SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1
to
SCHEDULE 13E-4
Issuer Tender Offer Statement
(Pursuant to section 13(e)(1) of the Securities Exchange Act of 1934)
Lewis Galoob Toys, Inc.
(Name of Issuer)
Depositary Convertible Exchangeable Preferred Shares,
each representing 1/10th of a share of $17.00
Convertible Exchangeable Preferred Stock
- -------------------------------------------------------------------------------
(Title of Class of Securities)
364091207
- -------------------------------------------------------------------------------
(CUSIP Number)
Lewis Galoob Toys, Inc.
- -------------------------------------------------------------------------------
(Name of Person Filing Statement)
Mark D. Goldman With a copy to: Charles I. Weissman, Esq.
President and Chief Shereff, Friedman,
Executive Officer Hoffman & Goodman, LLP
Lewis Galoob Toys, Inc. 919 Third Avenue
500 Forbes Boulevard New York, New York 10022
South San Francisco, CA 94080
(Name, Address and Telephone Number of
Person Authorized to Receive Notices
and Communications on behalf of the
Person Filing Statement)
March 15, 1996
- -------------------------------------------------------------------------------
(Date Tender Offer First Published, Sent or Given to Security Holders)
This Schedule including annexes consists of 13 pages.
<PAGE>
Calculation of Filing Fee
- -------------------------------------------------------------------------------
Transaction Valuation* Amount of filing fee
$52,536,120.00 $10,507.23
- -------------------------------------------------------------------------------
* Estimated solely for the purpose of calculating the filing fee, pursuant to
Section 13(e)(3) under the Securities Exchange Act of 1934, as amended, on the
basis of 1/50th of one per centum of the value of securities proposed to be
purchased.
[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: $10,507.23
Form or Registration No.: Schedule 13E-4
Filing Party: Lewis Galoob Toys, Inc.
Date Filed: February 8, 1996
2
<PAGE>
Lewis Galoob Toys, Inc. (the "Company") hereby amends and supplements
its Issuer Tender Offer Statement on Schedule 13E-4 originally filed with the
Securities and Exchange Commission on February 28, 1996 (the "Statement") with
this Amendment No. 1 (the "Amendment"). This Amendment is being filed in order
to disclose as an exhibit to the Statement certain information provided to the
executive officers of the Company to be used in describing and answering
questions in connection with the offer by the Company to exchange, upon the
terms and subject to the conditions set forth in the Company's Offering
Circular dated February 28, 1996 and the related Letter of Transmittal, each of
the Company's outstanding Depositary Convertible Exchangeable Preferred Shares,
representing 1/10th of a share of the $17.00 Convertible Exchangeable Preferred
Stock of the Company, for 1.85 shares of Common Stock, $.01 par value per
share, of the Company (the "Exchange Offer").
Only those items of the Statement that are amended and supplemented
hereby are included herein. Unless otherwise defined herein, all capitalized
terms shall have the respective meanings ascribed to them in the Statement.
ITEM 9. Material to be Filed as Exhibits.
Item 9 of the Statement is hereby amended and supplemented by the
addition of the following information:
(f) Text of certain information provided to executive officers of the
Company to be used in describing and answering questions in connection with the
Exchange Offer.
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
March 15, 1996 /s/ William G. Catron
- ---------------------- -------------------------------
(Date) (Signature)
William G. Catron
Executive Vice President, General Counsel and
Chief Administrative Officer
---------------------------
(Name and Title)
3
<PAGE>
EXHIBIT INDEX
Page No.
(f) Text of certain information provided to executive officers 5
of the Company to be used in describing and answering questions in
connection with the Exchange Offer.
4
<PAGE>
OFFER TO EXCHANGE BY LEWIS GALOOB TOYS, INC.
