<PAGE>
As filed with the Securities and Exchange Commission on December 26, 2000
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule TO
(Amendment No. 1)
Tender Offer Statement under Section 14(d)(1) or 13(e)(1)
of the Securities Exchange Act of 1934
Objective Systems Integrators, Inc.
(Name of Subject Company (Issuer))
Tahoe Acquisition Corp.
Agilent Technologies, Inc.
(Names of Filing Persons)
COMMON STOCK,
$ .001 PAR VALUE
(Title of Class of Securities)
674424-10-6
(CUSIP Number of Class of Securities)
D. Craig Nordlund, Esq.
Senior Vice President, General Counsel and Secretary
Agilent Technologies, Inc.
395 Page Mill Road
Palo Alto, California 94303-0870
(650) 752-5000
(Name, address, and telephone numbers of person authorized
to receive notices and communications on behalf of filing persons)
with a copy to:
Larry W. Sonsini, Esq.
John T. Sheridan, Esq.
Steve L. Camahort, Esq.
Robert D. Sanchez, Esq.
Wilson Sonsini Goodrich & Rosati, Professional Corporation
650 Page Mill Road
Palo Alto, California 94304
(650) 493-9300
CALCULATION OF FILING FEE
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<TABLE>
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<CAPTION>
Transaction valuation (1) Amount of filing fee
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<S> <C>
$707,420,410 $141,484
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</TABLE>
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(1) For purposes of calculating the filing fee only. This calculation assumes
the purchase of 39,854,671 shares of Common Stock of Objective Systems
Integrators, Inc. at the tender offer price of $17.75 per share of Common
Stock.
(2) The amount of the filing fee, calculated in accordance with Rule 0-11 of
the Securities Exchange Act of 1934 as amended, equals 1/50 of 1% of the
transaction value.
[X] 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: $141,484
Form or Registration No.: Schedule TO
Filing Party: Agilent Technologies, Inc.
Date Filed: December 6, 2000
[_] 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:
[X] third-party tender offer subject to Rule 14d-1.
[_] issuer tender offer subject to Rule 13e-4.
[_] 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: [_]
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<PAGE>
This Amendment No. 1 amends and supplements the Tender Offer Statement on
Schedule TO filed on December 6, 2000, relating to the commencement by Tahoe
Acquisition Corp., a Delaware corporation ("Merger Sub") and a wholly owned
subsidiary of Agilent Technologies, Inc., a Delaware corporation ("Parent"),
of its offer to purchase all of the outstanding shares of common stock, $0.001
par value ("Common Stock" or "Shares"), of Objective Systems Integrators,
Inc., a Delaware corporation (the "Company"), at a price of $17.75 per Share,
net to the seller in cash, upon the terms and subject to the conditions set
forth in the Offer to Purchase, dated December 6, 2000 (the "Offer to
Purchase") and in the related Letter of Transmittal (which, as they may be
amended and supplemented from time to time, together constitute the "Offer").
The information in the Offer to Purchase, including all schedules and
annexes thereto, is hereby incorporated by reference in response to all the
items of this Schedule TO, except as otherwise set forth below. Capitalized
terms used and not otherwise defined herein shall have meanings assigned to
such terms in the Offer to Purchase or the Schedule TO.
Cover Page
The following sentence is added at the end of the first paragraph of the
Cover Page:
ACCORDING TO THE COMPANY, AS OF DECEMBER 1, 2000, THERE WERE 37,609,227
SHARES OUTSTANDING OR 39,853,671 SHARES CALCULATED ON A FULLY DILUTED
BASIS. BASED ON THESE NUMBERS, THE TENDER AGREEMENT STOCKHOLDERS HAVE
AGREED TO TENDER 20,360,546 SHARES, WHICH AS OF DECEMBER 1, 2000, WAS
GREATER THAN A MAJORITY OF THE SHARES OUTSTANDING (CALCULATED ON A
FULLY DILUTED BASIS). THEREFORE, IF THE TENDER AGREEMENT STOCKHOLDERS
WERE TO SO TENDER AND IF PERSONS WHO HAVE NOT ENTERED INTO THE TENDER
AGREEMENT WERE TO HAVE TENDERED AT LEAST 8,542,819 SHARES IN THE OFFER
THEN THE MINIMUM CONDITION WOULD HAVE BEEN SATISFIED.
The following sentence is added to the end of the second paragraph of the
Cover Page:
FOR ADDITIONAL IMPORTANT INFORMATION REGARDING THE BOARD OF DIRECTORS'
RECOMMENDATION, SEE SECTION 10.
<PAGE>
Item 1. Summary Term Sheet
The first sentence of the first paragraph of the Summary Term Sheet is
revised to read:
This summary highlights important and material information from this
Offer to Purchase but might not include all of the information that is
important to you.
The following text is added at the end of the first paragraph under the
heading: "WHAT ARE THE MOST SIGNIFICANT CONDITIONS TO THE OFFER?"
According to the Company, as of December 1, 2000 there were 37,609,227
shares outstanding or 39,853,671 shares calculated on a fully diluted
basis. Based on these numbers, the tender agreement stockholders have
agreed to tender 20,360,546 shares, which as of December 1, 2000 was
greater than a majority of the shares outstanding (calculated on a
Fully Diluted Basis in accordance with the Merger Agreement).
