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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(D)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
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MICRO WAREHOUSE, INC.
(Name of Subject Company)
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MICRO WAREHOUSE, INC.
(Name of Person Filing Statement)
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Common Stock, Par Value $.01 Per Share
(Title of Class of Securities)
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59501B105
(CUSIP Number of Class of Securities)
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Bruce L. Lev, Esq.
Executive Vice President of Legal and Corporate Affairs
Micro Warehouse, Inc.
535 Connecticut Avenue
Norwalk, Connecticut 06854
(203) 899-4000
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of the Person Filing Statement)
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With copies to:
Randi L. Strudler, Esq.
Jones, Day, Reavis & Pogue
599 Lexington Avenue
New York, New York 10022
(212) 326-3939
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Item 1. Security and Subject Company.
The name of the subject company to which this Solicitation/Recommendation
Statement on Schedule 14D-9 (this "Schedule 14D-9") relates is Micro Warehouse,
Inc., a Delaware corporation (the "Company"). The address of the principal
executive offices of the Company is 535 Connecticut Avenue, Norwalk,
Connecticut. The class of equity securities to which this Schedule 14D-9 relates
is the Company's common stock, par value $.01 per share (the "Common Stock"),
including the associated preferred share rights (the "Rights" and together with
the Common Stock, the "Shares") issued pursuant to the Company's Rights
Agreement dated June 17, 1996 between the Company and State Street Bank and
Trust Company NA, as Rights Agent, as amended.
Item 2. Tender Offer of Purchaser.
This Schedule 14D-9 relates to the tender offer disclosed in the Schedule
14D-1, dated December 28, 1999 (the "Schedule 14D-1") of Bridgeport Acquisition
Corporation, a Delaware corporation ("Purchaser") and a wholly owned subsidiary
of Bridgeport Holdings Inc., a Delaware corporation ("Parent"), and the Company
to purchase all of the issued and outstanding Shares at a price of $19.00 per
Share, net to the seller in cash, without interest (the "Per Share Amount"),
upon the terms and subject to the conditions set forth in the Offer to Purchase,
dated December 28, 1999 (the "Offer to Purchase"), and the related Letter of
Transmittal (which, together with any amendments or supplements to the Offer to
Purchase or Letter of Transmittal, collectively constitute the "Offer"). As
described in the Offer to Purchase, Purchaser is offering to purchase
approximately 71% of the outstanding Shares (including Shares owned by BYOWC
Partners LLC, an affiliate of Purchaser) in the Offer and the Company is
offering to purchase the balance, if any, of the Shares tendered in the Offer.
Copies of the Offer to Purchase and the related Letter of Transmittal are
included as Exhibits (a)(1) and (a)(2) to the Schedule 14D-1 and are
incorporated herein by this reference.
The Offer is being made pursuant to an Agreement and Plan of Merger, dated
as of December 20, 1999 (the "Merger Agreement"), by and among the Company,
Parent, Purchaser and BYOWC Partners LLC ("BYOWC"). The Merger Agreement
provides, among other things, that Purchaser and Parent, on the one hand, and
the Company, on the other hand, will commence the Offer for all of the Shares at
a price of $19.00 per Share, and that, provided the specified conditions to
Purchaser's and the Company's obligations to purchase Shares in the Offer have
been satisfied or waived, Purchaser will acquire the first approximately 71% of
the outstanding Shares in the Offer (including Shares owned by BYOWC), if any,
and the Company will acquire the remaining Shares, if any, tendered pursuant to
the Offer. The Merger Agreement also provides that, as soon as practicable after
the satisfaction or waiver of certain additional conditions set forth in the
Merger Agreement, the Company will be merged into Purchaser (the "Merger").
Pursuant to the Merger, the Shares of non-tendering stockholders who do not
dissent from the Merger will be converted into the right to receive $19.00 per
Share in cash, without interest. A copy of the Merger Agreement is included as
Exhibit (c)(3) to the Schedule 14D-1 and is incorporated herein by this
reference.
At a meeting held on December 20, 1999 all members of the Board of Directors
of the Company (the "Company Board"), approved the Merger Agreement and the
transactions contemplated thereby, including the Offer and the Merger and
determined that the transactions contemplated by the Merger Agreement, including
the Offer and the Merger are fair to and in the best interests of the
stockholders.
As set forth in the Schedule 14D-1, the principal executive offices of
Parent and Purchaser are located at 9965 Wilshire Boulevard, Beverly Hills,
California 90212.
Item 3. Identity and Background.
