<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
SCHEDULE 13E-4
ISSUER TENDER OFFER STATEMENT
(Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934)
ALLIANT TECHSYSTEMS INC.
(Name of Issuer and Person Filing Statement)
COMMON STOCK, PAR VALUE $.01 PER SHARE
(Title of Class of Securities)
------------------------------
018804 10 4
(CUSIP Number of Class of Securities)
------------------------------
DARYL L. ZIMMER, ESQ.
VICE PRESIDENT AND GENERAL COUNSEL
ALLIANT TECHSYSTEMS INC.
600 SECOND STREET, N.E.
HOPKINS, MINNESOTA 55343
(612) 931-6140
(Name, Address and Telephone Number of Person Authorized to Receive Notice
and Communications on Behalf of the Person(s) Filing Statement)
COPY TO:
ROBERT A. PROFUSEK, ESQ.
JERE R. THOMSON, ESQ.
Jones, Day, Reavis & Pogue
599 Lexington Avenue
New York, New York 10022
(212) 326-3939
November 6, 1998
(Date Tender Offer First Published, Sent or Given to Security Holders)
CALCULATION OF FILING FEE
<TABLE>
<CAPTION>
TRANSACTION VALUATION AMOUNT OF FILING FEE
<S> <C>
$215,600,000* $43,120
</TABLE>
* Calculated solely for purposes of determining the filing fee in accordance
with Section 13(e)(3) of the Securities Exchange Act of 1934 and Rule O-11
thereunder. This amount assumes the purchase of 2,800,000 shares of Common
Stock at $77 per share.
/ / Check box if any part of the fee is offset as provided by Rule O-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number on the Form or
Schedule and the date of its filing.
<TABLE>
<S> <C>
Amount previously paid: Not applicable. Filing party: Not
Form or registration no.: Not applicable
applicable. Date filed: Not applicable.
</TABLE>
<PAGE>
ITEM 1. SECURITY AND ISSUER.
(a) The name of the issuer is Alliant Techsystems Inc., a Delaware
corporation (the "Company"), and the address of its principal executive office
is 600 Second Street, N.E., Hopkins, Minnesota 55343. The information set forth
under "Certain Information Concerning the Company" in Section 10 of the Offer to
Purchase (as defined below) is incorporated herein by reference.
(b) This Issuer Tender Offer Statement on Schedule 13E-4 (this "Schedule")
relates to an offer by the Company to purchase up to 2,800,000 shares of its
Common Stock, par value $.01 per share (the "Shares") (including the associated
preferred stock purchase rights issued pursuant to the Rights Agreement, dated
as of September 28, 1990, as amended, between the Company and The Chase
Manhattan Bank (as successor to Manufacturers Hanover Trust Company) as the
Rights Agent) at a price per Share not greater than $77 nor less than $67 per
Share, net to the seller in cash, specified by the tendering stockholders, upon
the terms and subject to the conditions set forth in the Offer to Purchase,
dated November 6, 1998 (the "Offer to Purchase"), and the related Letter of
Transmittal (the "Letter of Transmittal," which together with the Offer to
Purchase constitute the "Offer"), copies of which are attached hereto as
Exhibits (a)(1) and (a)(2), respectively. The information set forth on the front
cover page of, and in "Introduction," "Number of Shares; Proration; Expiration
Date," "Acceptance for Payment of Shares and Payment of Purchase Price,"
"Interests of Directors and Officers; Transactions and Agreements Concerning the
Shares" and "Extension of Tender Period; Termination; Amendments" in the Offer
to Purchase is incorporated herein by reference.
(c) The information set forth in "Introduction" and "Price Range of Shares;
Dividends" in the Offer to Purchase is incorporated herein by reference.
(d) Not applicable.
ITEM 2. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)-(b)The information set forth in "Source and Amount of Funds" in the
Offer to Purchase is incorporated herein by reference.
ITEM 3. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE ISSUER OR
AFFILIATE.
(a)-(j)The information set forth in "Introduction," "Purpose of the Offer;
Certain Effects of the Offer," and "Interests of Directors and Officers;
Transactions and Agreements Concerning the Shares" in the Offer to Purchase is
incorporated herein by reference.
ITEM 4. INTEREST IN SECURITIES OF THE ISSUER.
The information set forth in "Interests of Directors and Officers;
Transactions and Arrangements Concerning the Shares" in the Offer to Purchase is
incorporated herein by reference.
ITEM 5. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
THE ISSUER'S SECURITIES.
The information set forth in "Interests of Directors and Officers;
Transactions and Agreements Concerning the Shares" in the Offer to Purchase is
incorporated herein by reference.
ITEM 6. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth in "Source and Amount of Funds" and "Fees and
Expenses" in the Offer to Purchase is incorporated herein by reference.
1
<PAGE>
ITEM 7. FINANCIAL INFORMATION.
(a)-(b)The financial information set forth in "Certain Information
Concerning the Company-- Summary Historical Consolidated Financial Information"
and "--Summary Unaudited Pro Forma Consolidated Financial Information" in the
Offer to Purchase is incorporated herein by reference. The financial information
set forth on pages 27 through 44 of the Company's 1998 Annual Report, filed as
an exhibit to and incorporated by reference into the Company's Annual Report on
Form 10-K for the fiscal year ended March 31, 1998, a copy of which is filed as
Exhibit (g)(1) hereto, is incorporated herein by reference. The financial
information set forth on pages 2 through 11 of the Company's Quarterly Report on
Form 10-Q for the quarterly period ended September 27, 1998, a copy of which is
filed as Exhibit (g)(2) hereto, is incorporated herein by reference.
ITEM 8. ADDITIONAL INFORMATION.
(a) Not applicable.
(b) The information set forth in "Certain Legal Matters; Regulatory
Approvals" in the Offer to Purchase is incorporated herein by reference.
(c) The information set forth in "Purpose of the Offer; Certain Effects of
the Offer" in the Offer to Purchase is incorporated herein by reference.
(d) Not applicable.
(e) All of the information set forth in the Offer to Purchase and the
related Letter of Transmittal, copies of which are filed as Exhibits (a)(1) and
(a)(2) hereto, respectively, is incorporated herein by reference.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
(a) (1) Form of Offer to Purchase, dated November 6, 1998.
(2) Form of Letter of Transmittal.
(3) Form of Notice of Guaranteed Delivery.
(4) Form of Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
(5) Form of Letter to Clients.
(6) Form of Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9.
(7) Form of Letter to Stockholders from Peter Bukowick, President,
acting Chief Executive Officer and Chief Operating Officer of the
Company.
(8) Form of Letter to Participants in the Company's 401(k) plans.
(9) Form of Letter to Participants in the Company's employee stock
purchase plans.
(10) Form of Press Release issued by the Company on November 6, 1998.
(11) Form of Summary Advertisement published on November 6, 1998.
(b) (1) Commitment Letter between the Company and The Chase Manhattan Bank,
dated October 26, 1998.
2
<PAGE>
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS. (CONTINUED)
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
(g) (1) Audited Consolidated Financial Statements of the Company as of and
for the fiscal years ended March 31, 1997 and 1998 (incorporated by
reference to pages 27 through 44 of the Company's Annual Report,
filed as Exhibit 13 to and incorporated by reference into the
Company's Annual Report on Form 10-K for the fiscal year ended March
31, 1998).
(2) Unaudited Consolidated Financial Statements of the Company as of and
for the six-month periods ended September 28, 1997 and September 27,
1998 (incorporated by reference to pages 2 through 11 of the Company's
Quarterly Report on Form 10-Q for the quarterly period ended September
27, 1998).
3
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this Schedule 13E-4 is true, complete and correct.
<TABLE>
<S> <C> <C>
ALLIANT TECHSYSTEMS INC.
By: /s/ DARYL L. ZIMMER
-----------------------------------------
Daryl L. Zimmer
VICE PRESIDENT AND
GENERAL COUNSEL
</TABLE>
November 6, 1998
4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIALLY
NUMBERED
EXHIBITS PAGE
- -------------------- -----------------
<S> <C> <C> <C>
(a) (1) Form of Offer to Purchase, dated November 6, 1998........................................
(2) Form of Letter of Transmittal............................................................
(3) Form of Notice of Guaranteed Delivery....................................................
(4) Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other
Nominees.................................................................................
(5) Form of Letter to Clients................................................................
(6) Form of Guidelines for Certification of Taxpayer Identification Number on Substitute Form
W-9......................................................................................
(7) Form of Letter to Stockholders from Peter Bukowick, President, acting Chief Executive
Officer and Chief Operating Officer of the Company.......................................
(8) Form of Letter to Participants in the Company's 401(k) plans.............................
(9) Form of Letter to Participants in the Company's employee stock purchase plans............
(10) Form of Press Release issued by the Company on November 6, 1998..........................
(11) Form of Summary Advertisement published on November 6, 1998..............................
(b) (1) Commitment Letter between the Company and The Chase Manhattan Bank, dated October 26,
1998.....................................................................................
(g) (1) Audited Consolidated Financial Statements of the Company as of and for the years ended
March 31, 1997 and 1998 (incorporated by reference to pages 27 through 44 of the
Company's Annual Report, filed as Exhibit 13 to and incorporated by reference in the
Company's Annual Report on Form 10-K for the fiscal year ended March 31, 1998)...........
(2) Unaudited Consolidated Financial Statements of the Company as of and for the six-month
periods ended September 28, 1997 and September 27, 1998 (incorporated by reference to
pages 2 through 11 of the Company's Quarterly Report on Form 10-Q for the quarterly
period ended September 27, 1998).........................................................
</TABLE>
5
<PAGE>
OFFER TO PURCHASE FOR CASH
UP TO 2,800,000 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
AT A PURCHASE PRICE NOT GREATER THAN $77
NOR LESS THAN $67 PER SHARE
BY
ALLIANT TECHSYSTEMS INC.
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT
5:00 P.M., NEW YORK CITY TIME, ON TUESDAY, DECEMBER 8, 1998,
UNLESS THE OFFER IS EXTENDED.
------------------------
ALLIANT TECHSYSTEMS INC., A DELAWARE CORPORATION ("ALLIANT" OR THE
"COMPANY"), IS OFFERING TO PURCHASE UP TO 2,800,000 SHARES OF ITS COMMON STOCK,
PAR VALUE $.01 PER SHARE (THE "SHARES") (INCLUDING THE ASSOCIATED PREFERRED
STOCK PURCHASE RIGHTS (THE "RIGHTS") ISSUED PURSUANT TO THE RIGHTS AGREEMENT,
DATED AS OF SEPTEMBER 28, 1990, AS AMENDED, BETWEEN THE COMPANY AND THE CHASE
MANHATTAN BANK (AS SUCCESSOR TO MANUFACTURERS HANOVER TRUST COMPANY), AS THE
RIGHTS AGENT), AT PRICES NOT GREATER THAN $77 NOR LESS THAN $67 PER SHARE, NET
TO THE SELLER IN CASH, SPECIFIED BY THE TENDERING STOCKHOLDERS, UPON THE TERMS
AND SUBJECT TO THE CONDITIONS SET FORTH HEREIN AND IN THE RELATED LETTER OF
TRANSMITTAL (WHICH TOGETHER CONSTITUTE THE "OFFER"). UNLESS THE CONTEXT
OTHERWISE REQUIRES, ALL REFERENCES TO SHARES SHALL INCLUDE THE ASSOCIATED
RIGHTS. THE COMPANY WILL DETERMINE A SINGLE PER SHARE PRICE (NOT GREATER THAN
$77 NOR LESS THAN $67 PER SHARE) THAT IT WILL PAY FOR THE SHARES VALIDLY
TENDERED PURSUANT TO THE OFFER AND NOT PROPERLY WITHDRAWN (THE "PURCHASE
PRICE"), TAKING INTO ACCOUNT THE NUMBER OF SHARES SO TENDERED AND THE PRICES
SPECIFIED BY THE TENDERING STOCKHOLDERS. THE COMPANY WILL SELECT THE PURCHASE
PRICE THAT WILL ENABLE IT TO PURCHASE 2,800,000 SHARES (OR SUCH LESSER NUMBER OF
SHARES AS ARE VALIDLY TENDERED AT PRICES NOT GREATER THAN $77 NOR LESS THAN $67
PER SHARE) PURSUANT TO THE OFFER. THE COMPANY WILL PURCHASE ALL SHARES VALIDLY
TENDERED AT PRICES AT OR BELOW THE PURCHASE PRICE AND NOT PROPERLY WITHDRAWN,
UPON THE TERMS AND SUBJECT TO THE CONDITIONS OF THE OFFER, INCLUDING THE
PROVISIONS THEREOF RELATING TO PRORATION AND CONDITIONAL TENDERS DESCRIBED
HEREIN. SHARES TENDERED AT PRICES IN EXCESS OF THE PURCHASE PRICE AND SHARES NOT
PURCHASED BECAUSE OF PRORATION AND CONDITIONAL TENDERS WILL BE RETURNED.
STOCKHOLDERS MUST COMPLETE THE SECTION OF THE LETTER OF TRANSMITTAL RELATING TO
THE PRICE AT WHICH THEY ARE TENDERING SHARES IN ORDER TO VALIDLY TENDER SHARES.
--------------------------
THE OFFER IS NOT CONDITIONED UPON ANY MINIMUM NUMBER OF SHARES BEING TENDERED.
THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE SECTION 7.
------------------------
IMPORTANT
ANY STOCKHOLDER DESIRING TO TENDER ALL OR ANY PORTION OF HIS OR HER SHARES
SHOULD EITHER (I) COMPLETE AND SIGN THE LETTER OF TRANSMITTAL OR A FACSIMILE
THEREOF IN ACCORDANCE WITH THE INSTRUCTIONS IN THE LETTER OF TRANSMITTAL, MAIL
OR DELIVER IT AND ANY OTHER REQUIRED DOCUMENTS TO CHASEMELLON SHAREHOLDER
SERVICES, L.L.C. (THE "DEPOSITARY"), AND EITHER DELIVER THE CERTIFICATES FOR
SHARES TO THE DEPOSITARY ALONG WITH THE LETTER OF TRANSMITTAL OR DELIVER SUCH
SHARES PURSUANT TO THE PROCEDURE FOR BOOK-ENTRY TRANSFER SET FORTH IN SECTION 3
OR (II) REQUEST HIS OR HER BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR
NOMINEE TO EFFECT THE TRANSACTION FOR HIM OR HER. A STOCKHOLDER WHOSE SHARES ARE
REGISTERED IN THE NAME OF A BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR
NOMINEE MUST CONTACT SUCH BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR
NOMINEE IF HE OR SHE DESIRES TO TENDER SUCH SHARES. STOCKHOLDERS DESIRING TO
TENDER SHARES AND WHOSE CERTIFICATES FOR SUCH SHARES ARE NOT IMMEDIATELY
AVAILABLE, OR WHO CANNOT COMPLY IN A TIMELY MANNER WITH THE PROCEDURE FOR
BOOK-ENTRY TRANSFER, SHOULD TENDER SUCH SHARES BY FOLLOWING THE PROCEDURES FOR
GUARANTEED DELIVERY SET FORTH IN SECTION 3.
HOLDERS OR BENEFICIAL OWNERS OF SHARES UNDER THE COMPANY'S 401(K) PLANS OR
UNDER ITS EMPLOYEE STOCK PURCHASE PLANS (IF SUCH SHARES ARE NOT, AT THE TIME OF
TENDER, SUBJECT TO ANY OF THE RESTRICTIONS ON TRANSFERABILITY DESCRIBED IN
SECTION 3) WHO WISH TO TENDER ANY OF SUCH SHARES IN THE OFFER MUST FOLLOW THE
SEPARATE INSTRUCTIONS AND PROCEDURES DESCRIBED IN SECTION 3.
--------------------------
NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY
STOCKHOLDER AS TO WHETHER TO TENDER ALL OR ANY SHARES. EACH STOCKHOLDER MUST
MAKE HIS OR HER OWN DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO,
HOW MANY SHARES TO TENDER AND AT WHAT PRICE. THE COMPANY HAS BEEN ADVISED
THAT NO DIRECTOR OR EXECUTIVE OFFICER INTENDS TO TENDER SHARES
PURSUANT TO THE OFFER, EXCEPT FOR RICHARD SCHWARTZ, ITS RETIRED
CHIEF EXECUTIVE OFFICER AND RETIRING CHAIRMAN OF THE BOARD WHO,
AS PART OF HIS RETIREMENT PLANNING, INTENDS TO TENDER A
PORTION OF HIS SHARES.
------------------------
THE SHARES ARE LISTED AND PRINCIPALLY TRADED ON THE NEW YORK STOCK EXCHANGE
(THE "NYSE") UNDER THE SYMBOL "ATK." ON NOVEMBER 5, 1998, THE LAST TRADING DAY
PRIOR TO THE ANNOUNCEMENT OF THE OFFER, THE LAST REPORTED SALE PRICE OF THE
SHARES ON THE NYSE COMPOSITE TAPE WAS $73 7/8 PER SHARE. STOCKHOLDERS ARE URGED
TO OBTAIN CURRENT MARKET QUOTATIONS FOR THE SHARES.
--------------------------
QUESTIONS OR REQUESTS FOR ASSISTANCE OR FOR ADDITIONAL COPIES OF THIS OFFER
TO PURCHASE, THE LETTER OF TRANSMITTAL, NOTICE OF GUARANTEED DELIVERY OR OTHER
TENDER OFFER MATERIALS MAY BE DIRECTED TO MACKENZIE PARTNERS, INC. (THE
"INFORMATION AGENT") OR MORGAN STANLEY & CO. INCORPORATED (THE "DEALER MANAGER")
AT THEIR RESPECTIVE ADDRESSES AND TELEPHONE NUMBERS SET FORTH ON THE BACK COVER
OF THIS OFFER TO PURCHASE.
--------------------------
THE DEALER MANAGER FOR THE OFFER IS:
MORGAN STANLEY DEAN WITTER
NOVEMBER 6, 1998
<PAGE>
THE COMPANY HAS NOT AUTHORIZED ANY PERSON TO MAKE ANY RECOMMENDATION ON
BEHALF OF THE COMPANY AS TO WHETHER STOCKHOLDERS SHOULD TENDER SHARES PURSUANT
TO THE OFFER. THE COMPANY HAS NOT AUTHORIZED ANY PERSON TO GIVE ANY INFORMATION
OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THE OFFER OTHER THAN THOSE
CONTAINED HEREIN OR IN THE LETTER OF TRANSMITTAL. IF GIVEN OR MADE, SUCH
RECOMMENDATION AND SUCH INFORMATION AND REPRESENTATIONS MUST NOT BE RELIED UPON
AS HAVING BEEN AUTHORIZED BY THE COMPANY.
------------------------
THE OFFER IS NOT BEING MADE TO (NOR WILL ANY TENDER OF SHARES BE ACCEPTED
FROM OR ON BEHALF OF) HOLDERS IN ANY JURISDICTION IN WHICH THE MAKING OF THE
OFFER OR THE ACCEPTANCE OF ANY TENDER OF SHARES THEREIN WOULD NOT BE IN
COMPLIANCE WITH THE LAWS OF SUCH JURISDICTION. HOWEVER, THE COMPANY MAY, AT ITS
DISCRETION, TAKE SUCH ACTION AS IT MAY DEEM NECESSARY FOR THE COMPANY TO MAKE
THE OFFER IN ANY SUCH JURISDICTION AND EXTEND THE OFFER TO HOLDERS IN SUCH
JURISDICTION. IN ANY JURISDICTION THE SECURITIES OR BLUE SKY LAWS OF WHICH
REQUIRE THE OFFER TO BE MADE BY A LICENSED BROKER OR DEALER, THE OFFER IS BEING
MADE ON BEHALF OF THE COMPANY BY THE DEALER MANAGER OR ONE OR MORE REGISTERED
BROKERS OR DEALERS WHICH ARE LICENSED UNDER THE LAWS OF SUCH JURISDICTION.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
INTRODUCTION............................................................................................... 1
Summary Terms of the Offer............................................................................. 1
General Information.................................................................................... 2
Forward-looking Information............................................................................ 2
THE OFFER.................................................................................................. 3
1. Number of Shares; Proration; Expiration Date....................................................... 3
2. Tenders by Holders of Fewer than 100 Shares........................................................ 4
3. Procedure for Tendering Shares..................................................................... 5
4. Withdrawal Rights.................................................................................. 9
5. Acceptance for Payment of Shares and Payment of Purchase Price..................................... 10
6. Conditional Tender of Shares....................................................................... 10
7. Certain Conditions of the Offer.................................................................... 11
8. Price Range of Shares; Dividends................................................................... 13
9. Purpose of the Offer; Certain Effects of the Offer................................................. 15
10. Certain Information Concerning the Company......................................................... 17
11. Source and Amount of Funds......................................................................... 22
12. Interests of Directors and Officers; Transactions and Agreements Concerning the Shares............. 23
13. Certain Federal Income Tax Considerations.......................................................... 24
14. Certain Legal Matters; Regulatory Approvals........................................................ 27
15. Extension of Tender Period; Termination; Amendments................................................ 28
16. Fees and Expenses.................................................................................. 28
17. Additional Information............................................................................. 29
18. Miscellaneous...................................................................................... 30
</TABLE>
<PAGE>
TO THE HOLDERS OF COMMON STOCK OF
ALLIANT TECHSYSTEMS INC.:
INTRODUCTION
SUMMARY TERMS OF THE OFFER
Alliant Techsystems Inc., a Delaware corporation (the "Company"), hereby
offers to purchase up to 2,800,000 shares of its Common Stock, par value $.01
per share (the "Shares") (including the associated preferred stock purchase
rights (the "Rights") issued pursuant to the Rights Agreement, dated as of
September 28, 1990, as amended, between the Company and The Chase Manhattan Bank
(as successor to Manufacturers Hanover Trust Company), as the Rights Agent), at
prices not greater than $77 nor less than $67 per Share, net to the seller in
cash, specified by the tendering stockholders, upon the terms and subject to the
conditions set forth herein and in the related Letter of Transmittal (which
together constitute the "Offer"). Unless the context otherwise requires, all
references to Shares shall include the associated Rights.
The Company will determine a single per Share price (not greater than $77
nor less than $67 per Share) that it will pay for Shares validly tendered
pursuant to the Offer and not properly withdrawn (the "Purchase Price"), taking
into account the number of Shares so tendered and the prices specified by
tendering stockholders. The Company will select the Purchase Price that will
enable it to purchase 2,800,000 Shares (or such lesser number of Shares as is
validly tendered at prices not greater than $77 nor less than $67 per Share)
pursuant to the Offer. The Company will purchase all Shares validly tendered at
prices at or below the Purchase Price and not properly withdrawn on or prior to
the Expiration Date (as defined in Section 1), upon the terms and subject to the
conditions of the Offer, including the provisions relating to proration and
conditional tenders described below. The Purchase Price will be paid in cash,
net to the seller, with respect to all Shares purchased. Shares tendered at
prices in excess of the Purchase Price and Shares not purchased because of
proration or conditional tenders will be returned.
THE OFFER IS NOT CONDITIONED UPON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE
SECTION 7. The Company reserves the right (but is not obligated) to waive any or
all such conditions, other than those that are legally mandated.
Tendering stockholders who tender their Shares directly to the Depositary
will not be obligated to pay brokerage commissions, solicitation fees or,
subject to the Instructions to the Letter of Transmittal, stock transfer taxes
on the purchase of Shares by the Company. However, a tendering stockholder who
holds Shares through a broker or bank, including a discount broker, may be
required by such institution to pay a service fee or other charge. The Company
will pay all charges and expenses incurred in connection with the Offer of
Morgan Stanley & Co. Incorporated (the "Dealer Manager"), ChaseMellon
Shareholder Services, L.L.C. (the "Depositary"), MacKenzie Partners, Inc. (the
"Information Agent") and the tabulation agent retained by Fidelity Management
Trust Company, as trustee for the beneficial owners of Shares under the
Company's 401(k) plans (the "401(k) Trustee"). See Section 16. HOWEVER, ANY
TENDERING STOCKHOLDER OR OTHER PAYEE WHO FAILS TO COMPLETE AND SIGN THE
SUBSTITUTE FORM W-9 THAT IS INCLUDED IN THE LETTER OF TRANSMITTAL MAY BE SUBJECT
TO A REQUIRED FEDERAL INCOME TAX BACKUP WITHHOLDING OF 31% OF THE GROSS PROCEEDS
PAYABLE TO SUCH STOCKHOLDER OR OTHER PAYEE PURSUANT TO THE OFFER. SEE SECTIONS 3
AND 13.
Holders or beneficial owners of Shares under the Company's 401(k) plans or
its employee stock purchase plans (if such Shares, at the time of tender, are
not subject to any of the restrictions on transferability described in Section
3) who wish to tender any of such Shares in the Offer must follow the separate
instructions and procedures described in Section 3 and should also read the
separate tax provisions applicable to participants in such plans described in
Section 13.
NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY
STOCKHOLDER AS TO WHETHER TO TENDER ALL OR ANY SHARES. EACH STOCKHOLDER MUST
MAKE HIS OR HER OWN DECISION AS TO WHETHER TO TENDER
1
<PAGE>
SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND AT WHAT PRICE. THE COMPANY HAS
BEEN ADVISED THAT NO DIRECTOR OR EXECUTIVE OFFICER INTENDS TO TENDER SHARES
PURSUANT TO THE OFFER, EXCEPT FOR RICHARD SCHWARTZ, ITS RETIRED CHIEF EXECUTIVE
OFFICER AND RETIRING CHAIRMAN OF THE BOARD. MR. SCHWARTZ, AS PART OF HIS
RETIREMENT PLANNING, INTENDS TO TENDER UP TO 100,000 SHARES OF THE 50,493 SHARES
HE OWNS BENEFICIALLY AND THE 215,000 SHARES HE IS ENTITLED TO ACQUIRE PURSUANT
TO THE EXERCISE OF STOCK OPTIONS, ALL OF WHICH ARE CURRENTLY EXERCISEABLE.
GENERAL INFORMATION
As of November 5, 1998, the Company had issued and outstanding 12,151,965
Shares (not including 1,711,648 Shares held in treasury), and had reserved
2,101,975 Shares for issuance under its various benefit and/or incentive
compensation plans. Of the reserved Shares, 790,625 Shares are issuable upon
exercise of outstanding stock options and 25,900 Shares are reserved for
issuance to key officers who have been granted performance shares, some or all
of which may be issued upon achievement of certain earnings per share growth
goals. The 2,800,000 Shares that the Company is offering to purchase represent
approximately 23% of the Shares issued and outstanding as of such date and
approximately 22% of the Shares on a diluted basis (assuming the exercise of all
outstanding vested stock options).
A tender of Shares pursuant to the Offer will include a tender of the
associated Rights. No separate consideration will be paid for such Rights. See
Section 8.
The Shares are listed and principally traded on the New York Stock Exchange
("NYSE") under the symbol "ATK." Stockholders are urged to obtain current market
quotations for the Shares. See Section 8.
Shares acquired by the Company pursuant to the offer may be held as treasury
stock or retired by the Company. See Section 9.
FORWARD-LOOKING INFORMATION
This Offer to Purchase (including the documents incorporated or deemed
incorporated by reference herein) includes "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as amended (the
"Securities Act") and Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"). All statements other than statements of historical
fact provided or incorporated by reference herein are forward-looking statements
and may contain information about financial results, economic conditions, trends
and known uncertainties. The forward-looking statements contained or
incorporated by reference herein are subject to certain risks and uncertainties
that could cause actual results to differ materially from those reflected in the
forward-looking statements. Factors that might cause such a difference include,
but are not limited to, changes in governmental spending and budgetary policies,
governmental laws and other rules and regulations regarding various matters such
as environmental remediation, contract pricing and procurement policies,
changing economic and political conditions in the United States and in other
countries, international trade restrictions, customer product acceptance,
continued access to technical and capital resources, and merger and acquisition
activity within the industry, among others. Readers are cautioned not to place
undue reliance on these forward-looking statements, which reflect management's
analysis, judgment, belief or expectations only as of the date hereof and, in
the case of a document incorporated by reference, only as of the date thereof.
Neither the Company nor the Dealer Manager undertakes any obligation to publicly
revise these forward-looking statements to reflect events or circumstances that
arise after the date hereof. In addition to the disclosure contained herein,
readers should carefully review any disclosure of risks and uncertainties
contained in other documents the Company files or has filed from time to time
with the Securities and Exchange Commission (the "Commission") pursuant to the
Exchange Act.
2
<PAGE>
THE OFFER
1. NUMBER OF SHARES; PRORATION; EXPIRATION DATE.
Upon the terms and subject to the conditions described herein and in the
Letter of Transmittal, the Company will purchase up to 2,800,000 Shares that are
validly tendered on or prior to the Expiration Date (and not properly withdrawn
in accordance with Section 4) at a price (determined in the manner set forth
below) not greater than $77 nor less than $67 per Share. The later of 5:00 P.M.,
New York City time, on Tuesday, December 8, 1998, or the latest time and date to
which the Offer is extended, is referred to herein as the "Expiration Date." If
the Offer is oversubscribed as described below, only Shares tendered at or below
the Purchase Price on or prior to the Expiration Date will be eligible for
proration.
The Company will determine the Purchase Price taking into account the number
of Shares so tendered and the prices specified by tendering stockholders. The
Company will select the Purchase Price that will enable it to purchase 2,800,000
Shares (or such lesser number of Shares as is validly tendered and not properly
withdrawn at prices not greater than $77 nor less than $67 per Share) pursuant
to the Offer. The Company reserves the right to purchase more than 2,800,000
Shares at the selected Purchase Price pursuant to the Offer, but does not
currently plan to do so. The Offer is not conditioned on any minimum number of
Shares being tendered.
In accordance with Instruction 5 of the Letter of Transmittal, each
stockholder who wishes to tender Shares must specify the price (not greater than
$77 nor less than $67 per Share) at which such stockholder is willing to have
the Company purchase such Shares. As promptly as practicable following the
Expiration Date, the Company will determine the Purchase Price (which will not
be greater than $77 nor less than $67 per Share) that it will pay for Shares
validly tendered pursuant to the Offer, taking into account the number of Shares
so tendered and the prices specified by tendering stockholders. All Shares not
purchased pursuant to the Offer, including Shares tendered at prices greater
than the Purchase Price and Shares not purchased because of proration or
conditional tenders, will be returned to the tendering stockholders at the
Company's expense as promptly as practicable following the Expiration Date.
Upon the terms and subject to the conditions of the Offer, if 2,800,000 or
fewer Shares have been validly tendered at or below the Purchase Price and not
properly withdrawn on or prior to the Expiration Date, the Company will purchase
all such Shares. Upon the terms and subject to the conditions of the Offer, if
more than 2,800,000 Shares have been validly tendered at or below the Purchase
Price and not properly withdrawn on or prior to the Expiration Date, the Company
will purchase Shares in the following order of priority:
(a) all Shares validly tendered at or below the Purchase Price and not
properly withdrawn on or prior to the Expiration Date by any stockholder (an
"Odd Lot Owner") who owned beneficially or of record an aggregate of fewer
than 100 Shares (not including any Shares held pursuant to the Company's
401(k) plans ("401(k) Plan Shares") or its employee stock purchase plans
("ESPP Shares")) as of the close of business on November 5, 1998 and who
validly tenders all of such Shares (partial tenders will not qualify for
this preference) and completes the box captioned "Odd Lots" on the Letter of
Transmittal and, if applicable, the Notice of Guaranteed Delivery; and
(b) after purchase of all of the foregoing Shares, subject to the
conditional tender provisions described in Section 6, all other Shares
validly tendered at or below the Purchase Price and not properly withdrawn
on or prior to the Expiration Date on a pro rata basis, if necessary (with
appropriate rounding adjustments to avoid purchases of fractional Shares).
If proration of tendered Shares is required, because of the difficulty in
determining the number of Shares validly tendered (including Shares tendered by
the guaranteed delivery procedure described in Section 3) and as a result of the
"odd lot" procedure described in Section 2 and conditional tender procedure
described in Section 6, the Company does not expect that it will be able to
announce the final proration factor or to commence payment for any Shares
purchased pursuant to the Offer until approximately five (5) NYSE trading days
after the Expiration Date. Proration for each stockholder
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tendering Shares other than Odd Lot Owners will be based on the ratio of the
number of Shares tendered by such stockholder at or below the Purchase Price to
the total number of Shares tendered by all stockholders other than Odd Lot
Owners at or below the Purchase Price. This ratio will be applied to
stockholders tendering Shares other than Odd Lot Owners to determine the number
of Shares that will be purchased from each stockholder pursuant to the Offer.
Preliminary results of proration will be announced by press release as promptly
as practicable after the Expiration Date. Holders of Shares may obtain such
preliminary information from the Dealer Manager or the Information Agent and may
also be able to obtain such information from their brokers.
Subject to the applicable rules and regulations of the Commission, the
Company expressly reserves the right, in its sole discretion, to change the
terms of the Offer, including, but not limited to, purchasing more or less than
2,800,000 Shares in the Offer. If (i) the Company increases or decreases the
price to be paid for Shares, increases the number of Shares being sought and
such increase in the number of Shares being sought exceeds 2% of the outstanding
Shares or decreases the number of Shares being sought and (ii) the Offer is
scheduled to expire at any time earlier than the expiration of a period ending
on the tenth business day from, and including, the date that notice of such
increase or decrease is first published, sent or given in the manner described
in Section 15, the Offer will be extended until the expiration of ten business
days from the date of publication of notice of any such increase or decrease.
For purposes of the Offer, a "business day" means any day other than a Saturday,
Sunday or federal holiday and consists of the time period from 12:01 a.m.
through Midnight, New York City time.
The Company also expressly reserves the right, in its sole discretion, at
any time or from time to time, to extend the period of time during which the
Offer is open by giving oral or written notice of such extension to the
Depositary. See Section 15. There can be no assurance, however, that the Company
will exercise its right to extend the Offer.
As described in Section 13, the number of Shares that the Company will
purchase from a stockholder may affect the U.S. federal income tax consequences
to the stockholder of such purchase and therefore may be relevant to a
stockholder's decision whether to tender Shares. Stockholders may designate the
order in which their Shares shall be purchased in the event less than all of the
Shares tendered are purchased as a result of proration. This right of
designation is not available, however, with respect to 401(k) Plan Shares or
ESPP Shares.
If, as a result of the number of Shares tendered and the conditions thereto,
the number of Shares to be purchased from any stockholder making a conditional
tender is reduced below the minimum number specified by such stockholder, such
tender will automatically be regarded as withdrawn, except as provided in
Section 6, and all Shares tendered by such stockholder will be returned as
promptly as practicable after the Expiration Date at the Company's expense.
Copies of this Offer to Purchase, the Letter of Transmittal and Notice of
Guaranteed Delivery are being mailed to record holders of Shares and will be
furnished to brokers, banks and similar persons whose names, or the names of
whose nominees, appear on the Company's stockholder list or, if applicable, who
are listed as participants in a clearing agency's security position listing for
subsequent transmittal to beneficial owners of Shares.
2. TENDERS BY HOLDERS OF FEWER THAN 100 SHARES.
All Shares validly tendered at or below the Purchase Price and not properly
withdrawn on or prior to the Expiration Date by or on behalf of persons who each
owned beneficially or of record an aggregate of fewer than 100 Shares (not
including any 401(k) Plan Shares or ESPP Shares) as of the close of business on
November 5, 1998, will be accepted before proration, if any, of the purchase of
other tendered Shares. See Section 1. Partial tenders will not qualify for this
preference, and it is not available to beneficial or record holders of 100 or
more Shares (not including any 401(k) Plan Shares or ESPP Shares), even if such
holders have separate stock certificates for fewer than 100 Shares. This
preference is also not available for any 401(k) Plan Shares or ESPP Shares. By
accepting the Offer and tendering Shares directly to the
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Depositary, a stockholder owning beneficially or of record fewer than 100 Shares
will avoid the payment of brokerage commissions and any applicable odd lot
discount payable in a sale of such Shares in a transaction effected on a
securities exchange.