Therefore, if the tender agreement stockholders were to so tender and
if persons who have not entered into the tender agreement were to have
tendered at least 8,542,819 shares in the offer then the Minimum
Condition would have been satisfied.
The paragraph under the heading: "UNTIL WHAT TIME CAN I WITHDRAW PREVIOUSLY
TENDERED SHARES?" is replaced with the following:
The tender of your shares may be withdrawn at any time prior to the
expiration date of the Offer. In addition, you may withdraw your shares
anytime after February 4, 2001.
The following text is added to the end of the paragraph that appears under
the heading "WHAT DOES MY BOARD OF DIRECTORS THINK OF THE OFFER?":
For additional information, see Item 4 of Schedule 14D-9, filed by the
Company on December 6, 2000. Under the Merger Agreement, the Board of
Directors is obligated to recommend the Merger to the Company's
stockholders, provided, that the Board may withdraw its recommendation
under certain circumstances described in Section 11 of the Offer to
Purchase.
The following text is added at the end of the Summary Term Sheet:
. WHAT ARE THE US FEDERAL INCOME TAX CONSEQUENCES OF THE OFFER?
Sales of the Shares pursuant to the Offer and the exchange of the
Shares for cash pursuant to the Merger will be taxable transactions
for U.S. federal income tax purposes and may also be taxable under
applicable state, local, foreign and other tax laws. For U.S.
federal income tax purposes, a stockholder whose Shares are
purchased pursuant to the Offer or who receives cash as a result of
the Merger will realize gain or loss equal to the difference between
the adjusted basis of the Shares sold or exchanged and the amount of
cash received therefor. Such gain or loss will be capital gain or
loss if the Shares are held as capital assets by the stockholder and
will be long-term capital gain or loss if the stockholder has held
the Shares for more than one year at the time of sale. Long-term
capital gain of a non-corporate stockholder is generally subject to
a maximum U.S. federal income tax rate of 20%.
. WHO IS RESPONSIBLE FOR THE OTHER FEES AND EXPENSES OF THE
TRANSACTION?
Parent has agreed to pay Morgan Stanley a fee for financial advisory
services provided in connection with the Merger. In addition, Tahoe
Acquisition Corp. has agreed to pay a fee to Corporate Investor
Communications, Inc., who is acting as Information Agent, and to
Computershare, who is acting as depositary. You will not be
responsible for paying these fees. See Section 16 for additional
information.
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. CAN THE MERGER BE TERMINATED BY THE COMPANY, AGILENT TECHNOLOGIES OR
TAHOE ACQUISITION CORP.?
Yes. Anytime before the Merger is effective, the Company and Agilent
Technologies may agree to terminate the Merger. In other
circumstances, the Company or Agilent Technologies may abandon plans
for the Merger without the other party's consent. These
circumstances are described in Section 11.
. CAN THE BOARD OF DIRECTORS SOLICIT ACQUISITION PROPOSALS FROM THIRD
PARTIES?
The Company has agreed not to solicit or encourage acquisition
proposals from third parties and has agreed to refrain from
participating in negotiations with any third party regarding an
acquisition proposal. In addition, the Company and its board of
directors has agreed not to enter into any agreement with a third
party relating to an acquisition proposal. In limited circumstances
described in Section 11, the Company's board of directors can
respond to unsolicited acquisition proposals.
Item 2. Subject Company Information.
The following sentence is added at the end of the sixth paragraph under
"Introduction":
For additional information, please see Item 4 of the Schedule 14D-9
filed by the Company on December 6, 2000. The Merger Agreement
constrains the Board of Directors' ability to withdraw such
recommendation.
The following sentence is added to the end of the third paragraph under "1.
Terms of the Offer":
All conditions to the Offer, other than the Antitrust Condition, will
be satisfied or waived prior to the Expiration Date.
The first sentence of the second paragraph under "5. Certain U.S. Federal
Income Tax Consequences of the Offer" is replaced with the following:
The U.S. federal income tax discussion set forth above may not be
applicable to stockholders in special situations such as stockholders
who received their Shares upon the exercise of stock options or
otherwise as compensation and stockholders who are not United States
persons.
Item 3. Identity and Background of Filing Person
Not modified.
Item 4. Terms of the Transaction
Item 4 is amended and supplemented as follows:
In the Section "11. Purpose of the Offer; Plans for the Company; The
Merger", the first four paragraphs of the subsection entitled "Employment
Contracts and Change-in-Control Arrangements" are replaced in their entirety
with the following:
Jeffrey T. Boone entered into a Severance Agreement with the Company in
December of 1999. This agreement provides that, as a result of a
termination on a "change in control," Mr. Boone would be entitled to:
(a) payment of any accrued and unpaid compensation; (b) payment of
severance compensation in an amount equal to his compensation for 12
months; (c) payment of 100% of
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Company-paid benefits for up to 12 months; (d) full vesting of all
options he holds before termination (such options to remain exercisable
for 12 months after termination, or for 24 months if the termination
results from disability, but in no event longer than the original terms
of the options); and (e) a payment sufficient to pay certain taxes
should the benefits under the Severance Agreement constitute a
"parachute payment" within the meaning of Section 280G of the Internal
Revenue Code of 1986. The purchase by Merger Sub of at least 50% of the
voting power of the Company, or the closing of the Merger, constitute a
"change in control" for purposes of the Severance Agreement. Were Mr.