(a) NAME AND ADDRESS OF FILING PERSON. The name and address of the
Company, which is the person filing this statement, are set forth in Item 1
above.
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(b) MATERIAL CONTRACTS, CONFLICTS OF INTEREST, ETC. Except as set forth in
this Item 3(b), to the knowledge of the Company, there are no material
contracts, agreements, arrangements or understandings and no actual or potential
conflicts of interest between the Company or its affiliates and (i) the
Company's executive officers, directors or affiliates or (ii) Parent or
Purchaser or their respective executive officers, directors or affiliates.
AGREEMENTS WITH PARENT AND PURCHASER. A summary of the material provisions
of the Merger Agreement is included in the Section 15 "The Merger Agreement;
Stockholder's Agreements" of the Offer to Purchase, a copy of which is included
as Exhibit (a)(1) to the Schedule 14D-1 and is incorporated herein by this
reference. Such summary does not purport to be complete and is qualified in its
entirety by reference to the complete text of the Merger Agreement, a copy of
which has been filed as Exhibit (c)(1) to the Schedule 14D-1 and is incorporated
herein by this reference.
In connection with the execution of the Merger Agreement, two stockholders
of the Company separately entered into stockholder's agreements with Parent and
Purchaser (collectively, the Stockholder's Agreements"). A summary of the
material provisions of the Stockholder's Agreements is included in the Section
15 "The Merger Agreement; Stockholder's Agreements" of the Offer to Purchase, a
copy of which is included as Exhibit (a)(1) to the Schedule 14D-1 and is
incorporated herein by this reference. Such summary does not purport to be
complete and is qualified in its entirety by reference to the complete text of
the Stockholder's Agreements, copies of which have been filed as Exhibits (c)(4)
and (c)(5), respectively, to the Schedule 14D-1 and are incorporated herein by
this reference.
AGREEMENTS WITH EXECUTIVE OFFICERS, DIRECTORS OR AFFILIATES OF THE COMPANY;
INTERESTS OF DIRECTORS AND EXECUTIVE OFFICERS IN THE OFFER AND THE MERGER. The
Company Board and executive officers of the Company may have interests in the
Offer and the Merger that are different from or in addition to the interests of
stockholders of the Company generally. These additional interests relate to,
among other things, the effect of the Offer and the Merger on certain
employment, benefit and other arrangements to which directors and executive
officers are parties or under which they have rights. These interests, to the
extent material, are described in the Section captioned "Interests of Certain
Persons in the Offer and the Merger" of the Offer to Purchase, a copy of which
is attached as Exhibit (a)(1) to the Schedule 14D-1 and incorporated herein by
reference.
In addition, certain agreements, arrangements or understandings between the
Company and certain of its directors, executive officers and affiliates are set
forth in the Company's Proxy Statement, dated April 30, 1999, for its 1999
Annual Meeting of Stockholders (the "1999 Proxy Statement"). The relevant
portions of the 1999 Proxy Statement, updated where applicable, are included in
the Information Statement included as Schedule I of the Offer to Purchase, which
is included as Exhibit (a)(1) to the Schedule 14D-1 and incorporated herein by
reference.
The Company Board was aware of these interests and considered them, among
other things, prior to approving the Merger Agreement.
Item 4. The Solicitation or Recommendation.
RECOMMENDATION OF THE BOARD OF DIRECTORS OF THE COMPANY. At a meeting held
on December 20, 1999, the Company Board, by unanimous vote of all directors,
approved the Merger Agreement and the transactions contemplated thereby,
including the Offer and the Merger and determined that the transactions
contemplated by the Merger Agreement, including the Offer and the Merger, are
fair to and in the best interests of the stockholders.
The Company Board recommends that the stockholders accept the Offer and
tender their Shares pursuant to the Offer.
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A letter to the Company's stockholders communicating the Company Board's
recommendation and a press release announcing the execution of the Merger
Agreement are filed herewith as Exhibits 2 and 3, respectively, and are
incorporated herein by this reference.
BACKGROUND OF THE OFFER. The information set forth in the Section 11
"Background of the Offer and the Merger" of the Offer to Purchase, a copy of
which is attached as Exhibit (a)(1) to the Schedule 14D-1, is incorporated
herein by reference.
REASONS FOR THE COMPANY BOARD'S RECOMMENDATION. The information set forth
in the Section 12 "Recommendation of the Company's Board of Directors" of the
Offer to Purchase, a copy of which is attached as Exhibit (a)(1) to the Schedule
14D-1, is incorporated herein by reference.
