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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 3
TO
SCHEDULE 14D-1
Tender Offer Statement Pursuant to
Section 14(d)(1) of the Securities Exchange Act of 1934
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New West Eyeworks, Inc.
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(Name of Subject Company)
NW Acquisition Corp.
National Vision Associates, Ltd. (Bidders)
Common Stock, Par Value $0.01 Per Share
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(Title of Class of Securities)
649156 10 6
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(Cusip Number of Class of Securities)
___________________
James W. Krause, Chairman and Chief Executive Officer
National Vision Associates, Ltd.
296 Grayson Highway
Lawrenceville, Georgia 30045
(770) 822-3600
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(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of Bidders)
COPIES TO:
Mitchell Goodman, Esq.
National Vision Associates, Ltd.
296 Grayson Highway
Lawrenceville, Georgia 30045
(770) 822-3600
David A. Stockton, Esq.
Kilpatrick Stockton LLP
1100 Peachtree Street, Suite 2800
Atlanta, Georgia (404) 815-6500
CALCULATION OF FILING FEE
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Amount of
Transaction Valuation* Filing Fee*
- ---------------------------------------------------------------------------
$71,615,245 $14,323.05
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* Estimated for purposes of calculating amount of filing fee only as
described in the original filing; amount previously paid.
[x] Check box if any part of the fee is offset as provided by Rule 0-
11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its
filing.
Amount Previously Paid: $14,323.05 Filing Party: NW Acquisition Corp.
Form or Registration No.: Schedule 14D-1 and National Vision
Associates, Ltd.
Date Filed: July 20, 1998
<PAGE>
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National Vision Associates, Ltd. and its wholly-owned subsidiary,
NW Acquisition Corp., hereby amend and supplement their Tender Offer
Statement on Schedule 14D-1, originally filed on July 20, 1998, as
amended by Amendment No. 1 to Schedule 14D-1, filed on August 18, 1998,
and Amendment No. 3, filed on September 30, 1998, with respect to an
offer to purchase all outstanding shares of common stock, par value
$0.01 per share, of New West Eyeworks, Inc. Capitalized terms not
defined in this Amendment No. 3 have the meanings assigned to them in
the Tender Offer Statement.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
Item 3 is hereby amended and supplemented by the Change of Offer
Price and Third Extension of Expiration Date.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Item 4 is hereby amended and supplemented by the Change of Offer
Price and Third Extension of Expiration Date.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE
BIDDER.
Item 5 is hereby amended and supplemented by the Change of Offer
Price and Third Extension of Expiration Date.
ITEM 10. ADDITIONAL INFORMATION.
Item 10(f) is hereby supplemented as follows:
Parent, the Purchaser and New West Eyeworks, Inc. have entered
into a First Amendment to Agreement and Plan of Merger, dated as of
October 5, 1998 (the "First Amendment") in which such parties agree
among other things to an extension of the Expiration Date of the Offer
to October 22, 1998 and to change the Offer Price from $13.00 to $11.50.
The First Amendment is filed as Exhibit (a)(13) to Schedule 14D-1 and
incorporated herein by reference.
A press release issued by Parent on October 5, 1998 relating to
the change in Offer Price and extension of the Offer is filed as
Exhibit (a)(14) to the Schedule 14D-1 and is incorporated herein by
reference.
The Purchaser is disseminating a statement regarding the First
Amendment (and its implications for the terms and conditions of the
Offer) to the stockholders of the Company on October 5, 1998. The
Purchaser has filed such statement as Exhibit (a)(15) to the Schedule
14D-1 and hereby incorporates such statement herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a)(13) First Amendment to Agreement and Plan of Merger.
(a)(14) Text of Press Release of National Vision Associates,
Ltd., dated October 5, 1998, with respect to change in Offer
Price and extension of Expiration Date.
(a)(15) Change of Offer Price and Third Extension of Expiration Date.
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true,
complete and correct.
Dated: October 5, 1998
NW ACQUISITION CORP.
By: /s/ MITCHELL GOODMAN
Name: Mitchell Goodman
Title: Vice President, General Counsel and
Secretary
NATIONAL VISION ASSOCIATES, LTD.