As of November 4, 1998, there were approximately 11,868 holders of record of
Shares. Approximately 84.68% of these holders of record held individually fewer
than 100 Shares and held in the aggregate approximately 133,362 Shares. Because
of the large number of Shares held in the names of brokers and nominees, the
Company is unable to estimate the number of beneficial owners of fewer than 100
Shares or the aggregate number of Shares they own. Any beneficial or record
owner of fewer than 100 Shares (not including any 401(k) Plan Shares or ESPP
Shares) who wishes to tender all of his or her Shares pursuant to this Section
should complete the box captioned "Odd Lots" on the Letter of Transmittal and,
if applicable, on the Notice of Guaranteed Delivery.
3. PROCEDURE FOR TENDERING SHARES.
PROPER TENDER OF SHARES. To validly tender Shares pursuant to the Offer,
either (a) a properly completed and duly executed Letter of Transmittal or
facsimile thereof, together with any required signature guarantees and any other
documents required by the Letter of Transmittal, must be received by the
Depositary at one of its addresses set forth on the back cover of this Offer to
Purchase and either (i) certificates for the Shares to be tendered must be
received by the Depositary at one of such addresses or (ii) such Shares must be
delivered pursuant to the procedures for book-entry transfer described below
(and a confirmation of such delivery received by the Depositary), in each case
on or prior to the Expiration Date, or (b) the tendering holder of Shares must
comply with the guaranteed delivery procedure described below.
IN ACCORDANCE WITH INSTRUCTION 5 OF THE LETTER OF TRANSMITTAL, IN ORDER TO
TENDER SHARES PURSUANT TO THE OFFER, A STOCKHOLDER MUST EITHER (A) CHECK THE BOX
IN THE SECTION OF THE LETTER OF TRANSMITTAL CAPTIONED "SHARES TENDERED AT PRICE
DETERMINED BY DUTCH AUCTION" OR (B) CHECK ONE OF THE BOXES IN THE SECTION OF THE
LETTER OF TRANSMITTAL CAPTIONED "SHARES TENDERED AT PRICE DETERMINED BY
STOCKHOLDER."
A STOCKHOLDER WHO WISHES TO MAXIMIZE THE CHANCE THAT HIS OR HER SHARES WILL
BE PURCHASED AT THE RELEVANT PURCHASE PRICE SHOULD CHECK THE BOX ON THE RELEVANT
LETTER OF TRANSMITTAL MARKED, "SHARES TENDERED AT PRICE DETERMINED BY DUTCH
AUCTION." NOTE THAT THIS ELECTION COULD RESULT IN SUCH STOCKHOLDER'S SHARES
BEING PURCHASED AT THE MINIMUM PRICE OF $67 PER SHARE. A STOCKHOLDER WHO WISHES
TO INDICATE A SPECIFIC PRICE (IN INCREMENTS OF $0.25) AT WHICH HIS OR HER SHARES
ARE BEING TENDERED MUST CHECK A BOX UNDER THE SECTION CAPTIONED "SHARES TENDERED
AT PRICE DETERMINED BY STOCKHOLDER" OF THE LETTER OF TRANSMITTAL IN THE TABLE
LABELED "PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED." A
STOCKHOLDER WHO WISHES TO TENDER SHARES AT MORE THAN ONE PRICE MUST COMPLETE
SEPARATE LETTERS OF TRANSMITTAL FOR EACH PRICE AT WHICH SUCH SHARES ARE BEING
TENDERED. THE SAME SHARES CANNOT BE TENDERED AT MORE THAN ONE PRICE.
A TENDER OF SHARES WILL BE PROPER, IF, AND ONLY IF, ON THE APPROPRIATE
LETTER OF TRANSMITTAL EITHER THE BOX IN THE SECTION CAPTIONED "SHARES TENDERED
AT PRICE DETERMINED BY DUTCH AUCTION" OR ONE OF THE BOXES IN THE SECTION
CAPTIONED "SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER" IS CHECKED.
Stockholders may tender Shares subject to the condition that all or none of
such Shares be purchased, or that a specified minimum number of Shares be
purchased. Any stockholder desiring to make such a conditional tender should so
indicate in the box captioned "Conditional Tender" on the Letter of Transmittal
and, if applicable, on the Notice of Guaranteed Delivery. It is the tendering
stockholder's responsibility to determine the minimum number of Shares to be
purchased. STOCKHOLDERS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE
EFFECT OF PRORATION OF THE OFFER AND THE ADVISABILITY OF MAKING A CONDITIONAL
TENDER. See Sections 6 and 13.
BOOK-ENTRY DELIVERY. The Depositary will establish an account with respect
to the Shares at The Depository Trust Company (the "Book-Entry Transfer
Facility") for purposes of the Offer within two business days after the date of
this Offer to Purchase. Any financial institution that is a participant in the
Book-Entry Transfer Facility's system may make book-entry delivery of Shares by
causing such Book-Entry
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Transfer Facility to transfer such Shares into the Depositary's account in
accordance with the procedures of such Book-Entry Transfer Facility. Although
delivery of Shares may be effected through book-entry transfer into the
Depository's account at the Book-Entry Transfer Facility, a properly completed
and duly executed Letter of Transmittal or facsimile thereof, together with any
required signature guarantees, or an Agent's Message (as defined below), and any
other required documents, must, in any case, be transmitted to and received by
the Depositary at one of its addresses set forth on the back cover of this Offer
to Purchase on or prior to the Expiration Date, or the tendering stockholder
must comply with the guaranteed delivery procedure described below. The
confirmation of a book-entry transfer of Shares into the Depositary's account at
the Book-Entry Transfer Facility as described above is referred to herein as a
"Book-Entry Confirmation." Delivery of the Letter of Transmittal and any other
required documents to a Book-Entry Transfer Facility does not constitute
delivery to the Depositary.
The term "Agent's Message" means a message transmitted by the Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of a
Book-Entry Confirmation, which states that such Book-Entry Transfer Facility has
received an express acknowledgment from the participant in such Book-Entry
Transfer Facility tendering the Shares, that such participant has received and
agrees to be bound by the terms of the Letter of Transmittal and that the
Company may enforce such agreement against the participant.
SIGNATURE GUARANTEES. Except as otherwise provided below, all signatures on
a Letter of Transmittal must be guaranteed by a firm that is a member of a
registered national securities exchange or the National Association of
Securities Dealers, Inc., or by a commercial bank or trust company having an
office or correspondent in the United States which is a participant in an
approved Signature Guarantee Medallion Program (each of the foregoing, an
"Eligible Institution"). Signatures on a Letter of Transmittal need not be
guaranteed if (a) the Letter of Transmittal is signed by the registered holder
of the Shares tendered therewith and such holder has not completed the box
entitled "Special Payment Instructions" or the box entitled "Special Delivery
Instructions" on the Letter of Transmittal or (b) such Shares are tendered for
the account of an Eligible Institution. See Instructions 1 and 6 of the Letter
of Transmittal. If a certificate representing Shares is registered in the name
of a person other than the signer of a Letter of Transmittal, or if payment is
to be made, or Shares not purchased or tendered are to be issued to a person
other than the registered holder, the certificate must be endorsed or
accompanied by an appropriate stock power, in either case signed exactly as the
name of the registered holder appears on the certificate with the signature on
the certificate or stock power guaranteed by an Eligible Institution.
GUARANTEED DELIVERY. If a stockholder desires to tender Shares pursuant to
the Offer and cannot deliver certificates for such Shares and all other required
documents to the Depositary on or prior to the Expiration Date or the procedure
for book-entry transfer cannot be complied with in a timely manner, such Shares
may nevertheless be tendered if all of the following conditions are met:
(i) such tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery substantially in the form provided by the Company (with any
required signature guarantees) is received by the Depositary as provided
below on or prior to the Expiration Date; and
(iii) the certificates for the tendered Shares (or a confirmation of a
book-entry transfer of such Shares into the Depositary's account at the
Book-Entry Transfer Facility), together with a properly completed and duly
executed Letter of Transmittal (or facsimile thereof) and any other
documents required by the Letter of Transmittal, are received by the
Depositary no later than 5:00 p.m., New York City time, on the third NYSE
trading day after the date of execution of the Notice of Guaranteed
Delivery.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted by
facsimile transmission or mail to the Depositary and must include a guarantee by
an Eligible Institution in the form set forth in such Notice.
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The method of delivery of Shares, the Letter of Transmittal and all other
required documents is at the option and risk of the tendering stockholder.
Shares will be deemed delivered only when actually received by the Depositary
(including, in the case of a book-entry transfer, by Book-Entry Confirmation).
If delivery is by mail, registered mail with return receipt requested, properly
insured, is recommended. In all cases sufficient time should be allowed to
assure timely delivery.
No interest will be paid on the purchase price of the Shares to be paid by
the Company, regardless of any extension of the Offer or any delay in making
such payment.
U.S. FEDERAL INCOME TAX WITHHOLDING. To avoid federal income tax backup
withholding equal to 31% of the gross payments made pursuant to the Offer, each
stockholder must notify the Depositary of such stockholder's correct taxpayer
identification number and provide certain other information by properly
completing the substitute form W-9 included in the Letter of Transmittal.
Foreign stockholders (as defined in Section 13) may be required to submit a
properly completed form W-8, certifying non-United States status, in order to
avoid backup withholding. In addition, foreign stockholders may be subject to
30% (or lower treaty rate) withholding on gross payments received pursuant to
the Offer (as discussed in Section 13). Holders of ESPP Shares under the 1997
Employee Stock Purchase Plan who tender all or any of such Shares pursuant to
the Offer may be subject to income and employment tax withholding. For a
discussion of certain federal income tax consequences to tendering stockholders,
see Section 13. Each stockholder is urged to consult with his or her own tax
advisor.
TENDER CONSTITUTES AN AGREEMENT. It is a violation of Rule 14e-4
promulgated under the Exchange Act for a person, directly or indirectly, to
tender Shares for his or her own account unless, at the time of the tender and
at the end of the proration period, the person so tendering (a) has a net long
position equal to or greater than the amount of (i) Shares tendered or (ii)
other securities immediately convertible into, exercisable or exchangeable for
the amount of Shares tendered and will acquire such Shares for tender by
conversion, exercise or exchange of such other securities and (b) will cause
such Shares to be delivered in accordance with the terms of the Offer. Rule
14e-4 provides a similar restriction applicable to the tender or guarantee of a
tender on behalf of another person. The tender of Shares pursuant to any one of
the procedures described above or pursuant to the Special Instructions for
401(k) Plan Shares or ESPP Shares described below, as applicable, will
constitute the tendering stockholder's acceptance of the terms and conditions of
the Offer, as well as the tendering stockholder's representation and warranty
that (a) such stockholder has a net long position in the Shares being tendered
within the meaning of Rule 14e-4, and (b) the tender of such Shares complies
with Rule 14e-4. The Company's acceptance for payment of Shares tendered
pursuant to the Offer will constitute a binding agreement between the tendering
stockholder and the Company upon the terms and subject to the conditions of the
Offer.
DETERMINATION OF VALIDITY; REJECTION OF SHARES; WAIVER OF DEFECTS; NO
OBLIGATION TO GIVE NOTICE OF DEFECTS. All questions as to the Purchase Price,
the number of shares to be accepted, the form of documents and the validity,
eligibility (including time of receipt) and acceptance for payment of any tender
of Shares will be determined by the Company, in its sole discretion, and its
determination shall be final and binding on all parties. The Company reserves
the absolute right to reject any or all tenders of Shares that it determines are
not in proper form or the acceptance for payment of or payment for which may be
unlawful. The Company also reserves the absolute right to waive any condition of
the Offer or any defect or irregularity in any tender of Shares. A tender of
Shares will not be deemed to have been properly made until all defects or
irregularities have been cured by the tendering stockholder or waived by the
Company. None of the Company, the Dealer Manager, the Depositary, the
Information Agent or any other person will be under any duty to give notice of
any defect or irregularity in tenders, nor shall any of them incur any liability
for failure to give any such notice.
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SPECIAL INSTRUCTIONS FOR SHARES HELD PURSUANT TO THE COMPANY'S BENEFIT AND
INCENTIVE COMPENSATION PLANS
401(K) PLANS. Participants in the Company's 401(k) plans desiring to direct
the 401(k) Trustee to tender any Shares credited to their accounts under such
plans pursuant to the Offer must instruct the 401(k) Trustee to tender such
Shares by properly completing, duly executing and returning to the 401(k)
Trustee the Direction Forms sent to such participants by the 401(k) Trustee as
explained in the materials on YELLOW paper included herewith. The 401(k) Trustee
will aggregate all such tenders and execute one Letter of Transmittal on behalf
of all 401(k) plan participants desiring to tender Shares credited pursuant to
such plans. DELIVERY OF A LETTER OF TRANSMITTAL BY A PARTICIPANT IN THE
COMPANY'S 401(K) PLANS WITH RESPECT TO ANY SHARES CREDITED PURSUANT TO SUCH
PLANS DOES NOT CONSTITUTE PROPER TENDER OF SUCH SHARES. PROPER TENDER OF ANY
SHARES CREDITED PURSUANT TO THE COMPANY'S 401(K) PLANS CAN ONLY BE MADE BY THE
401(K) TRUSTEE, WHO IS THE RECORD OWNER OF SUCH SHARES. THE DEADLINE FOR
SUBMITTING DIRECTION FORMS TO THE 401(K) TRUSTEE IS SET BY THE 401(K) TRUSTEE
AND IS EARLIER THAN THE EXPIRATION DATE. If a stockholder desires to tender
non-401(k) Plan Shares as well as 401(k) Plan Shares, such stockholder must
properly complete and duly execute a Letter of Transmittal for the non-401(k)
Plan Shares and deliver such Letter of Transmittal directly to the Depositary,
as well as following the special instructions provided by the 401(k) Trustee for
directing the 401(k) Trustee to tender 401(k) Plan Shares. Any questions
regarding tender of 401(k) Plan Shares should be directed to the 401(k) Trustee
at the number provided in the separate materials on YELLOW paper.
EMPLOYEE STOCK PURCHASE PLANS, 1990 EQUITY INCENTIVE PLAN, AND NON-EMPLOYEE
DIRECTOR RESTRICTED STOCK PLANS. Shares acquired pursuant to the Company's
employee stock purchase plans, 1990 Equity Incentive Plan, as amended and
restated (the "1990 Equity Incentive Plan"), the Alliant Techsystems Inc.
Non-Employee Director Restricted Stock Plan, and the Alliant Techsystems Inc.
Restricted Stock Plan for Non-Employee Directors, may be subject to certain
restrictions on transferability, some of which are described below. The
provisions regarding transferability described below are only a summary and
participants in the aforementioned plans are urged to consult the actual terms
of the plans for applicability of these restrictions to particular Shares and
particular participants. Only those Shares which are not restricted as to
transferability at the time of tender may be tendered in the Offer and tenders
of any other Shares held pursuant to these plans will not be accepted.
EMPLOYEE STOCK PURCHASE PLANS. Certain Shares acquired pursuant to the
Company's employee stock purchase plans may be subject to restrictions on
transfer (the "ESPP Restricted Shares"). Specifically, Shares acquired
pursuant to the Company's 1997 Employee Stock Purchase Plan are restricted
and may not be withdrawn, sold or otherwise transferred by the participant
until the first to occur of the following events: (a) twelve months from the
date of purchase; (b) the participant's death; (c) the participant's
termination of employment; or (d) a "change of control" (as defined in the
plans). Holders or beneficial owners of ESPP Shares (other than the ESPP
Restricted Shares) who desire to tender any such Shares in the Offer, must
instruct Piper Jaffray Inc., as administrator of the employee stock purchase
plans (the "ESPP Administrator"), to tender any such Shares by properly
completing, duly executing and returning to the ESPP Administrator the
Direction Form sent to such holder by the ESPP Administrator as explained in
the materials on the PINK paper included herewith. DELIVERY OF A LETTER OF
TRANSMITTAL BY A PARTICIPANT IN THE COMPANY'S ESPP PLANS WITH RESPECT TO ANY
SHARES CREDITED PURSUANT TO SUCH PLANS DOES NOT CONSTITUTE PROPER TENDER OF
SUCH SHARES. PROPER TENDER OF ANY SHARES CREDITED PURSUANT TO THE COMPANY'S
ESPP PLANS CAN ONLY BE MADE BY THE ESPP ADMINISTRATOR. THE DEADLINE FOR
SUBMITTING DIRECTION FORMS TO THE ESPP ADMINISTRATOR IS SET BY THE ESPP
ADMINISTRATOR AND IS EARLIER THAN THE EXPIRATION DATE. If a stockholder
desires to tender non-ESPP Shares, such stockholder must properly complete
and duly execute a letter or transmittal directly to the Depositary, as well
as following the special instructions provided by the ESPP Administrator
directing the ESPP Administrator to tender ESPP Shares. Any questions
regarding the tender of ESPP Shares should be directed to the ESPP
Administrator at the number provided in the separate materials on PINK
paper.
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1990 EQUITY INCENTIVE PLAN. Shares acquired under the 1990 Equity
Incentive Plan (the "EIP Shares") may be subject to certain restrictions on
transferability. Specifically, Shares of restricted stock (the "Restricted
EIP Shares") issued under the 1990 Equity Incentive Plan, which are held by
the Company as custodian, are non-transferable and are restricted until such
Shares become nonforfeitable. Holders of EIP Shares should consult the Plan
for conditions of forfeitability. Holders of EIP Shares (other than
Restricted EIP Shares) who desire to tender such Shares in the Offer may do
so by complying with one of the procedures for tendering Shares described
above under "--Proper Tender of Shares." Any questions regarding the tender
of EIP Shares should be directed to the Company, as custodian for the
restricted stock, at (612) 931-6144.
OPTIONS. The Company is not offering, as part of the Offer, to purchase any
options ("Options") outstanding under the Company's 1990 Equity Incentive Plan
and tenders of Options will not be accepted. Holders of Options who wish to
participate in the Offer must exercise their Options by paying the applicable
exercise price and withholding taxes and then tender the Shares issued upon such
exercise in the Offer, provided that any exercise of an Option and tender of
Shares is in accordance with the terms of the 1990 Equity Incentive Plan and the
Options. In no event are any Options to be delivered to the Depositary in
connection with a tender of Shares hereunder. An exercise of an Option cannot be
revoked even if Shares received upon the exercise and tendered in the Offer are
not accepted for purchase in the Offer for any reason.
LOST, STOLEN, DESTROYED OR MUTILATED CERTIFICATES. If certificates
representing Shares to be tendered have been lost, stolen, destroyed or
mutilated, stockholders must complete the box captioned "Description of Shares
Tendered" on the Letter of Transmittal, indicating the number of Shares the
certificates for which have been so lost, stolen, destroyed or mutilated. The
stockholder will then be instructed by the Depositary as to the steps that must
be taken in order to replace the certificate(s). In order to avoid delay, any
such stockholder should contact the Depositary, ChaseMellon Shareholder
Services, L.L.C., at (800) 851-9677 (toll free).
4. WITHDRAWAL RIGHTS.
Tenders of Shares made pursuant to the Offer may be withdrawn at any time
prior to the Expiration Date. Thereafter, such tenders are irrevocable, except
that they may be withdrawn after January 17, 1999 unless theretofore accepted
for payment as provided in this Offer to Purchase. If the Company extends the
period of time during which the Offer is open, is delayed in accepting for
payment or paying for Shares or is unable to accept for payment or pay for
Shares pursuant to the Offer for any reason, then, without prejudice to the
Company's rights under the Offer, the Depositary may, on behalf of the Company,
retain all Shares tendered, and such Shares may not be withdrawn except as
otherwise provided in this Section 4, subject to Rule 13e-4(f)(5) under the
Exchange Act, which provides that the issuer making the tender offer shall
either pay the consideration offered, or return the tendered securities promptly
after the termination or withdrawal of the tender offer. To be effective, a
written or facsimile transmission notice of withdrawal must be timely received
by the Depositary at one of its addresses set forth on the back cover of this
Offer to Purchase and must specify the name of the person who tendered the
Shares to be withdrawn and the number of Shares to be withdrawn. If the Shares
to be withdrawn have been delivered to the Depositary, a signed notice of
withdrawal with signatures guaranteed by an Eligible Institution (except in the
case of Shares tendered by an Eligible Institution) must be submitted prior to
the release of such Shares. In addition, such notice must specify, in the case
of Shares tendered by delivery of certificates, the name of the registered
holder (if different from that of the tendering stockholder) and the serial
numbers shown on the particular certificates evidencing the Shares to be
withdrawn or, in the case of Shares tendered by book-entry transfer, the name
and number of the account at the Book-Entry Transfer Facility to be credited
with the withdrawn Shares. Withdrawals may not be rescinded, and Shares
withdrawn will thereafter be deemed not validly tendered for purposes of the
Offer. However, withdrawn Shares may be
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retendered by again following one of the procedures described in Section 3 at
any time prior to the Expiration Date.
All questions as to the form and validity (including time of receipt) of any
notice of withdrawal will be determined by the Company, in its sole discretion,
which determination shall be final and binding. None of the Company, the Dealer
Manager, the Depositary, the Information Agent or any other person will be under
any duty to give notification of any defect or irregularity in any notice of
withdrawal or incur any liability for failure to give any such notification.
5. ACCEPTANCE FOR PAYMENT OF SHARES AND PAYMENT OF PURCHASE PRICE.
Upon the terms and subject to the conditions of the Offer and as promptly as
practicable after the Expiration Date, the Company will determine the Purchase
Price, taking into account the number of Shares tendered and the prices
specified by tendering stockholders, announce the Purchase Price, and will
(subject to the proration and conditional tender provisions of the Offer) accept
for payment and pay for Shares validly tendered at or below the Purchase Price.
Thereafter, payment for all Shares validly tendered on or prior to the
Expiration Date and accepted for payment pursuant to the Offer will be made by
the Depositary by check as promptly as practicable. In all cases, payment for
Shares accepted for payment pursuant to the Offer will be made only after timely
receipt by the Depositary of certificates for Shares (or of a confirmation of a
book-entry transfer of such Shares into the Depositary's account at the
Book-Entry Transfer Facility), a properly completed and duly executed Letter of
Transmittal or facsimile thereof, and any other required documents.
For purposes of the Offer, the Company will be deemed to have accepted for
payment (and thereby purchased) Shares that are validly tendered and not
properly withdrawn as, if and when it gives oral or written notice to the
Depositary of its acceptance for payment of such Shares. The Company will pay
for Shares that it has purchased pursuant to the Offer by depositing the
Purchase Price therefor with the Depositary. The Depositary will act as agent
for tendering stockholders for the purpose of receiving payment from the Company
and transmitting payment to tendering stockholders. Under no circumstances will
interest be paid on amounts to be paid to tendering stockholders, regardless of
any delay in making such payment.
Certificates for all Shares not purchased will be returned (or, in the case
of Shares tendered by book-entry transfer, such Shares will be credited to an
account maintained with a Book-Entry Transfer Facility) as promptly as
practicable without expense to the tendering stockholder.
Payment for Shares may be delayed in the event of difficulty in determining
the number of Shares properly tendered or if proration is required. See Section
1. In addition, if certain events occur, the Company may not be obligated to
purchase Shares pursuant to the Offer. See Section 7.
The Company will pay or cause to be paid any stock transfer taxes with
respect to the sale and transfer of any Shares to it or its order pursuant to
the Offer. If, however, payment of the Purchase Price is to be made to, or
Shares not tendered or not purchased are to be registered in the name of, any
person other than the registered holder, or if tendered Shares are registered in
the name of any person other than the person signing the Letter of Transmittal,
the amount of any stock transfer taxes (whether imposed on the registered
holder, such other person or otherwise) payable on account of the transfer to
such person will be deducted from the Purchase Price unless satisfactory
evidence of the payment of such taxes, or exemption therefrom, is submitted. See
Instruction 7 to the Letter of Transmittal.
6. CONDITIONAL TENDER OF SHARES.
Under certain circumstances and subject to the exceptions set forth in
Section 1, the Company may prorate the number of Shares purchased pursuant to
the Offer. As discussed in Section 13, the number of Shares to be purchased from
a particular stockholder might affect the tax treatment of such purchase to
10
<PAGE>
such stockholder and such stockholder's decision whether to tender. Each
stockholder is urged to consult with his or her own tax advisor. Accordingly, a
stockholder may tender Shares subject to the condition that a specified minimum
number of such holder's Shares tendered pursuant to a Letter of Transmittal or
Notice of Guaranteed Delivery must be purchased if any such Shares so tendered
are purchased, and any stockholder desiring to make such a conditional tender
must so indicate in the box captioned "Conditional Tender" in such Letter of
Transmittal or, if applicable, in the Notice of Guaranteed Delivery. However,
this right to tender conditionally is not available with respect to tenders of
401(k) Plan Shares or ESPP Shares.
Any tendering stockholder wishing to make a conditional tender must
calculate and appropriately indicate such minimum number of Shares. If the
effect of accepting tenders on a pro rata basis would be to reduce the number of
Shares to be purchased from any stockholder (tendered pursuant to a Letter of
Transmittal or Notice of Guaranteed Delivery) below the minimum number so
specified, such tender will automatically be regarded as withdrawn (except as
provided in the next paragraph) and all Shares tendered by such stockholder
pursuant to such Letter of Transmittal or Notice of Guaranteed Delivery will be
returned as promptly as practicable thereafter.
If conditional tenders would otherwise be so regarded as withdrawn and would
cause the total number of Shares to be purchased to fall below 2,800,000, then,
to the extent feasible, the Company will select enough of such conditional
tenders that would otherwise have been so withdrawn to permit the Company to
purchase 2,800,000 Shares. In selecting among such conditional tenders, the
Company will select by random lot and will limit its purchase in each case to
the designated minimum number of Shares to be purchased.
7. CERTAIN CONDITIONS OF THE OFFER.
Notwithstanding any other provision of the Offer, the Company will not be
required to accept for payment or pay for any Shares tendered, and may terminate
or amend and may postpone (subject to the requirements of the Exchange Act for
prompt payment for or return of Shares) the acceptance for payment of Shares
tendered, if at any time on or after November 5, 1998 and at or before
acceptance for payment of any Shares any of the following shall have occurred:
(a) there shall have been threatened, instituted or pending any action
or proceeding by any government or governmental, regulatory or
administrative agency or authority or tribunal or any other person, domestic
or foreign, or before any court, authority, agency or tribunal that (i)
challenges the acquisition of Shares pursuant to the Offer or otherwise in
any manner relates to or affects the Offer or (ii) in the sole judgment of
the Company, could materially and adversely affect the business, condition
(financial or other), income, operations or prospects of the Company and its
subsidiaries, taken as a whole, or otherwise materially impair in any way
the contemplated future conduct of the business of the Company or any of its
subsidiaries or materially impair the Offer's contemplated benefits to the
Company;
(b) there shall have been any action threatened, pending or taken, or
approval withheld, or any statute, rule, regulation, judgment, order or
injunction threatened, proposed, sought, promulgated, enacted, entered,
amended, enforced or deemed to be applicable to the Offer or the Company or
any of its subsidiaries, by any legislative body, court, authority, agency
or tribunal which, in the Company's sole judgment, would or might directly
or indirectly (i) make the acceptance for payment of, or payment for, some
or all of the Shares illegal or otherwise restrict or prohibit consummation
of the Offer, (ii) delay or restrict the ability of the Company, or render
the Company unable, to accept for payment or pay for some or all of the
Shares, (iii) materially impair the contemplated benefits of the Offer to
the Company or (iv) materially and adversely affect the business, condition
(financial or other), income, operations or prospects of the Company and its
subsidiaries, taken as a whole, or otherwise materially impair in any way
the contemplated future conduct of the business of the Company or any of its
subsidiaries;
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(c) it shall have been publicly disclosed or the Company shall have
learned that (i) any person or "group" (within the meaning of Section
13(d)(3) of the Exchange Act) has acquired or proposes to acquire beneficial
ownership of more than 5% of the outstanding Shares whether through the
acquisition of stock, the formation of a group, the grant of any option or
right, or otherwise (other than as disclosed in a Schedule 13D or 13G on
file with the Commission on or prior to November 5, 1998) or (ii) any such
person or group that on or prior to November 5, 1998 had filed a Schedule
13D or 13G with the Commission thereafter shall have acquired or shall
propose to acquire whether through the acquisition of stock, the formation
of a group, the grant of any option or right, or otherwise, beneficial
ownership of additional Shares representing 2% or more of the outstanding
Shares;
(d) there shall have occurred (i) any general suspension of trading in,
or limitation on prices for, securities on any national securities exchange
or in the over-the-counter market, (ii) any significant decline in the
market price of the Shares, (iii) any change in the general political,
market, economic or financial condition in the United States or abroad that
could have a material adverse effect on the Company's business, condition
(financial or other), income, operations, prospects or ability to obtain
financing generally or the trading in the Shares, (iv) the declaration of a
banking moratorium or any suspension of payments in respect of banks in the
United States or any limitation on, or any event which, in the Company's
sole judgment, might affect, the extension of credit by lending institutions
in the United States, (v) the commencement of a war, armed hostilities or
other international or national calamity directly or indirectly involving
the United States or (vi) in the case of any of the foregoing existing at
the time of the commencement of the Offer, in the Company's sole judgment, a
material acceleration or worsening thereof;
(e) a tender or exchange offer with respect to some or all of the Shares
(other than the Offer), or a merger, acquisition or other business
combination proposal for the Company, shall have been proposed, announced or
made by any person;
(f) there shall have occurred any event or events that have resulted, or
may in the sole judgment of the Company result, in an actual or threatened
change in the business, condition (financial or other), income, operations,
stock ownership or prospects of the Company and its subsidiaries, taken as a
whole;
(g) there shall have occurred any decline in the Dow Jones Industrial
Average or the Standard & Poor's Composite 500 Stock Index by an amount in
excess of 10% measured from the close of business on November 5, 1998; or
(h) any conditions in the Credit Agreement described in Section 11 (the
"Credit Agreement") relating to the borrowing of funds to repurchase Shares
shall not have been satisfied or waived;
and, in the sole judgment of the Company, such event or events make it
undesirable or inadvisable to proceed with the Offer or with such acceptance for
payment or payment.
The foregoing conditions are for the sole benefit of the Company and may be
asserted by the Company regardless of the circumstances (including any action or
inaction by the Company) giving rise to any such condition, and any such
condition may be waived by the Company, in whole or in part, at any time and
from time to time, in its sole discretion, whether or not any other condition of
the Offer is also waived. The failure by the Company at any time to exercise any
of the foregoing rights shall not be deemed a waiver of any such right and each
such right shall be deemed an ongoing right which may be asserted at any time
and from time to time. Any determination by the Company concerning the events
described above will be final and binding on all parties.
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8. PRICE RANGE OF SHARES; DIVIDENDS.
The Shares are listed and principally traded on the NYSE under the symbol
"ATK." The following table sets forth the high and low sales prices of the
Shares on the NYSE Composite Tape for the Company's fiscal quarters indicated.
<TABLE>
<CAPTION>
HIGH* LOW*
--------- ---------
<S> <C> <C>
Fiscal Year Ended March 31, 1997:
Quarter ended June 30, 1996.................................................................. $ 49.13 $ 43.75
Quarter ended September 29, 1996............................................................. 53.25 46.25
Quarter ended December 29, 1996.............................................................. 57.38 47.63
Quarter ended March 31, 1997................................................................. 55.00 42.00
Fiscal Year Ended March 31, 1998:
Quarter ended June 29, 1997.................................................................. 52.88 40.50
Quarter ended September 28, 1997............................................................. 69.00 51.44
Quarter ended December 28, 1997.............................................................. 65.69 53.75
Quarter ended March 31, 1998................................................................. 65.00 54.50
Fiscal Year Ending March 31, 1999:
Quarter ended June 28, 1998.................................................................. 65.56 57.88
Quarter ended September 27, 1998............................................................. 68.88 61.38
Quarter ended December 27, 1998 (through November 5, 1998)................................... 74.38 65.00
</TABLE>
- ------------------------
* Information provided was obtained from The Wall Street Journal, and the
Company believes such information to be accurate.
On November 5, 1998, the last full NYSE trading day prior to the
announcement of the Offer, the last reported sale price of the Shares on the
NYSE Composite Tape was $73 7/8 per Share. Stockholders are urged to obtain
current market quotations for the shares.
The Company has not paid cash dividends since its spin-off from Honeywell
Inc. The Company's dividend policy will be reviewed by the Board of Directors at
such future times as may be appropriate in light of relevant factors existing at
such times, including the extent to which the payment of cash dividends may be
limited by covenants contained in the agreements governing its outstanding
indebtedness, including the Credit Agreement. The Company does not expect to pay
cash dividends in the foreseeable future.
On September 28, 1990, the Board of Directors of the Company declared a
dividend distribution of one Right on each share of Common Stock outstanding at
the close of business on October 9, 1990, and in connection therewith entered
into the Rights Agreement, dated as of September 28, 1990, as amended, between
the Company and The Chase Manhattan Bank (as successor to Manufacturers Hanover
Trust Company), as Rights Agent.
When exercisable, each Right will entitle the registered holder to purchase
one one-hundredth of a share of Series A Junior Participating Preferred Stock,
par value $1.00 per share (the "Preferred Stock"), at an exercise price of
$80.00, subject to adjustment. The Rights are not exercisable, transferrable, or
separable from the Company's Common Stock until the Distribution Date, which is
defined as the tenth business day after the earliest to occur of: (i) a public
announcement that a person or group of affiliated or associated persons (an
"Acquiring Person") has acquired, or obtained the right to require, beneficial
ownership of 20% or more of the outstanding shares of the Company's Common Stock
(the "Stock Acquisition Date"), (ii) the commencement of a tender offer or
exchange offer that upon consummation would result in a person being a
beneficial owner of 20% or more of the Common Stock or (iii) the Board of
Directors' determination that any person, alone or together with its affiliates
and associates, has become the beneficial owner of an amount of Common Stock
which the Board of Directors determines to be
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<PAGE>
substantial (in no event less than 10% of the outstanding shares of Common
Stock) and at least a majority of the Board of Directors who are not officers of
the Company, determines that (a) such beneficial ownership by such person is
intended to cause pressure on the Company to take action or enter into a
transaction (or series of transactions) intended to provide such person with
short-term financial gain under circumstances which the Board of Directors
determines that the long-term interests of the Company and its stockholders
would not be best served by taking any such actions at that time or (b) such
beneficial ownership is causing or is reasonably likely to cause a material
adverse impact on the business or prospects of the Company (any such person
being referred to as an "Adverse Person").
The Company is entitled to redeem the Rights in whole, but not in part, at
$.01 per Right (subject to adjustment) prior to the Distribution Date. Under
certain circumstances which are set forth in the Rights Agreement, the decision
to redeem requires the concurrence of a majority of the continuing directors.
The Company may not redeem the Rights if the Board of Directors has previously
declared a person to be an Adverse Person. Unless earlier redeemed, the Rights
will expire on September 28, 2000.
In general, the Rights Agreement provides that in the event of (i) a Person
becoming the beneficial owner of 20% or more of the then outstanding shares of
Common Stock (except pursuant to an offer for all outstanding shares of Common
Stock that a majority of the independent directors determine to be fair to and
otherwise in the best interests of the Company and its stockholders), or (ii)
the Board of Directors determining that a person is an Adverse Person, each
holder of a Right (except as provided in the Rights Agreement) will have the
right to receive, upon payment of the exercise price, a number of shares of
Common Stock (or, in certain circumstances, cash, property or other securities
of the Company) equal to the result obtained by (a) multiplying the Purchase
Price (as defined in the Rights Agreement) by the number of one-hundredths of a
share of Series A Junior Participating Preferred Stock for which a Right was
exercisable prior to the triggering event and (b) dividing that product by 50%
of the current market price per share of Common Stock on the triggering date. In
addition, if at any time following the Stock Acquisition Date, (i) the Company
is acquired in a merger or other business combination transaction in which the
Company is not the surviving corporation (other than in a merger that follows an
offer described in the following paragraph), or (ii) more than 50% of the
Company's assets, cash flow or earning power is sold or transferred, provision
must be made prior to the consummation of such transaction to entitle each
holder of a Right (except as provided in the Rights Agreement) to purchase at
the exercise price a number of the acquiring company's common shares (or, in
certain circumstances, cash, property, or other securities of the company) equal
to the result obtained by (a) multiplying the Purchase Price by the number of
one-hundredths of a share of Series A Junior Participating Preferred Stock for
which a Right was exercisable prior to the triggering event and (b) dividing
that product by 50% of the current market price per share of Common Stock on the
triggering date. Further, following the occurrence of any of the events set
forth in this paragraph, all Rights that are, or (under certain circumstances
specified in the Rights Agreement) were, beneficially owned by any Acquiring
Person or Adverse Person (or by certain related parties) become immediately null
and void.