Boone's termination, as such term is defined in the Severance
Agreement, to occur, Mr. Boone would be entitled to receive, among
other things, approximately $291,250, constituting the severance
compensation described above, and 79,792 options would be fully vested.
Philip N. Cardman entered into an employment agreement, as amended,
with the Company in May of 1996. This agreement includes, inter alia,
payment of base salary for two years from termination in the event of
involuntary termination without cause, or a total of $310,000 paid over
the course of two years. Mr. Cardman also entered into a Severance
Agreement with the Company in December of 1999. This agreement provides
that, as a result of a termination on a "change in control," Mr.
Cardman would be entitled to: (a) payment of any accrued and unpaid
compensation; (b) payment of severance compensation in an amount equal
to his compensation for 24 months; (c) payment of 100% of Company-paid
benefits for up to 24 months; (d) full vesting of all options he holds
before termination (such options to remain exercisable for 12 months
after termination, or for 24 months if the termination results from
disability, but in no event longer than the original terms of the
options); and (e) a payment sufficient to pay certain taxes should the
benefits under the Severance Agreement constitute a "parachute payment"
within the meaning of Section 280G of the Internal Revenue Code of
1986. The purchase by Merger Sub of at least 50% of the voting power of
the Company, or the closing of the Merger, constitute a "change in
control" for purposes of the Severance Agreement. Were Mr. Cardman's
termination, as such term is defined in the Severance Agreement, to
occur, Mr. Cardman would be entitled to receive, among other things,
approximately $612,500, constituting the severance compensation
described above, and 186,935 options would be fully vested.
Lawrence F. Fiore, the Chief Financial Officer of the Company, entered
into a Severance Agreement in December of 1999. This agreement provides
that, as a result of a termination on a "change in control," Mr. Fiore
would be entitled to: (a) payment of any accrued and unpaid
compensation; (b) payment of severance compensation in an amount equal
to his compensation for 24 months; (c) payment of 100% of Company-paid
benefits for up to 24 months; (d) full vesting of all options he holds
before termination (such options to remain exercisable for 12 months
after termination, or for 24 months if the termination results from
disability, but in no event longer than the original terms of the
options); and (e) a payment sufficient to pay certain taxes should the
benefits under the Severance Agreement constitute a "parachute payment"
within the meaning of Section 280G of the Internal Revenue Code of
1986. The purchase by Merger Sub of at least 50% of the voting power of
the Company, or the closing of the Merger, would constitute a "change
in control" for purposes of the Severance Agreement. Were Mr. Fiore's
termination, as such term is defined in the Severance Agreement, to
occur, Mr. Fiore would be entitled to receive, among other things,
approximately $562,500, constituting the severance compensation
described above, and 77,500 options would be fully vested.
Roger A. Hosier, Vice President and Chief Technology Officer of the
Company, entered into a Severance Agreement in December of 1999. This
agreement provides that, as a result of a termination on a "change in
control," Mr. Hosier would be entitled to: (a) payment of any accrued
and unpaid compensation; (b) full vesting of all options he holds
before termination (such options to remain exercisable for 12 months
after termination, or for 24 months if the termination results from
disability, but in no event longer than the original terms of the
options); and (c) a payment sufficient to pay certain taxes should the
benefits under the Severance Agreement constitute a "parachute payment"
within the meaning of Section 280G of the Internal Revenue Code of
1986. The purchase by Merger Sub of at least 50% of the voting power of
the Company, or the closing of the Merger, would constitute a
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"change in control" for purposes of the Severance Agreement. Were Mr.
Hosier's termination, as such term is defined in the Severance
Agreement, to occur, 54,270 options would be fully vested.
Dan D. Line entered into a Severance Agreement with the Company in
December of 1999. This agreement provides that, as a result of a
termination on a "change in control," Mr. Line would be entitled to:
(a) payment of any accrued and unpaid compensation; (b) payment of
severance compensation in an amount equal to his compensation for 12
months; (c) payment of 100% of Company-paid benefits for up to 12
months; (d) full vesting of all options he holds before termination
(such options to remain exercisable for 12 months after termination, or
for 24 months if the termination results from disability, but in no
event longer than the original terms of the options); and (e) a payment
sufficient to pay certain taxes should the benefits under the Severance
Agreement constitute a "parachute payment" within the meaning of
Section 280G of the Internal Revenue Code of 1986. The purchase by
Merger Sub of at least 50% of the voting power of the Company, or the
closing of the Merger, constitute a "change in control" for purposes of
the Severance Agreement. Were Mr. Line's termination, as such term is
defined in the Severance Agreement, to occur, Mr. Line would be
entitled to receive, among other things, approximately $175,000,
constituting the severance compensation described above, and 97,291
options would be fully vested.