ONE DEPOSITARY CONVERTIBLE EXCHANGEABLE PREFERRED SHARE
REPRESENTING 1/10TH OF A SHARE
OF $17.00 CONVERTIBLE EXCHANGEABLE PREFERRED STOCK
FOR 1.85 SHARES OF COMMON STOCK
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL
EXPIRE AT 5:00 P.M. NEW YORK CITY TIME
ON MARCH 29, 1996 UNLESS EXTENDED
SUMMARY HIGHLIGHTS
o Lewis Galoob Toys, Inc. ("Galoob" or the "Company") is offering to
exchange, upon the terms and subject to the conditions set forth in the
Offering Circular dated February 28, 1996 (the "Offering Circular") and
the accompanying Letter of Transmittal (which, collectively constitute the
"Exchange Offer"), each of its Depositary Convertible Exchangeable
Preferred Shares (the "Depositary Shares") for 1.85 shares of Common
Stock, $.01 par value per share (the "Common Stock"), of the Company (the
"Exchange Ratio"). Each Depositary Share represents 1/10th of a share of
$17.00 Convertible Exchangeable Preferred Stock (the "Preferred Stock") of
the Company.
o On February 9, 1996, the last trading day prior to the announcement of the
Exchange Offer, the closing sale prices of the Common Stock and Depositary
Shares, as reported by the New York Stock Exchange ("NYSE"), were $17.25
and $25.375 per share, respectively. As of February 27, 1996, the last
trading day prior to the commencement of the Exchange Offer, the closing
sale prices of the Common Stock and Depositary Shares, as reported by the
NYSE, were $16.00 and $29.00, respectively.
o The Exchange Offer is conditioned upon, among other things, at least 75%
of the Depositary Shares being validly tendered and not withdrawn prior to
the expiration date.
o The Finance Committee of the Board of Directors of the Company has
unanimously approved the Exchange Offer, has determined that the Exchange
Offer is in the best interest of the Company and fair to its stockholders,
and recommends that the holders of the Depositary Shares accept the
Exchange Offer. Schroder Wertheim & Co. Incorporated has delivered a
fairness opinion to the Finance Committee that, based on certain
assumptions and conditions and subject to certain limitations set forth in
such opinion, as of February 28, 1996, the Exchange Ratio was fair to the
holders of Depositary Shares (the "Depositary Stockholders") from a
financial point of view.
<PAGE>
o The Company is making the Exchange Offer to the Depositary Stockholders to
provide them with an economic incentive to exchange their Depositary
Shares for shares of Common Stock pursuant to the Exchange Offer. The
Exchange Offer is being made to enhance the Company's financial position
and ability to capitalize on opportunities for continued growth.
o The Company will pay all charges and expenses of Chemical Mellon
Shareholder Services, L.L.C., the Depositary for the receipts of the
Depositary Shares and Information Agent for the Exchange Offer in
connection with the Exchange Offer.
o The purchase of Depositary Shares pursuant to the Exchange Offer will
reduce the number of holders of Depositary Shares and the number of
Depositary Shares that might otherwise trade publicly, and, depending on
the number of Depositary Shares so exchanged, could adversely affect the
liquidity and market value of the remaining Depositary Shares held by the
public.
SUMMARY OF EXCHANGE OFFER
The Company Lewis Galoob Toys, Inc.
The Depositary Shares Depositary Shares, each
representing 1/10th of a share of $17.00
Convertible Exchangeable Preferred Stock,
$20.00 liquidation
preference of the Company.
Listing NYSE
Ticker GALPR
Number of Depositary All of the 1,839,500 Depositary Shares outstanding
Shares Sought
Exchange Ratio 1.85 shares of Common Stock for each Depositary Share
Expiration Date Friday, March 29, 1996 at 5:00 New York City time,
unless the Company shall have extended the period of
time during which the exchange offer is
open, in which event the expiration date
shall be the latest time and date at which
the Exchange Offer, as so extended by the
Company shall expire.
How to Exchange See "The Exchange Offer-Procedure for Exchanging
Depositary Shares Depositary Shares (pages 25-27) in the Offering
Circular. For information, call the Information Agent
at 800-774-5469.
2
<PAGE>
Withdrawal Rights Depositary Shares tendered for exchange may be withdrawn,
upon written notice to the Depositary, at any time prior
to the Expiration Date of the Exchange Offer, and, unless
accepted for exchange by the Company, may be withdrawn at
any time after 12:00 midnight on April 23, 1996. See "The
Exchange Offer-Withdrawal Rights" (page 27) in the
Offering Circular.