Item 5. Persons Retained, Employed or to be Compensated.
Pursuant to an engagement letter, dated as of December 1, 1998 (the
"Wasserstein Engagement Letter"), the Company engaged Wasserstein Perella &
Co., Inc. ("Wasserstein") to act as its financial advisor in connection with
various possible transactions, including transactions such as the Offer and
Merger. As part of its role as financial advisor, Wasserstein delivered the
Fairness Opinion to the Company Board. Pursuant to the Wasserstein Engagement
Letter, Wasserstein will receive from the Company total compensation equal to
approximately $4.88 million (the "Transaction Fee"). Of the Transaction Fee,
$150,000 was paid upon the execution of the Wasserstein Engagement Letter, and
the balance becomes payable upon consummation of the transactions. The Company
also has agreed to reimburse Wasserstein for its reasonable out-of-pocket
expenses, including the fees and expenses of legal counsel and other advisors,
and to indemnify Wasserstein and certain related persons or entities against
certain liabilities, including liabilities under the federal securities laws,
relating to or arising out of its engagement. In the ordinary course of its
business, Wasserstein may actively trade the debt and equity securities of the
Company for its own account and for the accounts of customers and, accordingly,
may at any time hold a long or short position in such securities. Except as
disclosed herein and in the Offer to Purchase, a copy of which is attached as
Exhibit (a)(1) to the Schedule 14D-1 and is incorporated herein by reference,
neither the Company nor any person acting on its behalf currently intends to
employ, retain or compensate any other person to make solicitations or
recommendations to stockholders of the Company on its behalf concerning the
Offer or the Merger.
Item 6. Recent Transactions and Intent With Respect to Securities.
(a) No transactions in the Shares have been effected during the past 60 days
by the Company or, to the Company's knowledge, by any executive officer,
director, affiliate or subsidiary of the Company.
(b) To the knowledge of the Company, all of its executive officers,
directors, affiliates and subsidiaries currently intend to tender pursuant to
the Offer all Shares held of record or beneficially owned by them (other than
Shares issuable upon exercise of stock options and Shares, if any, which if
tendered could cause such persons to incur liability under the provisions of
Section 16(b) of the Exchange Act).
Item 7. Certain Negotiations and Transactions by the Subject Company.
(a) Except as set forth in this Schedule 14D-9 and the Offer to Purchase,
the Company is not engaged in any negotiation in response to the Offer which
relates to or would result in (i) an extraordinary transaction, such as a merger
or reorganization, involving the Company or any subsidiary of the Company, (ii)
a purchase, sale or transfer of a material amount of assets by the Company or
any subsidiary of the Company, (iii) a tender offer for or other acquisition of
securities by or of the Company, or (iv) any material change in the present
capitalization or dividend policy of the Company.
(b) Except as described in Item 3 and Item 4 above (the provisions of which
are hereby incorporated by reference), there are no transactions, board
resolutions, agreements in principle or signed contracts in response to the
Offer which relate to or would result in one or more of the matters referred to
in Item 7(a).
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Item 8. Additional Information to be Furnished.
(a) The Information Statement included as Schedule I of the Offer to
Purchase, which is included as Exhibit (a)(1) to the Schedule 14D-1 and
incorporated herein by this reference, is being furnished pursuant to
Rule 14f-1 under the Securities and Exchange Act of 1934 in connection with the
potential designation by Parent, pursuant to the Merger Agreement, of certain
persons to be appointed to the Company Board other than at a meeting of the
stockholders if the Offer is completed.
(b) As a Delaware company, the anti-takeover provisions of Section 203 of
the Business Corporation Act of the State of Delaware ("Delaware Law") by their
terms apply to the Company. A description of these provisions and their
applicability to the Company is contained in the Offer to Purchase (which is
attached as Exhibit (a)(1) to the Schedule 14D-1 and incorporated herein by this
reference) in Section 18 "Certain Legal Matters." At its meeting held on
December 20, 1999, the Company Board approved the Merger Agreement and the
transactions contemplated thereby, which approval rendered Section 203 of the
Delaware Law inapplicable to the Merger Agreement and the transactions
contemplated thereby including the Offer and the Merger.
(c) The Company has entered into an amendment of the Company Rights
Agreement to make it inapplicable to the Offer, the Merger and the other
transactions contemplated by the Merger Agreement.
