77.3
million of other liabilities and a shareholders' deficit of $70.6 million.
Management of the Company has informed us that the foregoing amounts were
determined in accordance with generally accepted accounting principles
("GAAP") and do not necessarily reflect fair market value. Indeed, the
notes to the Pro Forma Balance Sheet state that the Transactions are to be
accounted for as a leveraged recapitalization and, therefore, the Company's
assets are recorded at their historical basis. However, based on the $23.00
price being paid by Vestar on an arms-length basis for shares of common
stock of the Company upon consummation of the Merger, the common equity of
the Company after giving effect to the Transactions would have an implied
value of $22.3 million as compared to the shareholders' deficit of $70.6
million shown on the Pro Forma Balance Sheet.
Murray, Devine & Co., Inc. has been requested to provide its opinion
that, on the Closing Date, as contemplated herein, and after giving effect
to the Transactions and to all indebtedness to be incurred in connection
therewith (except as indicated in #4 below), with respect to the Company,
on a consolidated basis:
1) the aggregate value of the assets of the Company, at fair value
and present fair saleable value, exceeds: (a) its total
liabilities (including contingent, subordinated, unmatured and
unliquidated liabilities) and (b) the amount required to pay
such liabilities as they become absolute and matured in the
normal course of business;
2) the Company has the ability to pay its debts and liabilities
(including contingent, subordinated, unmatured and unliquidated
liabilities) as they become absolute and matured in the normal
course of business;
3) the Company will not have an unreasonably small amount of
capital with which to conduct its business;
4) before giving effect to the Transactions, the aggregate value
of the assets of the Company, at fair value and present fair
saleable value, exceeds: (a) its total liabilities (including
contingent, subordinated, unmatured and unliquidated
liabilities) and (b) the amount required to pay such
liabilities as they become absolute and matured in the normal
course of business, by an amount at least equal to the funds
required to effect the Transactions plus the par value of the
Stated Capital of the Company; and
5) the excess of the aggregate value of the assets of the Company
at fair value and present fair saleable value over its
liabilities (including contingent, subordinated, unmatured and
unliquidated liabilities), is equal to or exceeds the amount of
the Stated Capital of the Company, after giving effect to the
Transaction.
In evaluating the foregoing, the subject phrases and the definitions
ascribed thereto are as follows:
"aggregate value of the assets of the Company" - The total value of
all assets of the Company, recorded on a consolidated basis,
including, without limitation, all current assets, all fixed assets
such as property, equipment and all intangible assets including
contracts, tradenames, trademarks, databases, mailing lists, backlog,
licenses, patents and other intangible assets including those in the
nature of goodwill and going concern value.
"fair value" - The total amount at which the assets of the Company,
recorded on a consolidated basis, would likely sell as part of a
going concern and for continued use as part of a going concern,
within a commercially reasonable period of time, between one or more
willing buyers and a willing seller with neither party being under
any compulsion to buy or sell and with all parties having reasonable
knowledge of all facts.
"present fair saleable value" - The price that could be obtained by
an independent willing seller from an independent willing buyer with
reasonable promptness in an arms-length transaction under present
conditions for the sale of comparable business enterprises.
"liabilities (including contingent, subordinated, unmatured and
unliquidated liabilities)" - The pro forma debts and liabilities of
the Company, as of the Closing Date, as set forth on the Pro Forma
Balance Sheet, including all fees, expenses, and the principal amount
of indebtedness being incurred in the Transactions through borrowings
under the Credit Agreement and the Company's estimated amount of
reasonably anticipated liabilities that may result from
contingencies, which liabilities may or may not meet the criteria for
accrual under Statement of Financial Accounting Standards ("SFAS")
No. 5 and, therefore, may not be included in liabilities under GAAP,
including: a) pending litigation, asserted claims and assessments,
guarantees, and other contingent liabilities including, without
limitation, employee benefit plan liabilities relating to retiree
benefits identified to us by responsible officers of the Company; as
well as b) contingent liabilities relating to environmental matters
identified to us by responsible officers of the Company.