Purpose of the Offer The Company is making the Exchange Offer to the Depositary
Stockholders to provide an economic incentive to exchange
their Depositary Shares for shares of Common Stock in the
Exchange Offer. The Exchange Offer is being made to
enhance the Company's financial position and ability to
capitalize on opportunities for continued growth.
Market price of On February 9, 1996, the last trading day prior to the
Depositary Shares announcement of the Exchange Offer, the closing sale
prices of the Common Stock and Depositary Shares, as
reported by the NYSE, were $17.25 and $25.375,
respectively. As of February 27, 1996, the last trading
day prior to the commencement of the Exchange Offer, the
closing sale prices of the Common Stock and the Depositary
Shares, as reported by the NYSE, were $16.00 and $29.00,
respectively. See "Market Price of Securities" (page 33) in
the Offering Circular.
Dividends On June 10, 1992, the Company announced that it would not
pay the July 1, 1992 $0.425 per share quarterly dividend
on its Depositary Shares. The Company has not paid any
subsequent quarterly dividends. As of December 31, 1995,
the dividend was cumulatively fifteen quarters in arrears,
representing a total dividend arrearage of $11.7 million
(or $6.375 per share). The Company is not legally
obligated to pay any such arrearage. There can be no
assurance that the Company will reinstate the dividends or
pay any dividend arrearages on any remaining Depositary
Shares after the completion of the Exchange Offer.
Stock Transfer Tax None, except as provided in Instruction 6 of the Letter of
Transmittal.
3
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Certain Federal Income The exchange of Depositary Shares for Common Stock in the
Tax Consequences Exchange Offer will be treated for federal income tax purposes as
a tax-free recapitalization. As such, tendering stockholders generally
will not recognize gain or loss on the exchange of Depositary Shares
into shares of Common Stock. However, a tendering Depositary Stockholder
will be deemed to receive a distribution of property (i.e., Common Stock)
from the Company in an amount equal to the lesser of (i) the amount of
dividends in arrears (currently $6.375 per Depositary Share) on the Depositary
Shares exchanged or (ii) the excess of the fair market value of the Common
Stock received over the issue price of the Depositary Shares surrendered by
the Depositary Stockholder. See "Certain Federal Income Tax Consequences"
(page 31-32) in the Offering Circular.
Delisting/Deregistering The purchase of Depositary Shares pursuant to the Exchange
Offer will reduce the number of holders of Depositary Shares and
the number of Depositary Shares that might otherwise trade
publicly, and, depending upon the number of Depositary Shares
so exchanged, could adversely affect the liquidity and market value of
the remaining Depositary Shares held by the public. If there are
less than 100,000 publicly held Depositary Shares, or the
aggregate market value of the remaining publicly held Depositary
Shares is less than $2,000,000, the NYSE may require delisting
of the Depositary Shares because the Depositary Shares would no
longer satisfy all of the requirements to be designated a NYSE
security. If in excess of 94.6% (or 1,739,500 Depositary Shares)
of the Depositary Shares are exchanged for shares of Common
Stock in the Exchange Offer, the Depositary Shares would no
longer satisfy all of the requirements to continue to be designated
as a NYSE security. The Depositary Shares are currently
registered under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"). Registration under the Exchange
Act may be terminated upon application of the Company to the
Securities and Exchange Commission if the Depositary Shares
are neither listed on the NYSE or another national securities
exchange nor held of record by at least 300 persons. This set of
circumstances may occur after the expiration of the Exchange
Offer. Therefore if you do not accept the Exchange Offer and
you are a remaining Depositary Shareholder and these
circumstances do arise, you may experience significant difficulty
in selling your Depositary Shares, should you wish to do so, after
the expiration date of an Exchange Offer.
</TABLE>
4
<PAGE>
QUESTIONS AND ANSWERS
<TABLE>
<CAPTION>
<C> <S>
Q: Why is Lewis Galoob Toys offering to exchange 1.85 shares of common stock
for each Depositary Convertible Exchangeable Preferred Share?