(d) For a description of appraisal rights applicable to the Merger (such
rights not being applicable to the Offer), see Section 5 "Purpose of the Offer
and the Merger; Structure of the Transaction; Short Form Merger; Plans for the
Company; Appraisal Rights; Going Private Transactions" of the Offer to Purchase,
which is included as Exhibit(a)(1) to the Schedule 14D-1 and is incorporated
herein by this reference.
(e) Reference is hereby made to the Offer to Purchase and the related Letter
of Transmittal which are attached as Exhibits (a)(1) and (a)(2), respectively,
to the Schedule 14D-1 and are incorporated herein by reference.
Item 9. Material to be Filed as Exhibits.
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Exhibit 1. Agreement and Plan of Merger, dated as of December 20, 1999,
among Purchaser, Parent, BYOWC and the Company (incorporated
by reference to Exhibit (c)(3) to the Schedule 14D-1).
Exhibit 2. Letter to Stockholders of Micro Warehouse, Inc., dated
December 28, 1999.
Exhibit 3. Joint Press Release issued by the Company and Parent on
December 20, 1999 (incorporated by reference to
Exhibit (a)(6) to the Schedule 14D-1).
Exhibit 4. Joint Press Release issued by the Company and Parent on
December 28, 1999 (incorporated by reference to
Exhibit (a)(9) to the Schedule 14D-1).
Exhibit 5. Opinion of Wasserstein Perella & Co., Inc. dated
December 20, 1999 (incorporated by reference to
Exhibit (a)(1) to the Schedule 14D-1 and incorporated in the
Offer to Purchase as Schedule V).*
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* Included in copies of the Offer to Purchase mailed to stockholders.
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SIGNATURE
After reasonable 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.
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MICRO WAREHOUSE, INC.
By: /s/ BRUCE L. LEV
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Bruce L. Lev
EXECUTIVE VICE PRESIDENT
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Dated: December 28, 1999
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[LETTERHEAD]
December 28, 1999
Dear Stockholder:
I am pleased to inform you that on December 20, 1999 Micro Warehouse, Inc.
(the "Company") entered into an Agreement and Plan of Merger (the "Merger
Agreement") with BYOWC Partners LLC ("BYOWC"), Bridgeport Holdings Inc. (the
"Parent") and Bridgeport Acquisition Corporation, a wholly owned subsidiary of
the Parent (the "Purchaser"), which provides for the acquisition of the Company
by the Purchaser. Pursuant to the Merger Agreement, the Purchaser and the
Company have simultaneously commenced tender offers (collectively, the "Offer")
for all outstanding common shares, including the associated preferred share
purchase rights, of the Company at a price of $19 per share. Under the Merger
Agreement, the Purchaser has agreed to purchase the first approximately 71% of
the shares tendered (including shares owned by BYOWC, an affiliate of the
Purchaser) and the Company has agreed to purchase all additional shares
tendered. The Merger Agreement also provides that, upon completion of the Offer,
any shares not tendered in the Offer will be converted in a follow-up merger
into the right to receive $19 per share, subject to dissenters rights under
Delaware law.
The Company's Board of Directors (the "Board") unanimously (i) determined
that the terms of the Offer and the merger are fair to and in the best interests
of the Company's stockholders, (ii) approved the Merger Agreement and the
transactions contemplated thereby, and (iii) recommends that stockholders accept
the Offer and tender their shares pursuant to the Offer.
In arriving at its recommendation, the Board considered the factors
described in the accompanying Offer to Purchase, including the written opinion
of our financial advisor, Wasserstein Perella & Co., Inc., that the
consideration to be received by the Company's stockholders pursuant to the Offer
and the merger is fair to such holders from a financial point of view. A copy of
Wasserstein Perella's written opinion is attached to the Offer to Purchase as
Schedule V.
Additional information with respect to the Offer and the merger accompany
this letter. These documents set forth all of the terms of the Offer and provide
instructions as to how to tender your shares. Included in the accompanying Offer
to Purchase is a discussion of the background and reasons for the Offer and the
merger. I urge you to read all these materials carefully and in their entirety.
On behalf of myself, the other members of management and directors of the
Company, I want to sincerely thank you for the support you have given us over
the years. If you have any questions about the Offer, please feel free to call
MacKenzie Partners, Inc., the Information Agent, at (800) 322-2885.
Very truly yours,
[SIGNATURE]
Peter Godfrey
CHAIRMAN OF THE BOARD, PRESIDENT AND
CHIEF EXECUTIVE OFFICER
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Micro Warehouse, Inc.
535 Connecticut Avenue, Norwalk, CT 06854
(203) 899-4000