"Stated Capital" - Shall mean "capital" as defined in and computed in
accordance with Sections 154 and 244 of the General Corporation Law
of the State of Delaware, i.e. the aggregate amount represented by
the aggregate par value of the outstanding shares of capital stock of
the Company, minus any reduction to the capital of the Company, by
resolution of its board of directors.
We have undertaken certain analyses and procedures relating to the
preparation of the requested opinion. The procedures undertaken, none of
which extended past the date of this letter, consisted solely of the
following:
1. Read the Merger Agreement, including schedules and exhibits
thereto.
2. Read the Schedule 14D-1 Tender Offer Statement as filed with
the Securities and Exchange Commission by the Company and
Acquisition Co. including exhibits and schedules thereto.
3. Read the Credit Agreement (Draft 1/25/00), including available
schedules and exhibits thereto.
4. Read the Confidential Information Memorandum.
5. Read the multi-year financial model for the Company, on a
consolidated basis (the "Projections"), as included in the
Confidential Information Memorandum and Pro Forma Balance Sheet
that was prepared by management of the Company. In this regard,
made inquiries of certain officials of the Company who have
responsibility for financial and accounting matters, with
respect to those assumptions which have been made in
formulating the Projections.
6. Performed a valuation of the Company, on a consolidated basis,
using current standards of valuation including the discounted
free cash flow and market multiple approaches, as a going
concern after giving effect to the Transactions and related
financing.
7. Read the audited financial statements of the Company for the
years ending December 31, 1997 and 1998, audited by Ernst &
Yount LLP, Certified Public Accountants. In this regard,
officials of the Company have informed us that no other audited
financial statements for any date or period subsequent to
December 31, 1998 are available for the Company.
8. Read the interim consolidated financial statements of the
Company for the nine months ended September 30, 1999, as
included in the Company's Form 10Q. In this regard, officers of
the Company have informed us that no other interim consolidated
financial statements for any date or period subsequent to
September 30, 1999 are available for the Company.
9. Read the minutes, written consents and resolutions of the Board
of Directors of the Company for the following the period
January 28, 1998 through December 8, 1999.
10. Read the Pro Forma Balance Sheet prepared by management of
the Company. With respect to the amounts shown in the Pro Forma
Balance Sheet and accompanying notes and schedules thereto, we
have made inquiries of certain officers of the Company who have
responsibility for financial and accounting matters regarding:
a) the basis for the assumptions and the information
presented in the Pro Forma Balance Sheet and the
consistency of such assumptions and information
with the Transactions and related financing; and
b) whether the Pro Forma Balance Sheet includes all
material assets and liabilities which it is
anticipated will have to be recorded under GAAP
after giving effect to the Transactions.
11. Inquired of certain officers of the Company as appropriate, who
have responsibility for financial and accounting matters regard
ing:
a) whether they were aware of any material liabilities
or loss contingencies that are required to be
accrued or disclosed by SFAS No. 5 or that
would be material to the Company, whether or
not required to be disclosed under SFAS No. 5,
or any unasserted claims or assessments that their
legal counsel has advised them are probable of
assertion and must be disclosed in accordance
with SFAS No. 5; and
b) whether they were aware of any events or conditions
that, as of the date thereof, would cause the
Company, after giving effect to the Transactions
and related financing, not to be solvent.
12. Conducted interviews with those individuals responsible for the
management of the Company for the purpose of reviewing its
operations and reviewing such operations in terms of their past
operating results, markets served and their ability to attain
operating results consistent with the forecasted results.
13. Conducted interviews with those responsible for the legal
affairs of the Company regarding any litigation to which the
Company is currently a party and any claims or causes of
actions which may be probable of legal assertion against the
Company which would be reasonably likely to have a material
adverse effect on the business, condition (financial or
otherwise), operations, properties or prospects of the Company.
We further discussed whether the Company is currently involved
in, or is expected to be involved in, any investigation or
enforcement action by any governmental body which would be
reasonably likely to result in the imposition of any sanctions,
fines, or penalties, the effect of which could have a material
adverse effect on the business, condition (financial or
otherwise), operations, properties or prospects of the Company.
14. Conducted interviews with management of the Company to
discuss their assertions concerning contingent liabilities that
are not recorded in the historical financial statements, or the
Company's Pro Forma Balance Sheet or Projections.
