<PAGE>
Securities and Exchange Commission,
Washington, D.C. 20549
Schedule TO
Tender Offer Statement under Section 14(d)(1) or 13(e)(1) of the Securities
Exchange Act of 1934
SPIROS DEVELOPMENT CORPORATION II, INC.
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(Name of Subject Company (issuer))
DURA PHARMACEUTICALS, INC. (OFFEROR)
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(Names of Filing Persons (identifying status as offeror, issuer or
other person))
CALLABLE COMMON STOCK, PAR VALUE $.001 PER SHARE
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(Title of Class of Securities)
848 936 100
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(CUSIP Number of Class of Securities)
Cam L. Garner
Chairman and Chief Executive Officer
Dura Pharmaceuticals, Inc.
7475 Lusk Boulevard
San Diego, California 92121
(619) 457-2553
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(Name, address, and telephone numbers of person authorized to receive
notices and communications on behalf of filing persons)
<TABLE>
<CAPTION>
Calculation of Filing Fee
- --------------------------------------------------------------------------------
Transaction valuation* Amount of filing fee
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<S> <C>
</TABLE>
*Set forth the amount on which the filing fee is calculated and state how it was
determined.
[ ] Check the 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:___________________
Form or Registration No.:__________________
Filing Party:_____________________________
Date Filed:______________________________
[X] Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer. Check the appropriate boxes
below to designate any transactions to which the statement relates:
[ ] third-party tender offer subject to Rule 14d-1.
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[ ] issuer tender offer subject to Rule 13e-4.
[X] going-private transaction subject to Rule 13e-3.
[ ] amendment to Schedule 13D under Rule 13d-2.
Check the following box if the filing is a final amendment reporting the results
of the tender offer: [ ]
2
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Exhibit 99.1
CONFIDENTIAL
February 14, 2000
Board of Directors
Spiros Development Corporation II, Inc.
7475 Lusk Boulevard
San Diego, CA 92121
Gentlemen:
Dura Pharmaceuticals, Inc. ("Dura") is pleased to submit to
you this offer to acquire Spiros Development Corporation II, Inc. ("Spiros") at
a cash price of $12.50 per share, net to each holder (the "Offer Price"), of
Callable Common Stock, par value $0.001 per share, of Spiros (the "Spiros Common
Stock"). The acquisition would be accomplished by means of a tender offer
followed by a merger at the Offer Price. Our offer is subject to the execution
of a satisfactory definitive merger agreement. We will provide a draft of the
merger agreement to Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the
special committee of independent directors of Spiros, within the next few days.
Dura believes the Offer Price is fair to the holders of Spiros
Common Stock, as it represents a premium of 20% over the average closing price
of the Spiros Common Stock for the past ten trading days. In establishing the
Offer Price, we have considered, among other things, the technical, clinical and
regulatory risks associated with completing the development programs for Spiros
Beclomethesone-TM- and Spiros Budesonide-TM-, the two remaining products under
development by Spiros that Dura would continue to develop upon acquisition of
the Spiros Common Stock, the significant costs required to complete the
development programs for these products, the market potential for these products
and the associated risks and costs of commercializing these products. We would
be pleased to discuss these issues with you and your advisors.
This offer has been approved by our board of directors and may
be withdrawn at any time prior to acceptance by you. We would like to enter into
the merger agreement no later than February 25, 2000 and complete the
acquisition as soon as possible. Dura, its financial advisor and legal counsel
are prepared to meet with you at any time to negotiate the terms of the merger
agreement.
We look forward to hearing from you.
Very truly yours,
DURA PHARMACEUTICALS, INC.
/s/ CAM L. GARNER
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Cam L. Garner
Chairman of the Board and
Chief Executive Officer
cc: Stelios Papadopoulos
Joseph J. Giunta
<PAGE>
Exhibit 99.2
Contact: Michael T. Borer
Senior Vice President and Chief Financial Officer
Dura Pharmaceuticals, Inc.
(858) 457-2553
DURA PHARMACEUTICALS OFFERS TO ACQUIRE
SPIROS DEVELOPMENT CORPORATION II
DURA ANNOUNCES INTENT TO DISCONTINUE ALBUTEROL SPIROS-TM- DEVELOPMENT PROGRAM
San Diego, CA - February 14, 2000 - Dura Pharmaceuticals, Inc. (Dura)
(Nasdaq NNM: DURA) today announced that it has made an offer to the board of
directors of Spiros Development Corporation II, Inc. (SDCII) (Nasdaq NNM: SDCO)
to acquire all of the outstanding callable common stock of SDCII at a cash price
of $12.50 per share or total cash consideration of approximately $79.0 million.