Bud J. Mullanix, the Vice President, Human Resources of the Company,
entered into a Severance Agreement in March of 1999. This agreement
provides that, as a result of a termination on a "change in control,"
Mr. Mullanix would be entitled to: (a) payment of any accrued and
unpaid compensation; (b) payment of severance compensation in an amount
equal to his compensation for 12 months; (c) payment of 100% of
Company-paid benefits for up to 12 months; (d) full vesting of all
options he holds before termination (such options to remain exercisable
for 12 months after termination, or for 24 months if the termination
results from disability, but in no event longer than the original terms
of the options); and (e) a payment sufficient to pay certain taxes
should the benefits under the Severance Agreement constitute a
"parachute payment" within the meaning of Section 280G of the Internal
Revenue Code of 1986. The purchase by Merger Sub of at least 50% of the
voting power of the Company, or the closing of the Merger, would
constitute a "change in control" for purposes of the Severance
Agreement. Were Mr. Mullanix's termination, as such term is defined in
the Severance Agreement, to occur, Mr. Mullanix would be entitled to
receive, among other things, approximately $227,500, constituting the
severance compensation described above, and 60,000 options would be
fully vested.
James T. Olsen entered into a Severance Agreement with the Company in
December of 1999. This agreement provides that, as a result of a
termination on a "change in control," Mr. Olsen would be entitled to:
(a) payment of any accrued and unpaid compensation; (b) payment of
severance compensation in an amount equal to his compensation for 12
months; (c) payment of 100% of Company-paid benefits for up to 12
months; (d) full vesting of all options he holds before termination
(such options to remain exercisable for 12 months after termination, or
for 24 months if the termination results from disability, but in no
event longer than the original terms of the options); and (e) a payment
sufficient to pay certain taxes should the benefits under the Severance
Agreement constitute a "parachute payment" within the meaning of
Section 280G of the Internal Revenue Code of 1986. The purchase by
Merger Sub of at least 50% of the voting power of the Company, or the
closing of the Merger, constitute a "change in control" for purposes of
the Severance Agreement. Were Mr. Olsen's termination, as such term is
defined in the Severance Agreement, to occur, Mr. Olsen would be
entitled to receive, among other things, approximately, $323,750,
constituting the severance compensation described above, and 163,542
options would be fully vested.
Mr. Fiore and Mr. Dan D. Line, Senior Vice President, Worldwide Sales and
Operations of the Company, have also each entered into employment agreements
with the Company. Mr. Fiore's employment agreement provides for a single
payment equal to one year's salary upon termination without cause, or a total
of $155,000, provided Mr. Fiore enters into a standard release and termination
agreement. Mr. Line's employment agreement provides for two years of
continuing salary if termination is without cause, or a total of $350,000 paid
over the course of two years, provided Mr. Line enters into a standard release
and termination agreement.
4
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The subsection "Offer Letters" is hereby amended by replacing the subsection
with the following:
Pursuant to letters, (each an "Offer Letter"), Parent has offered employment
to certain employees of the Company. Each such offer is contingent upon the
successful closing of the proposed acquisition. Parent and the Company agree
that a termination, as such term is defined in the Severance Agreements and
employment agreements described below, will be deemed to have occurred upon
the successful closing of the proposed acquisition. Certain terms of the Offer
Letters are summarized below, however, each description is qualified in its
entirety by such Offer Letters, which are attached, along with any amendments
thereto, as Exhibit (d)(6) hereto.
Jeffrey T. Boone. Mr. Boone's Offer Letter dated December 15, 2000, provides
for an annual base salary of $200,000 and he has been offered an option to
purchase 5,000 shares of Parent Common Stock, subject to customary vesting. In
addition, Parent will pay all sums and benefits due under Mr. Boone's
Severance Agreement under the heading "Employment Contracts and
Change-in-Control Arrangements," including the treatment of his outstanding
Company Stock Options, which will be converted into options to purchase Parent
Common Stock. In addition, as a result of Mr. Boone's acceptance of Parent's
offer, Parent will extend the life of the such options to purchase Parent
Common Stock to the original term of the underlying Company Stock Options.
Lawrence F. Fiore. Mr. Fiore's Offer Letter dated December 19, 2000 provides
for a temporary position, not to exceed six months. Mr. Fiore's base monthly
salary would be $18,500. In addition, as a result of Mr. Fiore's acceptance of
Parent's offer, any agreements Mr. Fiore entered into with the Company will
terminate, excluding Mr. Fiore's Severance Agreement and employment agreement
and Parent will pay all sums and benefits due under Mr. Fiore's Severance
Agreement and employment agreement (see "Employment Contracts and Change in
Control Agreements" above).
Roger A. Hosier. Mr. Hosier's Offer Letter dated December 4, 2000 and
amended on December 18, 2000, provides for an annual salary of $170,000 and he
has been offered an option to purchase 3,000 shares of Parent Common Stock,
subject to customary vesting. In addition, Parent will pay all sums and
benefits due under Mr. Hosier's Severance Agreement, as described in
"Employment Contracts and Change in Control Agreements" above, including the
treatment of his outstanding Company Stock Options, which will be converted
into options to purchase Parent Common Stock. As a result of Mr. Hosier's
acceptance of Parent's offer, Parent will extend the life of the such options
to purchase Parent Common Stock to the original term of the underlying Company
Stock Options.