The Rights may have certain anti-takeover effects, including deterring
someone from acquiring control of the Company in a manner or on terms not
approved by the Board of Directors. The Rights should not interfere with any
merger or other business combination approved by the Board of Directors, because
the Rights may be redeemed generally at any time by the Company as set forth
above, except in the case of a declaration by the Board of Directors that the
person seeking a merger or business combination is an Adverse Person.
The foregoing description of the Rights is qualified in its entirety by
reference to the Rights Agreement, a copy of which has been included as an
exhibit to the Company's 1990 Registration Statement on Form 10, and to the
amendments to the Rights Agreement (including the rescission agreement which
rescinded Amendment No. 1 to the Rights Agreement in its entirety), copies of
which have been included as exhibits to the Company's Annual Report on Form 10-K
for the year ended March 31, 1993 and to its
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<PAGE>
Current Report on Form 8-K dated October 28, 1994, in each case filed with the
Commission. Such reports and exhibits may be obtained from the Commission in the
manner provided in Section 17.
9. PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER.
The Company believes that the repurchase of outstanding Shares at this time
is consistent with the Company's goal to increase earnings per share and
maximize shareholder value. The Company further believes that the debt to be
incurred to repurchase the Shares will not affect the Company's prospects for
future internal growth or impede possible future acquisitions.
This Offer supersedes any other share repurchase previously authorized by
the Company's Board of Directors. However, the Company may in the future
purchase Shares on the open market, in privately negotiated transactions,
through tender offers or otherwise. Any such purchases may be on the same terms
or on terms that are more or less favorable to stockholders than the terms of
the Offer. However, under the Exchange Act rules, the Company and its affiliates
are prohibited from purchasing any Shares, other than pursuant to the Offer,
until at least ten business days after expiration or termination of the Offer.
Any possible future purchases by the Company will depend on many factors,
including the market price of the Shares, the results of the Offer, the
Company's business and financial position and general economic and market
conditions.
The Offer will afford to stockholders who are considering the sale of all or
a portion of their Shares the opportunity to determine the price at which they
are willing to sell their Shares and, in the event the Company accepts such
Shares for purchase, to dispose of Shares without the usual transaction costs
associated with a market sale. By tendering Shares directly to the Depositary,
the Offer will also allow qualifying stockholders owning beneficially or of
record fewer than 100 Shares (not including any 401(k) Plan Shares) to avoid the
payment of brokerage commissions and the applicable odd lot discount payable on
a sale of Shares in a transaction effected on a securities exchange.
Correspondingly, the costs to the Company for servicing the accounts of odd lot
holders will be reduced. See Section 2.
As of November 5, 1998, the Company had issued and outstanding 12,151,965
Shares (not including 1,711,648 Shares held in treasury), and had reserved
2,101,975 Shares for issuance under its various benefit and/or incentive
compensation plans. Of the reserved Shares, 790,625 Shares are issuable upon
exercise of outstanding stock options and up to 25,900 Shares are reserved for
issuance to key officers, which will vest upon achievement of certain earnings
per Share growth goals. The 2,800,000 Shares that the Company is offering to
purchase represent approximately 23% of the Shares issued and outstanding as of
such date and approximately 22% of the Shares on a diluted basis (assuming the
exercise of all outstanding vested stock options). As of November 5, 1998, all
directors and executive officers of the Company as a group owned beneficially an
aggregate of 605,445 Shares (including an aggregate of 331,962 Shares that may
be acquired pursuant to the exercise of outstanding stock options exercisable
within 60 days of the date hereof) or approximately 4.8% of the Shares then
outstanding (assuming the exercise of all such outstanding stock options). The
Company has been advised that no director or executive officer intends to tender
Shares pursuant to the Offer, except for Richard Schwartz, its retired Chief
Executive Officer and retiring Chairman of the Board. Mr. Schwartz, as part of
his retirement planning, intends to tender up to 100,000 Shares of the 50,493
Shares he owns beneficially and the 215,000 Shares he is entitled to acquire
pursuant to the exercise of stock options, all of which are currently
exercisable. If the Company purchases 2,800,000 Shares pursuant to the Offer and
no director or executive officer of the Company other than Mr. Schwartz
(assuming Mr. Schwartz tenders all 100,000 Shares) tenders Shares, the
percentage of outstanding Shares owned beneficially by all of the Company's
directors and executive officers as a group would increase to approximately 5.4%
of the Shares then outstanding (including for this purpose, Shares that may be
acquired by such directors and executive officers pursuant to the exercise of
outstanding stock options exercisable within 60 days of the date hereof).
15
<PAGE>
Stockholders who determine not to accept the Offer will obtain a
proportionate increase in their ownership interest in the Company. After
consummation of the Offer, increases or decreases in net income will likely be
reflected in greater increases or decreases in earnings per Share than is
presently the case because of the smaller number of Shares outstanding
thereafter.
Shares that the Company acquires pursuant to the Offer will become
authorized but unissued Shares and will be available for issuance by the Company
without further stockholder action (except as may be required by applicable law
or the rules of the NYSE or any other securities exchange on which the Shares
are listed). Such Shares could be issued without stockholder approval for, among
other things, acquisitions, the raising of additional capital for use in the
Company's business, stock dividends or in connection with employee stock, stock
option and other plans or a combination thereof.
Except as disclosed in this Offer to Purchase, the Company has no plans or
proposals which relate to or would result in: (a) the acquisition by any person
of additional securities of the Company or the disposition of securities of the
Company; (b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Company or any of its subsidiaries;
(c) a sale or transfer of a material amount of assets of the Company or any of
its subsidiaries; (d) any change in the present Board of Directors or management
of the Company, other than the Company's on-going search for a new Chief
Executive Officer; (e) any material change in the present dividend rate or
policy, or indebtedness or capitalization of the Company; (f) any other material
change in the Company's corporate structure or business; (g) any change in the
Company's Restated Certificate of Incorporation or By-Laws, as amended, or any
actions which may impede the acquisition of control of the Company by any
person; (h) a class of equity security of the Company being delisted from a
national securities exchange; (i) a class of equity security of the Company
becoming eligible for termination of registration pursuant to Section 12(g)(4)
of the Exchange Act; or (j) the suspension of the Company's obligation to file
reports pursuant to Section 15(d) of the Exchange Act.
The Company's purchase of Shares in the Offer will reduce the number of
Shares that might otherwise trade publicly. Nonetheless, it is expected that
there will still be a sufficient number of Shares outstanding and publicly
traded following the consummation of the Offer to ensure a continued trading
market in the Shares. Based upon the published guidelines of the NYSE, the
Company does not believe that the Offer will result in delisting of the Shares
on the NYSE.
The Shares are registered under the Exchange Act which requires, among other
things, that the Company furnish certain information to its stockholders and to
the Commission and comply with the Commission's proxy rules in connection with
meetings of the Company's stockholders. The Company has no reason to believe
that the purchase of Shares pursuant to the Offer will result in the termination
of registration of the Shares under the Exchange Act.
The Shares are currently "margin securities" under the rules of the Federal
Reserve Board. This has the effect, among other things, of allowing brokers to
extend credit on the collateral of the Shares. The Company expects that,
following the repurchase of the Shares in the Offer, the Shares will continue to
be "margin securities" for purposes of the Federal Reserve Board's margin
regulations. Eligibility for treatment as margin securities will, however,
continue to depend on maintenance of minimum daily trading volume.
NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO
ANY STOCKHOLDER AS TO WHETHER TO TENDER ALL OR ANY SHARES, NOR HAS THE COMPANY
AUTHORIZED ANY PERSON TO MAKE ANY SUCH RECOMMENDATION. HOLDERS ARE URGED TO
EVALUATE CAREFULLY ALL INFORMATION IN THE OFFER AND TO CONSULT THEIR OWN
INVESTMENT AND TAX ADVISORS. EACH STOCKHOLDER MUST MAKE HIS OR HER OWN DECISION
WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND AT WHAT
PRICE.
16
<PAGE>
10. CERTAIN INFORMATION CONCERNING THE COMPANY.
The Company, a Delaware corporation, was incorporated on May 2, 1990 as a
wholly-owned subsidiary of Honeywell Inc. in connection with Honeywell's plan to
spin off to its stockholders its defense and marine systems business, its test
instruments division and its signal analysis center. On September 28, 1990,
Honeywell completed the spin-off. The Shares are listed and principally traded
on the NYSE under the symbol "ATK." The Company's executive offices are located
at 600 Second Street, N.E., Hopkins, Minnesota 55343, and its telephone number
is (612) 931-6000.
The Company is a leading developer and supplier of aerospace and defense
technologies, products and systems to the U.S. Government. The Company
specializes in the production of high quality products manufactured to meet
exacting specifications designed to insure consistent, reliable performance. The
Company (including its predecessors) has supplied products and services to the
U.S. Government for more than 50 years. The Company has approximately 6,300
employees.
The Company's principal business areas are conventional munitions, solid
propulsion systems, smart weapons and composite structures. In the conventional
munitions and solid propulsion businesses, the Company holds a number one or two
position in most major market segments. The Company is a defense contractor for
the U.S. Government and a major component and subsystem supplier to the largest
Department of Defense prime contractors including Lockheed Martin, Boeing and
Raytheon. For the fiscal year ended March 31, 1998 ("Fiscal 1998"), the Company
generated sales of approximately $1.1 billion, operating income of $92.1 million
and net income of $68.2 million.
In order to focus the Company's development and production efforts and
respond effectively to its customer base, the Company is organized in the
following business groups:
CONVENTIONAL MUNITIONS GROUP. The Company is one of two principal suppliers
of conventional ammunition to the Department of Defense. Principal products and
services include conventional ammunition, propellants, solid propulsion systems
for tactical missiles, warheads, metal parts and composite structures for
weapons systems, infrared decoy flares and commercial gun powder. The Group has
four distinct business units: Ammunition Systems (tank ammunition, medium
caliber ammunition and warheads); Ordinance (military propellants and commercial
gun powders); Tactical Propulsion (solid propulsion for tactical missiles,
composite structures and warheads); and Kilgore Operations (flares). For Fiscal
1998, the Conventional Munitions Group had sales of approximately $465 million,
representing approximately 43% of the Company's total sales during such year.
SPACE AND STRATEGIC SYSTEMS GROUP. The Company is a leading designer,
developer and manufacturer of solid rocket propulsion systems for space launch
vehicles and strategic missile systems and high performance composite structures
for military and commercial aircraft and spacecraft. In addition, the Company
provides operational and technical support services for space launch activities.
The Company is the world's leading producer of solid rocket motors for unmanned
expendable space launch vehicles and one of the two leading developers and
producers of solid propulsion systems for U.S. strategic missile programs. For
Fiscal 1998, the Space and Strategic Systems Group had sales of approximately
$370 million, representing approximately 34% of the Company's total sales during
such year.
DEFENSE SYSTEMS GROUP. The Company is also a leading designer, developer
and manufacturer of tactical weapons systems, smart weapons, anti-tank and
demolition systems, unmanned aerial vehicles, fuzes, weapons test equipment
systems and targeting sensors. The Defense Systems Group has three distinct
business units: Tactical Systems (smart weapons, anti-tank and demolition
systems, fuzes); Defense Electronics Systems (smart weapons systems, missile
warning systems and weapons test equipment systems); and Unmanned Aerial
Vehicles (unmanned aerial vehicles and tactical ground control systems). For
Fiscal 1998, the Defense Systems Group had sales of approximately $242 million,
representing approximately 23% of the Company's total sales during such year.
17
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The foregoing description of the Company's business is qualified in its
entirety by the more detailed discussion contained in the Company's Annual
Report on Form 10-K for the year ended March 31, 1998 and in its other filings
made with the Commission pursuant to the Exchange Act.
RECENT DEVELOPMENTS
The Company had net sales of approximately $259 million for the quarter
ended September 27, 1998 (the "Second Quarter") and approximately $515.3 million
for the first half of fiscal 1999. The Company also had EBITDA of approximately
$35.6 million for the Second Quarter and approximately $70.8 million for the
first half of fiscal 1999. The Conventional Munitions Group reported net sales
of approximately $118 million for the Second Quarter and approximately $240
million for the first half of fiscal 1999. Second-quarter sales from the Space
and Strategic Systems Group were approximately $103 million and approximately
$194 million for the first half of fiscal 1999. The Defense Systems Group posted
second quarter sales of approximately $40 million and approximately $83 million
for the first half of fiscal 1999.
The Company's debt-to-capitalization ratio at the end of the second quarter
declined to 45% from 50% a year ago, reflecting the repayment of $44 million of
debt over the past year. The results set forth above are unaudited and no
assurance can be given that actual audited results for fiscal 1999 will not
differ materially from such unaudited results.
On September 15, 1998, the Company completed the repurchase of $140 million
of its outstanding 11 3/4% Senior Subordinated Notes due 2003 (the "Notes")
pursuant to a tender offer for such Notes. Approximately $10 million of the
Notes remain outstanding. The cost to extinguish the $140 million of Notes
(including the required premium) was approximately $153 million, which was
financed with borrowings under the Company's revolving credit facility. The
total extraordinary loss on debt extinguishment of $17.2 million ($14.6 million
after a tax benefit of $2.6 million) includes the $13 million premium paid to
purchase the Notes, and also includes the write-off of approximately $4 million,
representing the unamortized debt-issuance costs related to the debt.
In connection with the Offer, the Company intends to enter into new credit
facilities which will permit borrowings by the Company of up to $650 million in
the aggregate. As a result, the Company will significantly increase its leverage
and debt service requirements. See Section 11.
SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
The following is a summary of certain historical consolidated financial
information regarding the Company for the periods indicated. The summary
financial information (other than the ratio of earnings to fixed charges) set
forth below for the years ended March 31, 1997 and 1998 is derived from the
audited consolidated financial statements contained in the Company's Annual
Report, filed as an exhibit to and incorporated by reference into the Company's
Annual Report on Form 10-K for the fiscal year ended March 31, 1998 (the "1998
10-K"). The financial information (other than the ratio of earnings to fixed
charges) set forth below for the six-month periods ended September 28, 1997 and
September 27, 1998 is derived from the unaudited consolidated financial
statements set forth in the Company's Quarterly Report on Form 10-Q for the
quarterly period ended September 27, 1998 (the "1999 Second Quarter 10-Q"),
which has been prepared on a basis substantially consistent with the audited
consolidated financial statements, and which, in the opinion of management,
reflects all adjustments necessary to a fair presentation of the financial
position and results of operations for such periods. The results for the six-
month periods are not necessarily indicative of the results for the full year.
The information presented below should be read in conjunction with the Company's
consolidated financial statements and the notes thereto, incorporated by
reference herein. Copies of the 1999 Second Quarter 10-Q, and the 1998 10-K, in
each case complete with exhibits, may be obtained as described in Section 17.
18
<PAGE>
SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT RATIOS AND PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
SIX-MONTH PERIOD ENDED FISCAL YEAR ENDED
---------------------------- MARCH 31,
SEPT. 28, SEPT. 27, --------------------------
1997 1998 1997 1998
------------- ------------- ------------ ------------
<S> <C> <C> <C> <C>
(UNAUDITED)
INCOME STATEMENT DATA:
Sales................................................... $ 518,593 $ 515,319 $ 1,089,397 $ 1,075,506
Income before extraordinary loss........................ $ 30,578 $ 32,469 $ 59,159 $ 68,183
Extraordinary loss(1)................................... -- $ (14,627) -- --
Net income(2)........................................... $ 30,578 $ 17,842 $ 59,159 $ 68,183
Basic earnings per common share:
Income before extraordinary loss...................... $ 2.35 $ 2.58 $ 4.55 $ 5.23
Extraordinary loss.................................... -- (1.16) -- --
------------- ------------- ------------ ------------
Net income............................................ $ 2.35 $ 1.42 $ 4.55 $ 5.23
------------- ------------- ------------ ------------
------------- ------------- ------------ ------------
Diluted earnings per common share:
Income before extraordinary loss...................... $ 2.28 $ 2.51 $ 4.41 $ 5.10
Extraordinary loss.................................... -- (1.13) -- --
------------- ------------- ------------ ------------
Net Income............................................ $ 2.28 $ 1.38 $ 4.41 $ 5.10
------------- ------------- ------------ ------------
------------- ------------- ------------ ------------
Number of common shares used in computing basic net
income per common share............................... 13,023 12,607 13,015 13,048
Number of common shares used in computing diluted net
income per common share............................... 13,407 12,918 13,402 13,371
OTHER FINANCIAL DATA:
Ratio of earnings to fixed charges...................... 3.0x 4.4x 2.0x 3.4x
<CAPTION>
AS OF
---------------------------- AS OF MARCH 31,
SEPT. 28, SEPT. 27, --------------------------
1997 1998 1997 1998
------------- ------------- ------------ ------------
(UNAUDITED)
<S> <C> <C> <C> <C>
BALANCE SHEET DATA:
Working capital......................................... $ 116,259 $ 98,786 $ 108,191 $ 95,628
Total assets............................................ $ 946,606 $ 871,183 $ 1,000,588 $ 932,180
Total debt.............................................. $ 252,514 $ 208,814 $ 268,397 $ 198,648
Shareholders' equity and redeemable common shares(3).... $ 249,385 $ 256,445 $ 218,792 $ 265,754
Book value per common share............................. $ 19.01 $ 20.66 $ 16.72 $ 20.67
</TABLE>
- ------------------------
(1) On September 15, 1998, the Company repurchased $140 million of its $150
million 11 3/4% Senior Subordinated Notes pursuant to a tender offer for
such Notes. The cost to extinguish the $140 million of Notes (including the
required premium) was approximately $153 million, which was financed with
borrowings under the Company's revolving credit facility. The total
extraordinary loss on debt extinguishment of $17.2 million ($14.6 million
after a tax benefit of $2.6 million) includes the $13 million premium paid
to purchase the Notes, and also includes the write-off of approximately $4
million, representing the unamortized debt-issuance costs related to the
debt.
(2) On December 22, 1996, the Company entered into an agreement to sell its
Marine Systems Group, including substantially all of the assets of that
business, to Hughes Aircraft Co. (Hughes) for $141.0 million in cash. The
sale was completed on February 28, 1997, resulting in a pre-tax gain to the
Company of approximately $27.2 million (or $17.7 million after tax), which
the Company recognized in the fourth quarter of fiscal 1997. Marine System's
results of operations through the disposal date included pre-tax income from
operations of $7.4 million (or $4.8 million after tax).
The Company's fiscal 1997 results from operations also include a one-time
charge of $17.4 million for the Company's adoption of AICPA Statement of
Position No. 96-1 (SOP 96-1) "Environmental Remediation Liabilities."
(3) Redeemable common shares represent 813,000 shares and 271,000 shares,
redeemable at prescribed prices totaling $44,979 and $14,993, as of March
31, 1998 and September 27, 1998, respectively. The shares were redeemable in
three equal lots of 271,000 shares each during each of the last three
calendar quarters of 1998. On November 5, 1998, the Company purchased the
last lot of 271,000 shares.
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<PAGE>
SUMMARY UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
The following summary unaudited consolidated pro forma financial information
gives effect to the purchase of Shares pursuant to the Offer, based on the
assumptions described in the Notes to Summary Unaudited Consolidated Pro Forma
Financial Information as if such purchase had occurred on the first date of each
of the periods presented, with respect to the operating statement data, and on
March 31, 1998 and September 27, 1998, with respect to the balance sheet data.
The summary unaudited pro forma consolidated financial information is presented
for illustrative purposes only, should be read in conjunction with the summary
historical consolidated financial information and does not purport to be
indicative of the results that would actually have been obtained, or results
that may be obtained in the future, or the financial condition that would have
resulted had the purchase of the Shares pursuant to the Offer been completed at
the dates indicated.
SUMMARY UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT RATIOS AND PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Fiscal Year Ended March 31, 1998 Six Months Ended September 27, 1998
-------------------------------------- --------------------------------------
Pro Forma Pro Forma
INCOME STATEMENT DATA Actual Adjustments(1) Pro Forma Actual Adjustments(1) Pro Forma
--------- -------------- ----------- --------- -------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Sales........................... $1,075,506 $1,075,506 $ 515,319 $ 515,319
Income before extraordinary
loss.......................... $ 68,183 $ (13,937)(2) $ 54,246 $ 32,469 $ (6,923)(2) $ 25,546
Extraordinary loss.............. -- -- $ (14,627) $ (14,627)
Net income...................... $ 68,183 $ (13,937) $ 54,246 $ 17,842 $ (6,923) $ 10,919
Basic earnings per common share:
Income before extraordinary
loss........................ $ 5.23 $ 5.29 $ 2.58 $ 2.60
Extraordinary loss............ -- -- (1.16) (1.49)
--------- ----------- --------- -----------
Net income.................... $ 5.23 $ 5.29 $ 1.42 $ 1.11
--------- ----------- --------- -----------
--------- ----------- --------- -----------
Diluted earnings per common
share:
Income before extraordinary
loss........................ $ 5.10 $ 5.13 $ 2.51 $ 2.52
Extraordinary loss............ -- -- (1.13) (1.44)
--------- ----------- --------- -----------
Net income.................... $ 5.10 $ 5.13 $ 1.38 $ 1.08
--------- ----------- --------- -----------
--------- ----------- --------- -----------
Number of common shares used in
computing basic net income per
common share.................. 13,048 (2,800)(3) 10,248 12,607 (2,800)(3) 9,807
Number of common shares used in
computing diluted net income
per common share.............. 13,371 (2,800)(3) 10,571 12,918 (2,800)(3) 10,118
OTHER FINANCIAL DATA
Ratio of earnings to fixed
charges....................... 3.4x 2.3x 4.4x 2.5x
<CAPTION>
As of March 31, 1998 As of September 27, 1998
-------------------------------------- --------------------------------------
Pro Forma Pro Forma
BALANCE SHEET DATA Actual Adjustments(1) Pro Forma Actual Adjustments(1) Pro Forma
--------- -------------- ----------- --------- -------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Working capital................. $ 95,628 $ 95,628 $ 98,786 $ 98,786
Total assets.................... $ 932,180 $ 6,900(2) $ 939,080 $ 871,183 $ 8,500(2) $ 879,683
Total debt...................... $ 198,648 $ 238,600(2,3) $ 437,248 $ 208,814 $ 225,600(2,3) $ 434,414
Shareholders' equity and
redeemable common shares...... $ 265,754 $ (231,700)( ,3) $ 34,054 $ 256,445 $ (217,100)(3) $ 39,345
Book value per common share..... $ 20.67 $ 3.39 $ 20.66 $ 4.09
</TABLE>
20
<PAGE>
ALLIANT TECHSYSTEMS INC.
NOTES TO SUMMARY UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
(1) Where applicable, the tax rate applicable to pro forma adjustments was
15% for the six-month period ended September 27, 1998, and 0% for the fiscal
year ended March 31, 1998, consistent with the rates applied in each of the
respective historical periods.
(2) The purchase of Shares pursuant to the Offer will be financed by the
Company's new bank credit facilities, as described in Section 11. These new bank
credit facilities will also refinance the Company's existing bank credit
facility. In accordance with the Commitment Letter (as defined herein) the
Company has come to agreement on all substantive terms of the new bank credit
facilities and currently expects the new bank facilities to be effective prior
to the Expiration Date. Fees and expenses associated with the refinancing are
expected to be approximately $8.5 million. For pro forma purposes, such fees and
expenses are classified in other assets and are being charged to earnings on a
straight-line basis over the term of the new bank credit facilities (6 years, or
approximately $1.4 million per year). The interest rate charged under the new
bank credit facilities is a floating rate. For pro forma purposes, the interest
rate associated with the borrowings financed under the new bank credit
facilities is assumed to be 7.85%, which approximates what the Company's current
average cost of borrowing would be under the facility. As the repurchase of the
Shares pursuant to the Offer could not have occurred under the covenants
pertaining to the Company's Senior Subordinated Notes (the "Notes") and as the
costs of repurchasing the Notes, which occurred on September 15, 1998, will be
refinanced with borrowings under the new bank credit facilities, the Company's
pro forma interest expense (part of pro forma income before extraordinary loss)
is shown net of reductions totaling approximately $1.0 million and $4.3 million
for the six months ending September 27, 1998 and the year ending March 31, 1998,
respectively, to reflect the refinancing of the costs to repurchase the Notes on
a long term basis.
(3) For pro forma purposes, it is assumed that 2,800,000 Shares are
purchased pursuant to the Offer at $77 per Share (the maximum number of shares
and highest price contemplated by the terms of the Offer) for a total Share
purchase price of approximately $216 million. There can be no assurance that the
Company will purchase 2,800,000 Shares or at what price any Shares will be
purchased. Fees and expenses associated with the purchase of Shares are
estimated to be approximately $1.5 million.
21
<PAGE>
11. SOURCE AND AMOUNT OF FUNDS.
Assuming the Company purchases 2,800,000 Shares pursuant to the Offer at a
purchase price of $77 per Share, the Company expects the maximum aggregate cost
to be approximately $216 million (excluding estimated fees and expenses). It is
anticipated that the Company will fund the purchase of Shares pursuant to the
Offer and the payment of related fees and expenses with borrowings under new
credit facilities the Company expects to establish with a syndicate of lenders
led by The Chase Manhattan Bank ("Chase") on or prior to the Expiration Date
pursuant to a commitment letter dated October 26, 1998 (the "Commitment
Letter").
The new bank credit facilities, which will also refinance the Company's
existing credit facilities, will each have a term of six years and will provide
for borrowings of up to an aggregate principal amount of $650 million. The new
bank credit facilities will consist of: (1) a six-year term loan facility (the
"Closing Date Term Loan Facility") providing for term loans on the date on which
definitive credit documentation for the facility is executed (the "Loan Closing
Date") in an aggregate principal amount not to exceed $200 million; (2) a
six-year term loan facility (the "Delayed Draw Term Loan Facility") providing
for term loans at any time and from time to time on or prior to June 30, 1999 in
a principal amount not to exceed $200 million and in minimum drawings of at
least $20 million; and (3) a six-year revolving credit facility (the "Revolving
Credit Facility") providing for revolving loans in an aggregate principal amount
at any time outstanding not to exceed $250 million. The Closing Date Term Loan
Facility may be subdivided into two separate facilities, each of which may be
governed by one or more definitive agreements consisting of: (1) an amendment
and restatement of the Company's existing term loan facility providing for the
continuation for a term of six years of term loans outstanding on the Loan
Closing Date in an aggregate principal amount not to exceed $35 million and (2)
a six-year term loan facility providing for new term loans on the Loan Closing
Date in an aggregate principal amount not to exceed $165 million. Term loans
under the Closing Date Term Loan Facility and the Delayed Draw Term Loan
Facility will be repayable beginning June 30, 1999 and December 31, 1999,
respectively, in each case, in equal quarterly installments in accordance with a
fixed amortization schedule. Revolving loans may be borrowed, repaid, and
reborrowed at any time and from time to time and will be repayable at maturity.
Up to $150 million of the Revolving Credit Facility will be available for
letters of credit.
Loans under the new bank credit facilities will bear interests at floating
rates based on, at the option of the Company, an alternate base rate ("ABR")
plus a margin of 0-1.25%, depending on the Company's leverage ratio, or LIBOR
(as defined below) plus a margin of 1.25-2.50%, depending on the Company's
leverage ratio, provided that all swingline loans will be required to be ABR
loans. Under the Commitment Letter, ABR is defined to be the highest of (i)
Chase's New York prime rate; (ii) the secondary market rate for three-month
certificates of deposit plus 1%; and (iii) the federal funds effective rate from
time to time plus 0.5%. LIBOR is defined to mean the average of the London
interbank offered rates at which eurodollar deposits for one, two, three or six
months are offered to Chase, and such other lenders as Chase and the Company may
agree, in the interbank eurodollar market.
The term sheet attached to the Commitment Letter provides for certain
financial covenants, including a maximum ratio of total debt to EBITDA, a
minimum ratio of EBITDA to interest expense and a minimum net worth. The
Commitment Letter also provides that the credit agreement will contain customary
affirmative and negative covenants, including limitations with respect to
indebtedness, liens, consolidations, mergers and sales of assets, changes in
business conducted, investments and acquisitions, transactions with affiliates,
amendments of certain material agreements and instruments, restricted payments,
and customary events of default, in each case, with exceptions to be agreed upon
by the Company and Chase. The Company will also be required to pay certain
commitment fees, letter of credit fees, annual fees and to reimburse the lenders
thereunder for certain fees and expenses they incur in making the loan. The term
sheet also contemplates mandatory prepayments and commitment reductions upon the
occurrence of certain events, including certain incurrences of indebtedness,
certain issuances of preferred stock and certain asset sales.
22
<PAGE>
The obligations of the Company under the new bank credit facilities will be
secured by a first priority security interest in substantially all tangible and
intangible assets of the Company and its subsidiaries (subject to certain
permitted liens) and will be guaranteed by each of the Company's U.S.
subsidiaries.
The availability of the new bank credit facilities is subject to the
satisfaction by the Company of certain conditions, and the consummation of the
Offer is contingent upon such new bank credit facilities being available to the
Company at the time of acceptance of and payment for tendered Shares. See
Section 7.
The preceding summary of the terms of the new bank credit facilities is
qualified in its entirety by reference to the text of the Commitment Letter,
which has been filed as an exhibit to the Schedule 13E-4 filed by the Company
with the Commission. A copy of the Schedule 13E-4 may be obtained from the
Commission in the manner provided in Section 17.
The Company will incur substantial indebtedness in connection with the Offer
and, as a result, will be highly leveraged. As of September 27, 1998, on a pro
forma basis after giving effect to the Offer, as if the Offer were consummated
on September 27, 1998, the Company's total indebtedness and stockholders' equity
would have been approximately $434 million and $39 million, respectively,
assuming that 2,800,000 shares are validly tendered and accepted for purchase.
The Company's high leverage could have material consequences to the Company,
including, but not limited to, the following: (i) the Company's ability to
obtain additional financing in the future for acquisitions, working capital,
capital expenditures, and general corporate or other purposes may be impaired or
any such financing may not be available on terms favorable to the Company; (ii)
a substantial portion of the Company's cash flow will be required for debt
service and, as a result, will not be available for its operations or other
purposes; (iii) a substantial decrease in net operating cash flows or an
increase in expenses could make it difficult for the Company to meet its debt
service requirements or force it to modify its operations or sell assets; (iv)
the Company's ability to withstand competitive pressures may be limited; and (v)
the Company's level of indebtedness could make it more vulnerable to economic
downturns, and reduce its flexibility in responding to changing business and
economic conditions.
The ability of the Company to meet its debt service and other obligations
(including compliance with financial covenants) will depend upon the future
performance of the Company and its cash flow from operations, which will be
subject to prevailing economic conditions and financial, business and other
factors, certain of which are beyond the Company's control. These factors could
include general economic conditions, operating difficulties, increased operating
costs, product pricing pressures, potential revenue instability arising from
cost savings initiatives or other factors, labor relations, the response of
competitors or customers to the Company's business strategy or projects and
delays in implementation of the Company's business strategy, among others.
12. INTERESTS OF DIRECTORS AND OFFICERS; TRANSACTIONS AND AGREEMENTS CONCERNING
THE SHARES.
Except as described below, neither the Company, nor any subsidiary of the
Company nor, to the best of the Company's knowledge, any of the Company's
directors or executive officers, nor any affiliates of any of the foregoing, had
any transactions involving the Shares during the 40 business days prior to the
date hereof.
Except for outstanding options to purchase Shares granted from time to time
to certain employees (including executive officers) and non-employee directors
of the Company pursuant to the Company's stock option plans and performance
shares granted from time to time to certain employees (including executive
officers) pursuant to the Company's incentive compensation programs and except
as otherwise described herein, neither the Company nor, to the best of the
Company's knowledge, any of its affiliates, directors or executive officers, is
a party to any contract, arrangement, understanding or relationship with any
other person relating, directly or indirectly, to the Offer with respect to any
securities of the Company, including, but not limited to, any contract,
arrangement, understanding or relationship concerning the
23
<PAGE>
transfer or the voting of any such securities, joint ventures, loan or option
arrangements, puts or calls, guaranties of loans, guaranties against loss or the
giving or withholding or proxies, consents or authorizations.
The Company has been advised that none of its directors or executive
officers intends to tender Shares in the Offer, except for Richard Schwartz, its
retired Chief Executive Officer and retiring Chairman of the Board. Mr.
Schwartz, as part of his retirement planning, intends to tender up to 100,000
Shares of the 50,493 Shares he owns beneficially and the 215,000 Shares he is
entitled to acquire pursuant to the exercise of stock options, all of which are
currently exercisable.
13. CERTAIN FEDERAL INCOME TAX CONSIDERATIONS.
IN GENERAL. The following summary describes certain United States federal
income tax consequences relating to the Offer. The summary is based on the
Internal Revenue Code of 1986, as amended (the "Code"), and existing final,
temporary and proposed Treasury Regulations, Revenue Rulings and judicial
decisions, all of which are subject to prospective and retroactive changes. The
summary deals only with Shares held as capital assets within the meaning of
Section 1221 of the Code and does not address tax consequences that may be
relevant to investors in special tax situations, such as certain financial
institutions, tax-exempt organizations, life insurance companies, dealers in
securities or currencies, or stockholders holding the Shares as part of a
conversion transaction, as part of a hedge or hedging transaction, or as a
position in a straddle for tax purposes. The Company will not seek a ruling from
the Internal Revenue Service (the "IRS") with regard to the United States
federal income tax treatment of the Offer and, therefore, there can be no
assurance that the IRS will agree with the conclusions set forth below.
Accordingly, each stockholder should consult its own tax advisor with regard to
the Offer and the application of United States federal income tax laws, as well
as the laws of any state, local or foreign taxing jurisdiction, to its
particular situation.
CHARACTERIZATION OF THE SALE. A sale of Shares by a stockholder of the
Company pursuant to the Offer will be a taxable transaction for United States
federal income tax purposes and may also be a taxable transaction under
applicable state, local and foreign tax laws. The United States federal income
tax consequences to a stockholder may vary depending upon the stockholder's
particular facts and circumstances. Under Section 302 of the Code, a sale of
Shares by a stockholder to the Company pursuant to the Offer will be treated as
a "sale or exchange" of such Shares for United States federal income tax
purposes (rather than as a dividend distribution by the Company with respect to
the Shares held by the tendering stockholder) if the receipt of cash upon such
sale (a) is "substantially disproportionate" with respect to the stockholder,
(b) results in a "complete redemption" of the Shares owned by the stockholder,
or (c) is "not essentially equivalent to a dividend" with respect to the
stockholder (each as described below).
If any of the above three tests is satisfied, and the sale of the Shares is
therefore treated as a "sale or exchange" of such Shares for United States
federal income tax purposes, the tendering stockholder will recognize gain or
loss equal to the difference between the amount of cash received by the
stockholder pursuant to the Offer and the stockholder's tax basis in the Shares
sold pursuant to the Offer. Any such gain or loss will be capital gain or loss.
Stockholders should consult their own tax advisors concerning the tax treatment
of capital gains and losses.