A: The purpose of the Exchange Offer is to enhance the Company's financial
position and ability to capitalize on opportunities for continued growth.
In determining to proceed with the Exchange Offer, the Finance Committee
of the Board of Directors considered, among other things, the fact that
the Exchange Offer will enable the holders of the Depositary Shares to
obtain value (based on the NYSE close on February 9, 1996) exceeding both
the market price of the Depositary Shares prior to the announcement of the
Exchange Offer as well as the amount of the per share cash redemption
value plus unpaid dividend arrearages on the Depositary Shares. In
determining to proceed with the Exchange Offer, the Company received a
fairness opinion from Schroder Wertheim & Co. Incorporated that, based on certain
assumptions and conditions, the exchange ratio is fair to the holders of
the Depositary Shares from a financial point of view.
Q: What do the terms "beneficial owner", "registered holder" and "nominee"
mean?
A: Beneficial owner: If a holder of $17.00 Convertible Exchangeable Preferred
Stock is held by a broker, dealer, commercial bank, trust company or other
nominee and registered in the name of such nominee (including the
Depository Trust Company ("DTC")), such holder is the beneficial owner of
the $17.00 Convertible Exchangeable Preferred Stock even though its name
is not the name in which such shares are registered.
Registered holder: The registered holder of $17.00 Convertible
Exchangeable Preferred Stock is the person or institution in whose
name such shares are actually registered on the register kept by
Galoob or its agent for such purpose. If the $17.00 Convertible
Exchangeable Preferred Stock is registered directly in the name of the
holder who is the beneficial owner of such shares, such beneficial
owner is also the registered holder. If the Depositary Shares are
registered in the name of a broker, dealer, commercial bank, trust
company or other nominee, such nominee is the registered holder of
such shares.
Nominee: This term refers to the broker, dealer, commercial bank,
trust company or other institution that holds the Depositary Shares on
behalf of a beneficial owner of such shares. Although such shares
belong to such beneficial owner, such nominee is the registered holder
of such shares and, accordingly, such shares are registered to such
nominee (including if such nominee holds the Depositary Shares for
DTC, in the name of DTC).
Q: What is the dividend rate on the Depositary Shares?
A: The dividend rate of the Depositary Shares is $1.70 per annum for each
Depositary Share.
Q: The next dividend payment date for the Depositary Shares is April 1, 1996.
Will the holders that participate in the Exchange Offer be eligible for
that dividend?
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<C> <S>
A: No. Any Depositary Stockholder who participates in the Exchange Offer will lose all of
the existing rights and preferences of the Depositary Shares exchanged in the Exchange
Offer, including but not limited to (i) the right to accumulate dividends, if and when paid,
at the rate of $1.70 per Depositary Share per annum, (ii) the right, upon conversion, to
receive for each Depositary Share converted, approximately 1.185 shares of Common
Stock, and (iii) a liquidation preference of $20 per depositary share (plus accumulated
and unpaid dividends thereon).
Q: Will the dividend payment scheduled for April 1, 1996 be made?
A: The Company has not paid any dividends on the Depositary Shares since
July 1, 1992. The Company will make no assurance that it will
reinstate the dividends or pay any dividend arrearages on the
Depositary Shares in the near future.
Q: Will the Depositary Shares continue to be listed?
A: If in excess of 94.6% (or 1,739,500 Depositary Shares) of the
Depositary Shares are exchanged for shares of Common Stock in the
Exchange Offer, the Depositary Shares may no longer satisfy all of the
requirements to continue to be designated as a NYSE security.
Accordingly, there can be no assurance that the Depositary Shares will
continue to be listed on the NYSE after the expiration date of the
Exchange Offer.
Q: What information is available about the Exchange Offer?