We have not made any independent investigation in rendering this
opinion other than the examination described. Our opinion is, therefore,
qualified by the scope of that examination.
Based solely upon the foregoing, and subject to the other
qualifications set forth below, on the Closing Date and immediately after
giving effect to the Transactions and to all indebtedness to be incurred in
connection therewith (except as indicated in #4 below), we are of the
opinion, with respect to the Company, on a consolidated basis, that:
1) the aggregate value of the assets of the Company, at fair value
and present fair saleable value, exceeds: (a) its total
liabilities (including contingent, subordinated, unmatured and
unliquidated liabilities); and (b) the amount required to pay
such liabilities as they become absolute and matured in the
normal course of business;
2) the Company has the ability to pay its debts and liabilities
(including contingent, subordinated, unmatured and unliquidated
liabilities) as they become absolute and matured in the normal
course of business;
3) the Company does not have an unreasonably small amount of
capital with which to conduct its business;
4) before giving effect to the Transactions, the aggregate value
of the assets of the Company, at fair value and present fair
saleable value, exceeds: (a) its total liabilities (including
contingent, subordinated, unmatured and unliquidated
liabilities) and (b) the amount required to pay such
liabilities as they become absolute and matured in the normal
course of business, by an amount at least equal to the funds
required to effect the Transactions plus the par value of the
Stated Capital of the Company; and
5) the excess of the aggregate value of the assets of the Company
at fair value and present fair saleable value over its
liabilities (including contingent, subordinated, unmatured and
unliquidated liabilities), is equal to or exceeds the amount of
the Stated Capital of the Company, after giving effect to the
Transaction.
In rendering the above opinion, with regard to items 1, 2, 3 and 5,
we have assumed that the Transactions and related financing will be closed
and funded, on terms similar to those in the draft documents reviewed,
within two weeks of the date hereof. In the event that the Closing Date
exceeds two weeks from the date hereof, Murray, Devine & Co., Inc. will
issue an updated opinion based on the conditions in existence at such time.
In rendering the above opinion, we have relied upon certain past and
current unaudited financial information which has not been independently
verified and for which we assume no responsibility as to its accuracy.
Although it is not within the scope of the above opinion to determine the
accuracy of such information, we have no reason to believe any such
financial information is inaccurate to any material extent. Further, we
have assumed good title to the assets of the Company, and have made no
inspection of those assets for the purpose of determining the value of such
assets, both of which we expressly disclaim responsibility for in
connection with the rendering of this opinion.
This letter is intended solely for use of the addressees in
connection with the Transactions and related financing and is not to be
relied upon by any other person or entity, other than the addressees, or
for any other purpose without our prior written consent, except that the
opinion may be relied upon and referred to by officers of the Company in
connection with any certificates or similar documents required in
connection with the Transactions or the financing thereof. This letter is
not to be disclosed or otherwise circulated, quoted or referred to any
persons or entities other than the addressees without our written consent
(which will not be unreasonably withheld), except that this letter may be
filed by the Company or Acquisition Co. with the Securities and Exchange
Commission in any filings made in connection with the Transactions.
Notwithstanding anything to the contrary in the immediately preceding
sentence, our consent shall not be required for any of the following: (a)
submitting copies of this opinion to counsel or advisors to the Board of
Directors of the Company; (b) furnishing this opinion upon the demand or
order of any court, administrative agency or regulatory body or as may be
required in response to any summons or subpoena; (c) furnishing this
opinion as may be required or ordered in, or as may be necessary, to
protect the interests of the Board of Directors of the Company in, any
litigation, governmental proceeding or investigation pertaining to the
Transactions to which the Board of Directors of the Company is or may be
subject (whether or not named as a party in such proceeding); or (d)
furnishing this opinion to a governmental agency as otherwise required by
any law, order, regulation or ruling applicable to the Board of Directors
of the Company.
This letter is also delivered with the explicit understanding that it
is based on current standards of valuation and assessment and that
standards of valuation and assessment may change in the future. We disclaim
any responsibility for any impact any such changes may have on the
valuation or assessment of the Company described in this letter. Except as
contemplated by the Projections referred to in item number 4 on page 5 of
this letter, unforeseen future events which may change the current or
projected value of the Company do not apply and have not been factored into
the opinion expressed in this letter.