Bud J. Mullanix. Mr. Mullanix's Offer Letter dated December 4, 2000,
provides for an annual salary of $150,000 and he has been offered an option to
purchase 3,000 shares of Parent Common Stock, subject to customary vesting. In
addition, Parent will pay all sums and benefits due under Mr. Mullanix's
Severance Agreement, as described in "Employment Contracts and Change in
Control Agreements" above, including the treatment of his outstanding Company
Stock Options, which will be converted into options to purchase Parent Common
Stock. In addition, as a result of Mr. Mullanix's acceptance of Parent's
offer, Parent will extend the life of the such options to purchase Parent
Common Stock to the original term of the underlying Company Stock Options.
James T. Olsen. Mr. Olsen's Offer Letter dated December 4, 2000 and amended
on December 8, 2000, provides for an annual salary of $225,000 and he has been
offered an option to purchase 30,000 shares of Parent Common Stock, subject to
customary vesting. In addition, Parent will pay all sums and benefits due
under Mr. Olsen's Severance Agreement, as described in "Employment Contracts
and Change-in-Control Arrangements" above, including the treatment of his
outstanding Company Stock Options, which will be converted into options to
purchase Parent Common Stock. In addition, if Mr. Olsen accepts Parent's
offer, Parent will extend the life of the such options to purchase Parent
Common Stock to the original term of the underlying Company Stock Options. As
of December 22, 2000, Mr. Olsen had not accepted Parent's offer.
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Dan D. Line. Mr. Line's Offer Letter dated December 15, 2000, provides for a
temporary position, not to exceed nine months. Mr. Line's base monthly salary
would be $20,000. As a result of Mr. Line's acceptance of Parent's offer,
Parent will pay all sums and benefits due under Mr. Line's Severance
Agreement, as described in "Employment Contracts and Change-in-Control
Arrangements" above, including the treatment of his outstanding Company Stock
Options, which will be converted into options to purchase Parent Common Stock
with a one year exercise period. In addition, Parent will pay all sums due
under Mr. Line's employment agreement.
First paragraph of Section "13. Certain Conditions of the Offer" has been
replaced with the following:
The obligation of Merger Sub to accept for payment and to pay for any
Shares tendered (and the obligation of Parent to cause Merger Sub to
accept for payment and to pay for any Shares tendered) shall be subject
to various conditions, including the condition that each of (A) a
majority of Shares on a fully-diluted basis (including for purposes of
such calculation all Shares issuable upon exercise of all vested
Company Stock Options (as defined in Merger Agreement) and unvested
Company Stock Options that vest prior to January 31, 2001 (but
excluding any Shares held by the Company or any of its subsidiaries)
and (B) a majority of those Shares held by persons who have not
executed Tender and Voting Agreements be validly tendered (but
excluding any Shares held by Parent, Merger Sub or their respective
affiliates) (collectively, the "Minimum Condition"). Each condition,
other than the Antitrust Condition (as described below) is to be
satisfied or waived prior to the Expiration Date.
In the first two lines of the second paragraph of "Section 13. Certain
Conditions of the Offer", "Parent" has been replaced with "Merger Sub."
The first sentence of the second to last paragraph of "Section 13. Certain
Conditions of the Offer" has been revised as follows:
The foregoing conditions are for the sole benefit of Parent and Merger
Sub. Other than the Minimum Condition, these conditions may be waived
by Parent or Merger Sub, in whole or in part at any time and from time
to time prior to the Expiration Date in the sole discretion of Parent
or Merger Sub.
Item 5. Past Contacts, Transactions, Negotiations and Agreements.
Item 5 is amended and supplemented as follows:
Section 10, under the subsection "Background of the Offer" is amended and
supplemented by replacing the third, fourth, fifth, seventh, twelfth,
eighteenth, twentieth, and twenty second paragraphs with the following:
Between April and July of 2000, GKM or AHH contacted approximately 70
possible strategic partners and engaged in further preliminary
discussions with over 30 companies that had expressed an interest in a
business combination with the Company, including a large
telecommunication equipment provider ("Bidder A") and Parent. Of the
over 30 companies who initially expressed interest in a possible
business combination with the Company, seven (including Bidder A and
Parent) engaged in further discussions with the Company. During this
time period, GKM and AHH provided the Board and the Company's senior
management with periodic updates as to the results of these contacts.
The Company and Bidder A entered into a Non-Disclosure Agreement on
April 28, 2000. The remaining five companies all entered into Non-
Disclosure Agreements between May 1 and August 1, 2000 and performed
preliminary due diligence on the Company. However, none of these five
companies submitted any proposals for possible business combinations
with the Company.
On July 28, 2000, representatives of AHH presented the Board with a
report on the services that they had provided to date, the status of
AHH's preliminary discussions with Bidder A, Parent, the five other
companies that were still potential strategic partners, and various
strategic alternatives available to the Company. At this meeting, the
Board determined to form a special committee composed of Gary D.
Cuccio, George F. Schmitt and Dr. Kornel Terplan, the three non-
management directors (the "Special
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Committee"). The Board authorized the Special Committee to pursue a
possible business combination involving the Company and to review,
evaluate and negotiate the proposed structure, price and terms of such
a transaction. The Board also authorized the Special Committee to
recommend a possible business combination involving the Company to the
Board if the Special Committee believed such proposal would be in the
best interests of the Company and its stockholders.