A: Each holder of the Depositary Shares should have received a copy of the Offering
Circular, the Letter of Transmittal, a Notice of Guaranteed Delivery, a letter addressed to
Clients, Guidelines for Certification of Tax Payer Identification Number of Substitute
Form W-9 and a Letter from Mark Goldman, the President and Chief Executive Officer
of the Company. The Company encourages each holder to review each document and to
contact their broker and tax adviser for assistance. In the event holders require additional
information or assistance, they should contact the information agent at the toll free
number listed in the Offering Circular and the Letter of Transmittal.
Q: What is the process for a holder of Depositary Shares to participate in the Exchange
Offer?
A: If the Depositary Shares are registered in the beneficial owner's own
name, then the beneficial owner should complete the Letter of
Transmittal and mail it in time to reach the Depositary prior to the
expiration date of the Exchange Offer. If the beneficial owner
requires assistance in completing the Letter of Transmittal, such
beneficial owner may ask any broker, dealer, commercial bank, trust
company or other nominee to assist in completing the Letter of
Transmittal on the beneficial owner's behalf and effecting the
exchange of shares.
If the Depositary Shares are registered in the name of a broker,
dealer, commercial bank, trust company or other nominee, then the
beneficial owner should contact such nominee
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
<C> <S>
promptly and instruct it to exchange such shares on behalf of such
beneficial owner. In many circumstances, these instructions will have
to be given in writing. The nominee should then, in accordance with
such instructions, complete the Letter of Transmittal and mail it in
time to reach the Depositary by the expiration date of the Exchange
Offer.
The Letter of Transmittal must be mailed in time to reach the
Depositary by the expiration date of the Exchange Offer. In the event
a beneficial owner or nominee is unable to timely submit the Letter of
Transmittal, certificates for such Depositary Shares, or any other
necessary documents as described in the Offering Circular and the
Letter of Transmittal, such beneficial owner or nominee, as the case
may be, may still participate in the Exchange Offer by following the
Notice of Guaranteed Delivery instructions set forth in the Offering
Circular and the Letter of Transmittal.
Q: Are there any costs that a participating holder will bear in the context of the Exchange
Offer?
A: The Information Agent and Depositary will be paid fees for assisting
with this transaction. All such fees will be paid by the Company.
However, if a holder's Depositary Shares are held by a broker, dealer,
commercial bank or trust company, such holder may be charged a fee for
their services.
Q: Can a holder of Depositary Shares revoke its exchange of shares?
A: Tenders of Depositary Shares pursuant to the Exchange Offer may be withdrawn at any
time prior to the expiration date and, unless accepted for exchange by the Company, may
be withdrawn at any time after forty business days from the date of the Offering Circular
(April 23, 1996). To be effective, a written Notice of Withdrawal delivered by mail,
hand delivery or facsimile transmission must be timely received by the Depositary at one
of the addresses set forth in the Offering Circular and Letter of Transmittal before the
Depositary receives notice of acceptance by the Company of the Depositary Shares. Any
such Notice of Withdrawal must specify (i) the name of the person who tendered the
Depositary Shares to be withdrawn, (ii) a description of the Depositary Shares to be
withdrawn, and if the Depositary Shares are held in certificated form, the certificate
numbers of the Depositary Shares to be withdrawn, and the aggregate principal amount
represented by such Depositary Shares, (iii) that such holder is withdrawing its election to
have such Depositary Shares exchanged, and (iv) such Notice of Withdrawal must be
signed by the holder of the Depositary Shares in the same manner as the original
signature on the Letter of Transmittal (including any required signature guarantees) or be
accompanied by evidence satisfactory to the Company that the person withdrawing the
tender has succeeded to the beneficial ownership of the Depositary Shares being
withdrawn. The Depositary will return the properly withdrawn Depositary Shares
promptly following receipt of the Notice of Withdrawal. If the Depositary Shares have
been tendered pursuant to the procedure for book entry transfer, any Notice of
Withdrawal must specify the name and number of the account at a book entry transfer
facility to be credited the withdrawn Depositary Shares and otherwise comply with such book
entry transfer facility's procedures.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
<C> <S>
Q: To whom should additional questions be addressed?
A: Questions or request for information should be addressed to the Depositary and
Information Agent, Chemical Mellon Shareholder Services, L.L.C., at 800-774-5469.
</TABLE>
4