By: /s/ MITCHELL GOODMAN
Name: Mitchell Goodman
Title: Senior Vice President, General
Counsel and Secretary
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER EXHIBIT NAME
(a)(13) First Amendment to Agreement and Plan of Merger.
(a)(14) Text of Press Release of National Vision Associates, Ltd.,
dated October 5, 1998, with respect to change in Offer Price
and extension of expiration date.
(a)(15) Change of Offer Price and Third Extension of Expiration Date.
Exhibit (a)(13)
FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER
THIS FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER, dated as of
October 5, 1998 (this "First Amendment"), by and among NATIONAL VISION
ASSOCIATES, LTD., a Georgia corporation ("Parent"), NW ACQUISITION
CORP., a Delaware corporation and a wholly-owned subsidiary of Parent
("Sub"), and NEW WEST EYEWORKS, INC., a Delaware corporation (the
"Company").
RECITALS:
WHEREAS, the parties have previously entered into an Agreement
and Plan of Merger dated as of July 13, 1998 (the "Merger Agreement");
WHEREAS, undefined capitalized terms used in these recitals shall
have the meanings given to them in the Merger Agreement;
WHEREAS, the Merger Agreement contemplated that Sub would make
the Offer for all Common Stock and that as provided in the Merger
Agreement, the Offer would be at a price of $13.00 in cash per share
of the Common Stock;
WHEREAS, certain obligations of Parent and Sub under the Merger
Agreement were subject to the Financing Condition;
WHEREAS, following execution of the Merger Agreement, Parent and
Sub attempted to obtain the financing contemplated by the Financing
Condition;
WHEREAS, as a result of adverse developments in the financial
markets, Parent and Sub were unable to obtain financing at rates that
were contemplated at the time of the execution of the Merger
Agreement;
WHEREAS, Parent and Sub have informed the Company that, to
satisfy the Financing Condition, they will need to issue senior notes
in the face amount of $120 million (the "Notes") pursuant to Rule 144A
of the Securities Act at an effective yield to maturity of 13%;
WHEREAS, because of the unexpectedly high rate of interest which
will be required under the Notes, Parent and Sub are unwilling to
proceed to consummate the transactions contemplated by the Merger
Agreement unless the terms of the Offer and the Merger are changed to
$11.50 per share of Common Stock;
WHEREAS, the parties wish to amend the terms and conditions of
the Merger Agreement to, among other things, change the price per
share of Common Stock to be paid pursuant to the Offer, and to make
certain other amendments described herein; and
WHEREAS, the respective Boards of Directors of the Parent, Sub
and the Company have approved the terms of this First Amendment.
<PAGE>
NOW, THEREFORE, in consideration of the mutual covenants and
agreements, and upon the terms and subject to the conditions
hereinafter set forth, and intending to be legally bound, the parties
agree as follows
1. CHANGE IN OFFER. The price to be paid for each share of
Common Stock in the Offer and in the Merger is hereby changed from
$13.00 to $11.50 and all references to $13.00 in the Merger Agreement
or any exhibits thereto shall be changed accordingly and all
references to the Offer and the Merger shall refer to the Offer as
amended to reflect such purchase price and the Merger providing for
the payment of such purchase price.
2. OFFER DOCUMENTS. Concurrently with the execution of this
Agreement, the parties will jointly issue the press release attached
hereto as Exhibit A. At or promptly after, as applicable, the Pricing
Time (as defined below), (a) Parent and Sub will file with the SEC the
Offer Documents revised as appropriate to reflect the changes set
forth in this First Amendment and shall also take the other actions,
as appropriate, described in Section 1.01(b) of the Merger Agreement;
and (b) the Company will file with the SEC the Schedule 14D-9 revised
as appropriate to reflect the changes set forth in this First
Amendment and shall also take the other actions, as appropriate,
described in Section 1.02(b) of the Merger Agreement
3. FAIRNESS OPINION. The Company represents and warrants to
Parent and Sub that its Board of Directors has received the oral
opinion of Everen that the consideration to be received by the
Company's stockholders in the Offer and the Merger (as revised by this
First Amendment) is fair, from a financial point of view, to such
stockholders, and such opinion shall be reduced to written form as
soon as practicable.