At its initial meeting on August 15, 2000, the Special Committee
authorized AHH to pursue further discussions with five potential
strategic partners (including Bidder A and Parent). The Special
Committee also authorized one of its members to contact an officer of
Bidder A to discuss a possible strategic transaction.
In August 2000, Bidder A conducted a due diligence investigation of the
Company. Following this investigation and other meetings between
representatives of Bidder A and the Company, on August 31, 2000, Bidder
A delivered to the Special Committee a non-binding indication of
interest relating to an acquisition of the Company by Bidder A. AHH
provided the Special Committee with its analysis of the proposed price,
structure, terms and conditions of the proposed offer. Following
discussion, the Special Committee determined that the economic terms in
the non-binding indication of interest were not in the best interests
of the Company and its stockholders. The Special Committee directed AHH
to pursue further discussions with the financial advisors for Bidder A,
Parent and the other remaining potential strategic partners.
At a Special Committee meeting on November 2, 2000, AHH reported on the
current status of its ongoing discussions with Parent and Bidder A. AHH
also reported on its analysis of the price and other terms of the
potential transaction that had been proposed by Bidder A. The Special
Committee authorized AHH to pursue further discussions with Bidder A.
On November 2, 2000 and November 3, 2000, Parent continued its on-site
and off-site due diligence investigation of the Company.
On November 16, 2000, counsel for Parent delivered to the Special
Committee a revised non-binding proposal and draft definitive
agreement, providing for, among other things, an all cash tender offer
of the outstanding shares of the Company at the purchase price of
$17.75 per share to be followed by a second-step merger. The proposal
included a three percent termination fee, a non-solicitation provision
and a requirement that stockholders holding at least 50% of the
outstanding Common Stock enter into the Tender Agreement. The proposal
stated that execution of a definitive agreement was subject to the
approval of Parent's Board of Directors and satisfactory completion of
due diligence. Counsel for Bidder A also delivered a draft definitive
agreement, providing for, among other things, an all cash tender offer
for the outstanding shares of the Company at an orally expressed per
share price less than that offered by Parent.
The Special Committee met on the afternoon of November 17, 2000, at
which time Company counsel, AHH and GKM reviewed the principal terms
and conditions of the agreements submitted by Bidder A and Parent with
the Special Committee. AHH and GKM again analyzed the relative merits
of the final proposals from Bidder A and Parent, as well as the
perceived likelihood and timing of closing a transaction with each of
the parties. The Special Committee observed that while both Bidder A
and Parent had proposed all cash tender offers, Parent had proposed a
higher price per share than Bidder A. Following this discussion, the
Special Committee unanimously determined to proceed with immediate
negotiation and finalization of the draft merger agreement with Parent.
The Special Committee also instructed AHH to inform the financial
advisors for Bidder A that another party had proposed the acquisition
of the Company at a higher per share price than that proposed by Bidder
A. That evening, the financial advisors to Bidder A informed AHH that
Bidder A had delivered its best and final offer.
At the Board meeting immediately following the meeting of the Special
Committee, the Board reviewed the terms of the draft merger agreement
with AHH, GKM and Company counsel. At this meeting, AHH reviewed the
course of negotiations with Bidder A and Parent. GKM presented its
financial analysis of the proposed transaction and its written opinion
that, as of that date, the Offer Price to be received by holders of
Common Stock in connection with the Offer and the Merger was
7
<PAGE>
fair to such holders from a financial point of view. The Special
Committee then presented its recommendation to the Board that the Offer
and the Merger are in the best interests of the Company's stockholders.
After further discussion, the Board approved, by unanimous vote of the
directors, the transaction and the entry into the definitive agreements
by the Company, subject to finalization of the merger agreement and the
receipt of an updated fairness opinion from GKM on the date that the
draft merger agreement was finalized.
At the end of the final paragraph in Section 10, the following is added:
See Item 14 of Schedule 14D-9 filed by the Company on December 6, 2000
for additional information.
Item 7. Source and Amount of Funds
Section 12 of the Offer to Purchase is amended and restated in its entirety
as follows:
The Offer is not conditioned upon any financing arrangements. Merger
Sub estimates that the total amount of funds required to purchase all
of the outstanding Shares pursuant to the Offer and the Merger and to
pay related fees and expenses will be approximately $714,420,000.
Merger Sub will obtain all necessary funds required to consummate the
transaction through capital contributions or advances made by Parent.
Parent plans to make these contributions or advances from cash on hand
or from the proceeds from the sale of assets, as well as with proceeds
of Parent's commercial paper issuances or other short term borrowings
under Parent's Five Year Credit Agreement dated as November 5, 1999,
the term of which has been extended by one year to November 5, 2005
with Citicorp USA, Inc., as Administrative Agent, and the other parties
thereto, (the "Five Year Credit Agreement"), Parent's 364-Day Credit
Agreement dated as of November 5, 1999 as amended and restated as of
November 3, 2000, with Salomon Smith Barney Inc., as lead arranger and
sole book manager (the "364-Day Credit Agreement") and, an uncommitted
credit facility to be provided to Parent by Chase Manhattan Bank (the
"Uncommitted Facility" and, together with the Five Year Credit
Agreement and the 364-Day Credit Agreement, the "Credit Facilities").
