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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/ / Definitive Proxy Statement
/X/ Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
HILLS STORES COMPANY
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(Name of Registrant as Specified In Its Charter)
NOT APPLICABLE
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
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pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
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[NEWS RELEASE LETTERHEAD OF HILL & KNOWLTON]
For Immediate Release
Contact: William K. Friend
Hills Stores Company
617-821-1000 Ext.1189
Richard T. Rice
Hill and Knowlton
212-885-0367
HILLS STORES COMPANY CONTINUES TO OPPOSE DICKSTEIN PARTNERS --
URGES SHAREHOLDERS TO SUPPORT BOARD
Canton, Massachusetts, June 21, 1995 -- Hills Stores Company (NYSE:HDS)
announced today that it continues to oppose Dickstein Partners' efforts to seize
control of Hills' Board of Directors.
Michael Bozic, President & Chief Executive Officer of Hills, commented:
"Dickstein Partners continues to ignore the most critical point of the proxy
contest -- its highly conditional proposal to acquire Hills is inadequate and
not in the best interests of Hills shareholders. The proposal to acquire Hills,
by way of a merger in which Hills shareholders would receive cash and pay-in-
kind "junk bonds," was inadequate when it was made on May 24th and remains
inadequate today."
Bozic said that it was important for Hills shareholders to consider the
following when deciding how to vote:
"Dickstein Partners is attempting to convince our shareholders that it has
raised financing for its conditional and contingent acquisition proposal. Hills
shareholders should know that Dickstein Partners' so-called "commitments" total
no more than $20 million -- an insignificant sum which pales in comparison to
the full $630 million Dickstein Partners' advisors say is needed to finance the
takeover."
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"Moreover, the so-called commitment letters that Dickstein Partners has
received from potential equity investors contain so many conditions and
contingencies that it would be impossible for Dickstein Partners ever to count
on them to contribute cash to the acquisition proposal. We question whether
Dickstein Partners has worked seriously to advance their proposal or is more
interested in its election campaign."
Bozic continued: "Dickstein Partners is still far short of raising the
amount of equity which it originally said was required to finance the
acquisition proposal. Originally, Dickstein Partners stated that it needed to
raise $75 million in equity and that up to $37.5 million of that equity would be
supplied with its own funds. To date, Dickstein Partners claims to have raised
only $20 million. As a result, Dickstein Partners' required contribution is now
$55 million. Hills shareholders should consider whether Dickstein Partners is
willing or able to invest the required funds."
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"Further, Dickstein Partners has also referred to so-called "highly
confident" letters received from NatWest Markets and NatWest Bank, N.A. If
Dickstein Partners' financing is "arranged," why doesn't it have firm
commitments for the full $630 million required to finance the inadequate
proposal, rather than merely 1980's style "highly confident" letters?"
Hills has other concerns about the risks of Dickstein Partners' acquisition
proposal. Bozic noted: "The front page of Dickstein Partners' own proxy
statement says that, if its nominees acquire control of Hills' board, Dickstein
Partners may further modify its acquisition proposal. In addition, Dickstein
Partners acknowledges that it may conduct negotiations with existing Hills
shareholders regarding their investment of equity capital. As a result, if
Dickstein Partners wins control of Hills, it may "negotiate" with Hills
shareholders to force them to accept not only less cash and more pay-in-kind
"junk bonds" but also equity in a new, highly-leveraged Dickstein-controlled
company. Hills shareholders deserve to know: what exactly are Dickstein
Partners' plans?"
Bozic concluded: "Dickstein Partners' actions pose a real threat to Hills
shareholders, particularly if Dickstein Partners' nominees are elected but are
unable to sell the company. Shareholders are urged, in their own best interest,
to support the Hills nominees who are committed to continue to act in the best
interest of ALL Hills shareholders."
Shareholders who have questions may call D.F. King & Co., Inc. at 1-800-
290-6425 or Hills at 1-800-964-4910, extension 1956.
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