If none of the above three tests is satisfied, the tendering stockholder
would be treated as having received a dividend, to the extent the Company has
earnings and profits, which would be includible in gross income in an amount
equal to the entire amount of cash received by the stockholder pursuant to the
Offer (without reduction for the tax basis of the Shares sold pursuant to the
Offer), no loss would be recognized, and the tendering stockholder's basis in
the Shares sold pursuant to the Offer would be added to such stockholder's basis
in its remaining Shares, if any. If the aggregate amounts of the cash proceeds
of the Offer which are treated as dividends exceed the earnings and profits of
the Company, the excess would not
24
<PAGE>
be treated as a dividend. That portion of the distribution which is not a
dividend would be applied against and reduce the adjusted basis of the Shares in
the hands of the tendering stockholders who received dividend treatment. The
portion of the distribution which is not a dividend, to the extent that it
exceeded the adjusted basis of the Shares, would be treated as gain from the
sale or exchange of property (capital gain).
In determining whether any of the three tests under Section 302 of the Code
is satisfied, each stockholder must take into account not only the Shares which
are actually owned by the stockholder, but also Shares which are constructively
owned by the stockholder within the meaning of Section 318 of the Code. Under
Section 318 of the Code, a stockholder may constructively own Shares actually
owned, and in some cases constructively owned, by certain related individuals or
entities and Shares which the stockholder has the right to acquire by exercise
of an option or by conversion. Each stockholder should be aware that because
proration may occur in the Offer, even if all the Shares actually and
constructively owned by a stockholder are tendered pursuant to the Offer, fewer
than all of such Shares may be purchased by the Company. Thus, proration may
affect whether a sale by a stockholder pursuant to the Offer will meet any of
the three tests under Section 302 of the Code. See Section 6 for information
regarding each stockholder's option to make a conditional tender of a minimum
number of Shares. A stockholder should consult its own tax advisor regarding
whether to make a conditional tender of a minimum number of Shares, and the
appropriate calculation thereof.
SECTION 302 TESTS. The receipt of cash by a stockholder will be
"substantially disproportionate" if the percentage of the outstanding Shares
actually and constructively owned by the stockholder immediately following the
sale of Shares pursuant to the Offer (treating as not outstanding all Shares
purchased pursuant to the Offer) is less than 80% of the percentage of the
outstanding Shares actually and constructively owned by such stockholder
immediately before the sale of Shares pursuant to the Offer (treating as
outstanding all Shares purchased pursuant to the Offer). Stockholders should
consult their tax advisors with respect to the application of the "substantially
disproportionate" test to their particular situation.
The receipt of cash by a stockholder will be a "complete redemption" of all
the Shares owned by the stockholder if either (a) all of the Shares actually and
constructively owned by the stockholder are sold pursuant to the Offer, or (b)
all of the Shares actually owned by the stockholder are sold pursuant to the
Offer and, with respect to Shares constructively owned by the stockholder which
are not sold pursuant to the Offer, the stockholder is eligible to waive (and
effectively waives) constructive ownership of all such Shares under procedures
described in Section 302(c)(2) of the Code.
Even if the receipt of cash by a stockholder fails to satisfy the
"substantially disproportionate" test or the "complete redemption" test, a
stockholder may nevertheless satisfy the "not essentially equivalent to a
dividend" test, if the stockholder's sale of Shares pursuant to the Offer
results in a "meaningful reduction" in the stockholder's interest in the
Company. Whether the receipt of cash by a stockholder will be "not essentially
equivalent to a dividend" will depend upon the individual stockholder's facts
and circumstances. The IRS has indicated in published rulings that even a small
reduction in the proportionate interest of a small minority stockholder in a
publicly held corporation who exercises no control over corporate affairs may
constitute such a "meaningful reduction." The IRS held in Rev. Rul. 76-385,
1976-2 C.B. 92, that a reduction in the percentage ownership interest of a
stockholder in a publicly held corporation from .0001118% to .0001081% (a
reduction to 96.7% of the stockholder's prior percentage ownership interest)
would constitute a "meaningful reduction." Under this ruling, it is likely that
a small minority stockholder who exercises no control over the Company, and all
of whose actual and constructively owned Shares are tendered at or below the
Purchase Price, would satisfy the "not essentially equivalent to a dividend"
test notwithstanding proration in the Offer. Stockholders expecting to rely on
the "not essentially equivalent to a dividend" test should consult their own tax
advisors as to its application in their particular situation.
25
<PAGE>
CORPORATE STOCKHOLDER DIVIDEND TREATMENT. Under current law, if a sale of
Shares by a corporate stockholder is treated as a dividend, the corporate
stockholder may be entitled to claim a dividends-received deduction under
Section 243 of the Code, subject to applicable limitations. However, it is
expected that any amount received by a corporate stockholder pursuant to the
Offer that is treated as a dividend would constitute an "extraordinary dividend"
under Section 1059 of the Code. Accordingly, a corporate stockholder would be
required under Section 1059(a) of the Code to reduce its basis (but not below
zero) in its Shares by the non-taxed portion of the dividend (i.e., the portion
of the dividend for which a deduction is allowed). If such portion exceeds the
stockholder's tax basis for its Shares, the excess will be recognized
immediately as taxable gain from the sale of such Shares in the year in which
Shares are sold pursuant to the Offer. Corporate stockholders should consult
their own tax advisors as to the application of Section 1059 of the Code to the
Offer.
ADDITIONAL TAX CONSIDERATIONS. The distinction between capital gains and
ordinary income is relevant because certain individuals are subject to taxation
at reduced rates on certain capital gains. For example, a stockholder who is an
individual and has held his Shares for more than 12 months may be entitled to a
20% maximum federal tax rate for gains from the sale of these Shares.
Stockholders should consult their own tax advisors in this regard.
FOREIGN STOCKHOLDERS. The Company will withhold United States federal
income tax at a rate of 30% from gross proceeds paid pursuant to the Offer to a
foreign stockholder or his agent, unless the Company determines that a reduced
rate of withholding is applicable pursuant to a tax treaty or that an exemption
from withholding is applicable because such gross proceeds are effectively
connected with the conduct of a trade or business by the foreign stockholder
within the United States. For this purpose, a "foreign stockholder" is a person
or entity that, for United States federal income tax purposes, is a non-resident
alien individual, a foreign corporation, a foreign partnership or a foreign
estate or trust. Without definite knowledge to the contrary, the Company will
determine whether a stockholder is a foreign stockholder by reference to the
stockholder's address. A foreign stockholder may be eligible to file for a
refund of such tax or a portion of such tax if such stockholder (a) meets the
"complete redemption," "substantially disproportionate" or "not essentially
equivalent to a dividend" tests described above, (b) is entitled to a reduced
rate of withholding pursuant to a treaty and the Company withheld at a higher
rate, or (c) is otherwise able to establish that no tax or a reduced amount of
tax was due. In order to claim an exemption from withholding on the ground that
gross proceeds paid pursuant to the Offer are effectively connected with the
conduct of a trade or business by a foreign stockholder within the United States
or that the foreign stockholder is entitled to the benefits of a tax treaty, the
foreign stockholder must deliver to the Depositary (or other person who is
otherwise required to withhold United States tax) a properly executed statement
claiming such exemption or benefits. Such statements may be obtained from the
Depositary. Foreign stockholders are urged to consult their own tax advisors
regarding the application of United States federal income tax withholding,
including eligibility for a withholding tax reduction or exemption and the
refund procedures.
The Company has not determined whether or not it is or has been, during a
five-year lookback period, a United States real property holding corporation,
within the meaning of Section 897(c) of the Code. A foreign stockholder who (a)
meets the "complete redemption," "substantially disproportionate" or "not
essentially equivalent to a dividend" tests described above and (b) beneficially
owns or has owned, during a five-year lookback period, directly, indirectly or
constructively more than five percent of the Shares (a foreign stockholder who
is described in both clauses (a) and (b) of this sentence is hereafter called a
"Large Foreign Stockholder"), will be presumed, under Treasury Regulation
Section 1.897-2(g), to dispose of shares in a United States real property
holding corporation unless the Large Foreign Stockholder establishes, by methods
prescribed in the above-cited Treasury regulation, that the Shares do not
constitute a United States real property interest. A Large Foreign Stockholder
who does not rebut the presumption by the prescribed methods generally will
recognize gain or loss on the disposition of its Shares pursuant to the Offer as
if such gain or loss were effectively connected with a United States trade or
business. Large
26
<PAGE>
Foreign Stockholders, if any, are urged to consult their own tax advisors
regarding the particular United States federal income tax consequences to them
of a sale of Shares pursuant to the Offer.
BACKUP WITHHOLDING. See Section 3 with respect to the application of the
United States federal income tax backup withholding.
ESPP SHARES. ESPP Shares held by participants in the Company's 1997
Employee Stock Purchase Plan (the "1997 ESPP Shares") were purchased at a price
(the "Purchase Price") equal to 85% of their fair market value at the end of the
applicable calendar quarter. This 15% discount will be referred to as the
"Bargain Amount." The difference between the amount received in the Offer and
the Purchase Price of the 1997 ESPP Shares (including the Bargain Amount) will
be referred to as the "Gain Amount."
If the 1997 ESPP Shares tendered and accepted in the Offer are not ESPP
Restricted Shares the full Gain Amount will be treated as compensation income to
the stockholder. Such income will be taxed to the stockholder at ordinary income
rates and will be subject to withholding for U.S. federal income and employment
taxes by the Company.
A holder of ESPP Shares which are not 1997 ESPP Shares will be taxed as
described under the heading "Characterization of the Sale" if any of the Section
302 tests are satisfied and as a dividend if none of the Section 302 tests are
satisfied.
401(K) PLANS. The exchange of Shares for cash by the 401(k) plans, as
instructed by participants in such plans in accordance with the terms of such
plans, will not be a taxable transaction for federal income tax purposes for
either the 401(k) plans or the participants in such plans. A subsequent
distribution in cash from a 401(k) plan to a participant normally will be
taxable in full as ordinary income to the participant.
THE TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION ONLY
AND MAY NOT APPLY TO SHARES ACQUIRED IN CONNECTION WITH THE EXERCISE OF STOCK
OPTIONS OR PURSUANT TO OTHER COMPENSATION ARRANGEMENTS WITH THE COMPANY. THE TAX
CONSEQUENCES OF A SALE PURSUANT TO THE OFFER MAY VARY DEPENDING UPON, AMONG
OTHER THINGS, THE PARTICULAR CIRCUMSTANCES OF THE TENDERING STOCKHOLDER. NO
INFORMATION IS PROVIDED HEREIN AS TO THE STATE, LOCAL OR FOREIGN TAX
CONSEQUENCES OF THE TRANSACTION CONTEMPLATED BY THE OFFER. STOCKHOLDERS ARE
URGED TO CONSULT THEIR OWN TAX ADVISORS TO DETERMINE THE PARTICULAR FEDERAL,
STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF SALES MADE BY THEM PURSUANT TO THE
OFFER AND THE EFFECT OF THE STOCK OWNERSHIP ATTRIBUTION RULES MENTIONED ABOVE.
14. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS.
The Company is not aware of any license or regulatory permit that it
believes is material to the Company's business that might be adversely affected
by the Company's acquisition of Shares as contemplated herein or of any approval
or other action by any government or governmental, administrative or regulatory
authority or agency, domestic or foreign, that would be required for the
acquisition or ownership of Shares by the Company as contemplated herein. Should
any such approval or other action be required, the Company presently
contemplates that such approval or other action will be sought. The Company is
unable to predict whether it will be required to delay the acceptance for
payment of, or payment for, Shares tendered pursuant to the Offer pending the
outcome of any such matter. There can be no assurance that any such approval or
other action, if needed, would be obtained or would be obtained without
substantial conditions or that the failure to obtain any such approval or other
action might not result in adverse consequences to the Company's business. The
Company's obligations under the Offer to accept for payment and pay for Shares
are subject to certain conditions. See Section 7.
27
<PAGE>
15. EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENTS.
The Company expressly reserves the right, in its sole discretion and at any
time or from time to time, to extend the period of time during which the Offer
is open by giving oral or written notice of such extension to the Depositary.
There can be no assurance, however, that the Company will exercise its right to
extend the Offer. During any such extension, all Shares previously tendered will
remain subject to the Offer, except to the extent that such Shares may be
withdrawn as set forth in Section 4. The Company also expressly reserves the
right, in its sole discretion, (a) to terminate the Offer and not accept for
payment any Shares not theretofore accepted for payment or, subject to Rule
13-4(f)(5) under the Exchange Act, which requires the Company either to pay the
consideration offered or to return the Shares tendered promptly after the
termination or withdrawal of the Offer, to postpone payment for Shares upon the
occurrence of any of the conditions specified in Section 7 hereof by giving oral
or written notice of such termination to the Depositary and making a public
announcement thereof and (b) at any time or from time to time amend the Offer in
any respect. Amendments to the Offer may be effected by public announcement.
Without limiting the manner in which the Company may choose to make public
announcement of any termination or amendment, the Company shall have no
obligation (except as otherwise required by applicable law) to publish,
advertise or otherwise communicate any such public announcement, other than by
making a release to the Dow Jones News Service, except in the case of an
announcement of an extension of the Offer, in which case the Company shall have
no obligation to publish, advertise or otherwise communicate such announcement
other than by issuing a notice of such extension by press release or other
public announcement, which notice shall be issued no later than 9:00 a.m., New
York City time, on the next business day after the previously scheduled
Expiration Date. Material changes to information previously provided to holders
of the Shares in this Offer or in documents furnished subsequent thereto will be
disseminated to holders of Shares in compliance with Rule 13e-4(e)(2)
promulgated by the Commission under the Exchange Act.
If the Company materially changes the terms of the Offer or the information
concerning the Offer, or if it waives a material condition of the Offer, the
Company will extend the Offer to the extent required by Rules 13e-4(d)(2) and
13e-4(e)(2) under the Exchange Act. Those rules require that the minimum period
during which an offer must remain open following material changes in the terms
of the offer or information concerning the offer (other than a change in price,
change in dealer's soliciting fee or change in percentage of securities sought)
will depend on the facts and circumstances, including the relative materiality
of such terms or information. In a published release, the Commission has stated
that in its view, an offer should remain open for a minimum of five business
days from the date that notice of such a material change is first published,
sent or given. The Offer will continue or be extended for at least ten business
days from the time the Company publishes, sends or gives to holders of Shares a
notice that it will (a) increase or decrease the price it will pay for Shares or
the amount of the Dealer Manager's soliciting fee or (b) increase (except for an
increase not exceeding 2% of the outstanding Shares) or decrease the number of
Shares it seeks.
16. FEES AND EXPENSES.
Morgan Stanley & Co. Incorporated has been retained by the Company to act as
Dealer Manager in connection with the Offer. The Company has agreed to pay the
Dealer Manager, upon acceptance for payment of Shares pursuant to the Offer, a
fee of $900,000. The Company has also agreed to reimburse the Dealer Manager for
its reasonable out-of-pocket expenses and to indemnify the Dealer Manager
against certain liabilities and expenses, including liabilities under the
federal securities laws, in connection with the Offer.
The Dealer Manager has rendered, is currently rendering and is expected to
continue to render various investment banking and other advisory services to the
Company. It has received, and will continue to receive, customary compensation
from the Company for such services.
28
<PAGE>
The Company has retained ChaseMellon Shareholder Services, L.L.C., as
Depositary, and MacKenzie Partners, Inc., as Information Agent, in connection
with the Offer. The Information Agent may contact stockholders by mail,
telephone, telex, telegraph and personal interviews, and may request brokers,
dealers and other nominee stockholders to forward materials relating to the
Offer to beneficial owners. The Depositary and the Information Agent will
receive reasonable and customary compensation for their services and will also
be reimbursed for certain out-of-pocket expenses. The Company has agreed to
indemnify the Depositary and the Information Agent against certain liabilities,
including certain liabilities under the federal securities laws, in connection
with the Offer.
The Company retained Fidelity Management Trust Company to act as trustee for
its 401(k) plans and Piper Jaffray Inc. to act as administrator for its employee
stock purchase plans. In connection with the Offer, the 401(k) Trustee and the
ESPP Administrator may contact participants in such plans by mail, telephone,
telex, telegraph and personal interviews. Pursuant to its arrangements with the
Company to act as trustee for the Company's 401(k) plans or administrator for
the Company's Employee Stock Purchase Plan, as the case may be, the 401(k)
Trustee and the ESPP Administrator each receives reasonable and customary
compensation for its services and each is reimbursed for certain out-of-pocket
expenses. Under those arrangements, no separate fee is payable to the 401(k)
Trustee or the ESPP Administrator in connection with the Offer. However, the
401(k) Trustee has retained its own tabulation agent for purposes of tenders of
401(k) Plan Shares. This tabulation agent will receive reasonable and customary
compensation for its services in connection with the Offer and will also be
reimbursed for certain out-of-pocket expenses.
None of the Information Agent, the Depositary, the 401(k) Trustee or the
ESPP Administrator has been retained to make solicitations or recommendations in
connection with the Offer.
The Company will not pay any fees or commissions to any broker, dealer or
other person for soliciting tenders of Shares pursuant to the Offer (other than
the fee of the Dealer Manager). However, a tendering stockholder who holds
Shares through a broker or bank, including a discount broker, may be required by
such institution to pay a service fee or other charge. The Company will, upon
request, reimburse brokers, dealers, commercial banks and trust companies for
reasonable and customary handling and mailing expenses incurred by them in
forwarding materials relating to the Offer to their customers.
17. ADDITIONAL INFORMATION.
The Company is subject to the informational filing requirements of the
Exchange Act and, in accordance therewith, files with the Commission periodic
reports, proxy statements and other information relating to its business,
financial condition and other matters. The Company is required to disclose in
such reports certain information, as of particular dates, concerning its
operating results and financial condition, officers and directors, principal
holders of securities, any material interests of such persons in transactions
with the Company and other matters. These reports and other informational
filings required by the Exchange Act are available for inspection at the public
reference facilities maintained by the Commission at Room 1024, Judiciary Plaza,
450 Fifth Street, N.W. Washington, D.C. 20549 and also are available for
inspection and copying at the regional offices of the commission located at
Citicorp Center, 500 West Madison Street, Chicago, Illinois 60611 and 7 World
Trade Center, 13th Floor, New York, New York 10048. Copies of such material may
be obtained by mail, upon payment of the Commission's customary fees, from the
Commission's principal office at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington D.C. 20549. The Commission maintains a Web site that contains
reports, proxy and information statements and other information regarding
registrants that file electronically with the Commission's Web site address,
http://www.sec.gov. Information regarding the Company may also be obtained at
the offices of The New York Stock Exchange, 20 Broad Street, New York, NY 10005.
The Company's Annual Report on Form 10-K for the fiscal year ended March 31,
1998 (File No. 1-10582), the Company's Quarterly Reports on Form 10-Q for the
quarterly periods ended June 28, 1998
29
<PAGE>
and September 27, 1998 and all reports and other documents filed by the Company
with the Commission pursuant to Section 13(a), 13(c), 14 and 15(d) of the
Exchange Act subsequent to the date of this Offer to Purchase and on or prior to
the termination of the Offer shall be deemed incorporated herein by reference.
Any statement contained herein or in a document or report incorporated or deemed
to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Offer to Purchase to the extent that a statement
contained herein or in any subsequently filed document or report that also is or
is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Offer to
Purchase.
The information related to the Company contained in this Offer to Purchase
should be read in conjunction with the information contained in the documents
incorporated by reference.
The Company will provide without charge to each person to whom a copy of
this Offer to Purchase is delivered, upon the written or oral request of any
such person, a copy of any or all of the documents incorporated herein by
reference, other than exhibits to such documents (unless such exhibits are
specifically incorporated by reference into such documents). Requests should be
directed to Alliant Techsystems Inc., 600 Second Street N.E., Hopkins, Minnesota
55343-8384, Attention: Investor Relations (telephone: (612) 931-6080). In order
to ensure timely delivery of the documents prior to the Expiration Date, any
such requests should be made by December 1, 1998.
This Offer to Purchase constitutes part of an Issuer Tender Offer Statement
on Schedule 13E-4 (the "Schedule 13E-4") filed with the Commission by the
Company pursuant to Section 13 of the Exchange Act and the rules and regulations
promulgated thereunder. The Schedule 13E-4 and all exhibits thereto are
incorporated by reference into this Offer to Purchase.
18. MISCELLANEOUS.
The Offer is not being made to (nor will any tender of Shares be accepted
from or on behalf of) holders in any jurisdiction in which the making of the
Offer or the acceptance of any tender of Shares therein would not be in
compliance with the laws of such jurisdiction. However, the Company may, at its
discretion, take such action as it may deem necessary for the Company to make
the offer in any such jurisdiction and extend the Offer to holders in such
jurisdiction. In any jurisdiction the securities or blue sky laws of which
require the Offer to be made by a licensed broker or dealer, the Offer is being
made on behalf of the Company by the Dealer Manager or one or more registered
brokers or dealers which are licensed under the laws of such jurisdiction.
ALLIANT TECHSYSTEMS INC.
November 6, 1998
30
<PAGE>
Facsimile copies of the Letter of Transmittal will be accepted from Eligible
Institutions. The Letter of Transmittal and certificates for Shares and any
other required documents should be sent or delivered by each tendering person or
his broker, dealer, commercial bank, trust company or nominee to the Depository
at the address set forth below.
The Depositary is:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
<TABLE>
<CAPTION>
BY REGISTERED MAIL: BY HAND BY OVERNIGHT COURIER:
<S> <C> <C>
ChaseMellon Shareholder ChaseMellon Shareholder ChaseMellon Shareholder
Services, L.L.C. Services, L.L.C. Services, L.L.C.
P.O. Box 3301 120 Broadway, 13th Floor 85 Challenger Road
South Hackensack, New York, New York 10271 Mail Drop--Reorg
New Jersey 07606 Attn: Reorganization Department Ridgefield Park,
Attn: Reorganization Department New Jersey 07660
Attn: Reorganization Department
</TABLE>
BY FACSIMILE TRANSMISSION:
(FOR ELIGIBLE INSTITUTIONS ONLY)
(201) 296-4293
CONFIRM RECEIPT OF FACSIMILE BY TELEPHONE:
(201) 296-4860
Any questions or requests for assistance or for additional copies of this
Offer to Purchase, the Letter of Transmittal or the Notice of Guaranteed
Delivery may be directed to the Information Agent at the telephone numbers and
address set forth below. You may also contact the Dealer Manager or your broker,
dealer, commercial bank or trust company for assistance concerning this Offer.
To confirm the delivery of your Shares, you are directed to contact the
Depositary.
The Information Agent is:
[LOGO]
156 Fifth Avenue
New York, NY 10010
(212) 929-5500 (collect)
(800) 322-2885 (toll-free)
The Dealer Manager is:
MORGAN STANLEY DEAN WITTER
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
(212) 761-5722 (collect)
(800) 223-2440 ext. 5722 (toll-free)
<PAGE>
LETTER OF TRANSMITTAL
TO
TENDER SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
OF
ALLIANT TECHSYSTEMS INC.
PURSUANT TO ITS OFFER TO PURCHASE
DATED NOVEMBER 6, 1998
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON TUESDAY, DECEMBER 8, 1998, UNLESS THE OFFER IS EXTENDED.
TO: CHASEMELLON SHAREHOLDER SERVICES, L.L.C., DEPOSITARY
<TABLE>
<S> <C> <C>
BY MAIL: BY HAND: BY OVERNIGHT COURIER:
ChaseMellon Shareholder ChaseMellon Shareholder ChaseMellon Shareholder
Services, L.L.C. Services, L.L.C. Services, L.L.C.
Reorganization Department Reorganization Department Reorganization Department
P.O. Box 3301 120 Broadway--13th Floor 85 Challenger Road
South Hackensack, NJ 07606 New York, NY 10271 Mail Drop--Reorg
Ridgefield Park, NJ 07660
</TABLE>
BY FACSIMILE TRANSMISSION
(FOR ELIGIBLE INSTITUTIONS ONLY)
201-296-4293
CONFIRM RECEIPT OF NOTICE OF FACSIMILE:
201-296-4860
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
Stockholders tendering Shares other than 401(k) Plan Shares and ESPP Shares
(as each such term is defined below) should complete the following chart:
<TABLE>
<S> <C> <C> <C>
DESCRIPTION OF SHARES TENDERED
<CAPTION>
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN EXACTLY AS NAME(S) APPEAR(S) ON SHARES TENDERED
CERTIFICATE(S) (ATTACH ADDITIONAL LIST IF NECESSARY)
<S> <C> <C> <C>
TOTAL NUMBER
OF SHARES NUMBER
CERTIFICATE REPRESENTED BY OF SHARES
NUMBER(S)* CERTIFICATE(S)* TENDERED**
TOTAL SHARES
* Need not be completed by stockholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented by any certificate
delivered to the Depositary
are being tendered. See Instruction 4.
</TABLE>
<PAGE>
FOR INFORMATION ONLY PLAN PARTICIPANT
<PAGE>
This Letter of Transmittal is to be used only if certificates are to be
forwarded herewith or, unless an Agent's Message (as defined in the Offer to
Purchase) is utilized, if delivery of Shares (as defined below) is to be made by
book-entry transfer to the Depositary's account at The Depository Trust Company
("DTC" or the "Book-Entry Transfer Facility") pursuant to the procedures set
forth in Section 3 of the Offer to Purchase.
Participants in Alliant Techsystems Inc.'s 401(k) plans or its employee
stock purchase plans may not use this Letter of Transmittal to direct the tender
of Shares held through such plans ("401(k) Plan Shares" and "ESPP Shares,"
respectively). Such participants must follow the instructions set forth in the
materials on YELLOW paper, in the case of 401(k) Plan Shares, or on PINK paper,
in the case of ESPP Shares, and must use the Direction Form sent to them
separately by the trustee or administrator, as the case may be, of such plans.
ONLY ESPP SHARES WHICH ARE NOT ESPP RESTRICTED SHARES AS DEFINED IN SECTION 3 OF
THE OFFER TO PURCHASE MAY BE TENDERED IN THE OFFER. Fidelity Management Trust
Company, the trustee for the Company's 401(k) plans, will submit one Letter of
Transmittal for such plans on behalf of all tendering plan participants. Piper
Jaffray, Inc., the administrator for the Company's employee stock purchase
plans, will submit one Letter of Transmittal for such plans on behalf of all
tendering plan participants.
Participants in the Company's other benefit and incentive plans who hold
Shares through such plans that are not subject to restrictions on
transferability as described in Section 3 of the Offer to Purchase may use this
Letter of Transmittal to tender such Shares.
If a holder owns Shares, in addition to any 401(k) Plan Shares or ESPP
Shares that he or she desires to tender, such holder must submit both this
Letter of Transmittal to tender the non-401(k) Plan Shares or non-ESPP Shares,
as the case may be, and the applicable Direction Form(s) to tender the 401(k)
Plan Shares and ESPP Shares, as the case may be.
Stockholders who cannot deliver their Shares and all other documents
required hereby to the Depositary by the Expiration Date (as defined in the
Offer to Purchase), or who cannot comply with the procedures for book-entry
transfer on a timely basis, must tender their Shares pursuant to the guaranteed
delivery procedure set forth in Section 3 of the Offer to Purchase. See
Instruction 2. Delivery of documents to the Company will not be forwarded to the
Depositary and therefore will not constitute valid delivery. Delivery of
documents to the Book-Entry Transfer Facility does not constitute delivery to
the Depositary.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
(BOXES BELOW FOR USE BY ELIGIBLE INSTITUTIONS ONLY)
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER TO
THE DEPOSITARY'S ACCOUNT AT THE BOOK-ENTRY TRANSFER FACILITY AND COMPLETE
THE FOLLOWING:
Name of Tendering Institution ______________________________________________
Account No. ________________________________________________________________
Transaction Code No. _______________________________________________________
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE
FOLLOWING:
Name(s) of Tendering Stockholder(s) ________________________________________
Date of Execution of Notice of Guaranteed Delivery _________________________
Name of Institution that Guaranteed Delivery _______________________________
If delivery is by book-entry transfer:
Name of Tendering Institution __________________________________________
Account No. ____________________________________________________________
Transaction Code No. _______________________________________________________
NOTE: SIGNATURES MUST BE PROVIDED ON PAGE 8.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
2
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Alliant Techsystems Inc., a Delaware
corporation (the "Company"), the above-described shares of its Common Stock, par
value $.01 per share (the "Shares") (including the associated preferred stock
purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated as
of September 28, 1990, as amended, between the Company and The Chase Manhattan
Bank (as successor to Manufacturers Hanover Trust Company), as the Rights
Agent), pursuant to the Company's offer to purchase up to 2,800,000 Shares at a
price per Share hereinafter set forth, net to the seller in cash, upon the terms
and subject to the conditions set forth in the Offer to Purchase, dated November
6, 1998 (the "Offer to Purchase"), receipt of which is hereby acknowledged, and
in this Letter of Transmittal (which together constitute the "Offer"). Unless
the context otherwise requires, all references to Shares shall include the
associated Rights.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the undersigned hereby
sells, assigns and transfers to, or upon the order of, the Company all right,
title and interest in and to all the Shares that are being tendered hereby and
orders the registration of all such Shares if tendered by the book-entry
transfer and constitutes and appoints the Depositary the true and lawful agent
and attorney-in-fact of the undersigned with respect to such Shares (with full
knowledge that the Depositary also acts as the agent of the Company), with full
power of substitution (such power of attorney being deemed to be an irrevocable
power coupled with an interest), to (a) deliver certificates for such Shares, or
transfer ownership of such Shares on the account books maintained by the
Book-Entry Transfer Facility, together, in any such case, with all accompanying
evidences of transfer and authenticity, to or upon the order of the Company upon
receipt by the Depositary, as the undersigned's agent, of the Purchase Price
with respect to such shares, (b) present such Shares for registration and
transfer on the books of the Company and (c) receive all benefits and otherwise
exercise all rights of beneficial ownership of such Shares, all in accordance
with the terms of the Offer.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby and that, when and to the extent the same are accepted for payment by the
Company, the Company will acquire good, marketable and unencumbered title
thereto, free and clear of all security interests, liens, restrictions, charges,
encumbrances, conditional sales agreements or other obligations relating to the
sale or transfer thereof, and the same will not be subject to any adverse
claims. The undersigned will, upon request, execute and deliver any additional
documents deemed by the Depositary or the Company to be necessary or desirable
to complete the sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by, and shall survive the death or incapacity of the undersigned, and
any obligation of the undersigned hereunder shall be binding upon the heirs,
personal representatives, successors and assigns of the undersigned. Except as
stated in the Offer, this tender is irrevocable.
By execution hereof, the undersigned understands that tenders of Shares
pursuant to any one of the procedures described in Section 3 of the Offer to
Purchase and in the instructions hereto will constitute the undersigned's
acceptance of the terms and conditions of the Offer, including the undersigned's
representation and warranty that (a) the undersigned has a net long position in
the Shares at least equal to the Shares tendered within the meaning of Rule
14e-4 promulgated under the Securities Exchange Act of 1934, as amended, and (b)
the tender of such Shares complies with Rule 14e-4. The Company's acceptance for
payment of Shares tendered pursuant to the Offer will constitute a binding
agreement between the undersigned and the Company upon the terms and subject to
the conditions of the Offer. The undersigned acknowledges that no interest will
be paid on the Purchase Price for tendered Shares regardless of any extension of
the Offer or any delay in making such payment.
3
<PAGE>
The undersigned understands that the Company will determine a single per
Share price (not greater than $77 nor less than $67 per Share) (the "Purchase
Price") that it will pay for Shares validly tendered and not properly withdrawn
pursuant to the Offer taking into account the number of Shares so tendered and
the prices specified by tendering stockholders. The undersigned understands that
the Company will select the lowest Purchase Price that will enable it to
purchase 2,800,000 Shares (or such lesser number of Shares as are validly
tendered at prices not greater than $77 nor less than $67 per Share) pursuant to
the Offer. The undersigned understands that tenders of Shares pursuant to any
one of the procedures described in Section 2 or 3 of the Offer to Purchase and
in the instructions hereto will constitute an agreement between the undersigned
and the Company upon the terms and subject to the conditions of the Offer. The
undersigned also understands that unless the Rights are redeemed or become
separately transferable in accordance with their terms, by tendering Shares the
undersigned will also be tendering the associated Rights and that no separate
consideration will be paid for such Rights. The undersigned understands that all
Shares properly tendered prior to the Expiration Date at prices at or below the
Purchase Price and not properly withdrawn will be purchased at the Purchase
Price, upon the terms and subject to the conditions of the Offer, including its
proration provisions, and that the Company will return all other Shares not
purchased pursuant to the Offer, including Shares tendered at prices greater
than the Purchase Price and not properly withdrawn prior to the Expiration Date
and Shares not purchased because of proration.
Unless otherwise indicated under "Special Payment Instructions," please
issue the check for the purchase price of any Shares purchased, and/or return
any Shares not tendered or not purchased, in the name(s) of the undersigned
(and, in the case of Shares tendered by book-entry transfer, by credit to the
account at the Book-Entry Transfer Facility designated above). Similarly, unless
otherwise indicated under "Special Delivery Instructions," please mail the check
for the purchase price of any Shares purchased and/or any certificates for
Shares not tendered or not purchased (and accompanying documents, as
appropriate) to the undersigned at the address shown below the undersigned's
signature(s). If "Special Payment Instructions" and/or "Special Delivery
Instructions" is completed, please issue the check for the purchase price of any
Shares purchased and/or return any Shares not tendered or not purchased in the
name(s) of, and mail said check and/or any certificates to, the person(s) so
indicated.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may
postpone the acceptance for payment of, or the payment for, Shares tendered or
may accept for payment fewer than all of the Shares tendered hereby. In any such
event, the undersigned understands that the certificate(s) for any Shares
delivered herewith but not tendered or not purchased will be returned to the
undersigned at the address indicated below, unless otherwise indicated under the
"Special Payment Instructions" or "Special Delivery Instructions" below. The
undersigned recognizes that the Company has no obligation, pursuant to the
"Special Payment Instructions," to transfer any Shares from the name of the
registered holder(s) thereof, or to order the registration or transfer of Shares
tendered by book-entry transfer, if the Company does not accept for payment any
of the Shares so tendered.
This Letter of Transmittal is to be used by stockholders if (i) the Shares
are to be physically delivered to the Depositary herewith, (ii) tender of Shares
is to be made by book-entry transfer to the Depositary's account at The
Depositary Trust Company ("DTC") pursuant to the procedures set forth under the
caption "The Offer--Procedure for Tendering Shares" in Section 3 of the Offer to
Purchase by any financial institution that is a participant in DTC and whose
name appears on a security position listing as the owner of the Shares (both
Shareholders and such DTC participants, acting on behalf of Shareholders, are
referred to herein as "Acting Holders"), unless an Agent's Message (defined
below) is delivered in connection with such book-entry transfer, or (iii) tender
of Shares is to be made according to the guaranteed delivery procedures set
forth under the caption "The Offer--Procedure for Tendering Shares" in Section 3
of the Offer to Purchase and, in each case, instructions are not being
transmitted through the DTC Automated Tender Offer Program ("ATOP").
4
<PAGE>
Shareholders that are tendering by book-entry transfer to the Depositary's
account at DTC can execute the tender through ATOP, for which the transaction
will be eligible. DTC participants that are accepting the Offer must transmit
their acceptance to DTC which will verify the acceptance and execute a
book-entry delivery to the Depositary's account at DTC. DTC will then send an
Agent's Message to the Depositary for its acceptance. Delivery of the Agent's
Message by DTC will satisfy the terms of the Offer as to execution and delivery
of a Letter of Transmittal by the participant identified in the Agent's Message.
DTC participants may also accept the Offer by submitting a notice of guaranteed
delivery through ATOP.
THE OFFER AND THE SOLICITATION ARE NOT BEING MADE TO (NOR WILL TENDERS OF
NOTES BE ACCEPTED FROM OR ON BEHALF OF) HOLDERS IN ANY JURISDICTION IN WHICH THE
MAKING OR ACCEPTANCE OF THE OFFER OR SOLICITATION WOULD NOT BE IN COMPLIANCE
WITH THE LAWS OF SUCH JURISDICTION.