This letter is a financial opinion only. We express no opinion
regarding questions of legal interpretation and expressly disclaim that it
be construed in any way as a legal opinion. This opinion is delivered to
each recipient subject to the conditions, scope of the engagement,
limitations and understandings set forth in this opinion and subject to the
understanding that the obligations of Murray, Devine & Co., Inc. in the
Transactions are solely corporate obligations and no officer, director,
employee, agent, shareholder or controlling person of Murray, Devine & Co.,
Inc. shall be subject to any personal liability whatsoever to any person,
nor will any such claim be asserted by or on behalf of the Company or any
of its subsidiaries or affiliates. Further it is understood that in no
event, regardless of the legal theory advanced, shall Murray, Devine & Co.,
Inc. be held responsible to the Company or any of its subsidiaries or
affiliates other than for its gross negligence, bad faith, willful
misconduct or reckless disregard of its obligations.
We have no obligation to update or revise this letter for any events
occurring subsequent to the date of this letter.
Very truly yours,
/s/ MURRAY, DEVINE & CO., INC.
Murray, Devine & Co., Inc.
For Further Information, Contact for Vestar:
SANDER M. LEVY
Vestar Capital Partners
(212) 351-1610
For Further Information, Contact for Gleason:
JOHN J. PERROTTI
Vice President - Finance & Treasurer
(716) 461-8105
FOR IMMEDIATE RELEASE
GLEASON CORPORATION AND TORQUE ACQUISITION CO., L.L.C.
ANNOUNCE EXTENSION OF JOINT TENDER OFFER
FOR GLEASON CORPORATION COMMON STOCK
ROCHESTER, NY, JANUARY 28, 2000 - Torque Acquisition Co., L.L.C.
("Acquisition Company"), a wholly owned subsidiary of Vestar Capital
Partners IV, L.P., and Gleason Corporation (NYSE: GLE) (the "Company", and
together with Acquisition Company, the "Purchasers") announced today that
they are extending their offer to purchase all of the outstanding shares of
common stock, par value $1.00 per share, together with the associated
preferred share purchase rights, of the Company, at a purchase price of
$23.00 per share, until 12:00 midnight, New York City time, on February 10,
2000. The offer had originally been scheduled to expire at midnight on
January 27, 2000. The terms of the extended offer are the same as the
original offer as set forth in offering materials filed with the Securities
and Exchange Commission on December 15, 1999.
According to ChaseMellon Shareholder Services, L.L.C., the depositary
for the offer, as of midnight on January 27, 2000, 5,186,109 shares
(including 160,620 shares tendered pursuant to notices of guaranteed
delivery), or approximately 64.4% of the public shares available to be
tendered, have been validly tendered and not withdrawn pursuant to the
offer. Together with the shares owned by the Gleason Foundation and
management, approximately 70% of the outstanding shares are in support of
the transaction.
The offer is being extended in order to provide stockholders
additional time to tender shares so that the minimum condition may be
satisfied. Acquisition Company stated it is actively reviewing all its
alternatives, including ways to reduce the minimum condition.
Questions and requests for assistance with respect to the offer may
be directed to Georgeson Shareholder Communications Inc., the Information
Agent for the offer, at (212) 440-9800 (banks and brokers call collect) or
(800) 223-2064 (all other callers).
The Company's principal business activity is the development,
manufacture and sale of gear production machinery and related equipment.
The gears produced by the Company's machines are used in drive trains of
automobiles, sport utility vehicles, trucks, buses, aircraft and marine,
agricultural and construction machinery. The Company has manufacturing
operations in Rochester, New York; Rockford, Illinois; Plymouth, England;
Munich and Ludwigsburg, Germany; Bangalore, India; and Biel, Switzerland,
and has sales and service offices throughout the United States and Europe
and in the Asia-Pacific region.
MORE INFORMATION ABOUT GLEASON CORPORATION IS AVAILABLE ON THE WORLD WIDE
WEB AT HTTP://WWW.GLEASON.COM