4. EXTENSION DATE. References to the date October 14, 1998 in
Sections 1.01 and 8.06(b) of the Merger Agreement and to the date
October 15, 1998 in Section 8.01(b)(ii)(2) of the Merger Agreement
shall be amended to refer to the first business day (the "Extension
Date") after the day that is the earliest day that shares of Common
Stock can be purchased in the Offer under applicable regulations of
the SEC in light of the changes to the Offer that are effected by this
First Amendment and the filings referred to in Section 2 above. The
parties agree that the Extension Date is Thursday, October 23, 1998.
At the Pricing Time, the Offer will be extended by Parent to midnight
on Wednesday, October 22, 1998. In no event may the Offer be extended
beyond such date.
5. CONDITIONS TO THE OFFER. Parent affirms that it is not
currently aware of any facts that would establish a basis pursuant to
paragraphs (c) or (f) of Exhibit A to the Merger Agreement upon which
to not continue the Offer or to terminate the Offer or to not accept
for payment or pay for shares of Common Stock tendered pursuant
thereto. Parent and Sub further agree that they will only take any
such actions pursuant to the conditions contained in such paragraphs
on the basis of facts arising after the Pricing Time (or facts arising
prior to the Pricing Time which are concealed from Parent) and that do
not arise from this First Amendment, including without limitation, any
action or proceeding before any Governmental Person with respect to
the Offer, the Merger or this First Amendment. The condition
contained in paragraph (d) (ii) of Exhibit A of the Merger Agreement
shall, upon the closing of the offering of the Notes pursuant to the
2<PAGE>
Purchase Agreement (as defined below), apply only to any facts or
circumstances contemplated by such paragraph that occur solely on or
after such closing date without consideration of any related facts or
circumstances that occurred prior to such closing date.
6. PROCEEDS OF NOTES. Net proceeds from the sale of the Notes
in an amount sufficient to satisfy Parent's and Sub's obligations
hereunder shall be held by Parent in a segregated account and used
only to satisfy Parent's obligations hereunder or until the Merger
Agreement, as amended by this First Amendment, is terminated in
accordance with its terms.
7. CONVERSION OF PREFERRED STOCK AND EXERCISE OF WARRANTS. The
stockholders of the Company listed on the signature page of Exhibit E
to the Merger Agreement have executed this First Amendment solely for
the purpose of agreeing to promptly enter into agreements
substantially in the forms of Exhibits C, D and E to the Merger
Agreement, as applicable. The Company also agrees to use its best
efforts to cause all other holders of its Convertible Preferred Stock
and Company Warrants to promptly enter into agreements substantially
in the form of Exhibits C and D as applicable.
8. RATIFICATION. The parties hereby ratify and confirm the
terms of the Merger Agreement. In the event of any inconsistency
between the terms of the Merger Agreement and terms of this First
Amendment, the terms of this First Amendment shall control.
9. PRICING TIME. This First Amendment shall become effective
(the time of such effectiveness, the "Pricing Time") as of the
execution and delivery of that certain Purchase Agreement by and among
the Parent, Schroder & Co., Inc., BancAmerica Securities, Inc., and
First Union Capital Markets (the "Purchase Agreement") pursuant to
which Parent will sell the Notes at an effective yield to maturity of
13%. This First Amendment shall be of no force and effect if either
(a) the Pricing Time does not occur by 5:00 PM Eastern Standard Time
on Tuesday, October 6, 1998 or (b) the Notes sold by Parent under the
Purchase Agreement bear an effective yield to maturity of less than
13%.
IN WITNESS WHEREOF, each of Company, Parent, the Sub and the
Stockholders have caused this First Amendment to be duly executed and
delivered as of the date first written above.
NEW WEST EYEWORKS, INC.
By: /s/ Ronald E. Weinberg
Name: Ronald E. Weinberg
Title: Chairman
3
<PAGE>
NATIONAL VISION ASSOCIATES, LTD.