All capitalized terms used herein and not defined shall have the meaning
ascribed to them in the Offer to Purchase.
All authority herein conferred or agreed to be conferred shall survive the
death or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, personal representatives, executors,
administrators, successors, assigns, trustees in bankruptcy and legal
representatives of the undersigned. Except as stated in the Offer to Purchase,
this tender is irrevocable.
The undersigned has read, understands, and agrees to all of the terms of the
Offer.
5
<PAGE>
PRICE (IN DOLLARS) PER SHARE
AT WHICH SHARES ARE BEING TENDERED
(SEE INSTRUCTION 5)
CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR
IF NO BOX IS CHECKED, THERE IS NO PROPER TENDER OF SHARES.
SHARES TENDERED AT PRICE DETERMINED BY DUTCH AUCTION
/ / The undersigned wants to maximize the chance of having the Company purchase
all the Shares the undersigned is tendering (subject to the possibility of
proration). Accordingly, by checking this ONE box INSTEAD OF ONE OF THE
PRICE BOXES BELOW, the undersigned hereby tenders Shares and is willing to
accept the Purchase Price resulting from the "Dutch Auction" tender process.
This action will result in receiving a price per Share of as low as $67 or
as high as $77.
_____________________OR_____________________
SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER
By checking ONE of the boxes below INSTEAD OF THE BOX ABOVE, the undersigned
hereby tenders Shares at the price checked. This action could result in none
of the Shares being purchased if the Purchase Price for the Shares is less
than the price checked. A stockholder who desires to tender Shares at more
than one price must complete a separate Letter of Transmittal for each price
at which Shares are tendered. The same Shares cannot be tendered at more
than one price.
Price (in dollars) per Share at which Shares are being tendered:
<TABLE>
<S> <C> <C> <C> <C>
/ / 67.00 / / 69.00 / / 71.00 / / 73.00 / / 75.00
/ / 67.25 / / 69.25 / / 71.25 / / 73.25 / / 75.25
/ / 67.50 / / 69.50 / / 71.50 / / 73.50 / / 75.50
/ / 67.75 / / 69.75 / / 71.75 / / 73.75 / / 75.75
/ / 68.00 / / 70.00 / / 72.00 / / 74.00 / / 76.00
/ / 68.25 / / 70.25 / / 72.25 / / 74.25 / / 76.25
/ / 68.50 / / 70.50 / / 72.50 / / 74.50 / / 76.50
/ / 68.75 / / 70.75 / / 72.75 / / 74.75 / / 76.75
/ / 77.00
</TABLE>
ODD LOTS
(SEE INSTRUCTION 9)
This section is to be completed ONLY if Shares are being tendered by or on
behalf of a person owning beneficially an aggregate of fewer than 100 Shares as
of the close of business on November 5, 1998.
The undersigned either (check one box):
/ / was the beneficial owner or the owner of record of an aggregate of fewer
than 100 Shares (not including any 401(k) Plan Shares or ESPP Shares (as
each such term is defined in the Offer to Purchase)), as of the close of
business on November 5, 1998, all of which are being tendered, or
/ / is a broker, dealer, commercial bank, trust company or other nominee that
(a) is tendering, for the beneficial owners thereof, Shares with respect to
which it is the record owner, and (b) believes, based upon representations
made to it by each such beneficial owner, that such beneficial owner owned
beneficially an aggregate of fewer than 100 Shares (not including any 401(k)
Plan Shares or ESPP Shares) as of the close of business on November 5, 1998
and is tendering all of such Shares.
6
<PAGE>
- -------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 6, 7 AND 8)
To be completed ONLY if the check for the purchase price of Shares
purchased and/ or certificates for Shares not tendered or not purchased are
to be issued in the name of someone other than the undersigned or if Shares
tendered by book-entry transfer that are not accepted for purchase are to be
credited to an account maintained at a DTC other than the one designated
above.
Issue / / check and/or / / certificate(s) to:
Name _______________________________________________________________________
____________________________________________________________________________
(PLEASE PRINT)
Address ____________________________________________________________________
____________________________________________________________________________
(INCLUDE ZIP CODE)
__________________________________________________________________________
(TAXPAYER IDENTIFICATION OR SOCIAL SECURITY NO.)
/ / Credit unpurchased Shares by book-entry transfer to the DTC account set
forth below:
____________________________________________________________________________
(DTC ACCOUNT NUMBER)
____________________________________________________________________________
(NAME OF ACCOUNT PARTY)
- -------------------------------------------
- -------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 6, 7 AND 8)
To be completed ONLY if the check for the purchase price of Shares
purchased and/ or certificates for Shares not tendered or not purchased are
to be mailed to someone other than the undersigned or to the undersigned at
an address other than that shown below the undersigned's signature(s) or are
to be credited to an account maintained at a DTC other than the one
designated above.
Mail / / check and/or / / certificate(s) to:
Name _______________________________________________________________________
____________________________________________________________________________
(PLEASE PRINT)
Address ____________________________________________________________________
____________________________________________________________________________
(INCLUDE ZIP CODE)
/ / Credit unpurchased Shares by book-entry transfer to the DTC account set
forth below:
____________________________________________________________________________
(DTC ACCOUNT NUMBER)
____________________________________________________________________________
(NAME OF ACCOUNT PARTY)
- ------------------------------------------
- --------------------------------------------------------------------------------
CONDITIONAL TENDER
A tendering stockholder may condition his or her tender of Shares upon the
purchase by the Company of a specified minimum number of the Shares tendered
hereby, all as described in the Offer to Purchase, particularly in Section 6
thereof. Unless at least such minimum number of Shares is purchased by the
Company pursuant to the terms of the Offer, none of the Shares tendered hereby
will be purchased. It is the tendering stockholder's responsibility to calculate
such minimum number of Shares, and each stockholder is urged to consult his or
her own tax advisor. Unless this box has been completed and a minimum specified,
the tender will be deemed unconditional.
Minimum number of Shares that must be purchased, if any are purchased:
-------------- Shares
- --------------------------------------------------------------------------------
7
<PAGE>
- --------------------------------------------------------------------------------
SIGN HERE
(PLEASE COMPLETE SUBSTITUTE FORM W-9 ON PAGE 15)
,_________________________________________________________________________m
,_________________________________________________________________________m
SIGNATURE(S) OF OWNER(S)
Dated ___________________, 1998
Name(s) ____________________________________________________________________
____________________________________________________________________
(PLEASE PRINT)
____________________________________________________________________
Capacity (full title) ______________________________________________________
Address ____________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Telephone No. ________________________________________________
Must be signed by registered holder(s) exactly as name(s) appear(s) on stock
certificate(s) or on a security position listing or by person(s) authorized
to become registered holder(s) by certificates and documents transmitted
herewith. If signature is by a trustee, executor, administrator, guardian,
attorney-in-fact, officer of a corporation or other person acting in a
fiduciary or representative capacity, please set forth full title and see
Instruction 6.
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 1 AND 6)
Certain signatures must be guaranteed by an Eligible Institution.
Name of Firm _______________________________________________________________
Authorized Signature _______________________________________________________
Dated ___________________, 1998
----------------------------------------------------------------------------
8
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm that is a
member of a registered national securities exchange or the National Association
of Securities Dealers, Inc., or by a commercial bank or trust company having an
office or correspondent in the United States which is a participant in an
approved Signature Guarantee Medallion Program (an "Eligible Institution").
Signatures on this Letter of Transmittal need not be guaranteed (a) if this
Letter of Transmittal is signed by the registered holder(s) of the Shares (which
term, for purposes of this document, shall include any participant in one of the
Book-Entry Transfer Facilities whose name appears on a security position listing
as the owner of Shares) tendered herewith and such holder(s) have not completed
the box entitled "Special Payment Instructions" or the box entitled "Special
Delivery Instructions" on this Letter of Transmittal or (b) if such Shares are
tendered for the account of an Eligible Institution. See Instruction 6.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARES. This Letter of Transmittal
is to be used either if certificates are to be forwarded herewith or if delivery
of Shares is to be made by book-entry transfer pursuant to the procedures set
forth in Section 3 of the Offer to Purchase. Certificates for all physically
delivered Shares, or a confirmation of a book-entry transfer into the
Depositary's account at the Book-Entry Transfer Facility of all Shares delivered
electronically, as well as a properly completed and duly executed Letter of
Transmittal (or facsimile thereof) (or an Agent's Message (as defined below) in
connection with a book-entry transfer) and any other documents required by this
Letter of Transmittal, must be received by the Depositary at one of its
addresses set forth on this Letter of Transmittal on or prior to 5:00 P.M., New
York City time, on the Expiration Date (as defined in the Offer to Purchase).
The term "Agent's Message" means as a message transmitted by DTC to, and
received by, the Depositary and forming a part of a Book-Entry Confirmation,
which states that DTC has received an express acknowledgment from the
participant in DTC tendering the Shares, that such participant has received and
agrees to be bound to the terms of this Letter of Transmittal and the Company
may enforce any such agreement against the participant.
Stockholders whose certificates are not immediately available or who cannot
deliver their Shares and all other required documents to the Depositary on or
prior to 5:00 P.M., New York City time, on the Expiration Date, or whose Shares
cannot be delivered on a timely basis pursuant to the procedures for book-entry
transfer, must tender their Shares pursuant to the guaranteed delivery procedure
set forth in Section 3 of the Offer to Purchase. Pursuant to such procedure: (a)
such tender must be made by or through an Eligible Institution, (b) a properly
completed and duly executed Notice of Guaranteed Delivery substantially in the
form provided by the Company (with any required signature guarantees) must be
received by the Depositary on or prior to 5:00 P.M., New York City time, on the
Expiration Date and (c) the certificates for all physically delivered Shares, or
a confirmation of a book-entry transfer into the Depositary's account at one of
the Book-Entry Transfer Facilities of all Shares delivered electronically, as
well as a properly completed and duly executed Letter of Transmittal (or
facsimile thereof) (or an Agent's Message in connection with a book-entry
transfer) and any other documents required by this Letter of Transmittal must be
received by the Depositary within three New York Stock Exchange trading days
after the date of receipt by the Depositary of such Notice of Guaranteed
Delivery, all as provided in Section 3 of the Offer to Purchase.
THE NOTICE OF GUARANTEED DELIVERY MAY BE DELIVERED BY HAND OR TRANSMITTED BY
TELEGRAM, FACSIMILE TRANSMISSION OR MAIL TO THE DEPOSITARY AND MUST INCLUDE A
SIGNATURE GUARANTEE BY AN ELIGIBLE INSTITUTION IN THE FORM SET FORTH THEREIN.
FOR SHARES TO BE TENDERED VALIDLY PURSUANT TO THE GUARANTEED DELIVERY PROCEDURE,
THE DEPOSITARY MUST RECEIVE THE NOTICE OF GUARANTEED DELIVERY ON OR BEFORE 5:00
P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE. DELIVERY OF DOCUMENTS TO THE
BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH SUCH BOOK-ENTRY TRANSFER
FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING STOCKHOLDER. IF CERTIFICATES FOR SHARES ARE
SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED,
IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE
DELIVERY.
9
<PAGE>
Tenders of Shares made pursuant to the Offer may be withdrawn at any time
prior to the Expiration Date. Thereafter, such tenders are irrevocable, except
that they may be withdrawn after January 17, 1999 unless theretofore accepted
for payment as provided in this Offer to Purchase. If the Company extends the
period of time during which the Offer is open, is delayed in accepting for
payment or paying for Shares or is unable to accept for payment or pay for
Shares pursuant to the Offer for any reason, then, without prejudice to the
Company's rights under the Offer, the Depositary may, on behalf of the Company,
retain all Shares tendered, and such Shares may not be withdrawn except as
otherwise provided in this Section 4, subject to Rule 13e-4(f)(5) under the
Exchange Act, which provides that the issuer making the tender offer shall
either pay the consideration offered, or return the tendered securities promptly
after the termination or withdrawal of the tender offer. To be effective, a
written or facsimile transmission notice of withdrawal must be timely received
by the Depositary at one of its addresses set forth on the back cover of this
Offer to Purchase and must specify the name of the person who tendered the
Shares to be withdrawn and the number of Shares to be withdrawn. If the Shares
to be withdrawn have been delivered to the Depositary, a signed notice of
withdrawal with signatures guaranteed by an Eligible Institution (except in the
case of Shares tendered by an Eligible Institution) must be submitted prior to
the release of such Shares. In addition, such notice must specify, in the case
of Shares tendered by delivery of certificates, the name of the registered
holder (if different from that of the tendering stockholder) and the serial
numbers shown on the particular certificates evidencing the Shares to be
withdrawn or, in the case of Shares tendered by book-entry transfer, the name
and number of the account at one of the Book-Entry Transfer Facility to be
credited with the withdrawn Shares. Withdrawals may not be rescinded, and Shares
withdrawn will thereafter be deemed not validly tendered for purposes of the
Offer. However, withdrawn Shares may be retendered by again following one of the
procedures described in Section 3 at any time prior to the Expiration Date.
Except as specifically permitted by Section 6 of the Offer to Purchase, no
alternative or contingent tenders will be accepted. Fractional Shares will not
be purchased. See Section 1 of the Offer to Purchase. By executing this Letter
of Transmittal (or a facsimile thereof) (or delivery of an Agent's Message), the
tendering stockholder waives any right to receive any notice of the acceptance
for payment of the Shares.
3. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of Shares should be listed on a separate
schedule attached hereto.
4. PARTIAL TENDERS (NOT APPLICABLE TO STOCKHOLDERS WHO TENDER BY BOOK-ENTRY
TRANSFER). If fewer than all the Shares represented by any certificate delivered
to the Depositary are to be tendered, fill in the number of Shares that are to
be tendered in the box entitled "Number of Shares Tendered." In such case, if
any tendered Shares are purchased, a new certificate for the remainder of the
Shares represented by the old certificate will be sent to the person(s) signing
this Letter of Transmittal, unless otherwise provided in the "Special Payment
Instructions" or "Special Delivery Instructions" boxes on this Letter of
Transmittal, as promptly as practicable following the expiration or termination
of the Offer. All Shares represented by certificates delivered to the Depositary
will be deemed to have been tendered unless otherwise indicated.
5. INDICATION OF PRICE AT WHICH SHARES ARE BEING TENDERED. For Shares to be
validly tendered by this Letter of Transmittal, the stockholder must either:
(a) check the box under "Shares Tendered at Price Determined by Dutch
Auction;" OR
(b) check the box indicating the price per Share at which he is tendering
Shares under "Shares Tendered at Price Determined by Stockholder."
By checking the box under "Shares Tendered at Price Determined by Dutch
Auction" you agree to accept the Purchase Price that results from the "Dutch
Auction" tender process, which may be as low as $67 or as high as $77 per Share.
By checking a box under "Shares Tendered at Price Determined by Stockholder,"
you acknowledge that doing so could result in none of the Shares being purchased
if the Purchase Price for the Shares is less than the price you check.
ONLY ONE BOX MAY BE CHECKED. IF MORE THAN ONE BOX IS CHECKED OR IF NO BOX IS
CHECKED, THERE IS NO VALID TENDER OF SHARES. A stockholder wishing to tender
portions of his or her Share holdings at different prices must complete a
separate Letter of Transmittal for each price at which he or she wishes to
tender each such portion of his or her Shares. The same Shares cannot be
tendered (unless previously properly withdrawn as provided in Section 4 of the
Offer to Purchase) at more than one price.
10
<PAGE>
6. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the Shares
hereby, the signature(s) must correspond with the name(s) as written on the face
of the certificates without alteration, enlargement or any change whatsoever. If
this Letter of Transmittal is signed by a participant in DTC whose name is shown
as the owner of the Shares tendered hereby, the signature must correspond with
the name shown on the security position listing as the owner of the Shares.
If any of the Shares hereby is held of record by two or more persons, all
such persons must sign this Letter of Transmittal. If any of the Shares tendered
hereby are registered in different names on different certificates, it will be
necessary to complete, sign and submit as many separate Letters of Transmittal
as there are different registrations of certificates.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares tendered hereby, no endorsements of certificates or separate stock powers
are required unless payment of the Purchase Price is to be made to, or Shares
not tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s). Signatures on any such certificates or
stock powers must be guaranteed by an Eligible Institution. See Instruction 1.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, or if payment is to be made,
or Shares not purchased are to be issued, to a person other than the registered
holder, the certificates must be endorsed or accompanied by appropriate stock
powers, in either case, signed exactly as the name(s) of the registered
holder(s) appear(s) on the certificates for such Shares. Signature(s) on any
such certificates or stock powers must be guaranteed by an Eligible Institution
unless such stock powers are executed by an Eligible Institution. See
Instruction 1.
If this Letter of Transmittal or any certificate or stock power is signed by
a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
the Company of the authority of such person so to act must be submitted with
this Letter of Transmittal.
7. STOCK TRANSFER TAXES. The Company will pay or cause to be paid any stock
transfer taxes with respect to the sale and transfer of any Shares to it or its
order pursuant to the Offer. If, however, payment of the purchase price is to be
made to, or Shares not tendered or not purchased are to be registered in the
name of, any person other than the registered holder(s), or if tendered Shares
are registered in the name of any person other than the person(s) signing this
Letter of Transmittal, the amount of any stock transfer taxes (whether imposed
on the registered holder(s), such other person or otherwise) payable on account
of the transfer to such person will be deducted from the purchase price unless
satisfactory evidence of the payment of such taxes, or exemption therefrom, is
submitted. See Section 5 of the Offer to Purchase. EXCEPT AS PROVIDED IN THIS
INSTRUCTION 7, IT WILL NOT BE NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE
CERTIFICATES REPRESENTING SHARES TENDERED HEREBY.
8. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the purchase
price of any Shares purchased is to be issued in the name of, and/or any Shares
not tendered or not purchased are to be returned to, a person other than the
person(s) signing this Letter of Transmittal or if the check and/or any
certificates for Shares not tendered or not purchased are to be mailed to
someone other than the person(s) signing this Letter of Transmittal or to an
address other than that shown above in the box captioned "Description of Shares
Tendered," then the boxes captioned "Special Payment Instructions" and/or
"Special Delivery Instructions" on this Letter of Transmittal should be
completed. Stockholders tendering Shares by book-entry transfer may have any
Shares not accepted for payment credited to such account at DTC as such
stockholder may designate under the caption "Special Delivery Instructions". If
no such instructions are given, Shares not accepted for payment will be returned
by crediting the account maintained by such stockholder at the Book-Entry
Transfer Facility from which the original book-entry transfer was made.
9. ODD LOTS. As described in Section 6 of the Offer to Purchase, if fewer
than all Shares validly tendered at or below the Purchase Price and not properly
withdrawn on or prior to the Expiration Date are to be purchased, the Shares
purchased first will consist of all Shares tendered by any stockholder who owned
beneficially or of record an aggregate of fewer than 100 Shares (not including
any 401(k) Plan Shares or ESPP Shares, if any, held by such stockholder) as of
the close of business on November 5 , 1998 who validly and unconditionally
tendered all such Shares at or below the Purchase Price. Partial tenders of
Shares will
11
<PAGE>
not qualify for this preference. This preference will not be available unless
the box captioned "Odd Lots" in this Letter of Transmittal and the Notice of
Guaranteed Delivery, if any, is completed.
10. RANDOM LOTS. As described in the Offer to Purchase, if conditional
tenders would otherwise be deemed to have been withdrawn and if, as a result,
would cause the total number of Shares to be purchased to fall below 2,800,000,
then, to the extent feasible, the Company will select enough of such conditional
tenders that would otherwise have been deemed withdrawn to permit the Company to
purchase 2,800,000 Shares. In selecting among such conditional tenders, the
Company will select by random lot and will limit its purchase in each case to
the designated minimum number of Shares to be purchased.
11. SUBSTITUTE FORM W-9 AND FORM W-8. The tendering stockholder is required
to provide the Depositary with either a correct Taxpayer Identification Number
("TIN") on Substitute Form W-9, which is provided under "Important Tax
Information" below, or a properly completed Form W-8. Failure to provide the
information on either Substitute Form W-9 or Form W-8 may subject the tendering
stockholder to a $50 penalty imposed by the Internal Revenue Service and to a
31% federal income tax backup withholding on the payment of the Purchase Price.
The box in Part 2 of Substitute Form W-9 may be checked if the tendering
stockholder has not been issued a TIN and has applied for a number or intends to
apply for a number in the near future. If the box in Part 2 is checked and the
Depositary is not provided with a TIN by the time of payment, the Depositary
will withhold 31% on all payments of the Purchase Price thereafter until a TIN
is provided to the Depositary.
12. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Any questions or requests
for assistance may be directed to the Information Agent or the Dealer Manager at
their respective telephone numbers and addresses listed on the back cover of
this Letter of Transmittal. Requests for additional copies of the Offer to
Purchase, this Letter of Transmittal or other tender offer materials may be
directed to the Information Agent or the Dealer Manager and such copies will be
furnished promptly at the Company's expense. Stockholders may also contact their
local broker, dealer, commercial bank or trust company for assistance concerning
the Offer.
13. IRREGULARITIES. All questions as to the Purchase Price, the form of
documents and the validity, eligibility (including time of receipt) and
acceptance of any tender of Shares will be determined by the Company, in its
sole discretion, and its determination shall be final and binding on all
parties. The Company reserves the absolute right to reject any or all tenders of
Shares that it determines are not in proper form or the acceptance for payment
of or payment for Shares that may, in the opinion of the Company's counsel, be
unlawful. The Company also reserves the absolute right to waive any of the
conditions to the Offer or any defect or irregularity in any tender of Shares
and the Company's interpretation of the terms and conditions of the Offer
(including these instructions) shall be final and binding on all parties. Unless
waived, any defects or irregularities in connection with tenders must be cured
within such time as the Company shall determine. None of the Company, the Dealer
Manager, the Depositary, the Information Agent or any other person shall be
under any duty to give notice of any defect or irregularity in tenders, nor
shall any of them incur any liability for failure to give any such notice.
Tenders will not be deemed to have been made until all defects and
irregularities have been cured or waived.
14. ORDER OF PURCHASE IN EVENT OF PRORATION. As described in the Offer to
Purchase, the number of Shares that the Company will purchase from a stockholder
may affect the U.S. federal income tax consequences to the stockholder of such
purchase. Stockholders may designate the order in which their Shares are to be
purchased in the event of proration by so indicating in the box entitled
"Description of Shares Tendered." See Section 1 of the Offer to Purchase.
PARTICIPANTS IN THE COMPANY'S 401(K) PLANS OR ITS EMPLOYEE STOCK PURCHASE
PLANS MAY NOT USE THIS LETTER OF TRANSMITTAL TO DIRECT THE TENDER OF THE SHARES
ATTRIBUTABLE TO THE PARTICIPANT'S ACCOUNT BUT MUST USE THE "DIRECTION FORM" SENT
TO THEM BY THE TRUSTEE OR THE ADMINISTRATOR, AS THE CASE MAY BE, OF THE PLANS.
PARTICIPANTS IN THE COMPANY'S 401(K) PLANS OR ITS EMPLOYEE STOCK PURCHASE PLAN
ARE URGED TO READ THE SEPARATE "DIRECTION FORM" AND RELATED MATERIALS CAREFULLY.
12
<PAGE>
THE COMPANY IS NOT OFFERING, AS PART OF THE OFFER, TO PURCHASE ANY OPTIONS
OUTSTANDING UNDER ITS 1990 EQUITY INCENTIVE PLAN AND TENDERS OF ANY SUCH OPTIONS
WILL NOT BE ACCEPTED. HOLDERS OF OPTIONS WHO WISH TO PARTICIPATE IN THE OFFER
MUST EXERCISE THEIR OPTIONS BY PAYING THE APPLICABLE EXERCISE PRICE AND
WITHHOLDING TAXES AND THEN TENDER THE SHARES ISSUED UPON SUCH EXERCISE PURSUANT
TO THE OFFER. SEE INSTRUCTION 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A FACSIMILE COPY THEREOF) (OR AN
AGENT'S MESSAGE) TOGETHER WITH CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY
TRANSFER AND ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR
THE NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, ON OR
PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE (AS DEFINED IN
THE OFFER TO PURCHASE). STOCKHOLDERS ARE ENCOURAGED TO RETURN A COMPLETED
SUBSTITUTE FORM W-9 WITH THIS LETTER OF TRANSMITTAL.
IMPORTANT TAX INFORMATION
Under federal income tax law, a stockholder whose tendered Shares are
accepted for payment is required to provide the Depositary (as payer) with
either such stockholder's correct TIN on Substitute Form W-9 below or a properly
completed Form W-8. If such stockholder is an individual, the TIN is his or her
social security number (or, for certain foreign individuals, his or her
individual tax identification number). For businesses and other entities, the
number is the employer identification number. If the Depositary is not provided
with the correct TIN on Substitute Form W-9 or a properly completed Form W-8,
the stockholder may be subject to a $50 penalty imposed by the Internal Revenue
Service. In addition, payments that are made to such stockholder with respect to
Shares purchased pursuant to the Offer may be subject to backup withholding. The
Form W-8 can be obtained from the Depositary. See the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If federal income tax backup withholding applies, the Depositary is required
to withhold 31% of any payments made to the stockholder. Backup withholding is
not an additional tax. Rather, the federal income tax liability of persons
subject to federal income tax backup withholding will be reduced by the amount
of the tax withheld. If withholding results in an overpayment of taxes, a refund
may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on payments that are made to a stockholder with
respect to Shares purchased pursuant to the Offer, the stockholder is required
to notify the Depositary of his or her correct TIN by completing the Substitute
Form W-9 below certifying that the TIN provided on Substitute Form W-9 is
correct and that (a) the stockholder is exempt from backup withholding, (b) the
stockholder has not been notified by the Internal Revenue Service that he or she
is subject to federal income tax backup withholding as a result of failure to
report all interest or dividends, or (c) the Internal Revenue Service has
notified the stockholder that he or she is no longer subject to federal income
tax backup withholding. Foreign stockholders must submit a properly completed
Form W-8 in order to avoid the applicable backup withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The stockholder is required to give the Depositary the social security
number or employer identification number of the registered owner of the Shares.
If the Shares are in more than one name or are not in the name of the actual
owner, consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidance on which
number to report. If the stockholder does not have a TIN, such stockholder
should (a) consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for instructions on applying for a
TIN, (b) write "Applied For" in the space provided in Part 1 of the Substitute
Form W-9, and (c) sign and date the Substitute Form W-9 and the Certificate of
Awaiting Taxpayer Identification Number set forth herein. If the Stockholder
does not provide such Stockholder's TIN to the Depositary within sixty (60)
days, backup withholding will begin and continue until such Stockholder
furnishes such Stockholder's TIN
13
<PAGE>
to the Depositary. Note that writing "Applied For" on the Substitute Form W-9
means that the Stockholder has already applied for a TIN or that such Payee
intends to apply for one in the near future.
EXEMPT STOCKHOLDERS ("PAYEES")
Exempt payees (including, among others, all corporations and certain foreign
individuals) are not subject to backup withholding and reporting requirements.
To prevent possible erroneous backup withholding, an exempt payee should write
"Exempt" in Part 2 of Substitute W-9. See the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions. In order for a nonresident alien or foreign entity to
qualify as exempt, such person must submit a completed Form W-8 Certificate of
Foreign Status, signed under penalty of perjury attesting to such exempt status.
Such form may be obtained from the Depositary.
WITHHOLDING ON NON-UNITED STATES HOLDER
Even if a Non-United States Holder (as defined below) has provided the
required certification to avoid backup withholding, the Depositary will withhold
United States federal income taxes equal to 30% of the gross payments payable to
a Non-United States Holder or such Holder's agent unless the Depositary
determines that a reduced rate of withholding is applicable under a tax treaty
to which the United States is a party or because such gross proceeds are
effectively connected with the conduct of a trade or business within the United
States. For this purpose, a "Non-United States Holder" is any stockholder that
for United States federal income tax purposes is not (a) a citizen or resident
of the United States, (b) a corporation or partnership created or organized in
or under the laws of the United States or any State or division thereof
(including the District of Columbia), (c) an estate the income of which is
subject to United States federal income taxation regardless of the source of
such income, or (d) a trust (i) the administration over which a United States
court can exercise primary supervision and (ii) all of the substantial decisions
of which one or more United States persons have the authority to control.
Notwithstanding the foregoing, to the extent provided in United States Treasury
Regulations, certain trusts in existence on August 20, 1996, and treated as
United States persons prior to such date, that elect to continue to be treated
as United States persons also will not be Non-United States Holders. In order to
obtain a reduced rate of withholding pursuant to a tax treaty, a Non-United
States Holder must deliver to the Depositary before the payment a properly
completed and executed IRS Form 1001. In order to obtain an exemption from
withholding on the grounds that the gross proceeds paid pursuant to the Offer
are effectively connected with the conduct of a trade or business within the
United States, a Non-United States Holder must deliver to the Depositary a
properly completed and executed IRS Form 4224. The Depositary will determine a
stockholder's status as a Non-United States Holder and eligibility for a reduced
rate of, or an exemption from, withholding by reference to outstanding
certificates or statements concerning eligibility for a reduced rate of, or
exemption from, withholding (e.g., IRS Form 1001 or IRS Form 4224) unless facts
and circumstances indicate that such reliance is not warranted. A Non-United
States Holder may be eligible to obtain a refund of all or a portion of any tax
withheld if such Non-United States Holder meets those tests described in Section
13 of the Offer to Purchase that would characterize the exchange as a sale (as
opposed to a dividend) or is otherwise able to establish that no tax or a
reduced amount of tax is due.
NON-UNITED STATES HOLDERS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS
REGARDING THE APPLICATION OF UNITED STATES FEDERAL INCOME TAX WITHHOLDING,
INCLUDING ELIGIBILITY FOR A WITHHOLDING TAX REDUCTION OR EXEMPTION, AND THE
REFUND PROCEDURE.
14
<PAGE>
PAYER'S NAME: CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
<TABLE>
<S> <C> <C>
SUBSTITUTE PART 1--PLEASE PROVIDE YOUR ----------------------------
FORM W-9 TIN Social Security Number
DEPARTMENT OF THE TREASURY IN THE BOX AT RIGHT AND OR
INTERNAL REVENUE SERVICES CERTIFY BY SIGNING AND -----------------------------
PAYER'S REQUEST FOR TAPAYERS DATING BELOW Employer Identification
IDENTIFICATION NUMBER (TIN) Number
</TABLE>
<TABLE>
<S> <C>
PART 2--Certification--Under penalties of perjury, I certify that: PART 3--Awaiting TIN
(1) The number shown on this form is my correct Taxpayer
Identification Number (or I am waiting for a TIN number to be
issued to me) and / / Awaiting TIN
(2) I am not subject to backup withholding either because I have not
been notified by the Internal Revenue Service ("IRS") that I am
subject to backup withholding as a result of failure to report
all interest or dividends, or the IRS has notified me that I am
no longer subject to backup withholding.
</TABLE>
Certificate Instructions--You must cross out item (2) in Part 2 above if you
have been notified by the IRS that you are subject to backup withholding
because of underreporting interest or dividends on your tax return. However,
if after being notified by the IRS that you were subject to backup withholding
you received another notification from the IRS stating that you are no longer
subject to backup withholding, do not cross out item (2).
Signature
----------------------------------- Date
---------------------, 1998
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS. YOU
MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 2
OF THE SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number
has not been issued to me and either (1) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or
(2) I intend to mail or deliver an application in the near future. I
understand that if I do not provide a taxpayer identification number by the
time of payment, 31% of all payments of the purchase price made to me
thereafter will be withheld until I provide a number.
Signature
----------------------------------------------- Date
-----------------------, 1998
15
<PAGE>
THE INFORMATION AGENT IS:
[LOGO]
156 Fifth Avenue
New York, New York 10010
(212) 929-5500 (collect)
(800) 322-2885 (toll-free)
THE DEALER MANAGER IS:
MORGAN STANLEY DEAN WITTER
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
(212) 761-5722 (collect)
(800) 223-2440 ext. 5722 (toll-free)
<PAGE>
NOTICE OF GUARANTEED DELIVERY
FOR
TENDERED SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
OF
ALLIANT TECHSYSTEMS INC.
(NOT TO BE USED FOR SIGNATURE GUARANTEES)
This form, or a form substantially equivalent to this form, must be used to
accept the Offer (as defined below) (a) if certificates for the shares of Common
Stock, par value $.01 per share, of Alliant Techsystems Inc. are not immediately
available and cannot be delivered to the Depositary at or prior to 5:00 P.M.,
New York City time, on the Expiration Date (as defined in Section 1 of the Offer
to Purchase); (b) if the procedure for book-entry transfer cannot be completed
on a timely basis; or (c) if time will not permit all other documents required
by the Letter of Transmittal to be delivered to the Depositary on or prior to
the Expiration Date (as defined in Section 1 of the Offer to Purchase). Such
form, properly completed and duly executed, may be delivered by hand or
transmitted by mail, or, for Eligible Institutions only (as defined in the Offer
to Purchase), by facsimile transmission, to the Depositary. See Section 3 of the
Offer to Purchase. THE ELIGIBLE INSTITUTION WHICH COMPLETES THIS FORM, MUST
COMMUNICATE THE GUARANTEE TO THE DEPOSITARY AND MUST DELIVER THE LETTER OF
TRANSMITTAL (OR AGENT'S MESSAGE) AND CERTIFICATES FOR SHARES (OR CONFIRMATIONS
OF BOOK-ENTRY TRANSFER) TO THE DEPOSITARY WITHIN THE TIME SHOWN HEREIN. FAILURE
TO DO SO COULD RESULT IN A FINANCIAL LOSS TO SUCH ELIGIBLE INSTITUTION.
TO: CHASEMELLON STOCKHOLDER SERVICES, L.L.C., DEPOSITARY
<TABLE>
<CAPTION>
BY MAIL: BY HAND:
<S> <C>
Reorganization Department Reorganization Department
P.O. Box 3301 120 Broadway--13th Floor
South Hackensack, NJ 07606 New York, NY 10271
<CAPTION>
BY FACSIMILE TRANSMISSION: BY OVERNIGHT COURIER:
<S> <C>
(For Eligible Institutions Only) Reorganization Department
201-269-4293 85 Challenger Road
CONFIRM RECEIPT OF FACSIMILE Mail Drop--Reorg
201-296-4860 Ridgefield Park, NJ 07660
</TABLE>
THE INFORMATION AGENT FOR THE OFFER IS:
MacKenzie Partners, Inc.
156 Fifth Avenue
New York, New York 10010
212-929-5500 (collect)
800-322-2885 (toll-free)
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN THE ONE LISTED
ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. DELIVERIES TO THE COMPANY WILL NOT
BE FORWARDED TO THE DEPOSITARY AND THEREFORE WILL NOT CONSTITUTE VALID DELIVERY.
DELIVERIES TO THE BOOK-ENTRY TRANSFER FACILITY WILL NOT CONSTITUTE VALID
DELIVERY TO THE DEPOSITARY.
This form is not to be used to guarantee signatures. If a signature on a
Letter of Transmittal is required to be guaranteed by an Eligible Institution
under the instructions thereto, such signature guarantee must appear in the
applicable space provided in the signature box on the Letter of Transmittal.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Alliant Techsystems Inc., a Delaware
corporation (the "Company"), upon the terms and subject to the conditions set
forth in the Offer to Purchase, dated November 6, 1998 (the "Offer to
Purchase"), and the related Letter of Transmittal (which together constitute the
"Offer"), receipt of which is hereby acknowledged, the number of shares listed
below of the Company's Common Stock, par value $.01 per share (the "Shares")
(including the associated preferred stock purchase rights (the "Rights") issued
pursuant to the Rights Agreement, dated as of September 28, 1990, as amended,
between the Company and The Chase Manhattan Bank (as successor to Manufacturers
Hanover Trust Company), as Rights Agent), pursuant to the guaranteed delivery
procedure set forth in Section 3 of the Offer to Purchase.