The Dura warrants (Nasdaq NNM: DURAW) that separated from the SDCII callable
shares on January 1, 2000 are not affected by Dura's offer. In the offer, Dura
proposed to complete the acquisition by means of a tender offer followed by a
merger at the same $12.50 price per share. The offer is subject to the
negotiation and execution of a satisfactory merger agreement, but is not subject
to financing. SDCII previously informed Dura that it had formed a committee of
independent directors to consider the company's strategic alternatives,
including any transactions proposed by Dura.
"This offer represents significant premiums to the recent trading
prices for SDCII's callable common stock and SDCII's available cash per share
and we intend to work diligently to reach a definitive agreement with SDCII,"
said Cam L. Garner, Dura's Chairman and Chief Executive Officer. "We believe a
successful acquisition of SDCII will remove any uncertainty and confusion
surrounding Dura's relationship with SDCII, resulting in part from SDCII's
current cash position and cash burn, and the pending pronouncement issued by the
Financial Accounting Standards Board covering consolidations. The consolidation
of SDCII into Dura will eliminate the earnings impact of SDCII contract revenue
net of related income tax expense. We believe the acquisition of SDCII, as we
are proposing, will enhance Dura shareholder value for the long-term."
As previously announced, Dura, on behalf of SDCII, has been addressing
chemistry, manufacturing and control (CMC) issues for Albuterol Spiros-TM- and
at the same time evaluating the market potential and financial return from this
product candidate. Dura has concluded its evaluation, and upon successful
completion of the proposed acquisition of SDCII, Dura plans for commercial
reasons to discontinue development of albuterol in the current Spiros-Registered
Trademark- platform. The Company stated that the full market value of the
existing respiratory products is resident in the two steroids in development and
that development activity on these two products, Beclomethasone Spiros-TM- and
Budesonide Spiros-TM-, is moving ahead.
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"Although we plan to discontinue the Albuterol Spiros-TM- program, we
continue to have confidence in the Spiros-Registered Trademark- platform and
remain very excited about the opportunity with the steroid products and the
successful development of Beclomethasone Spiros-TM- and Budesonide Spiros-TM-,"
stated David S. Kabakoff, Ph.D., President of Dura Technologies. "The clinical
programs for the two steroids are continuing as patient enrollment for the
Beclomethasone Spiros-TM- reliability study was recently completed. The
Spiros-Registered Trademark- clinical programs and regulatory reviews, if
successful and assuming the acquisition of SDCII, should allow for the two
steroid product candidates to add significantly to Dura's product revenues
beginning in the 2002 and 2003 timeframe, respectively. In addition, we are
currently evaluating additional candidates for development in the
Spiros-Registered Trademark- platform with a goal of commencing development on a
selected compound in 2000. We are also actively pursuing partnerships for local
and systemic delivery of products that could benefit from delivery in the
Spiros-Registered Trademark- platform.
Dura Pharmaceuticals, Inc. is a San Diego based developer and marketer
of prescription pharmaceutical products for the treatment of allergies, asthma,
pneumonia and related respiratory conditions. Dura focuses on the U.S.
respiratory market because of its size and growth opportunities through two
major strategies: (1) acquiring prescription pharmaceuticals and/or businesses
developing or marketing such pharmaceuticals to support its marketing presence
in high-prescribing physicians' offices and/or the hospital market, and (2)
developing Spiros-Registered Trademark-, a pulmonary drug delivery system for
both topical and systemic delivery of medications.
Except for the historical and factual information contained herein, the
matters discussed in this press release may contain forward-looking statements
which involve risks and uncertainties, including the completion of the
acquisition of SDCII, Inc. on acceptable terms, the timely initiation and
successful completion of the clinical trial programs for the Spiros-Registered
Trademark- products, the ability to obtain adequate funding to complete the
clinical trial programs for the Spiros-Registered Trademark- products, the
timely FDA approval of the Spiros-Registered Trademark- products, if at all, the
dependence on third parties for manufacturing and development, the
competitiveness of the pharmaceutical industry, risks inherent in merger and
acquisition transactions and other risks detailed from time to time in Dura's
filings with the Securities and Exchange Commission. Actual results may differ
materially from those projected. Any forward-looking statements represent Dura's
judgment as of the date of this release. Dura disclaims, however, any intent or
obligation to update these forward-looking statements. Further information about
Dura Pharmaceuticals, Inc. can be found at www.durapharm.com.
####
News releases from Dura Pharmaceuticals are available at no charge on Dura's
web site at www.durapharm.com and through PR Newswire's On-Call fax service by
calling (800) 758-5804, extension 197051.