By: /s/ James W. Krause
Name: James W. Krause
Title:________________________
NW ACQUISITION CORP.
By: /s/ James W. Krause
Name: James W. Krause
Title:________________________
STOCKHOLDERS:
/s/ Ronald E. Weinberg
Ronald E. Weinberg
MESIROW CAPITAL PARTNERS II
By: /s/ Thomas E. Galuhn
Name: /s/ Thomas E. Galuhn
MESIROW CAPITAL PARTNERS III
By: /s/ Thomas E. Galuhn
Name: /s/ Thomas E. Galuhn
4
<PAGE>
MESIROW CAPITAL PARTNERS IV
By: /s/ Thomas E. Galuhn
Name: Thomas E. Galuhn
MESIROW CAPITAL PARTNERS V
By: /s/ Thomas E. Galuhn
Name: Thomas E. Galuhn
MESIROW CAPITAL PARTNERS VI
By: /s/ Thomas E. Galuhn
Name: Thomas E. Galuhn
/s/ Barry J. Feld
Barry J. Feld
Exhibit (a)(14)
Monday October 5, 1:21 pm Eastern Time
Company Press Release
SOURCE: National Vision Associates, Ltd.
National Vision Associates, Ltd. And New West Eyeworks, Inc.
Announce Amendment To Merger Agreement And Extension Of Tender Offer
LAWRENCEVILLE, Ga. and TEMPE, Ariz., Oct. 5 /PRNewswire/ -- National
Vision Associates, Ltd. (Nasdaq: NVAL - news) and New West Eyeworks,
Inc. (Nasdaq: NEWI - news) announced today that they have amended
their previously executed Merger Agreement pursuant to which National
Vision would acquire all of the outstanding stock, warrants and
options of New West. The amendment changes the per share purchase
price from $13.00 in cash to $11.50 in cash net to sellers. The change
resulted from the higher interest rate environment encountered by
National Vision in the high yield debt markets.
National Vision also announced that it is extending the expiration
date of its tender offer from October 9, 1998 to midnight, Eastern
time on Thursday, October 22, 1998. As of 5:00 p.m., September 28,
1998, approximately 4,700,400 shares of New West's common stock have
been validly tendered and not withdrawn pursuant to the offer. In
addition, the holders of convertible preferred stock and warrants of
New West have entered into letter agreements in which they have agreed
to convert or exercise such securities and tender the underlying
shares of common stock in the offer. These agreements are being
amended to reflect the changed per share purchase price.
The number of underlying shares of common stock subject to such letter
agreements is 806,563. The total number of such tendered or committed
shares is approximately 5,507,000, which represents approximately
96.7% of the common stock of New West, assuming conversion of all
convertible preferred stock and exercise of all warrants.
Such total would be sufficient to satisfy the 51% minimum tender
condition established for the consummation of the offer. However,
holders of tendered shares will continue to have withdrawal rights
during the extended period of the offer.
The closing of the tender offer remains subject to customary
conditions, including the obtaining of financing by National Vision.
National Vision expects to close on such financing this week.
Any expectations, beliefs and other non-historical statements
contained in this press release are forward looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
(the "Act"). Actual results may differ materially due to a variety of
factors that affect the Company. Forward-looking statements involve
risks and uncertainties, including but not limited to, the uncertainty
as to whether the transactions discussed in the press release will be
completed. Such factors are described in a cautionary statement for
purposes of the "Safe Harbor" provisions of the Act, contained in the
Company's Report on Form 10-Q for the second quarter of 1998. Other
risks and uncertainties are detailed from time to time in both
National Vision's and New West's periodic reports filed with the
Securities and Exchange Commission, including both companies' Annual
Reports for 1997 on Form 10-K and first and second quarter 1998
reports on Form 10-Q.
SOURCE: National Vision Associates, Ltd.
10-05-98
CONTACT: Angus Morrison, Senior Vice President, CFO & Treasurer,
National Vision Associates, Ltd. 770-822-4285; Ronald E. Weinberg,
Chairman of the Board, New West Eyeworks, Inc., or Barry Feld,
President and CEO, New West Eyeworks, Inc., 602-438-1330, or Janice J.