<TABLE>
<S> <C>
Number of Shares:
Signature(s)
Certificate Nos.: (if available)
Name(s) (Please Print)
If Shares will be tendered by book-entry transfer:
Name of Tendering Institution:
Address(es)
Account No. at DTC:
Dated:
Area Code and Telephone Number
</TABLE>
ODD LOTS
To be completed ONLY if Shares are being tendered by or on behalf of persons
owning, beneficially or of record an aggregate of fewer than 100 Shares (not
including any Shares held pursuant to the Company's 401(k) plans or its employee
stock purchase plans) as of the close of business on November 5, 1998.
The undersigned either (check one):
/ / was the beneficial owner or owner of record of an aggregate of fewer than
100 Shares (not including any Shares held pursuant to the Company's 401(k) plans
or its employee stock purchase plans) as of the close of business on November 5,
1998, all of which are tendered, or;
/ / is a broker, dealer, commercial bank, trust company or other nominee that
(i) is tendering, for the beneficial owner(s) thereof, Shares with respect to
which it is the record owner, and (ii) believes, based upon representations made
to it by each such beneficial owner, that such beneficial owner owned an
aggregate of fewer than 100 Shares (not including any Shares held pursuant to
the Company's 401(k) plans or its employee stock purchase plans) as of the close
of business on November 5, 1998 and is tendering all of such Shares.
CONDITIONAL TENDER
UNLESS THIS BOX HAS BEEN COMPLETED AND A MINIMUM SPECIFIED, THE TENDER WILL
BE DEEMED UNCONDITIONAL (See Sections 6 and 13 of the Offer to Purchase)
/ / Check here if tender of Shares is conditional on the Company purchasing
all or a minimum number of the tendered Shares and complete the following:
Minimum Number of Shares that must be purchased, if any are purchased:
________________________ Shares
2
<PAGE>
PRICE (IN DOLLARS) PER SHARE
AT WHICH SHARES ARE BEING TENDERED
CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED,
OR IF NO BOX IS CHECKED, THERE IS NO PROPER TENDER OF SHARES
SHARES TENDERED AT PRICE DETERMINED BY DUTCH AUCTION
/ / The undersigned wants to maximize the chance of having the Company purchase
all the Shares the undersigned is tendering (subject to the possibility of
proration). Accordingly, by checking this ONE box INSTEAD OF ONE OF THE
PRICE BOXES BELOW, the undersigned hereby tenders Shares and is willing to
accept the Purchase Price resulting from the "Dutch Auction" tender process.
This action will result in receiving a price per Share of as low as $67 or
as high as $77.
________________________OR________________________
SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER
By checking ONE of the boxes below INSTEAD OF THE BOX ABOVE, the undersigned
hereby tenders Shares at the price checked. This action could result in none
of the Shares being purchased if the Purchase Price for the Shares is less
than the price checked. A stockholder who desires to tender Shares at more
than one price must complete a separate Letter of Transmittal and Notice of
Guaranteed Delivery for each price at which Shares are tendered. The same
Shares cannot be tendered at more than one price.
Price (in dollars) per Share at which Shares are being tendered:
<TABLE>
<S> <C> <C> <C> <C>
/ / 67.00 / / 69.00 / / 71.00 / / 73.00 / / 75.00
/ / 67.25 / / 69.25 / / 71.25 / / 73.25 / / 75.25
/ / 67.50 / / 69.50 / / 71.50 / / 73.50 / / 75.50
/ / 67.75 / / 69.75 / / 71.75 / / 73.75 / / 75.75
/ / 68.00 / / 70.00 / / 72.00 / / 74.00 / / 76.00
/ / 68.25 / / 70.25 / / 72.25 / / 74.25 / / 76.25
/ / 68.50 / / 70.50 / / 72.50 / / 74.50 / / 76.50
/ / 68.75 / / 70.75 / / 72.75 / / 74.75 / / 76.75
/ / 77.00
</TABLE>
3
<PAGE>
- --------------------------------------------------------------------------------
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm that is a member of a registered national
securities exchange or the National Association of Securities Dealers, Inc.
or a commercial bank or trust company having an office or correspondent in
the United States which is a participant in an approved Signature Guarantee
Medallion Program (each of the foregoing, an "Eligible Institution"),
guarantees (a) that the above-named person(s) has a net long position in the
Shares (and associated Rights) being tendered within the meaning of Rule
14e-4 promulgated under the Securities Exchange Act of 1934, as amended, (b)
that such tender of Shares complies with Rule 14e-4 and (c) that the
undersigned will deliver to the Depositary, at one of its addresses set
forth above, (i) certificate(s) for the Shares tendered hereby, in proper
form for transfer; or (ii) a confirmation of the book-entry transfer of the
Shares tendered hereby into the Depositary's account at The Depository Trust
Company, in each case, together with a properly completed and duly executed
Letter(s) of Transmittal (or facsimile(s) thereof) (or an Agent's Message),
with any required signature guarantee(s) and any other required documents,
all within three New York Stock Exchange trading days after the date that
the Depositary receives this Notice of Guaranteed Delivery.
<TABLE>
<S> <C>
Name of Firm Authorized Signature
Address Name
City, State, Zip Code Title
Area Code and Telephone Number
Dated:, 1998
</TABLE>
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM.
YOUR STOCK CERTIFICATES MUST BE SENT WITH
THE LETTER OF TRANSMITTAL.
- --------------------------------------------------------------------------------
4
<PAGE>
MORGAN STANLEY DEAN WITTER
MORGAN STANLEY & CO. INCORPORATED
1585 BROADWAY
NEW YORK, NEW YORK 10036
OFFER TO PURCHASE FOR CASH
UP TO 2,800,000 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
AT
A PURCHASE PRICE NOT IN EXCESS OF $77 NOR LESS THAN $67
OF
ALLIANT TECHSYSTEMS INC.
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW
YORK
CITY TIME, ON TUESDAY, DECEMBER 8, 1998, UNLESS THE OFFER IS EXTENDED.
November 6, 1998
To Brokers, Dealers, Commercial
Banks, Trust Companies and
Other Nominees:
In our capacity as Dealer Manager (the "Dealer Manager"), we are enclosing
the material listed below relating to the offer by Alliant Techsystems Inc., a
Delaware corporation (the "Company"), to purchase up to 2,800,000 shares (or
such lesser number of shares as is properly tendered and not properly withdrawn)
of its Common Stock, par value $.01 per share (the "Shares") (including the
associated preferred stock purchase rights (the "Rights") issued pursuant to the
Rights Agreement, dated as of September 28, 1990, as amended, between the
Company and The Chase Manhattan Bank (as successor to Manufacturers Hanover
Trust Company), as the Rights Agent), at prices not greater than $77 nor less
than $67 per Share, net to the seller in cash, specified by tendering
stockholders, upon the terms and subject to the conditions set forth in the
Offer to Purchase, dated November 6, 1998 (the "Offer to Purchase"), and in the
related Letter of Transmittal (which together constitute the "Offer"). The
Company will determine a single price (not greater than $77 nor less than $67
per Share) that it will pay for Shares validly tendered pursuant to the Offer
(the "Purchase Price"), taking into account the number of Shares so tendered and
the prices specified by tendering stockholders. The Company will select the
Purchase Price that will enable it to purchase 2,800,000 Shares (or such lesser
number of Shares as are validly tendered at prices not greater than $77 nor less
than $67 per Share) pursuant to the Offer. The Company will purchase all Shares
validly tendered at prices at or below the Purchase Price and not properly
withdrawn, upon the terms and subject to the conditions of the Offer, including
the provisions relating to proration and conditional tenders described in the
Offer to Purchase.
The Purchase Price will be paid in cash, net to the seller, with respect to
all Shares purchased. All Shares acquired in the Offer will be acquired at
Purchase Price. Shares tendered at prices in excess of the Purchase Price and
Shares not purchased because of proration and conditional tenders will be
returned.
THE OFFER IS NOT CONDITIONED UPON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. The Offer is, however, subject to other conditions. See Section 7 of
the Offer to Purchase.
We are asking you to contact your clients for whom you hold Shares
registered in your name (or in the name of your nominee) or who hold Shares
registered in their own names. Please bring the Offer to their attention as
promptly as possible. The Company will, upon request, reimburse you for
reasonable and customary handling and mailing expenses incurred by you in
forwarding any of the enclosed materials to your clients.
<PAGE>
For your information and for forwarding to your clients for whom you hold
Shares registered in your name or in the name of your nominee, we are enclosing
the following documents:
1. The Offer to Purchase, dated November 6, 1998;
2. The Letter of Transmittal for your use and for the information of
your clients;
3. A letter to stockholders of the Company from Peter A. Bukowick, the
President, acting Chief Executive Officer and Chief Operating Officer of the
Company;
4. The Notice of Guaranteed Delivery to be used to accept the Offer if
the Shares and all other required documents cannot be delivered to the
Depositary by the Expiration Date (as defined in the Offer to Purchase);
5. A letter which may be sent to your clients for whose accounts you
hold Shares registered in your name or in the name of your nominee, with
space for obtaining such clients' instructions with regard to the Offer;
6. A Substitute Form W-9 (included in the Letter of Transmittal) and
Guidelines of the Internal Revenue Service for Certification of Taxpayer
Identification Number on Substitute Form W-9 providing information relating
to backup federal income tax withholding; and
7. A return envelope addressed to ChaseMellon Shareholder Services,
L.L.C., the Depositary.
WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE
THAT THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M., NEW
YORK CITY TIME, ON TUESDAY, DECEMBER 8, 1998, UNLESS THE OFFER IS EXTENDED.
The Company will not pay any fees or commissions to any broker, dealer or
other person for soliciting tenders of Shares pursuant to the Offer (other than
the Dealer Manager). The Company will, upon request, reimburse brokers, dealers,
commercial banks and trust companies for reasonable and customary handling and
mailing expenses incurred by them in forwarding materials relating to the Offer
to their customers. The Company will pay or cause to be paid all stock transfer
taxes applicable to its purchase of Shares pursuant to the Offer, subject to
Instruction 7 of the Letter of Transmittal.
As described in the Offer to Purchase, if more than 2,800,000 Shares have
been validly tendered at or below the Purchase Price and not properly withdrawn
on or prior to the Expiration Date (as defined in Section 1 of the Offer to
Purchase), the Company will purchase Shares in the following order of priority:
(a) all Shares validly tendered at or below the Purchase Price and not withdrawn
on or prior to the Expiration Date by any stockholder who owned beneficially or
of record an aggregate of fewer than 100 Shares (not including any Shares held
pursuant to the Company's 401(k) plans or its employee stock purchase plans) as
of the close of business on November 5, 1998 and who validly tenders all of such
Shares (partial and conditional tenders will not qualify for this preference)
and completes the box captioned "Odd Lots" on the Letter of Transmittal and, if
applicable, the Notice of Guaranteed Delivery; and (b) after purchase of all the
foregoing Shares, subject to the conditional tender provisions described in
Section 6 of the Offer to Purchase, all other Shares validly tendered at or
below the Purchase Price and not properly withdrawn on or prior to the
Expiration Date on a pro rata basis, if necessary (with appropriate rounding
adjustments to avoid purchases of fractional Shares). If any shareholder tenders
Shares and does not wish to have such Shares purchased subject to proration,
such shareholder may tender Shares subject to the condition that a specified
minimum number of Shares (which may be represented by designated stock
certificates) or none of such Shares be purchased.
In order to take advantage of the Offer, a duly executed and properly
completed Letter of Transmittal and any other required documents should be sent
to the Depositary with either certificate(s) representing the tendered Shares or
confirmation of their book-entry transfer, all in accordance with the
instructions set forth in the Letter of Transmittal and the Offer to Purchase.
2
<PAGE>
As described under the caption "The Offer--Procedure for Tendering Shares"
in Section 3 of the Offer to Purchase, tenders may be made without the
concurrent deposit of stock certificates or concurrent compliance with the
procedure for book-entry transfer, if such tenders are made by or through a
broker or dealer that is a member firm of a registered national securities
exchange, a member of the National Association of Securities Dealers, Inc. or a
commercial bank or trust company having an office, branch or agency in the
United States. Certificates for Shares so tendered (or a confirmation of a
book-entry transfer of such Shares into the Depositary's account at the
Book-Entry Transfer Facility described in the Offer of Purchase), together with
a properly completed and duly executed Letter of Transmittal (or Agent's Message
(as defined in Section 3 of the Offer to Purchase)), must be received by the
Depositary within three New York Stock Exchange trading days after timely
receipt by the Depositary of a properly completed and duly executed Notice of
Guaranteed Delivery.
NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO
ANY STOCKHOLDER AS TO WHETHER TO TENDER ALL OR ANY SHARES. STOCKHOLDERS MUST
MAKE THEIR OWN DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO, HOW MANY
SHARES TO TENDER.
Any questions or requests for assistance or additional copies of the
enclosed materials may be directed to MacKenzie Partners, Inc. (the "Information
Agent") or the Dealer Manager at their respective addresses and telephone
numbers set forth on the back cover of the enclosed Offer to Purchase.
Very truly yours,
MORGAN STANLEY DEAN WITTER
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
THE AGENT OF THE COMPANY, THE DEALER MANAGER, THE INFORMATION AGENT OR THE
DEPOSITARY, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY
STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE
DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED THEREIN.
3
<PAGE>
OFFER TO PURCHASE FOR CASH
UP TO 2,800,000 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
AT
A PURCHASE PRICE NOT GREATER THAN $77
NOR LESS THAN $67
OF
ALLIANT TECHSYSTEMS INC.
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON TUESDAY, DECEMBER 8, 1998, UNLESS THE OFFER IS EXTENDED.
To Our Clients:
Enclosed for your consideration are the Offer to Purchase, dated November 6,
1998 (the "Offer to Purchase"), and the related Letter of Transmittal (which
together constitute the "Offer") setting forth the Offer by Alliant Techsystems
Inc., a Delaware corporation (the "Company"), to purchase up to 2,800,000 shares
of its Common Stock, par value $.01 per share (the "Shares") (including the
associated preferred stock purchase rights (the "Rights") issued pursuant to the
Rights Agreement, dated as of September 28, 1990, as amended, between the
Company and The Chase Manhattan Bank (as successor to Manufacturers Hanover
Trust Company), as the Rights Agent), at prices not greater than $77 nor less
than $67 per Share, net to the seller in cash, specified by tendering
stockholders, upon the terms and subject to the conditions of the Offer. Unless
the context otherwise requires, all references to Shares shall include the
associated Rights.
The Company will determine a single per Share price, not greater than $77
nor less than $67 per Share, that it will pay for the Shares validly tendered
pursuant to the Offer and not properly withdrawn (the "Purchase Price"), taking
into account the number of Shares so tendered and the prices specified by
tendering stockholders. The Company will select the Purchase Price that will
enable it to purchase 2,800,000 Shares (or such lesser number of Shares as are
validly tendered at prices not greater than $77 nor less than $67 per Share)
pursuant to the Offer. The Company will purchase all Shares validly tendered at
prices at or below the Purchase Price and not properly withdrawn, upon the terms
and subject to the conditions of the Offer, including the provisions thereof
relating to proration and conditional tenders. The Company will return all other
Shares, including Shares tendered at prices greater than the Purchase Price and
Shares not purchased because of proration or conditional tenders.
We are the holder of record of Shares held for your account. A tender of
such Shares can be made only by us as the holder of record and pursuant to your
instructions. THE LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR YOUR INFORMATION
ONLY AND CANNOT BE USED BY YOU TO TENDER SHARES HELD BY US FOR YOUR ACCOUNT.
We request instructions as to whether you wish us to tender any or all of
the Shares held by us for your account, upon the terms and subject to the
conditions set forth in the Offer to Purchase and the Letter of Transmittal.
Your attention is invited to the following:
(1) You may tender Shares at either (i) the price determined by you (in
multiples of $0.25), not greater than $77 nor less than $67 per Share, or
(ii) the price determined by "Dutch Auction" as indicated in the attached
instruction form, net to you in cash. You should mark the box entitled,
"Shares Tendered at Price Determined by Dutch Auction" if you are willing to
accept the Purchase Price resulting from the "Dutch Auction" tender process.
This could result in your receiving the minimum price of $67 per Share.
(2) The Offer is for up to 2,800,000 Shares, constituting approximately
23% of the total Shares outstanding as of November 5, 1998. Although it has
no present intention of so doing, the Company reserves the right to purchase
more than 2,800,000 Shares pursuant to the Offer. The Offer is not
conditioned upon any minimum number of Shares being tendered. The Offer is,
however, conditional on other factors, such as the Company's obtaining the
funds necessary to consummate the Offer and to pay all related fees and
expenses.
(3) The Offer, proration period and withdrawal rights will expire at
5:00 P.M., New York City time, on Tuesday, December 8, 1998 unless the Offer
is extended. Your instructions to us should be forwarded to us in ample time
to permit us to submit a tender on your behalf. If you would like to
withdraw your Shares that we have tendered, you can withdraw them so long as
the Offer remains open or any time after January 17, 1999 if they have not
been accepted for payment.
(4) As described in the Offer to Purchase, if more than 2,800,000 Shares
have been validly tendered at or below the Purchase Price and not properly
withdrawn on or prior to the Expiration Date, as defined in Section 1 of the
Offer to Purchase, the Company will purchase Shares in the following order
of priority:
<PAGE>
(a) all Shares validly tendered at or below the Purchase Price and
not properly withdrawn on or prior to the Expiration Date by any
stockholder (an "Odd Lot Owner") who owned beneficially or of record an
aggregate of fewer than 100 Shares (not including any Shares held
pursuant to the Company's 401(k) plans or its employee stock purchase
plans) as of the close of business on November 5, 1998 and who validly
tenders all of such Shares (partial tenders will not qualify for this
preference) and completes the box captioned "Odd Lots" on the Letter of
Transmittal and, if applicable, the Notice of Guaranteed Delivery;
(b) after purchase of all of the foregoing Shares, subject to the
conditional tender provisions described in Section 6 of the Offer to
Purchase, all other Shares validly tendered at or below the Purchase
Price and not properly withdrawn on or prior to the Expiration Date on a
pro rata basis, if necessary (with appropriate rounding adjustments to
avoid purchases of fractional Shares); and
(c) If conditional tenders would otherwise be deemed to have been
withdrawn and, as a result, would cause the total number of Shares to be
purchased to fall below 2,800,000, then, to the extent feasible, the
Company will select enough of such conditional tenders that would
otherwise have been so properly withdrawn to permit the Company to
purchase 2,800,000 Shares. In selecting among such conditional tenders,
the Company will select by random lot and will limit its purchase in each
case to the designated minimum number of Shares to be purchased.
(5) Any stock transfer taxes applicable to the sale of Shares to the
Company pursuant to the Offer will be paid by the Company, except as
otherwise provided in Instruction 7 of the Letter of Transmittal.
(6) If you owned beneficially or of record an aggregate of fewer than
100 Shares (not including any Shares held pursuant to the Company's 401(k)
plans or its employee stock purchase plans) as of the close of business on
November 5, 1998 and you instruct us to tender at or below the Purchase
Price on your behalf all such Shares on or prior to the Expiration Date and
check the box captioned "Odd Lots" in the instruction form, all such Shares
will be accepted for purchase before proration, if any, of the purchase of
other tendered Shares.
(7) Tendering stockholders will not be obligated to pay any brokerage
commissions, solicitation fees or, subject to Instruction 7 of the Letter of
Transmittal, stock transfer taxes on the Company's purchase of Shares
pursuant to the Offer. However, a tendering stockholder who holds Shares
through a broker, dealer or custodian may be required by such entity to pay
a service charge or other fee.
(8) If you wish to tender portions of your Share holdings at different
prices, you must complete separate Instruction Forms for each price at which
you wish to tender each such portion of your Shares. We must submit separate
Letters of Transmittal on your behalf for each price specified. The same
Shares cannot be tendered at different prices unless such tendered Shares
are validly withdrawn and retendered.
(9) You may designate the priority in which your Shares shall be
purchased in the event of proration.
NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO
ANY STOCKHOLDER AS TO WHETHER TO TENDER ALL OR ANY SHARES. STOCKHOLDERS MUST
MAKE THEIR OWN DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO, HOW MANY
SHARES TO TENDER.
If you wish to have us tender any or all of your Shares held by us for your
account upon the terms and subject to the conditions set forth in the Offer,
please so instruct us by completing, executing, detaching and returning to us
the instruction form on the detachable part hereof. An envelope to return your
instructions to us is enclosed. If you authorize tender of your Shares, all such
Shares will be tendered unless otherwise specified on the detachable part
hereof.
YOUR INSTRUCTIONS SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT US TO
SUBMIT A TENDER ON YOUR BEHALF BY THE EXPIRATION OF THE OFFER. THE OFFER,
PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M., NEW YORK CITY TIME,
ON TUESDAY, DECEMBER 8, 1998, UNLESS THE COMPANY EXTENDS THE OFFER.
A tendering stockholder may condition the tender of Shares upon the purchase
by the Company of a specified minimum number of Shares tendered, all as
described in Section 6 of the Offer to Purchase. Unless such specified minimum
is purchased by the Company pursuant to the terms of the Offer to Purchase and
the related Letter of Transmittal, none of the Shares tendered by the
stockholder will be purchased. If you wish us to condition your tender upon the
purchase of a specified minimum number of Shares, please complete the box
entitled "Conditional Tender" on the instruction form. It is the tendering
stockholder's responsibility to calculate such minimum number of Shares, and you
are urged to consult your own tax advisor.
The Offer is being made to all holders of Shares solely pursuant to the
Offer to Purchase and the related Letter of Transmittal. This Offer is not being
made to (nor will any tender of Shares be accepted from or on behalf of) holders
in any jurisdiction in which the making of the Offer or the acceptance of any
tender of Shares therein would not be in compliance with the laws of such
jurisdiction. However, the Company may, at its discretion, take such action as
it may deem necessary for the Company to make the Offer in any such jurisdiction
and extend the Offer to holders in such jurisdiction. In any jurisdiction the
securities or blue sky laws of which require the Offer to be made by a licensed
broker or dealer, the Offer is being made on behalf of the Company by the Dealer
Manager or one or more registered brokers or dealers which are licensed under
the laws of such jurisdiction.
2
<PAGE>
INSTRUCTIONS WITH RESPECT TO
OFFER TO PURCHASE FOR CASH
UP TO 2,800,000 SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
AT A PURCHASE PRICE NOT GREATER THAN $77 NOR
LESS THAN $67 PER SHARE
OF ALLIANT TECHSYSTEMS INC.
The undersigned acknowledge(s) receipt of your letter and the enclosed Offer
to Purchase, dated November 6, 1998 and the related Letter of Transmittal (which
together constitute the "Offer") in connection with the Offer by Alliant
Techsystems Inc., a Delaware corporation (the "Company"), to purchase up to
2,800,000 shares of its Common Stock, par value $.01 per share (the "Shares")
(including the associated preferred stock purchase rights issued pursuant to the
Rights Agreement, dated as of September 28, 1990, as amended between the Company
and The Chase Manhattan Bank (as successor to Manufacturers Hanover Trust
Company) as Rights Agent), at prices not greater than $77 nor less than $67 per
Share, net to the undersigned in cash, without interest thereon, as specified by
the undersigned, upon the terms and subject to the conditions of the Offer.
This will instruct you to tender to the Company the number of Shares
indicated below (or, if no number is indicated below, all Shares) which are held
by you for the account of the undersigned, at the price per Share indicated
below, upon the terms and subject to the conditions of the Offer. The Company
will return Shares tendered at prices greater than the purchase price and Shares
not purchased because of proration or conditional tenders.
PRICE (IN DOLLARS) PER SHARE
AT WHICH SHARES ARE BEING TENDERED.
CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED,
OR IF NO BOX IS CHECKED, THERE IS NO PROPER TENDER OF SHARES.
SHARES TENDERED AT PRICE DETERMINED BY DUTCH AUCTION
/ / The undersigned wants to maximize the chance of having the Company purchase
all the Shares the undersigned is tendering (subject to the possibility of
proration). Accordingly, by checking this ONE box INSTEAD OF ONE OF THE
PRICE BOXES BELOW, the undersigned hereby tenders Shares and is willing to
accept the Purchase Price resulting from the Dutch Auction tender process.
This action will result in receiving a price per Share of as low as $67 or
as high as $77.
-------------OR
-------------
SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER
By checking ONE of the boxes below INSTEAD OF THE BOX ABOVE, the
undersigned hereby tenders Shares at the price checked. This action could
result in none of the Shares being purchased if the Purchase Price for the
Shares is less than the price checked. A stockholder who desires to tender
Shares at more than one price must complete a separate Letter of
Transmittal for each price at which Shares are tendered. The same Shares
cannot be tendered at more than one price.
Price (in dollars) per Share at which Shares are being tendered:
<TABLE>
<S> <C> <C> <C> <C>
/ / 67.00 / / 69.00 / / 71.00 / / 73.00 / / 75.00
/ / 67.25 / / 69.25 / / 71.25 / / 73.25 / / 75.25
/ / 67.50 / / 69.50 / / 71.50 / / 73.50 / / 75.50
/ / 67.75 / / 69.75 / / 71.75 / / 73.75 / / 75.75
/ / 68.00 / / 70.00 / / 72.00 / / 74.00 / / 76.00
/ / 68.25 / / 70.25 / / 72.25 / / 74.25 / / 76.25
/ / 68.50 / / 70.50 / / 72.50 / / 74.50 / / 76.50
/ / 68.75 / / 70.75 / / 72.75 / / 74.75 / / 76.75
/ / 77.00
</TABLE>
3
<PAGE>
ODD LOTS
/ / By checking this box, the undersigned represents that the undersigned
owned beneficially or of record an aggregate of fewer than 100 Shares
(not including any Shares held pursuant to the Company's 401(k) plans
or its employee stock purchase plans) as of the close of business on
November 5, 1998 and is tendering all of such Shares.
CONDITIONAL TENDER
By completing this box, the undersigned conditions the tender
authorized hereby on the following minimum number of Shares being
purchased if any are purchased.
------------------------------- Shares
Unless this box is completed, the tender authorized hereby will be made
unconditionally.
<TABLE>
<S> <C>
Number of Shares to be Tendered: SIGN HERE
Shares*
Signature(s)
Dated: , 1998 Name
Address
Social Security or Taxpayer ID No.
</TABLE>
- --------------
* Unless otherwise indicated, it will be assumed that all Shares held by us
for your account are to be tendered.
4
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYER.--Social Security numbers have nine digits separated by two hyphens: i.e.
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen: i.e. 000-000000. The table below will help determine the number to
give the payer.
<TABLE>
<CAPTION>
- -------------------------------------------------------
<C> <S> <C> <C>
GIVE THE
FOR THIS TYPE OF ACCOUNT SOCIAL SECURITY
NUMBER OF--
<CAPTION>
- -------------------------------------------------------
- -------------------------------------------------------
GIVE THE
FOR THIS TYPE OF ACCOUNT EMPLOYER IDENTIFICATION
NUMBER OF--
- -------------------------------------------------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
1. An individual's account The individual
2. Two or more individuals The actual owner of the
(joint account) account or, if combined
funds, any one of the
individuals
3. Husband and wife The actual owner of the
(joint account) account or, if joint funds,
either person (1)
4. Custodian account of a minor The minor (2)
(Uniform Gift to Minors Act)
5. Adult and minor The adult or, if the minor is
(joint account) the only contributor, the
minor (1)
6. Account in the name of guardian The ward, minor, or
or committee for a designated incompetent person (3)
ward, minor, or incompetent
person
7. a. The usual revocable The grantor-trustee (1)
savings trust
account (grantor is
also trustee)
b. So-called trust The actual owner (1)
account that is not
a legal or valid
trust under State
law
8. Sole proprietorship account The Owner (4)
9. A valid trust, estate, or Legal entity (Do not furnish
pension trust the identifying number of the
personal representative or
trustee unless the legal
entity itself is not
designated in the account
title.) (5)
10. Corporate account The Corporation
11. Religious, charitable, or The organization
educational organization
account
12. Partnership account held in the The partnership
name of the business
13. Association, club, or other The organization
tax-exempt organization
14. A broker or registered nominee The broker or nominee
15. Account with the Department of The public entity
Agriculture in the name of a
public entity (such as a State
or local government, school
district, or prison) that
receives agricultural program
payments
</TABLE>
<TABLE>
<C> <S> <C> <C>
- -------------------------------------------------------
- -------------------------------------------------------
</TABLE>
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) List first and circle the name of the legal trust, estate, or pension trust.
NOTE: IF NO NAME IS CIRCLED WHEN THERE IS MORE THAN ONE NAME, THE NUMBER WILL BE
CONSIDERED TO BE THAT OF THE FIRST NAME LISTED.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
PAGE 2
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include
the following:
- - A corporation.
- - A financial institution.
- - An organization exempt from tax under section 501(a), or an individual
retirement plan.
- - The United States or any agency or instrumentality thereof.
- - A State, the District of Columbia, a possession of the United States, or any
subdivision or instrumentality thereof.
- - A foreign government, a political subdivision of a foreign government, or
agency or instrumentality thereof.
- - An international organization or any agency, or instrumentality thereof.
- - A registered dealer in securities or commodities registered in the U.S. or a
possession of the U.S.
- - A real estate investment trust.
- - A common trust fund operated by a bank under section 584(a).
- - An exempt charitable remainder trust, or a non-exempt trust described in
section 4947(a)(1).
- - An entity registered at all times under the Investment-Company Act of 1940.
- - A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to
backup withholding include the following:
- - Payments to nonresident aliens subject to withholding under section 1441.
- - Payments to partnerships not engaged in a trade or business in the U.S. and
which have at least one nonresident partner.
- - Payments of patronage dividends where the amount received is not paid in
money.
- - Payments made by certain foreign organizations.
- - Payments made to a nominee.
Payments of interest not generally subject to backup withholding include the
following:
- - Payments of interest on obligations issued by individuals.
Note: You may be subject to backup withholding if this interest is $600 or
more and is paid in the course of the payer's trade or business and you have
not provided your correct taxpayer identification number to the payer.
- - Payments of tax-exempt interest (including exempt interest dividends under
section 852).
- - Payments described in section 6049(b)(5) to nonresident aliens.
- - Payments on tax-free covenant bonds under section 1451.
- - Payments made by certain foreign organizations.
- - Payments made to a nominee.
Exempt payees described above should file Form W-9 to avoid possible erroneous
backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER
IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO
THE PAYER. IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO
SIGN AND DATE THE FORM.
Certain payments other than interest, dividends, and patronage dividends
that are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under sections 6041, 6041A(a),
6045, and 6050A.
PRIVACY ACT NOTICE.--Section 6109 requires most recipients of dividend,
interest, or other payments to give taxpayer identification numbers to payers
who must report the payments to IRS. IRS uses the numbers for identification
purposes. Payers must be given the numbers whether or not recipients are
required to file tax returns. Beginning January 1, 1993, payers must generally
withhold 31% of taxable interest, dividend, and certain other payments to a
payee who does not furnish a taxpayer identification number to a payer. Certain
penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER.--If you fail
to furnish your taxpayer identification number to a payer, you are subject to a
penalty of $50 for each such failure unless your failure is due to reasonable
cause and not to willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.--If you
make a false statement with no reasonable basis which results in no imposition
of backup withholding, you are subject to a penalty of $500
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.--Falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE
SERVICE
<PAGE>
[LOGO]
November 6, 1998
Dear Stockholder:
Alliant Techsystems Inc. is offering to purchase up to 2,800,000 shares of
its Common Stock (including the associated preferred stock purchase rights) at a
price not greater than $77 nor less than $67 per share. The offer is being
conducted through a procedure commonly referred to as a modified "Dutch
Auction." If you do not wish to sell any of your shares, you do not need to take
any action.
If you would like to sell some or all of your shares in response to this
offer, you may either:
- specify the price, within the above range, at which you are willing to
sell some or all of your shares; or
- elect to sell some or all of your shares at a price determined by the
"Dutch Auction" procedure.
The number of shares that will be purchased by the Company in the offer and
the price at which they will be purchased will depend upon the number of shares
tendered (offered for sale) to the Company and the prices at which the tendering
stockholders specify that they are willing to sell their shares.
- If 2,800,000 or fewer shares are tendered, the Company will buy all
tendered shares at the highest price specified by any tendering
stockholder.
- If more than 2,800,000 shares are tendered, the Company will select a
single price at or below which tendering stockholders have offered to sell
at least 2,800,000 shares. In such event, stockholders tendering shares at
or below the selected price will have their shares purchased at such
selected price on a pro rata basis. Any such stockholder who owns less
than 100 shares will have all of his or her shares purchased. This "odd
lot" preference will not apply to shares acquired under the Company's
401(k) plans or employee stock purchase plans. Shares tendered at prices
above the selected price will not be purchased. Shares not purchased will
be returned to the tendering stockholder.
The offer and the procedure for tendering shares are explained in more
detail in the enclosed Offer to Purchase and Letter of Transmittal. I encourage
you to read these materials carefully before making any decision regarding
whether to tender any of your shares.
If you are a participant in one of the Company's 401(k) plans, you may
tender your plan shares by following the special instructions you will receive
separately from Fidelity Management Trust Company, the plan trustee. If you are
a participant in one of the Company's employee stock purchase plans, and your
shares are not subject to plan restrictions on transfer, you may tender your
plan shares by following the special instructions you will receive separately
from Piper Jaffray Inc., the plan administrator. If you hold an exercisable
Company stock option, you may tender the shares covered by your option, but you
must first exercise the option and pay the exercise price and applicable
withholding taxes.
The Company believes that repurchasing its shares at this time is consistent
with its goal to increase earnings per share and maximize shareholder value.
However, neither the Company nor its Board of Directors makes any recommendation
to any stockholder regarding whether to tender all or any of the stockholder's
shares. Each stockholder must make his or her own decision whether to tender any
shares and if so, at what price.
Sincerely,
/s/ Peter A. Bukowick
Peter A. Bukowick
PRESIDENT, ACTING CHIEF EXECUTIVE
OFFICER
AND CHIEF OPERATING OFFICER
<PAGE>
Exhibit 99.(a)8
IMMEDIATE ATTENTION REQUIRED
November 9, 1998
RE: The Alliant Techsystems Inc. 401(k) Plan and
The Alliant Techsystems Inc. 401(k) Plan Subject to a Collective Bargaining
Agreement
Dear Plan Participant:
Our records reflect that, as a participant in the plans above
(collectively, the "Plan"), a portion of your individual account is invested in
the Alliant Techsystems Inc. Common Stock Fund. Alliant Techsystems Inc. has
initiated an offer to purchase up to 2,800,000 shares of Alliant Techsystems
Inc. Common Stock.
Enclosed are tender offer materials and Direction Forms that require your
immediate attention. These materials describe an offer to purchase up to
2,800,000 shares of Alliant Techsystems Inc. Common Stock at prices not greater
than $77.00 nor less than $67.00. As described below, you have the right to
instruct Fidelity Management Trust Company ("Fidelity"), as trustee of the Plan,
concerning whether to tender shares of Alliant Techsystems Inc. Common Stock
credited to your individual account under the Plan, and at which price or
prices.
YOU WILL NEED TO COMPLETE THE ENCLOSED DIRECTION FORMS AND RETURN THEM TO
FIDELITY INSTITUTIONAL RETIREMENT SERVICES COMPANY IN THE ENCLOSED RETURN
ENVELOPE SO THAT THEY ARE RECEIVED BY 12:00 MIDNIGHT, EASTERN TIME, ON DECEMBER
3, 1998, UNLESS THE OFFER IS EXTENDED. IMPORTANT: PLEASE COMPLETE AND RETURN
BOTH OF THE ENCLOSED DIRECTION FORMS EVEN IF YOU DECIDE NOT TO PARTICIPATE IN
THE TENDER OFFER DESCRIBED BELOW.
The remainder of this letter summarizes the transaction, your rights under
the Plan and the procedures for completing the Direction Forms. You should also
review the more detailed explanation provided in the other tender offer
materials including the Offer to Purchase and the related BEIGE Letter of
Transmittal, enclosed with this letter.