Parent also intends to enter into a new, $150 million Credit Facility
with Citicorp USA, Inc., as Administrative Agent, and the other parties
thereto, the terms of which will not be materially deviating from the
364-Day Credit Agreement.
Each of the Credit Facilities is an unsecured facility for which
interest is based on the Citicorp base rate, a margin over LIBOR, or a
fixed rate based on competitive bids and pursuant to which Parent must
not exceed a defined debt to earnings ratio. The foregoing summary of
the Credit Facilities is qualified in its entirety by the Credit
Facilities copies of which may be obtained from the offices of the SEC
in the same manner as set forth in Section 8 above, and are included or
incorporated by reference as exhibits to the Schedule TO.
No alternative financing plans or arrangements have been made in the
event that Parent is unable to obtain sufficient funds in connection
with the Offer and the Merger through borrowings under the Credit
Agreement or issuances of commercial paper. Parent intends to repay
borrowings under the Credit Facilities from working capital and funds
provided by future operations.
Item 9. Persons/Assets, Retained, Employed, Compensated or Used
The second sentence of the first paragraph under Section "16. Fees and
Expenses" is replaced with the following:
Parent has agreed to pay Morgan Stanley approximately $4.5 million
compensation for its financial advisory services, including, without
limitation, their services in their capacity as dealer manager in
connection with the Offer.
8
<PAGE>
The last sentence in the second paragraph under Section "16. Fees and
Expenses" is replaced with the following:
Parent has agreed to pay the Information Agent a base fee of $10,000
and additional fees based on the number of inbound calls received by
the Information Agent and the length of time of offer is held open. The
Information Agent will also be reimbursed for certain reasonable out-
of-pocket expenses and be indemnified against certain liabilities and
expenses in connection with its services, including certain liabilities
under federal securities laws.
Item 11. Certain Legal Matters
The first two sentences of the third paragraph of this section have been
revised as follows:
Pursuant to the HSR Act, Parent filed a Notification Premerger and
Report Form with respect to the acquisition of the Shares pursuant to
the Offer and the Merger with the Antitrust Division and the FTC on
December 11, 2000 and received notification from the Premerger
Notification Office of the FTC of early termination effective December
22, 2000 of the required waiting period.
The last two sentences of the first paragraph under "Antitrust Compliance--
Other Foreign Filings" is replaced with the following:
Parent and the Company believe that there are no approvals by foreign
jurisdictions that are necessary to consumate the proposed transaction.
The first sentence of the second paragraph under "Antitrust Compliance--
Other Foreign Filings" is deleted.
The seventh paragraph has been revised as follows:
Parent has been advised that in connection with Merger Sub's
acquisition of the Shares pursuant to the Offer a regulatory filing
will be required in the Republic of China in Taiwan (the "ROC"). In the
ROC, a combination filing must be made with its Fair Trade Commission
(the "ROC FTC") for prior approval. The ROC FTC must respond to the
combination filing within two months of receipt. Parent made the
combination filing on December 11, 2000. The ROC FTC may approve Merger
Sub's acquisition of the Shares pursuant to the Offer prior to the
expiration of the full two-month period, but there can be no assurance
that it will do so. In the event the ROC FTC does not approve the
transaction prior to the expiration date, the acceptance of the Shares
by the Merger Sub may be delayed and the proposed transaction may not
be consummated until such approval is received. This may result in a
delay of payment to the Stockholders.
9
<PAGE>
Item 12. Exhibits.
The following are attached as exhibits to this Schedule TO:
<TABLE>
<CAPTION>
Exhibit
Number Exhibit Description
------- -------------------
<C> <S>
(a)(1)* Offer to Purchase
(a)(2)* Letter of Transmittal
(a)(3)* Notice of Guaranteed Delivery
(a)(4)* Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9
(a)(5)* Letter to brokers, dealers, commercial banks, trust companies and
other nominees
(a)(6)* Letter to be used by brokers, dealers, commercial banks, trust
companies and other nominees to their clients
(a)(7)* Summary newspaper advertisement, dated December 6, 2000, as published
in The Wall Street Journal
(a)(8)* Press release issued by Parent on November 27, 2000 (incorporated by
reference to Exhibit 99.1 of the schedule TO-C filed by Parent on
November 27, 2000)
(a)(9)* Presentation to analysts on November 27, 2000 (incorporated by
reference to Exhibit 99.2 of the Schedule TO-C filed by Parent on
December 4, 2000
(a)(10) Press release issued by Parent and Company on December 26, 2000.
(b) None
(d)(1)* Agreement and Plan of Merger, dated as of November 24, 2000, by and
among Parent, Merger Sub and the Company (incorporated by reference to
Exhibit 99.1(A) of the Schedule 13D filed by Parent on December 4,
2000).
(d)(2)* Tender and Voting Agreement, dated as of November 24, 2000, by and
among Parent, Merger Sub, Objective Systems Integrators, Inc. and
certain stockholders of Objective Systems Integrators, Inc.