Kuntz, Fleishman-Hillard, Inc., 404-659-4446
/Web site: http://www.nationalvision.com
Exhibit (a)(15)
CHANGE OF OFFER PRICE
AND
THIRD EXTENSION OF EXPIRATION DATE
Offer to Purchase for Cash
All Outstanding Shares of Common Stock
of
NEW WEST EYEWORKS, INC.
now at
$11.50 NET PER SHARE
by
NW ACQUISITION CORP.
a Wholly-Owned Subsidiary
of
NATIONAL VISION ASSOCIATES, LTD.
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| AS A RESULT OF ADVERSE DEVELOPMENTS IN THE FINANCIAL MARKETS, |
| AND BECAUSE OF THE UNEXPECTEDLY HIGH RATE OF INTEREST WHICH WILL |
| BE REQUIRED UNDER THE BORROWINGS NECESSARY TO FINANCE THE OFFER, |
| THE PARTIES HAVE AGREED THAT THE OFFER PRICE WILL BE CHANGED |
| FROM $13.00 PER SHARE TO $11.50 PER SHARE. THE OFFER WILL NOW |
| EXPIRE AT 12:00 MIDNIGHT ON THURSDAY, OCTOBER 22, 1998, UNLESS |
| EXTENDED (THE "EXPIRATION DATE"). SHARES TENDERED PURSUANT TO |
| THE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION |
| DATE. |
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THE OFFER CONTINUES TO BE CONDITIONED UPON, AMONG OTHER THINGS, THERE
BEING VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF
THE OFFER THAT NUMBER OF SHARES THAT WOULD REPRESENT AT LEAST 51% OF
THE OUTSTANDING SHARES OF COMMON STOCK OF NEW WEST EYEWORKS, INC. AS
DETERMINED IMMEDIATELY PRIOR TO THE CONSUMMATION OF THE OFFER.
----------------------
IMPORTANT
----------------------
To the Holders of Common Stock of New West Eyeworks, Inc.:
NW Acquisition Corp., a Delaware corporation (the "Purchaser")
and a wholly-owned subsidiary of National Vision Associates, Ltd., a
Georgia corporation ("Parent"), hereby notifies you that, as a result
of adverse developments in the financial markets, and because of the
unexpectedly high rate of interest which will be required under the
<PAGE>
borrowings necessary to finance the offer referenced above (the
"Offer"), the parties have agreed to reduce the Offer Price to $11.50
per share, and to further extend the expiration date for the Offer to
Midnight, Eastern Time, October 22, 1998. Capitalized terms not
defined in this Change of Offer and Third Extension of Expiration Date
have the meanings assigned to them in the Offer to Purchase, dated
July 20, 1998, relating to the Offer.
1. The First Amendment to Agreement and Plan of Merger.
Parent, the Purchaser, and New West Eyeworks, Inc. (the
"Company") have entered into a First Amendment to Agreement and Plan
of Merger, dated as of October 5, 1998 (the "First Amendment"), which
amends certain provisions of the Merger Agreement. The First
Amendment provides that all references in the Merger Agreement and any
exhibits to such agreement shall be changed to reflect the change in
the Offer Price from $13.00 to $11.50, and all references to the Offer
and the Merger shall refer to the Offer as amended to reflect such
new Offer Price and the Merger providing for the payment of such new
Offer Price. The First Amendment became effective upon the execution
and delivery of the Purchase Agreement relating to the Parent Senior
Notes (as defined below), which occurred later in the day on October 5,
1998. In the event of any inconsistency between the terms of the Merger
Agreement and the terms of the First Amendment, the terms of the First
Amendment shall control.
The Company has represented and warranted to Parent and the
Purchaser that its Board of Directors has received the oral opinion of
EVEREN Securities, Inc., the Company's financial advisor, that the
consideration to be received by the Company's stockholders in the
Offer and the Merger (as revised by the First Amendment to the Merger
Agreement) is fair, from a financial point of view, to such
stockholders. The First Amendment provides that such opinion shall be
provided in writing as soon as practicable.