BACKGROUND
Alliant Techsystems Inc. (the "Company") has made a tender offer to
purchase up to 2,800,000 shares of its Common Stock, par value $.01 per share
(the "Shares")(including the associated preferred stock purchase rights (the
"Rights") issued pursuant to the Rights Agreement, dated as of September 28,
1998, as amended), at prices not greater than $77.00 nor less than $67.00 per
Share. The enclosed Offer to Purchase dated November 6, 1998 (the "Offer to
Purchase"), and the related Letter of Transmittal (together with the Offer to
Purchase, the "Offer") set forth the objectives, terms and conditions of the
Offer and are being provided to all of the Company's shareholders.
<PAGE>
The Company's Offer to Purchase extends to the Shares held by the Plan. As
of October 30, 1998, the Plan held approximately 668,060 Shares. Only Fidelity,
as trustee of the Plan, can tender these Shares in the Offer. Nonetheless, as a
participant under the Plan, you have the right to direct Fidelity whether or not
to tender some or all of the Shares credited to your individual account in the
Plan, and at which price or prices. Unless otherwise required by applicable
law, Fidelity will tender Shares credited to participant accounts in accordance
with participant instructions and Fidelity will not tender Shares credited to
participant accounts for which it does not receive timely instructions. IF YOU
DO NOT COMPLETE THE ENCLOSED DIRECTION FORMS AND RETURN THEM TO FIDELITY ON A
TIMELY BASIS, YOU WILL BE DEEMED TO HAVE ELECTED NOT TO PARTICIPATE IN THE OFFER
AND NO SHARES CREDITED TO YOUR PLAN ACCOUNT WILL BE TENDERED IN THE OFFER.
The Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
and the trust agreement between the Company and Fidelity (the "trust
agreement"), prohibits the sale of Shares to the Company for less than adequate
consideration, which Fidelity will determine based on the prevailing or closing
market price of the Shares on or about the date the Shares are tendered by
Fidelity pursuant to the Offer (the "prevailing or closing market price").
Accordingly, depending on the closing market price of the Shares on such date,
Fidelity may be unable to tender Shares at certain directed prices within the
offered range. In such event, Fidelity will tender or nor tender Shares as
follows:
- - If the prevailing or closing market price is greater than the price at
which a participant directed his or her Shares be tendered but within the range
of tender prices offered, Fidelity will follow such participant's directions
regarding the percentage of Shares to be tendered but will increase the price at
which such Shares are to be tendered to the prevailing or closing market price.
This may result in some or all of such Shares not being purchased by the
Company.
- - If the prevailing or closing market price is greater than the maximum
tender price offered by the Company ($77.00 per Share), notwithstanding
participants' directions to tender Shares in the Offer, no Shares will be
tendered.
- - If the prevailing or closing market price is lower than the price at which
a participant directed his or her Shares to be tendered, notwithstanding the
lower closing market price, Fidelity will follow such participant's direction
(or failure to direct) both as to percentage of Shares to tender and as to the
price at which such Shares are tendered.
- - Unless otherwise required by applicable law, Fidelity will not tender
Shares for which it has received no direction, or for which it has received a
direction not to tender.
Please note that a tender of Shares credited to your individual account
under the Plan can be made only by Fidelity as the holder of record. DO NOT
COMPLETE THE BEIGE LETTER OF TRANSMITTAL; IT IS FURNISHED TO YOU FOR YOUR
INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER DIRECTLY SHARES CREDITED TO
YOUR INDIVIDUAL ACCOUNT UNDER THE PLAN. IF YOU WISH TO
2
<PAGE>
DIRECT FIDELITY CONCERNING THE TENDER OF YOUR SHARES IN THE PLAN, YOU MUST
COMPLETE AND RETURN THE ENCLOSED DIRECTION FORMS.
FIDELITY MAKES NO RECOMMENDATION AS TO WHETHER TO DIRECT THE TENDER OF
SHARES OR WHETHER TO REFRAIN FROM DIRECTING THE TENDER OF SHARES. EACH
PARTICIPANT MUST MAKE HIS OR HER OWN DECISION ON THESE MATTERS.
CONFIDENTIALITY
TO ASSURE THE CONFIDENTIALITY OF YOUR DECISION, FIDELITY AND ITS AFFILIATES
OR AGENTS WILL TABULATE THE DIRECTION FORMS. NEITHER FIDELITY NOR ITS
AFFILIATES OR AGENTS WILL MAKE THE RESULTS OF YOUR INDIVIDUAL DIRECTION
AVAILABLE TO THE COMPANY.
PROCEDURE FOR DIRECTING TRUSTEE
Enclosed are two Direction Forms which should be completed and returned to
Fidelity. Participants may have NON-RESTRICTED (or participant directed) Shares
and/or RESTRICTED Shares (Shares which cannot be exchanged into other investment
options). Please note that the reverse side of each Direction Form indicates
next to your address how many Shares of each type you have in your individual
account as of October 30, 1998. However, for purposes of final tabulation,
Fidelity will apply your instructions to the number of Shares credited to your
account as of December 1, 1998, or as of a later date if the Offer is extended.
If you want to tender NON-RESTRICTED Shares, you should complete and return
the top Direction Form. If NON-RESTRICTED Shares are accepted for payment in
the Offer, the proceeds will be reinvested in the Fidelity Money Market Trust:
Retirement Government Money Market Portfolio pending further investment
direction from you.
If you want to tender RESTRICTED Shares, you should complete and return the
bottom Direction Form. If RESTRICTED Shares are accepted for payment in the
Offer, the proceeds will be reinvested in the Alliant Techsystems Inc. Common
Stock Fund and will be used to purchase new shares of Alliant Techsystems Inc.
Common Stock as soon as administratively feasible after receipt of such
proceeds, in accordance with the provisions of the trust agreement regarding the
Alliant Techsystems Inc. Common Stock Fund. The purchase price of these new
Shares could be higher or lower than the final tender offer Purchase Price.
Therefore, participants who tender RESTRICTED Shares will be subject to risks
associated with fluctuations in the price of the Alliant Techsystems Inc. Common
Stock.
If you do not properly complete the Direction Form(s) or do not return them
by the deadline specified, such Shares will be considered NOT TENDERED.
To properly complete your Direction Forms, you must do the following:
(1) On the face of each Direction Form, check Box 1 or 2. CHECK ONLY ONE
BOX ON EACH DIRECTION FORM:
3
<PAGE>
- - CHECK BOX 1 if you DO NOT want the Shares credited to your individual
account tendered for sale in accordance with the terms of the Offer and simply
want the Plan to continue holding such Shares.
- - CHECK BOX 2 in all other cases and complete the table immediately below Box
2. Specify the percentage (in whole numbers) of Shares credited to your
individual account that you want to tender at each price indicated.
You may direct the tender of Shares credited to your account at
different prices. To do so, you must state the percentage (in whole
numbers) of Shares to be sold at each price by filling in the
percentage of such Shares on the line immediately before the price.
Also, you may elect to accept the per Share Purchase Price resulting
from the Dutch Auction tender process, which will result in receiving
a price per Share as low as $67.00 or as high as $77.00. Leave a line
blank if you want no Shares tendered at that price. The total
percentage of Shares credited to your individual account may not
exceed 100%, but it may be less than 100%. If this amount is less
than 100%, you will be deemed to have instructed Fidelity NOT to
tender the balance of the Shares credited to your individual account.
(2) Date and sign the Direction Forms in the space provided.
(3) Return the Direction Forms in the enclosed return envelope so that they
are received by Fidelity at the address on the return envelope (P.O. Box 9142,
Hingham, MA 02043) not later than 12:00 Midnight, Eastern time, on Thursday,
December 3, 1998, unless the Offer is extended (in which case the Direction
Forms must be returned no later than 12:00 Midnight, Eastern time, on the third
business day prior to the Expiration Date as so extended). If you wish to
return the forms by overnight mail, please send them to Fidelity's tabulation
agent, Management Information Services, at 61 Accord Park Drive, Norwell, MA
02061. NO FACSIMILE TRANSMITTALS OF THE DIRECTION FORMS WILL BE ACCEPTED.
Your direction will be deemed irrevocable unless withdrawn by
12:00 Midnight, Eastern time, on Thursday, December 3, 1998, unless the Offer is
extended. In order to make an effective withdrawal, you must submit new
Direction Forms which may be obtained by calling Fidelity at 1-888-285-4015.
Your new Direction Forms must include your name, address and Social Security
number. Upon receipt of new, completed and signed Direction Forms, your
previous direction will be deemed canceled. You may direct the re-tendering of
any Shares credited to your individual account by obtaining an additional
Direction Forms from Fidelity and repeating the previous instructions for
directing tenders as set forth in this letter.
After the deadline above for returning the Direction Forms to Fidelity,
Fidelity and its affiliates or agents will complete the tabulation of all
directions and Fidelity, as trustee, will tender the appropriate number of
Shares, as described in the "BACKGROUND" section above. Unless the Offer is
terminated or amended in accordance with its terms, after the expiration date of
the Offer the Company will determine the per Share purchase price (not greater
than $77.00 nor less than $67.00) (the "Purchase Price"), that allows the
Company to purchase 2,800,000 Shares (or such lesser number of Shares as is
validly tendered and not withdrawn at prices not
4
<PAGE>
greater than $77.00 nor less than $67.00 per Share). The Company will then buy
all of the Shares, up to 2,800,000, that were tendered at the Purchase Price or
below. ALL PARTICIPANTS WHO TENDER SHARES AT OR BELOW THE PURCHASE PRICE WILL
RECEIVE THE SAME PER SHARE PURCHASE PRICE FOR SHARES ACCEPTED FOR PURCHASE. If
there is an excess of Shares tendered over the exact number desired by the
Company at the Purchase Price, Shares tendered pursuant to the Offer may be
subject to proration, as set forth in Section 1 of the Offer to Purchase. If
you direct the tender of any Shares credited to your individual account at a
price in excess of the Purchase Price as finally determined, or in the event of
proration, those Shares not purchased in the Offer will remain allocated to your
individual account under the Plan.
The preferential treatment of holders of fewer than 100 Shares, as
described in Section 2 of the Offer to Purchase, will not be afforded to
participants in the Plan, regardless of the number of Shares held within their
individual accounts. Similarly, participants in the Plan are not able to
conditionally tender the Shares within their individual accounts under the Plan
(as described in Section 6 of the Offer to Purchase).
EFFECT OF TENDER ON YOUR ACCOUNT
As of 4:00 p.m., Eastern Time, on Tuesday, December 1, 1998, you will NOT
be able to make exchanges out of the Alliant Techsystems Inc. Common Stock Fund
until all tender offer processing has been completed. Further, all
distributions, loans and withdrawals from balances in the Alliant Techsystems
Inc. Common Stock Fund in the Plan will be frozen after that time. However,
balances in the Alliant Techsystems Inc. Common Stock fund will be utilized to
calculate amounts eligible for distributions, loans and withdrawals throughout
the freeze. Contributions to and exchanges from other investment options into
the Alliant Techsystems Inc. Common Stock Fund may continue throughout the
tender offer and will be unaffected by the freeze. FOR ADMINISTRATIVE PURPOSES,
THE ACCOUNTS OF ALL PLAN PARTICIPANTS WILL BE TEMPORARILY FROZEN, REGARDLESS OF
WHETHER YOU ELECT TO TENDER YOUR SHARES, AND WILL REMAIN FROZEN UNTIL ALL TENDER
OFFER PROCESSING HAS BEEN COMPLETED. Fidelity will complete processing as soon
as administratively possible. Fidelity anticipates that the processing will be
completed five to seven business days after receipt of proceeds from the
Company.
For any Shares in the Plan that are tendered and purchased by the Company,
the Company will pay cash to the Plan. INDIVIDUAL PARTICIPANTS IN THE PLAN WILL
NOT, HOWEVER, RECEIVE ANY CASH TENDER PROCEEDS DIRECTLY. ALL SUCH PROCEEDS WILL
REMAIN IN THE PLAN AND MAY BE WITHDRAWN ONLY IN ACCORDANCE WITH THE TERMS OF THE
PLAN.
The investment of proceeds from the Offer depends on whether the tendered
Shares accepted for purchase are attributable to participant directed or
RESTRICTED sources. Fidelity will invest proceeds with respect to Shares
credited to your account from participant directed sources in the Fidelity Money
Market Trust: Retirement Government Money Market Portfolio as soon as
administratively possible after receipt of proceeds. As required by the Plan,
proceeds received with respect to Shares tendered from RESTRICTED sources will
be reinvested in the Alliant Techsystems Inc. Common Stock Fund as soon as
administratively possible after receipt of the
5
<PAGE>
proceeds. You may call Fidelity at 1-888-285-4015 after the reinvestment is
complete to learn the effect of the tender on your account or to have the
proceeds from the sale of Shares which were invested in the Fidelity Money
Market Trust: Retirement Government Money Market Portfolio invested in other
investment options offered under the Plan.
SHARES OUTSIDE THE PLAN
If you hold Shares directly, you will receive, under separate cover, tender
offer materials directly from the Company which can be used to tender such
Shares directly to the Company. THOSE TENDER OFFER MATERIALS MAY NOT BE USED TO
DIRECT FIDELITY TO TENDER OR NOT TENDER THE SHARES CREDITED TO YOUR INDIVIDUAL
ACCOUNT UNDER THE PLAN. The direction to tender or not tender Shares credited
to your individual account under the Plan may only be made in accordance with
the procedures in this letter. Similarly, the enclosed Direction Forms may not
be used to tender non-Plan Shares.
FURTHER INFORMATION
If you require additional information concerning the procedure to tender
Shares credited to your individual account under the Plan, please contact
Fidelity at 1-888-285-4015. If you require additional information concerning
the terms and conditions of the Offer, please call MacKenzie Partners, Inc., the
Information Agent, at 1-800-322-2885.
Sincerely,
Fidelity Management Trust Company
6
<PAGE>
OFFER TO PURCHASE FOR CASH
UP TO 2,800,000 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
AT
A PURCHASE PRICE NOT IN EXCESS OF $77 NOR LESS THAN $67
OF
ALLIANT TECHSYSTEMS INC.
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON TUESDAY, DECEMBER 8, 1998 UNLESS THE OFFER IS EXTENDED.
To the Participants in the Alliant Techsystems Inc. 1991 Monthly Common
Stock Purchase Program (the "1991 ESPP") or the Alliant Techsystems Inc. 1997
Employee Stock Purchase Plan (the "1997 ESPP" and together with the 1991 ESPP
the "ESPP Plans"):
Enclosed for your consideration are the Offer to Purchase, dated November 6,
1998 (the "Offer to Purchase"), and the related Letter of Transmittal which
together constitute (the "Offer) setting forth Alliant Techsystems Inc.'s offer
to purchase up to 2,800,000 shares of its Common Stock (including the associated
preferred stock purchase rights (the "Shares")) at a price not greater than $77
nor less that $67 per share. The offer is being conducted through a procedure
commonly referred to as a modified "Dutch Auction." If you do not wish to sell
any of the Shares held in your ESPP Plan account (the "ESPP Shares"), you do not
need to take any action.
If you would like to sell some or all of your ESPP Shares in response to
this offer, you may either:
- specify the price, within the above range, at which you are willing to
sell some or all of your shares; or
- elect to sell some or all of your shares at a price determined by the
modified "Dutch Auction" procedure.
The number of shares that will be purchased by the Company in the Offer and
the price at which they will be purchased, will depend upon the number of shares
tendered (offered for sale) to the Company and the price at which the tendering
stockholders specify that they are willing to sell their shares.
- If 2,800,000 or fewer shares are tendered, the Company will buy all
tendered shares at the highest price specified by any tendering
stockholder.
- If more than 2,800,000 shares are tendered, the Company will select the
single price at or below which tendering stockholders have offered to sell
at least 2,800,000 shares. In such event, stockholders tendering shares at
or below the selected price will have their shares purchased at such
selected price on a pro rata basis. Any such stockholder who owns less
than 100 Shares will have all of his or her shares purchased. This "odd
lot" preference will not apply to shares acquired under the Company's
401(k) plans or ESPP Plans. Shares tendered at prices above the selected
price will not be purchased. Shares not purchased will be returned to the
tendering stockholder.
You must carefully follow the instructions below if you want to tender some
or all of the Shares held in your ESPP account. Failure to follow such
instructions properly may make you ineligible to tender such Shares in the
Company's offer.
We are the holder of record of the ESPP Shares held for your account. A
tender of such ESPP Shares can be made only by us as the holder of record.
Pursuant to your instructions, we will complete a Letter of
<PAGE>
Transmittal with respect to ESPP Shares you direct the Administrator to tender
on your behalf. BECAUSE THE TERMS AND CONDITIONS OF THE LETTER OF TRANSMITTAL
WILL GOVERN THE TENDER OF YOUR ESPP SHARES, YOU SHOULD READ THE LETTER OF
TRANSMITTAL CAREFULLY. HOWEVER, THE LETTER OF TRANSMITTAL IS FURNISHED TO YOU
FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER ESPP SHARES HELD
BY US FOR YOUR ACCOUNT.
Under the terms of the 1997 ESPP, participants may not sell 1997 ESPP
Shares, including in the Offer, unless 12 months have elapsed since the date
such Shares were purchased or the participant for whose account such Shares were
purchased has died or terminated employment with the Company or a change of
control (as defined in the 1997 ESPP) has occurred. ESPP Shares that may not be
sold due to these restrictions will not be tendered in the Offer and will remain
credited to participants' 1997 ESPP accounts notwithstanding participants'
instructions to tender such Shares. These ESPP Shares will continue to not be
eligible for sale until expiration of the one-year holding period, death of the
participant, termination of employment with the Company by the participant or
the occurrence of a "change of control."
ESPP Shares that are not purchased in the Company's offer because of the
proration process as described below and in the Offer to Purchase (or for any
other reason) will be returned to your applicable ESPP Plan account.
We request instructions as to whether you wish us to tender any or all of
the Shares held by us for your account, upon the terms and subject to the
conditions set forth in the Offer to Purchase and the Letter of Transmittal.
Your attention is invited to the following:
(1) You may tender Shares at either (i) the price determined by you (in
multiples of $0.25), not greater than $77 nor less than $67 per Share, or
(ii) the price determined by "Dutch Auction."
(2) The Offer is for up to 2,800,000 Shares, constituting approximately 23% of
the total Shares outstanding as of November 5, 1998. Although it has no
present intention of so doing, the Company reserves the right to purchase
more or less than 2,800,000 Shares pursuant to the Offer. The Offer is not
conditioned upon any minimum number of Shares being tendered. The Offer is,
however, conditional on other factors, such as the Company's obtaining the
funds necessary to consummate the Offer and to pay all related fees and
expenses.
(3) The Offer, proration period and withdrawal rights will expire at 5:00 P.M.,
New York City time, on Tuesday, December 8, 1998 unless the Offer is
extended. SHOULD YOU WISH TO TENDER ALL OR ANY OF YOUR ESPP SHARES, YOU
SHOULD INSTRUCT US OF YOUR INTENTIONS IN AMPLE TIME TO PERMIT US TO SUBMIT A
TENDER ON YOUR BEHALF AND IN ANY EVENT NO LATER THAN 5:00 P.M. ON WEDNESDAY,
DECEMBER 2, 1998. If you would like to withdraw your Shares that we have
tendered, you can withdraw them so long as the Offer remains open or at any
time after January 17, 1999 if they have not been accepted for payment.
(4) As described in the Offer to Purchase, if more than 2,800,000 Shares have
been validly tendered at or below the Purchase Price and not properly
withdrawn on or prior to the Expiration Date, as defined in Section 1 of the
Offer to Purchase, the Company will prorate the number of Shares it
purchases from each person who tenders Shares. This means that the Company
will not purchase all of the ESPP Shares you tender under these
circumstances. In the event of proration, the Company will purchase Shares
in the following order of priority:
(a) all Shares validly tendered at or below the Purchase Price and not
properly withdrawn on or prior to the Expiration Date by any stockholder
(an "Odd Lot Owner") who owned beneficially or of record an aggregate of
fewer than 100 Shares (not including any Shares held pursuant to the
Company's 401(k) plans or the ESPP Plans) as of the close of business on
November 5, 1998.
2
<PAGE>
(b) after purchase of all of the foregoing Shares, subject to the
conditional tender provisions described in Section 6 of the Offer to
Purchase, all other Shares (including any ESPP Shares) validly tendered
at or below the Purchase Price and not properly withdrawn on or prior to
the Expiration Date on a pro rata basis, if necessary (with appropriate
rounding adjustments to avoid purchases of fractional Shares); and
(c) If conditional tenders would otherwise be deemed to have been withdrawn
and, as a result, would cause the total number of Shares to be purchased
to fall below 2,800,000, then, to the extent feasible, the Company will
select enough of such conditional tenders that would otherwise have been
so properly withdrawn to permit the Company to purchase 2,800,000 Shares.
In selecting among such conditional tenders, the Company will select by
random lot and will limit its purchase in each case to the designated
minimum number of Shares to be purchased. PLEASE BE AWARE THAT THE
COMPANY WILL NOT ACCEPT CONDITIONAL TENDERS OF ESPP SHARES AS PART OF THE
OFFER.
(5) Any stock transfer taxes applicable to the sale of Shares to the Company
pursuant to the Offer will be paid by the Company, except as otherwise
provided in Instruction 7 of the Letter of Transmittal.
(6) Tendering stockholders will not be obligated to pay any brokerage
commissions, solicitation fees or, subject to Instruction 7 of the Letter of
Transmittal, stock transfer taxes on the Company's purchase of Shares
pursuant to the Offer. However, a tendering stockholder who holds Shares
through a broker, dealer or custodian may be required by such entity to pay
a service charge or other fee.
(7) If you wish to tender portions of your ESPP Share holdings at different
prices, you must notify us, as administrator for the ESPP Plans, of each
price at which you wish to tender each such portion of your ESPP Shares. We
must submit separate Letters of Transmittal on your behalf for each price
specified. The same ESPP Shares cannot be tendered at different prices
unless such tendered ESPP Shares are validly withdrawn and retendered.
(8) You may designate the priority in which your Shares shall be purchased in
the event of proration.
NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO
ANY STOCKHOLDER AS TO WHETHER TO TENDER ALL OR ANY SHARES. STOCKHOLDERS MUST
MAKE THEIR OWN DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO, HOW MANY
SHARES TO TENDER.
The Offer is being made to all holders of Shares solely pursuant to the
Offer to Purchase and the related Letter of Transmittal. This Offer is not being
made to (nor will any tender of Shares be accepted from or on behalf of) holders
in any jurisdiction in which the making of the Offer or the acceptance of any
tender of Shares therein would not be in compliance with the laws of such
jurisdiction. However, the Company may, at its discretion, take such action as
it may deem necessary for the Company to make the Offer in any such jurisdiction
and extend the Offer to holders in such jurisdiction. In any jurisdiction the
securities or blue sky laws of which require the Offer to be made by a licensed
broker or dealer, the Offer is being made on behalf of the Company by the Dealer
Manager or one or more registered brokers or dealers which are licensed under
the laws of such jurisdiction.
IN ORDER TO TENDER ESPP SHARES, YOU MUST CALL THE PLAN ADMINISTRATOR AT
1-800-677-1113 IN AMPLE TIME TO PERMIT US TO SUBMIT A TENDER ON YOUR BEHALF BY
THE EXPIRATION OF THE OFFER AND IN ANY EVENT NO LATER THAN 5:00 P.M., NEW YORK
CITY TIME, ON WEDNESDAY, DECEMBER 2, 1998. THE OFFER, PRORATION PERIOD AND
WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON TUESDAY, DECEMBER
8, 1998 UNLESS THE COMPANY EXTENDS THE OFFER. SHARES THAT ARE TENDERED AFTER
THIS DEADLINE, AND SHARES THAT ARE OTHERWISE INVALIDLY TENDERED, WILL NOT BE
ACCEPTED.
3
<PAGE>
As more fully described in the Offer to Purchase, tenders will be deemed
irrevocable unless withdrawn by the dates specified therein. If you instruct the
Plan Administrator to tender ESPP Shares, and you subsequently decide to change
your instructions, you may do so by contacting the Plan Administrator at
1-800-677-1113. The notice of withdrawal will be effective only if is received
by the Plan Administrator AT OR BEFORE 5:00 P.M., NEW YORK CITY TIME, ON
WEDNESDAY, DECEMBER 2, 1998. Upon receipt of a timely notice of change of
instruction to the Plan Administrator, previous instructions to tender with
respect to such Shares will be deemed canceled. If you later wish to retender
Shares, you may call the Plan Administrator at the above number.
If you have questions about tendering ESPP Shares, please call the Plan
Administrator, Piper Jaffray Inc. at (800) 677-1113. If you have any questions
about the Offer or any of the other matters discussed above, please call
MacKenzie Partners, Inc., the Information Agent at (800) 322-2885.
Sincerely,
PIPER JAFFRAY INC.
4
<PAGE>
Exhibit 99(a)10
NEWS RELEASE [ALLIANT TECHSYSTEMS LETTERHEAD]
FOR IMMEDIATE RELEASE
MEDIA CONTACT: INVESTOR CONTACT:
ROD BITZ RICHARD N. JOWETT
PHONE: 612-931-5413 PHONE: 612-931-6080
E-MAIL: [email protected] E-MAIL: [email protected]
ALLIANT TECHSYSTEMS ANNOUNCES MODIFIED DUTCH AUCTION
TENDER OFFER FOR UP TO 2.8 MILLION OF ITS SHARES
MINNEAPOLIS, NOV. 5, 1998 -- Alliant Techsystems (NYSE: ATK) today
announced that its board of directors has authorized the company to repurchase
up to 2.8 million shares of its common stock, or approximately 23 percent of its
outstanding shares, pursuant to a modified "Dutch Auction" tender offer.
The tender offer will commence on Friday, Nov. 6, 1998, and will expire at
5:00 p.m., New York City time, on Tuesday, Dec. 8, 1998, unless extended. The
offer invites shareholders to tender all or a portion of their shares at a price
not greater than $77 nor less than $67 per share. The closing price of the
company's stock on Nov. 5, 1998, was $73 7/8 per share. Copies of the offering
materials are being mailed to all stockholders.
The number of shares that will be purchased by the company in the offer,
and the price at which they will be purchased, will depend upon the number of
shares tendered (offered for sale) to the company and the prices at which the
tendering stockholders specify that they are willing to sell their shares.
If 2.8 million or fewer shares are tendered, the company will buy all
tendered shares at the highest price specified by any tendering stockholder.
-more-
<PAGE>
ALLIANT TECHSYSTEMS - PAGE 2
If more than 2.8 million shares are tendered, the company will select the
single price at or below which tendering stockholders have offered to sell at
least 2.8 million shares. In such event, stockholders tendering shares at or
below the selected price will have their shares purchased at such selected price
on a pro-rata basis. Any such stockholder who owns less than 100 shares will
have all of his or her shares purchased. This "odd lot" preference will not
apply to shares acquired under the company's 401(k) plans or employee stock
purchase plans. Shares tendered at prices above the selected price will not be
purchased. Shares not purchased will be returned to the tendering stockholder.
The company said it will enter into new credit facilities arranged by Chase
Securities Inc. and agented by The Chase Manhattan Bank to refinance existing
borrowings, fund the offer, and provide for its working capital and other
general corporate requirements.
Peter A. Bukowick, president, acting chief executive officer, and chief
operating officer, said the offer is supportive of the company's goal to
increase earnings per share and maximize shareholder value.
"Our strong financial performance, record backlog, and new long-term
contracts, together with the prevailing interest rate environment, give us
confidence that the debt we will incur to repurchase these shares will not
affect our prospects for future internal growth nor impede possible future
acquisitions," said Bukowick.
Bukowick said the strategic use of cash and future cash flows for share
repurchases, acquisitions, or internal investments is one of six building blocks
to achieve the company's goal to increase earnings per share at an average
annual rate of 15 percent over a five-year period.
"By repurchasing these shares now, with borrowed funds, we are accelerating
the benefits of this building block," said Bukowick. "Although the company's
interest expense will increase, the transaction is not expected to have any net
impact on earnings per share for the fiscal year ending March 31, 1999, and is
expected to be accretive to earnings in future years."
Neither the company nor its board of directors makes any recommendation to
shareholders whether to tender or refrain from tendering their shares.
Shareholders must make their own decision.
This news release is neither an offer to purchase nor a solicitation of an
offer to sell the common stock. The offer is made only by an Offer to Purchase
dated Nov. 6, 1998, and the related Letter of Transmittal.
-more-
<PAGE>
ALLIANT TECHSYSTEMS - PAGE 3
Additional information concerning the terms of the tender offer may be
obtained from the Dealer Manager, Morgan Stanley Dean Witter, at 800-223-2440,
extension 5722. Copies of the Offer to Purchase and the Letter of Transmittal
and related documents may be obtained from the Information Agent, MacKenzie
Partners, Inc., at 156 Fifth Avenue, New York, N.Y., 10010. Telephone:
800-322-2885.
The prospects and expectations for growth, acquisitions, cash flows,
interest expense, and earnings per share included in this news release are
"forward-looking statements" as defined in the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially from
anticipated results, including changes in governmental spending and budgetary
policies, economic conditions, the company's competitive environment, the timing
of awards and contracts, the outcome of contingencies, including litigation and
environmental remediation, and program performance, in addition to other factors
not listed.
Alliant Techsystems is a $1.1 billion aerospace and defense company with
approximately 6,300 employees. Headquartered in Hopkins, Minn., the company's
business groups are Conventional Munitions, Space and Strategic Systems, and
Defense Systems. Company news and information can be found on the Internet at
www.ATK.com.
# # #
<PAGE>
SUMMARY ADVERTISEMENT
THIS ANNOUNCEMENT IS NEITHER AN OFFER TO PURCHASE NOR A SOLICITATION OF AN
OFFER TO SELL SHARES. THE OFFER IS MADE SOLELY PURSUANT TO THE OFFER TO
PURCHASE DATED NOVEMBER 6, 1998 AND THE RELATED LETTER OF TRANSMITTAL.
THE OFFER IS BEING MADE TO ALL HOLDERS OF SHARES; PROVIDED THAT THE
OFFER IS NOT BEING MADE TO, NOR WILL TENDERS BE ACCEPTED FROM OR ON
BEHALF OF, HOLDERS OF SHARES IN ANY JURISDICTION IN WHICH MAKING OR
ACCEPTING THE OFFER WOULD VIOLATE THAT JURISDICTION'S LAWS. IN THOSE
JURISDICTIONS WHERE SECURITIES, BLUE SKY OR OTHER LAWS REQUIRE THE
OFFER TO BE MADE BY A LICENSED BROKER OR DEALER, THE OFFER SHALL BE
DEEMED TO BE MADE ON BEHALF OF THE COMPANY BY MORGAN STANLEY & CO.
INCORPORATED OR ONE OR MORE REGISTERED BROKERS OR DEALERS LICENSED
UNDER THE LAWS OF SUCH JURISDICTIONS.
NOTICE OF OFFER TO PURCHASE FOR CASH
BY
ALLIANT TECHSYSTEMS INC.
UP TO 2,800,000 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
AT A PURCHASE PRICE NOT GREATER THAN
$77 NOR LESS THAN $67 PER SHARE
Alliant Techsystems Inc., a Delaware corporation (the "Company"), invites
its stockholders to tender shares of its Common Stock, par value $.01 per share
(the "Shares") (including the associated preferred stock purchase rights issued
pursuant to the Rights Agreement, dated as of September 28, 1990, as amended
between the Company and The Chase Manhattan Bank (as successor to Manufacturers
Hanover Trust Company), as the Rights Agent), at prices not greater than $77 nor
less than $67 per Share, net to the seller in cash, specified by tendering
stockholders, upon the terms and subject to the conditions set forth in the
Offer to Purchase, dated November 6, 1998 (the "Offer to Purchase") and in the
related Letter of Transmittal (which together constitute the "Offer").
THE OFFER IS NOT CONDITIONED UPON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO OTHER CONDITIONS. SEE SECTION 7 OF
THE OFFER TO PURCHASE.
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON TUESDAY, DECEMBER 8, 1998, UNLESS THE OFFER IS EXTENDED.
The Company will determine a single per Share price (not greater than $77
nor less than $67 per Share) that it will pay for Shares validly tendered
pursuant to the Offer and not properly withdrawn (the "Purchase Price"), taking
into account the number of Shares so tendered and the prices specified by
tendering stockholders. The Company will select the Purchase Price that will
enable it to buy 2,800,000 Shares (or such lesser number of Shares as are
validly tendered at prices not greater than $77 nor less than $67 per Share)
pursuant to the Offer. The Company will purchase all Shares validly tendered at
prices at or below the Purchase Price and not withdrawn, upon the terms and
subject to the conditions of the Offer, including the provisions relating to
proration and conditional tenders described below. The Purchase Price will be
paid in cash, net to the seller, with respect to all Shares purchased. Shares
tendered at prices in excess of the Purchase Price and Shares not purchased
because of proration and conditional tenders will be returned.
Upon the terms and subject to the conditions of the Offer, if more than
2,800,000 Shares have been validly tendered at or below the Purchase Price and
not withdrawn on or prior to the Expiration Date (as defined in the Offer to
Purchase), the Company will purchase Shares in the following order of priority:
(a) first, all Shares validly tendered at or below the Purchase Price and not
withdrawn on or prior to the
<PAGE>
Expiration Date by any stockholder who owned beneficially or of record an
aggregate of fewer than 100 Shares (not including any Shares acquired pursuant
to the Company's 401(k) plans or its employee stock purchase plans) as of the
close of business on November 5, 1998 and who validly tenders all of such Shares
(partial tenders will not qualify for this preference) and completes the box
captioned "Odd Lots" on the Letter of Transmittal and, if applicable, the Notice
of Guaranteed Delivery; and (b) then, after purchase of all the foregoing
Shares, subject to the conditional tender provisions described in Section 6 of
the Offer to Purchase, all other Shares validly tendered at or below the
Purchase Price and not withdrawn on or prior to the Expiration Date on a pro
rata basis, if necessary (with appropriate rounding adjustments to avoid
purchases of fractional Shares).
Stockholders may tender Shares subject to the condition that a specified
minimum number of such holder's Shares tendered pursuant to a Letter of
Transmittal or Notice of Guaranteed Delivery must be purchased if any such
Shares so tendered are purchased, and any stockholder desiring to make such a
conditional tender must so indicate in the box captioned "Conditional Tender" in
such Letter of Transmittal or, if applicable, in the Notice of Guaranteed
Delivery. In addition, participants in the Company's 401(k) plans who wish to
tender all or any Shares acquired pursuant to such plans must follow the special
instructions set forth in the materials on YELLOW paper. Participants in the
Company's employee stock purchase plans who wish to tender all or any Shares
acquired pursuant to such plans must follow the special instructions set forth
on PINK paper.
The Company believes that the repurchase of outstanding Shares at this time
is consistent with the Company's goal to increase earnings per share and
maximize shareholder value. The Offer will afford to stockholders who are
considering the sale of all or a portion of their Shares the opportunity to
determine the price (not greater than $77 nor less than $67 per Share) at which
they are willing to sell their Shares and, in the event the Company accepts such
Shares, to dispose of Shares without the usual transaction costs associated with
a market sale. The Offer will also allow qualifying stockholders owning
beneficially or of record fewer than 100 Shares (not including any Shares
acquired pursuant to the Company's 401(k) plans or its employee stock purchase
plans) to avoid the payment of brokerage commissions and the applicable odd lot
discount payable on a sale of Shares in a transaction effected on a securities
exchange.
Neither the Company nor its Board of Directors makes any recommendation to
any stockholder as to whether to tender all or any Shares. Each stockholder must
make his or her own decision as to whether to tender shares and, if so, how many
Shares to tender and at what price. The Company has been informed that no
director or executive officer intends to tender Shares pursuant to the Offer,
except for Richard Schwartz, its retired Chief Executive Officer and retiring
Chairman of the Board. Mr. Schwartz, as part of his retirement planning, intends
to tender up to 100,000 Shares of the 50,493 Shares he owns beneficially and the
215,000 Shares he is entitled to acquire pursuant to the exercise of stock
options, all of which are currently exercisable.