(incorporated by reference to Exhibit 99.1(B) of the Schedule 13D
filed by Parent on December 4, 2000).
(d)(3)* Offer Letters from Agilent Technologies, Inc. to each of Jeffrey
Boone, Philip Cardman, Lawrence Fiore, Roger Hosier, Bud Mullanix and
Jim Olsen, dated December 4, 2000.
(d)(4)* Agreement and Plan of Merger, dated as of November 24, 2000, by and
among Parent, Merger Sub and the Company (incorporated by reference to
Exhibit 99.1(A) of the Schedule 13D filed by Parent on December 4,
2000).
(d)(5)* Tender and Voting Agreement, dated as of November 24, 2000, by and
among Parent, Merger Sub, Objective Systems Integrators, Inc. and
certain stockholders of Objective Systems Integrators, Inc.
(incorporated by reference to Exhibit 99.1(A) of the Schedule 13D
filed by Parent on December 4, 2000).
(d)(6) Offer Letters from Agilent Technologies, Inc. to each of Dan Line,
Jeffrey Boone and Lawrence Fiore.
(d)(7) 364-Day Credit Agreement with Salomon Smith Barney as lead arranger
and sole book manager (incorporated by reference from Exhibit 2.15 of
Parent's Registration Statement on Form S-1)
(d)(8) Five Year Credit Agreement with Citicorp USA, Inc. as Administrative
Agent (incorporated by reference from Exhibit 2.16 of Parent's
Registration Statement on Form S-1)
(d)(9) Fixed Rate Promissory Note with Chase Manhattan Bank dated December
21, 2000.
(g) None
(h) None
</TABLE>
--------
* Previously filed
10
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, we certify
that the information set forth in this statement is true, complete and
correct.
TAHOE ACQUISITION CORP.
/s/ Marie Oh Huber
By: _________________________________
Name: Marie Oh Huber
Title: Vice President, Assistant
General Counsel and
Assistant Secretary
AGILENT TECHNOLOGIES, INC.
/s/ Marie Oh Huber
By: _________________________________
Name: Marie Oh Huber
Title: Vice President,
Assistant General
Counsel and Assistant
Secretary
Date: December 26, 2000
11
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Exhibit Description
------- -------------------
<C> <S>
(a)(1)* Offer to Purchase
(a)(2)* Letter of Transmittal
(a)(3)* Notice of Guaranteed Delivery
(a)(4)* Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9
(a)(5)* Letter to brokers, dealers, commercial banks, trust companies and
other nominees
(a)(6)* Letter to be used by brokers, dealers, commercial banks, trust
companies and other nominees to their clients
(a)(7)* Summary newspaper advertisement, dated December 6, 2000, as published
in The Wall Street Journal
(a)(8)* Press release issued by Parent on November 27, 2000 (incorporated by
reference to Exhibit 99.1 of the schedule TO-C filed by Parent on
November 27, 2000)
(a)(9)* Presentation to analysts on November 27, 2000 (incorporated by
reference to Exhibit 99.2 of the Schedule TO-C filed by Parent on
December 4, 2000)
(a)(10) Press release issued by Parent and Company on December 26, 2000
(b) None
(d)(1)* Agreement and Plan of Merger, dated as of November 24, 2000, by and
among Parent, Merger Sub and the Company (incorporated by reference to
Exhibit 99.1(A) of the Schedule 13D filed by Parent on December 4,
2000)
(d)(2)* Tender and Voting Agreement, dated as of November 24, 2000, by and
among Parent, Merger Sub, Objective Systems Integrators, Inc. and
certain stockholders of Objective Systems Integrators, Inc.
(incorporated by reference to Exhibit 99.1(B) of the Schedule 13D
filed by Parent on December 4, 2000)
(d)(3)* Offer Letters from Agilent Technologies, Inc. to each of Jeffrey
Boone, Philip Cardman, Lawrence Fiore, Roger Hosier, Bud Mullanix and
Jim Olsen, Dated December 4, 2000
(d)(4)* Agreement and Plan of Merger, dated as of November 24, 2000, by and
among Parent, Merger Sub and the Company (incorporated by reference to
Exhibit 99.1(A) of the Schedule 13D filed by Parent on December 4,
2000)
(d)(5)* Tender and Voting Agreement, dated as of November 24, 2000, by and
among Parent, Merger Sub, Objective Systems Integrators, Inc. and
certain stockholders of Objective Systems Integrators, Inc.
(incorporated by reference to Exhibit 99.1(A) of the Schedule 13D
filed by Parent on December 4, 2000)
(d)(6) Offer Letters from Agilent Technologies, Inc. to each of Dan Line,
Jeffrey Boone and Lawrence Fiore
(d)(7) 364-Day Credit Agreement with Salomon Smith Barney as lead arranger
and sole book manager (incorporated by reference to Exhibit 2.15 of
the Parent's Registration Statement on Form S-1)
(d)(8) Five Year Credit Agreement with Citicorp USA, Inc. as Administrative
Agent (incorporated by reference to Exhibit 2.16 of the Parent's
Registration Statement on Form S-1)
(d)(9) Fixed Rate Promissory Note with Chase Manhattan Bank dated December
21, 2000
(g) None
(h) None
</TABLE>
--------
* Previously Filed