In the First Amendment, Parent affirmed that it was not currently
aware of any facts that would establish a basis pursuant to paragraphs
(c) or (f) of Exhibit A to the Merger Agreement (which paragraphs
relate, respectively, to material adverse market changes and the
continuing accuracy of the representations and warranties and the
performance of all agreements of the Company set forth in the Merger
Agreement) upon which not to continue the Offer or to terminate the
Offer, or not to accept for payment or pay for Shares tendered
pursuant to the Offer, at the reduced Offer Price of $11.50 per share.
Parent and the Purchaser further agreed that they will only take any
such actions pursuant to the conditions contained in such paragraphs
on the basis of facts arising after the date on which the Purchase
Agreement (the "Purchase Agreement") relating to Parent's offering of its
Senior Notes due 2005 (the "Parent Senior Notes") is executed and delivered
(or facts arising prior to such time which are concealed from Parent) and
that do not arise from the First Amendment, including without limitation,
any action or proceeding before any governmental entity with respect to
the Offer, the Merger or the First Amendment. The condition of the Offer
contained in paragraph (d) (ii) of Exhibit A of the Merger Agreement
(which relates to termination or amendment of the Offer upon the
2<PAGE>
occurrence of material adverse changes in the financial markets,
commodities markets or major stock exchange indices in the United
States) shall be deleted automatically upon the closing of the
offering of the Parent Senior Notes (described more fully in "Contacts
With the Company; Background of the Revised Offer" below).
The net proceeds from the sale of the Parent Senior Notes,
in an amount sufficient to satisfy Parent's and the Purchaser's
obligations under the First Amendment shall be held by Parent in
a segregated account and used only to satisfy Parent's obligations
under the First Amendment or until the Merger Agreement, as amended
by the First Amendment, is terminated in accordance with its terms.
Certain stockholders of the Company listed on the signature page
to Exhibit E to the Merger Agreement have executed the First Amendment
solely for the purpose of agreeing to promptly enter into agreements
substantially in the forms of Exhibits C, D and E to the Merger
Agreement, as applicable. Such agreements relate to the tendering of
Shares, the conversion of Preferred Stock into Shares and the
tendering of all of such Shares, and the exercise of certain warrants
for Shares and the tendering of all such Shares. These agreements are
more fully described in Section 12 of the Offer to Purchase under the
heading "The Commitment Agreements."
2. CONTACTS WITH THE COMPANY; BACKGROUND OF THE REVISED OFFER.
After the execution of the Merger Agreement on July 13, 1998,
Parent and the Purchaser proceeded to take actions necessary to allow
the Offer and Merger to be consummated at the earliest practicable
time. These actions included among others: (i) making required
filings under the Hart-Scott-Rodino Act, (ii) commencing the Offer,
and (iii) pursuing financing for the Offer and Merger.
Throughout the month of August and the first half of September,
Parent worked with Schroders and its two co-managers, their legal
counsel and the Company's independent accountants and legal counsel,
to prepare an offering memorandum pursuant to which $130 million of
Parent's Senior Notes due 2005 would be privately placed pursuant to
Rule 144A.
The Offer was extended from August 17, 1998 to September 28, 1998
in order to allow Parent more time to satisfy the Financing Condition.
The Hart-Scott-Rodino Act waiting period expired and that condition to
the Offer was therefore satisfied as of September 18, 1998.
Meetings with potential institutional purchasers of the Parent
Senior Notes were held from September 17 through September 29, 1998.
During such meetings it became evident to Parent and Schroders that the
severe volatility in the financial markets during August and early September
was having a substantial impact on the demand for high yield debt such
as the Parent Senior Notes. As a result, the likelihood of success in
3<PAGE>
placing the Parent Senior Notes was substantially less than had been
expected at the time the Merger Agreement was executed in July 1998,
and the rates of interest that would be required to be carried by the
Parent Senior Notes in order to be successfully marketed would be
substantially higher than had been expected.
During mid-August to mid-September, Parent continually explored
other potential sources of financing for the Offer and Merger, but
none of such alternatives proved feasible.