The Company reserves the right, at any given time or from time to time, to
extend the period of time during which the Offer is open by giving oral or
written notice of such extension to the Depositary, followed by a public
announcement thereof no later than 9:00 a.m., New York City time, on the next
business day after the previously scheduled Expiration Date.
Tenders of Shares made pursuant to the Offer may be withdrawn at any time
prior to the Expiration Date. Thereafter, such tenders are irrevocable, except
that they may be withdrawn after January 17, 1999, unless theretofore accepted
for payment by the Company as provided in the Offer to Purchase. For a
withdrawal to be effective, a written or facsimile transmission notice of
withdrawal must be timely received by the Depositary at one of the addresses or
the facsimile number set forth on the back cover of the Offer to Purchase and
must specify the name of the person who tendered the Shares to be withdrawn and
the number of Shares to be withdrawn. If the Shares to be withdrawn have been
delivered to the Depositary, a signed notice of withdrawal with signatures
guaranteed by an Eligible Institution (as defined in Section 3 of the Offer to
Purchase) (except in the case of Shares tendered by an Eligible Institution)
must be submitted
2
<PAGE>
prior to the release of such Shares. In addition, such notice must specify, in
the case of Shares tendered by delivery of certificates, the name of the
registered holder (if different from that of the tendering stockholder) and the
serial numbers shown on the particular certificates evidencing the Shares to be
withdrawn or, in the case of Shares tendered by book-entry transfer, the name
and number of the account at one of the Book-Entry Transfer Facilities (as
defined in the Offer to Purchase) to be credited with the withdrawn Shares.
Withdrawals may not be rescinded, and Shares withdrawn will thereafter be deemed
not validly tendered for purposes of the Offer. However, withdrawn Shares may be
retendered by again following one of the procedures described in Section 3 of
the Offer to purchase at any time prior to the Expiration Date.
The Company will be deemed to have purchased tendered Shares as, if and when
it gives oral or written notice to the Depositary of its acceptance for payment
of Shares.
The information required to be disclosed by Rule 13e-4(d)(1) of the General
Rules and Regulations under the Securities Exchange Act of 1934, as amended, is
contained in the Offer to Purchase and is incorporated herein by reference.
Copies of the Offer to Purchase and the related Letter of Transmittal are
being mailed to record holders of Shares and will be furnished to brokers, banks
and similar persons whose names, or the names of whose nominees, appear on the
Company's stockholder list or, if applicable, who are listed as participants in
a clearing agency's security position listing for subsequent transmittal to
beneficial owners of Shares.
The Offer to Purchase and the related Letter of Transmittal contain
important information that should be read before any decision is made with
respect to the Offer.
Any questions or requests for assistance may be directed to MacKenzie
Partners, Inc. (the "Information Agent") or Morgan Stanley & Co. Incorporated
(the "Dealer Manager") at their respective telephone numbers and addresses
listed below. Requests for additional copies of the Offer to Purchase, the
Letter of Transmittal, Notice of Guaranteed Delivery or other tender offer
materials may be directed to the Information Agent or the Dealer Manager and
such copies will be furnished promptly at the Company's expense. Stockholders
may also contact their local broker, dealer, commercial bank or trust company
for assistance concerning the Offer.
The Information Agent is:
[LOGO]
156 Fifth Avenue
New York, New York 10010
(212) 929-5500 (collect)
(800) 322-2885 (toll-free)
The Dealer Manager is:
MORGAN STANLEY DEAN WITTER
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
(212) 761-5722 (call collect)
(800) 223-2440 ext. 5722 (toll-free)
November 6, 1998
3
<PAGE>
Exhibit 99(b)(1)
THE CHASE MANHATTAN BANK
CHASE SECURITIES INC.
270 Park Avenue
New York, NY 10017
October 26, 1998
Alliant Techsystems Inc.
600 Second Street N.E.
Hopkins, MN 55343-8384
Attention: Mr. Scott Meyers
Chief Financial Officer
ALLIANT TECHSYSTEMS INC.
SENIOR SECURED CREDIT FACILITIES
COMMITMENT LETTER
Ladies and Gentlemen:
You have advised The Chase Manhattan Bank ("Chase") and Chase
Securities Inc. ("CSI") that Alliant Techsystems Inc. ("ATK") wishes to
establish Senior Secured Credit Facilities (the "Facilities") in an aggregate
principal amount of up to $650,000,000, consisting of a Senior Secured Term Loan
Facility in a principal amount of $200,000,000, a Senior Secured Delayed Draw
Term Loan Facility in a principal amount of up to $200,000,000, and a Senior
Secured Revolving Credit Facility in a principal amount of up to $250,000,000,
as described in the Summary of Principal Terms and Conditions attached hereto as
Exhibit A (the "Term Sheet").
You hereby appoint CSI, and CSI hereby agrees to act, as advisor,
arranger and book manager (the "Arranger") for the Facilities, and you hereby
appoint Chase, and Chase hereby agrees to act, as administrative agent (the
"Administrative Agent") for the Facilities. Chase is pleased to advise you of
its commitment to provide up to $65,000,000 of the Facilities, subject to the
successful syndication of the portion of the Facilities not committed to by
Chase and upon the terms and subject to the conditions set forth or referred to
in this Commitment Letter and in the Term Sheet. CSI will use its best
reasonable efforts to effect a successful syndication of the Facilities.
It is agreed that Chase will act as the sole and exclusive
administrative agent for the Facilities and CSI will act as the sole and
exclusive advisor, arranger and book manager for the Facilities, and each will,
in such capacities, perform the duties customarily associated with such roles.
It is further agreed that no other agents or co-agents will be appointed, and no
other titles will be awarded to any Lender (as defined below), unless approved
by us and you.
Chase reserves the right, prior to or after the execution of
definitive documentation for the Facilities, to syndicate all or a portion of
its commitment hereunder to one or more financial institutions and other
entities that will become parties to such definitive documentation pursuant to a
syndication to be managed by the Arranger in consultation with you (Chase and
any such financial institutions becoming parties to such definitive
documentation being collectively called the "Lenders"). You agree actively to
assist the Arranger in achieving a timely syndication that is reasonably
satisfactory to the Arranger, Chase and you. This will be accomplished by a
variety of means, including direct contact during the syndication among the
directors, senior officers,
<PAGE>
2
representatives and advisors of ATK and its subsidiaries, on the one hand, and
the proposed Lenders, on the other hand. Such assistance shall also include
your using your best reasonable efforts to cause the syndication efforts of the
Arranger to benefit from the lending relationships of ATK and its subsidiaries.
It is agreed that the Arranger will, in consultation with you, manage
all aspects of the syndication, including selection of Lenders, determination of
when the Arranger will approach potential Lenders, any naming rights and the
final allocations of the commitments among the Lenders. To assist the Arranger
in the above-described syndication efforts, you agree, upon the Arranger's
reasonable request, (a) promptly to provide such financial and other information
with respect to ATK and its subsidiaries and the transactions contemplated
hereby, including but not limited to information and projections prepared by ATK
relating to ATK or any transaction contemplated hereby, as the Arranger shall
reasonably request, (b) to make your senior officers and your subsidiaries'
senior officers available to prospective Lenders, (c) to assist, and to cause
your subsidiaries to assist, the Arranger in the preparation of a Confidential
Information Memorandum and other marketing materials to be used in connection
with the syndication and (d) to host, with the Arranger, a meeting or meetings
with prospective Lenders.
As consideration for Chase's commitment hereunder and the agreement of
the Arranger to structure, arrange and syndicate the Facilities, you agree to
pay to Chase the fees set forth in the Term Sheet and in the Fee Letter dated
the date hereof and delivered herewith (the "Fee Letter"). Once paid, such fees
shall not be refundable.
Chase and the Arranger shall be entitled, with your prior consent, to
change the structure, terms or pricing of the Facilities if the syndication has
not been completed and if Chase and the Arranger determine that such changes are
advisable in order to insure a successful syndication of the Facilities.
Chase's commitment is subject to the agreements in this paragraph.
You hereby represent and covenant that (a) all information and data
(excluding financial projections) concerning ATK, its subsidiaries and the other
transactions contemplated hereby (the "Information") that have been or will be
prepared by or on behalf of you or any of your representatives and that have
been made or will be made available to Chase or the Arranger by you or any of
your representatives in connection with the transactions contemplated hereby,
when taken as a whole, will be complete and correct in all material respects and
will not contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements contained therein not
materially misleading in light of the circumstances under which such statements
are made and (b) all financial projections concerning ATK and its subsidiaries
and the transactions contemplated hereby (the "Projections") that have been
prepared by or on behalf of you or any of your representatives and that have
been or will be made available to Chase or the Arranger by you or any of your
representatives in connection with the transactions contemplated hereby have
been and will be prepared in good faith based upon assumptions believed to be
reasonable by you. You agree to supplement the Information and the Projections
from time to time until the closing of the Facilities so that the
representations and covenants in the preceding sentence remain correct. In
arranging the Facilities, including the syndication of the Facilities, Chase and
the Arranger will be using and relying primarily on the Information and the
Projections without independent verification thereof.
Chase's commitment hereunder is subject to (a) Chase's satisfaction
that ATK and its subsidiaries and affiliates are not subject to material
contractual or other restrictions that would be violated by the transactions
contemplated hereby, (b) there not having occurred or become known to Chase
since June 28, 1998, any material adverse change in the business, financial
condition, results of operations or prospects of ATK and its subsidiaries, taken
as a whole, (c) there not having occurred and being continuing any material
disruption of or material adverse change in financial, banking or capital market
conditions since the date hereof that, in the good faith judgment of the
Arranger, would have an adverse effect on the syndication of the Facilities,
(d) the Arranger's satisfaction that, prior to and during the syndication of the
Facilities, there shall
<PAGE>
3
be no competing issues of debt securities or commercial bank facilities of ATK
or any of its subsidiaries being offered, placed or arranged and (e) the other
conditions set forth herein and in the Term Sheet.
In addition, Chase's commitment hereunder is subject to the
negotiation, execution and delivery of definitive documentation with respect to
the Facilities reasonably satisfactory to Chase. Such documentation shall
contain indemnities, covenants, representations and warranties, events of
default, conditions precedent, guarantee and security arrangements and other
terms and conditions satisfactory to Chase and ATK in all respects.
By executing this Commitment Letter, you agree (a) to indemnify and
hold harmless the Arranger, Chase and the other Lenders and their respective
officers, directors, employees, affiliates, agents and controlling persons from
and against any and all losses, claims, damages, liabilities and expenses, joint
or several, to which any such persons may become subject arising out of or in
connection with the Facilities, this Commitment Letter, the Term Sheet, the Fee
Letter or any related transaction or any claim, litigation, investigation or
proceeding relating to any of the foregoing, regardless of whether any of such
indemnified parties is a party thereto, and to reimburse each of such
indemnified parties upon demand for any legal or other expenses incurred in
connection with investigating or defending any of the foregoing; PROVIDED that
the foregoing indemnity will not, as to any indemnified party, apply to losses,
claims, damages, liabilities or related expenses to the extent they are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the willful misconduct or gross negligence of
such indemnified party or any officer, director, employee, affiliate, agent or
controlling person of such indemnified party (or of an institution of which such
indemnified party is an officer, director, employee, affiliate, agent or
controlling person or an affiliate of any such institution), and (b) to
reimburse the Arranger and Chase from time to time, promptly upon demand, for
all reasonable out-of-pocket expenses (including but not limited to syndication
expenses and reasonable fees, disbursements and other charges of counsel,
including local counsel), in each case incurred in connection with the
Facilities, this Commitment Letter, the Term Sheet, the Fee Letter, the
definitive documentation for the Facility or the guarantee or security
arrangements in connection therewith. The provisions contained in this
paragraph shall remain in full force and effect notwithstanding the termination
of this Commitment Letter or Chase's commitment hereunder.
None of the Arranger or Chase or their officers, directors, employees,
agents and controlling persons will be liable for any damages arising from the
use by others of information obtained through electronic, telecommunications or
other information transmission systems or for any special, indirect,
consequential or punitive damages in connection with the Facilities.
This Commitment Letter is delivered to you on the understanding that
none of this Commitment Letter, the Term Sheet, the Fee Letter or any of their
terms or substance shall be disclosed, directly or indirectly, to any other
person except (a) to your directors, officers, employees, professional advisors
and agents who are directly involved in the consideration of this matter and who
have agreed to the disclosure limitations set forth above, or (b) as may be
compelled in a judicial or administrative proceeding or as otherwise required by
law (in which case you agree to inform us as promptly as practicable thereof in
advance); PROVIDED that notwithstanding the foregoing restrictions you may
disclose the terms and substance of this Commitment Letter and the Term Sheet
(but not the Fee Letter or its terms or substance) in filings with the
Securities and Exchange Commission after this Commitment Letter and the Fee
Letter have been accepted by you.
Neither this Commitment Letter nor Chase's commitment hereunder shall
be assignable by you without the prior written consent of Chase, and any
attempted assignment shall be void. This Commitment Letter may not be amended
or any provision hereof waived or modified except by an instrument in writing
signed by Chase, the Arranger and you. This Commitment Letter may be executed
in any number of counterparts, each of which shall be an original and all of
which, when taken together, shall constitute one agreement. Delivery of an
executed counterpart of
<PAGE>
4
a signature page of this Commitment Letter by facsimile transmission shall be
effective as delivery of a manually executed counterpart of this Commitment
Letter. This Commitment Letter is intended to be solely for the benefit of the
parties hereto and is not intended to confer any benefits upon, or create any
rights in favor of, any person other than the parties hereto. This Commitment
Letter shall be governed by, and construed in accordance with, the laws of the
State of New York.
You acknowledge that Chase, the Arranger and their affiliates may be
providing financing or other services to other companies that have or may in the
future have interests conflicting with your own interests in the transactions
contemplated hereby. Chase and the Arranger agree that they will not use
information obtained from you in the course of the transactions contemplated
hereby in connection with the performance by Chase and the Arranger of services
for such other companies, and will not furnish any such information to such
other companies. You acknowledge that Chase and the Arranger have no obligation
to use in connection with the transactions contemplated hereby or to furnish to
you confidential information obtained by them from other companies.
Please indicate your acceptance of the terms hereof and of the Fee
Letter by signing in the appropriate space below and in the Fee Letter and
returning to Chase the enclosed duplicate originals of this Commitment Letter
and the Fee Letter not later than 5:00 p.m., New York City time, on October 26,
1998, failing which Chase's commitment hereunder will expire at such time. In
the event that the initial borrowing in respect of the Facilities does not occur
on or before December 4, 1998, then this Commitment Letter and Chase's
commitment hereunder shall automatically terminate unless each of Chase and the
Arranger shall, in their sole discretion, agree to an extension.
We are pleased to have been given the opportunity to assist ATK in
connection with this important financing.
Very truly yours,
THE CHASE MANHATTAN BANK,
by /s/ Bruce Borden
--------------------------------------
Name: Bruce Borden
Title: Vice President
CHASE SECURITIES INC.,
by /s/ Mathis H. Shinnick
--------------------------------------
Name: Mathis H. Shinnick
Title: Managing Director
Accepted and agreed to as of
the date first above written:
ALLIANT TECHSYSTEMS INC.,
by /s/ Scott S. Meyers
--------------------------------------
Name: Scott S. Meyers
Title: Vice President and Chief
Financial Officer
<PAGE>
EXHIBIT A
ALLIANT TECHSYSTEMS INC.
SENIOR SECURED CREDIT FACILITIES
SUMMARY OF TERMS AND CONDITIONS
Borrower: Alliant Techsystems Inc. (the "BORROWER").
Guarantors: Each of the Borrower's domestic subsidiaries,
whether now owned or hereafter formed or
acquired (the "GUARANTORS" and, together with
the Borrower, the "LOAN PARTIES").
Administrative Agent: The Chase Manhattan Bank ("CHASE" and, in such
capacity, the "ADMINISTRATIVE AGENT").
Advisor, Arranger and Book Chase Securities Inc. (in such capacity, the
Manager: "ARRANGER").
Lenders: A syndicate of banks, financial institutions
and other entities, including Chase, arranged
by the Arranger (collectively, the "LENDERS").
Facilities: Senior secured credit facilities in an
aggregate principal amount of up to
$650,000,000, consisting of the following:
(A) Six-year term loan facility (the "CLOSING
DATE TERM LOAN FACILITY") providing for
term loans on the date on which
definitive credit documentation for the
Facilities is executed (the "CLOSING
DATE") in an aggregate principal amount
not to exceed $200,000,000 (the "CLOSING
DATE TERM LOANS").
(B) Six-year term loan facility (the
"DELAYED DRAW TERM LOAN FACILITY" and,
together with the Closing Date Term
Loan Facility, the "TERM LOAN
FACILITIES") providing for term loans
at any time and from time to time on
or prior to June 30, 1999 in an
aggregate principal amount not to
exceed $200,000,000 (the "DELAYED DRAW
TERM LOANS" and, together with the
Closing Date Term Loans, the "TERM
LOANS").
(C) Six-year revolving credit facility
(the "REVOLVING CREDIT FACILITY" and,
together with the Term Loan
Facilities, the "FACILITIES")
providing for revolving loans in an
aggregate principal amount at any time
outstanding not to exceed $250,000,000
(the "REVOLVING CREDIT LOANS" and,
together with the Term Loans, the
"LOANS").
Availability: The Closing Date Term Loans will be made in
a single drawing on the Closing Date.
Delayed Draw Term Loans will be available
at any time and from time to time on or
prior to June 30, 1999 in a minimum amount
of $20,000,000 per drawing. Revolving
Credit Loans will be available on a
revolving basis during the period
commencing on the Closing
<PAGE>
2
Date and ending on the sixth anniversary
thereof (the "MATURITY DATE").
Use of Proceeds: The proceeds of the Term Loans and of up to
$85,000,000 of Revolving Credit Loans will
be used by the Borrower (a) to repurchase
up to 3,000,000 shares of the common stock
of the Borrower at an aggregate purchase
price not in excess of $220,000,000; (b) to
refinance the indebtedness outstanding
under the Borrower's Amended and Restated
Credit Agreement dated as of November 14,
1996 (the "EXISTING CREDIT AGREEMENT") and
(c) to pay related fees and expenses (the
transactions described in clauses (a), (b)
and (c) above being called the
"TRANSACTIONS"). The proceeds of Revolving
Credit Loans made after the Closing Date
will be used for general corporate
purposes, including to finance acquisitions
and to pay related fees and expenses.
Final Maturity and The Closing Date Term Loans will be repayable
Amortization: beginning June 30, 1999 in equal quarterly
installments in the aggregate amounts set
forth opposite each period set forth below:
<TABLE>
<S> <C>
Period Amount
------ ------
FY ended 3/31/2000 $30,000,000
FY ended 3/31/2001 $30,000,000
FY ended 3/31/2002 $35,000,000
FY ended 3/31/2003 $35,000,000
FY ended 3/31/2004 $35,000,000
4/1/2004 to Maturity Date $35,000,000
</TABLE>
The Delayed Draw Term Loans will be
repayable beginning December 31, 1999 in
equal quarterly installments in the
following aggregate percentages of the
aggregate amount of Delayed Draw Term Loans
on June 30, 1999 set forth opposite each
period set forth below:
<TABLE>
<S> <C>
Period Percentage
------ ----------
FY ended 3/31/2000 5%
FY ended 3/31/2001 15%
FY ended 3/31/2002 20%
FY ended 3/31/2003 20%
FY ended 3/31/2004 20%
4/1/2004 to Maturity Date 20%
</TABLE>
The Revolving Credit Loans and any Term
Loans not previously repaid will mature on
the Maturity Date.
Fees and Interest Rates: As set forth on Annex I hereto.
Optional Prepayments and Loans may be prepaid and commitments may be
Commitment Reductions: reduced by the Borrower in minimum amounts
to be agreed upon. Optional prepayments of
the Term Loans will be applied ratably to
the installments thereof and may not be
reborrowed.
<PAGE>
3
Mandatory Prepayments and The following amounts shall be applied to
Commitment Reductions: prepay and reduce the Facilities:
(a) 100% of the net proceeds of certain
incurrences of indebtedness or issuances of
preferred stock (with exceptions to be
agreed upon) by the Borrower or any of its
subsidiaries; and
(b) 100% of the net proceeds of certain
sales or other dispositions of assets by
the Borrower or any of its subsidiaries,
provided that no prepayment will be
required in respect of any sale or other
disposition of assets if the proceeds
thereof are held for reinvestment and
reinvested in other capital assets within
270 days of such sale or disposition.
All such amounts shall be applied first to
prepay the Term Loans and second to reduce
the Revolving Credit Facility. Each such
prepayment of the Term Loans under the Term
Loan Facility will be applied ratably to
the installments thereof and may not be
reborrowed.
Letters of Credit: Up to $150,000,000 of the Revolving Credit
Facility will be available in the form of
letters of credit denominated in US
dollars. Letters of credit will be issued
by any Lender that agrees to issue letters
of credit (in such capacity, the "ISSUING
BANKS"). Each letter of credit will expire
no later than the earlier of (a) one year
after its date of issuance and (b) ten days
prior to the Maturity Date.
Drawings under any letter of credit will be
reimbursed on or prior to the second
business day following such drawing. To
the extent that the Borrower does not
reimburse an Issuing Bank on the same
business day, the Lenders will be
irrevocably obligated to reimburse such
Issuing Bank pro rata based upon their
respective commitments.
The issuance of all letters of credit will
be subject to the customary procedures of
the applicable Issuing Bank and to
agreement between the Borrower and the
Administrative Agent as to the countries in
which beneficiaries thereof are to be
located.
Swingline Loans: The Revolving Credit Facility will include
a swingline borrowing option under which
Chase and such other Lenders as Chase and
the Borrower shall agree (in such capacity,
the "SWINGLINE LENDERS") will commit to
make swingline loans (the "SWINGLINE
LOANS") in a maximum aggregate principal
amount outstanding at any time not in
excess of $20,000,000. Credit exposure
associated with the Swingline Loans will be
shared by the Lenders ratably in accordance
with their commitments. Swingline Loans
will mature up to seven business days after
they are made and will be made on same-day
notice.
Collateral: The obligations of the Loan Parties will be
secured by valid,
<PAGE>
4
perfected first priority security interests
(subject only to permitted liens) in
substantially all the tangible and
intangible assets of the Borrower and its
domestic subsidiaries, including, without
limitation, intellectual property, real
property and the capital stock of each of
the Borrower's direct and indirect
subsidiaries. To the extent necessary to
avoid adverse tax consequences, pledges of
foreign subsidiaries will be limited to 65%
of the capital stock of first-tier foreign
subsidiaries.
Conditions to Effectiveness: The availability of the Facilities will be
conditioned upon satisfaction on or before
December 4, 1998, of customary closing
conditions, including but not limited to
the following:
1. Each Loan Party shall have executed
and delivered satisfactory definitive
financing documentation with respect
to the Facilities (the "CREDIT
DOCUMENTATION").
2. The Transactions and the related
transactions contemplated thereby
shall have been or shall
simultaneously be consummated on terms
and pursuant to documentation
satisfactory to the Lenders and
consistent in all respects with the
pro forma financial information
heretofore furnished to the
Administrative Agent and the Arranger
and in compliance with all applicable
laws. After giving effect to the
Loans made on the Closing Date and the
application of the proceeds thereof,
the Borrower and its subsidiaries
shall have no outstanding indebtedness
other than indebtedness under the
Facilities and other indebtedness
permitted under the Credit
Documentation. The lending
commitments under the Existing Credit
Agreement shall have been permanently
terminated and the Borrower shall have
paid in full the principal of and
accrued interest on all loans and all
other amounts owed by the Borrower
under such agreement.
3. The Lenders, the Administrative Agent
and the Arranger shall have received
all fees required to be paid, and all
expenses for which invoices have been
presented, on or before the Closing
Date.
4. All governmental and third party
approvals necessary or advisable in
connection with the transactions
contemplated hereby shall have been
obtained and shall be in full force
and effect.
5. The Lenders shall have received a
satisfactory pro forma consolidated
balance sheet of the Borrower as of
the date of the Borrower's most
recently ended fiscal quarter,
adjusted to give effect to the
consummation of the Transactions and
the other transactions contemplated
thereby as if they had occurred on
such date.
<PAGE>
5
6. The Lenders shall have received the
results of recent lien searches in
each relevant jurisdiction with
respect to the Borrower and its
domestic subsidiaries, and such
searches shall reveal no liens except
for liens permitted by the Credit
Documentation or liens to be
discharged on or prior to the Closing
Date.
7. The Borrower and its subsidiaries
shall have executed and delivered all
such pledge agreements, security
agreements, mortgages and other
agreements, shall have made
arrangements for all such filings and
recordings, and shall have delivered
all such legal opinions, policies of
title insurance and other documents,
as the Administrative Agent shall have
requested in connection with the
creation and perfection of the
security interests referred to under
"Collateral" above.
8. The Lenders shall have received such
legal opinions (including opinions (i)
from counsel to the Borrower and its
subsidiaries and (ii) from such
special and local counsel as may be
required by the Administrative Agent),
evidence of corporate authority and
other documents customary for
transactions of this type or as they
may reasonably request.
Conditions to Each Each extension of credit under the Credit
Credit Event: Documentation will be conditioned on (a)
the accuracy of all representations and
warranties in the Credit Documentation and
(b) there being no default or event of
default in existence at the time of, or
after giving effect to, such Loan.
Documentation: The Credit Documentation will include a
credit agreement for the Facilities and
appropriate guarantee and collateral
documents incorporating the terms provided
for herein and such other customary terms
and provisions as the Administrative Agent
may reasonably specify in the context of
the transactions contemplated hereby.
Representations and Warranties: Customary for facilities of this type and
others to be reasonably specified by Chase,
including: corporate existence and power;
corporate and governmental authorization;
no contravention; binding effect; financial
information (including pro forma financial
information); litigation; compliance with
ERISA; environmental matters; taxes;
subsidiaries; not an investment company;
full disclosure; compliance with laws;
Transactions; absence of material adverse
change; Federal Reserve regulations;
solvency; and Year 2000 compliance.
Affirmative Covenants: Customary for facilities of this type,
including furnishing of information;
payment of obligations; maintenance of
property; insurance; compliance with laws;
inspection of property, books and records;
additional guarantees and security and
other matters relating to collateral; fees
and
<PAGE>
6
expenses; and use of proceeds; in each
case, with exceptions to be agreed upon.
Negative Covenants: Customary for facilities of this type,
including limitations with respect to
indebtedness; liens; consolidations,
mergers and sales of assets; changes in
business conducted; investments and
acquisitions; transactions with affiliates;
amendments of certain material agreements
and instruments; and restricted payments
(other than as part of the Transactions);
in each case, with exceptions to be agreed
upon.
The Borrower will also agree not to acquire
any margin stock (as defined in Regulation
U of the Board of Governors of the Federal
Reserve System) (other than common stock of
the Borrower) unless such margin stock is
pledged to the collateral agent to secure
the Facilities and the Administrative Agent
receives evidence satisfactory to it that
such acquisition and pledge will not
violate Regulation T, U or X of the Board
of Governors of the Federal Reserve System.
Financial Covenants: Customary for facilities of this type,
including:
1. LEVERAGE RATIO (defined as the ratio
of total debt to EBITDA) for any
period of four fiscal quarters not to
be greater than 3.75 to 1.00 (with
step-downs to be agreed upon).
2. INTEREST COVERAGE RATIO (defined as
the ratio of EBITDA to interest
expense) for any period of four fiscal
quarters not to be less than 3.50 to
1.00.
3. MINIMUM NET WORTH at levels to be
agreed upon.
Events of Default: Customary for facilities of this type,
including: nonpayment of principal;
nonpayment of interest, fees or other
amounts within five business days; failure
to observe or perform any covenant
(subject, in the case of certain
affirmative covenants, to a 30-day grace
period); material inaccuracy of
representations and warranties; failure to
make any payment in respect of material
indebtedness; cross-default; bankruptcy
events; certain ERISA events; material
judgments; change in control (to be
defined); loss of a material portion of the
collateral; or actual or asserted
invalidity of any guarantee or security
document or non-perfection of security
interests.
Voting Rights: Amendments and waivers of the Credit
Documentation will require the approval of
Lenders holding not less than a majority of
the aggregate amount of the Term Loans and
Revolving Credit Loans and unused
commitments under the Facilities, except
that (a) the consent of each affected
Lender will be required with respect to (i)
reductions in the amount or extensions of
the scheduled dates for the payment of
principal of any Loan, (ii) reductions in
interest rates or fees or extensions of the
dates for payment thereof, (iii) increases
in the amounts or extensions of the expiry
date of the Lenders'
<PAGE>
7
commitments and (iv) modifications to the
pro rata provisions of the Credit
Documentation and (b) the consent of 100%
of the Lenders shall be required with
respect to (i) modifications to any of the
voting percentages and (ii) releases of all
or substantially all of the Guarantors or
the collateral.
Assignments and Lenders will be permitted to assign and sell
Participations: participations in their Loans and
commitments, subject, in the case of
assignments (other than to another Lender
or to an affiliate of a Lender), to the
consent of the Administrative Agent and the
Borrower (which consent will not be
unreasonably withheld). In the case of
partial assignments (other than to another
Lender or to an affiliate of a Lender), the
minimum assignment amount will be
$5,000,000 unless otherwise agreed by the
Borrower and the Administrative Agent.
Participants will have the same benefits as
the Lenders with respect to yield
protection and increased cost provisions.
Voting rights of participants will be
limited to those matters referred to in
clauses (a) and (b) under "Voting Rights"
above.
Yield Protection: The Credit Documentation will contain
customary provisions (a) protecting the
Lenders against increased costs or loss of
yield resulting from changes in reserve,
tax, capital adequacy and other
requirements of law and from the imposition
of or changes in withholding or other taxes
and (b) indemnifying the Lenders for
"breakage costs" incurred in connection
with the prepayment of any Eurodollar Loan
on a day other than the last day of an
interest period with respect thereto.
Expenses and The Borrower will pay (a) all reasonable
Indemnification: out-of-pocket expenses of the
Administrative Agent and the Arranger
associated with the syndication of the
Facilities and the preparation, execution,
delivery and administration of the Credit
Documentation and any amendment or waiver
with respect thereto (including the
reasonable fees, disbursements and other
charges of counsel) and (b) all
out-of-pocket expenses of the
Administrative Agent and the Lenders
(including the fees, disbursements and
other charges of counsel) in connection
with the enforcement of the Credit
Documentation.
The Administrative Agent, the Arranger and
the Lenders (and their affiliates and their
respective officers, directors, employees,
advisors and agents) will have no liability
for, and will be indemnified by the
Borrower and held harmless against, any
loss, liability, cost or expense incurred
in respect of the financing contemplated
hereby or the use or the proposed use of
proceeds thereof (except to the extent
resulting from the gross negligence or
wilful misconduct of the indemnified party
or any officer, director, employee, advisor
or agent of such indemnified party (or of
an institution of which such indemnified
party is an officer, director, employee,
advisor or agent or an affiliate of any
such institution)).
<PAGE>
8
Governing Law State of New York.
and Forum:
Counsel to Cravath, Swaine & Moore.
Administrative Agent
and Arranger:
<PAGE>
ANNEX I
INTEREST RATES AND FEES
Interest Rate Options: The Borrower may elect that the Loans
comprising each borrowing bear interest at
a rate per annum equal to:
(1) ABR plus the Applicable Margin; or
(2) LIBOR plus the Applicable Margin;
PROVIDED that all Swingline Loans will be
ABR Loans.
As used herein:
"ABR" means the highest of (i) the rate of
interest publicly announced by Chase as its
prime rate in effect at its principal
office in New York City (the "Prime Rate"),
(ii) the secondary market rate for
three-month certificates of deposit
(adjusted for statutory reserve
requirements) PLUS 1% and (iii) the federal
funds effective rate from time to time PLUS
0.5%.
"LIBOR" means the average of the London
interbank offered rates (adjusted for
statutory reserve requirements for
eurocurrency liabilities) at which
eurodollar deposits for one, two, three or
six months (as selected by the Borrower)
are offered to each of Chase and such other
Lenders as Chase and the Borrower shall
agree (the "REFERENCE LENDERS") in the
interbank eurodollar market.
"APPLICABLE MARGIN" means, with respect to
ABR Loans or LIBOR Loans, a percentage
determined by reference to the Borrower's
Leverage Ratio (as defined under "Financial
Covenants" above) as of the end of and for
the most recent period of four fiscal
quarters for which financial statements
have been delivered, as set forth in the
pricing grid attached hereto as Annex I-A.
Interest Payment Dates: In the case of Loans bearing interest based
upon the ABR, quarterly in arrears.
In the case of Loans bearing interest based
upon LIBOR, on the last day of each
relevant interest period and, in the case
of any interest period longer than three
months, on each successive date three
months after the first day of such interest
period.
Commitment Fee: A commitment fee will accrue and be payable
to the Lenders on the unused amounts of
their respective commitments under each of
the Delayed Draw Term Loan Facility and the
Revolving Credit Facility, commencing on
the Closing Date and payable in arrears at
the end of each calendar quarter and upon
any termination of the commitments under
the Delayed Draw Term Loan Facility and the
Revolving Credit Facility, respectively.
The Commitment Fee will accrue at rates per
<PAGE>
2
annum based at any time on the Borrower's
Leverage Ratio (as defined under "Financial
Covenants" above) for the most recent
period of four fiscal quarters for which
financial statements are required to have
been delivered, as set forth in the pricing
grid attached hereto as Annex I-A.
Letter of Credit Fees: The Borrower shall pay a commission on the
face amount of all outstanding letters of
credit at a per annum rate equal to the
Applicable Margin with respect to LIBOR
Loans under the Facilities. Such
commission shall be shared ratably among
the Lenders participating in the Revolving
Credit Facility and shall be payable
quarterly in arrears.
A fronting fee in the amount of 0.25% per
annum on the face amount of each letter of
credit shall be payable quarterly in
arrears to the applicable Issuing Bank for
its own account. In addition, customary
administrative, issuance, amendment,
payment and negotiation charges shall be
payable to the applicable Issuing Bank for
its own account.
Rate and Fee Basis: All per annum rates shall be calculated on
the basis of a year of 360 days (or 365/366
days, in the case of interest on ABR Loans
when based on the Prime Rate) for actual
days elapsed.
<PAGE>
ANNEX I-A
Fee and Margin Table
--------------------
<TABLE>
<S> <C> <C> <C>
Category 1 2 3
Leverage Ratio < 1.5x more than equal to 1.5x and < 2.0x more than equal to 2.0x and < 2.5x
Commitment Fee .300% .375% .375%
Applicable ABR Margin 0% .25% .50%
Applicable LIBOR Margi n 1.25% 1.50% 1.75%
</TABLE>
<TABLE>
<S> <C> <C> <C>
Category 4 5 6
Leverage Ratio more than equal to 2.5x and < 3.0x more than equal to 3.0x and < 3.5x more than equal to 3.5x
Commitment Fee .500% .500% .500%
Applicable ABR Margin .75% 1.00% 1.25%
Applicable LIBOR Margin 2.00% 2.25% 2.50%
</TABLE>
Changes in commitment fees and margins will become effective three business days
after the delivery of financial statements indicating such changes. Initially,
the Commitment Fee and the Applicable Margins will be based upon Category 5
until June 30, 1999 or, if later, the date on which the financial statements
with respect to the Borrower's fiscal quarter ended March 31, 1999 have been
delivered.
In addition, if at any time S&P and Moody's shall assign long-term ratings to
the Borrower below the ratings assigned to the Borrower by such ratings agencies
on September 30, 1998, the Applicable ABR Margin and the Applicable LIBOR Margin
shall be increased by .25%.