Towards the end of these institutional marketing meetings, it
became more clear to Schroders and officers of the Company that the
unexpectedly high rates of interest that would be required to be
carried by the Parent Senior Notes would seriously impact the economic
viability of the acquisition of the Company by Parent at a per Share price
of $13.00, as was originally contemplated in the Merger Agreement. As a
result, Mr. Krause communicated to Mr. Feld during the last week of
September that a reduction in the $13.00 per Share price (still in an
unspecified amount) would be essential to prevent Parent from exercising
its right to terminate the Offer and the Merger Agreement. Various
informal conversations between officers of Parent and the Company occurred
regarding this general topic during the week of September 28, 1998.
On Friday, October 2, the Board of Directors of Parent met to
discuss the prospects for placing the Parent Senior Notes and the terms
upon which they might be issued, the potential for other financing sources,
and whether to continue the Offer at a $13.00 per Share price in light of
such matters. The Board adjourned such meeting without reaching a
conclusion and agreed to reconvene on Saturday, October 3, 1998 to
continue such discussion.
At this Saturday Board meeting, the advantages and disadvantages
of various alternative courses of action for Parent were again
presented by the Parent's officers, financial advisors and counsel,
which were studied by the Board. The Board unanimously resolved to
communicate to the Company its unwillingness to proceed with the Offer
and the Merger unless the $13.00 per Share price were reduced to
$11.50 per Share.
This position of Parent's Board of Directors was communicated to
Mr. Weinberg that day, Saturday, October 3, 1998. There ensued
various conversations among Mr. Weinberg and Mr. Feld on behalf of the
Company and Mr. Krause and Schroders personnel on behalf of Parent
regarding the terms and conditions under which the parties could agree
to reduce the per Share purchase price to $11.50. Those discussions
continued through the weekend into Monday morning, culminating in the
execution of the First Amendment at approximately noon on Monday,
October 5, 1998.
3. Other Information.
As of October 2, 1998, approximately 4,719,200 Shares have been
validly tendered and not withdrawn pursuant to the Offer. In
addition, the holders of Convertible Preferred Stock and Company
Warrants have entered into Letter Agreements in which they have agreed
4<PAGE>
to convert or exercise such securities and tender the Shares received
thereupon in the Offer. These agreements are being amended to reflect
the changed per share Purchase Price. The number of Shares issuable
and subject to such Letter Agreements is 806,563. The total number of
such tendered or committed Shares is approximately 5,525,800, which
represents approximately 97% of the outstanding Shares, assuming
conversion of all Convertible Preferred Stock and exercise of all
outstanding Company Warrants, and which number of Shares would satisfy
the Minimum Tender Condition.
Parent notes, as stated above, that the waiting period imposed
by the Hart-Scott-Rodino Act has expired without any regulatory
challenge under that Act to the consummation of the Offer or the
Merger, and so that condition of the Offer has been satisfied. Parent
expects that the Purchase Agreement will be executed shortly and that
the Financing Condition will be satisfied later in the week of October 5,
1998 when its offering of its Senior Notes is expected to be closed. At
that time, Parent will issue an additional press release, make an
appropriate dissemination to the Shareholders of the Company, and file
a further amendment to its Schedule 14D-1 with the Securities and Exchange
Commission.
Questions and requests for assistance or for additional copies of
this Change in Offer Price and Third Extension of Expiration Date, the
Offer to Purchase, the Letter of Transmittal and the Notice of
Guaranteed Delivery may be directed to the Information Agent or the
Dealer Manager at their respective telephone numbers and locations
listed below. You may also contact your broker, dealer, bank, trust
company or other nominee for assistance concerning the Offer.
NW Acquisition Corp. October 5, 1998
The Information Agent for the Offer is:
GEORGESON
& COMPANY INC.
==============
Wall Street Plaza, 30th Floor
88 Pine Street
New York, New York 10005
Banks and Brokers Call Collect: (212) 440-9800
ALL OTHERS CALL TOLL FREE: 1-800-223-2064
The Dealer Manager for the Offer is:
SCHRODER & CO., INC.
Equitable Center
787 Seventh Avenue
New York, New York 10019
(212) 492-6000
