SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
SCHEDULE TO
(RULE 14D-100)
TENDER OFFER STATEMENT UNDER SECTION 14(D) (1) OR 13(E) (1)
OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. __)
QUALITY DINING, INC.
(Name of Subject Company (Issuer))
NBO, LLC
(Names of Filing Persons (Identifying Status as Offeror,
Issuer or Other Person))
COMMON STOCK, NO PAR VALUE
(Title of Class of Securities)
747456P105
(CUSIP Number of Class of Securities)
DAVID W. SCHOSTAK
NBO, LLC
25800 NORTHWESTERN HIGHWAY, SUITE 750
SOUTHFIELD, MICHIGAN 48075
TELEPHONE: (248) 262-1000
FACSIMILE: (248) 357-6116
(Name, Address and Telephone Numbers of Person
Authorized to Receive Notices and Communications on Behalf of Filing Persons)
Copies to:
DAVID ZELTNER, ESQ.
WEIL, GOTSHAL & MANGES LLP
767 FIFTH AVENUE
NEW YORK, NEW YORK 10153-0119
TELEPHONE: (212) 310-8000
FACSIMILE: (212) 310-8007
CALCULATION OF FILING FEE
================================================================================
Transaction Valuation* Amount of Filing Fee
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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: None Filing Party: Not Applicable
Form or Registration No.: Not Applicable Date Filed: Not Applicable
[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:
[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>
FOR IMMEDIATE RELEASE
CONTACT
David W. Schostak
(248) 357-6126
NBO ANNOUNCES INTENTION TO COMMENCE $5.00 PER SHARE TENDER
OFFER FOR QUALITY DINING
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Southfield, MI, April 18, 2000 - NBO, LLC, a 9.8% shareholder of Quality Dining,
Inc. (Nasdaq/NM:QDIN), today announced its intention to commence a tender offer
to purchase all Quality Dining shares at a price of $5.00 per share. NBO
indicated that, as described below, the tender offer will be subject to certain
conditions, but will not be subject to a financing or due diligence condition.
Following completion of the tender offer, NBO intends to effect a merger in
which all remaining Quality Dining shareholders will also receive the same cash
price paid in the tender offer.
This action was taken in response to the Quality Dining Board's decision to
permit Daniel B. Fitzpatrick, the Company's CEO who already owns nearly 19% of
the Company's shares, to purchase an additional 1,000,000 shares. Directors and
officers, including Mr. Fitzpatrick, already own approximately 30% of the
Company's shares, and the Company has stated its intention to buy back shares in
the market. In March 2000, the Quality Dining Board rejected NBO's cash merger
proposal under which all Quality Dining shareholders would have received $5.00
per share.
Mr. David Schostak, a principal of NBO, stated, "I am hopeful that the Quality
Dining Board will not block our $5.00 per share offer while permitting Dan
Fitzpatrick to buy shares at current market prices of less than half our offer
price, enabling him and the other managers to obtain effective control without
paying a premium to shareholders." In a letter to the Board, Mr. Schostak urged
the Board to let the matter be resolved by shareholders in the marketplace,
stating, "Please give your shareholders, the owners of Quality Dining, the right
to decide whether to accept our $5.00 per share offer before handing effective
control to Dan Fitzpatrick and management at no premium to market prices." Mr.
Schostak further urged the Board to protect all shareholders by not permitting
Mr. Fitzpatrick to buy any additional shares at a price below NBO's offer price
and requiring him to offer the same price for all outstanding shares.
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<PAGE>
NBO indicated that its offer will be conditioned, among other things, upon (1)
there being properly tendered and not withdrawn a number of shares that, when
added to the number of shares beneficially owned by NBO, would represent a
majority of the outstanding shares, (2) Quality Dining's approval of the offer
for purposes of its "poison pill" shareholder rights plan and Indiana corporate
statutes, (3) Quality Dining agreeing with NBO that its representatives will
constitute a majority of the Quality Dining Board if the tender offer is
successful and (4) NBO being satisfied that Quality Dining will not be in
default under any instrument evidencing its outstanding indebtedness upon
consummation of the tender offer.
A copy of NBO's April 18, 2000 letter to the Quality Dining Board is attached.
<PAGE>
Attachment
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NBO, LLC
25800 NORTHWESTERN HIGHWAY
SUITE 750
SOUTHFIELD, MICHIGAN 48075
TEL. (248) 262-1000 FAX (248) 357-6116
April 18, 2000
BY FACSIMILE AND FEDERAL EXPRESS
- --------------------------------
Board of Directors
Quality Dining, Inc.
4220 Edison Lakes Parkway
Mishawaka, Indiana 46545
Dear Directors:
I am writing on behalf of NBO, LLC to urge you to take
immediate action to give all Quality Dining shareholders the opportunity to
receive a fair price for their shares before Daniel B. Fitzpatrick and other
members of management lock-up control of the Company forever. I am concerned
that your close relationship with Dan has consciously or unconsciously led you
to follow a course of action that will cause grave and irreparable financial
injury to the Company's public shareholders.
After rejecting our $5.00 per share cash merger proposal in
March, Quality Dining announced on April 4, 2000 that you authorized Daniel
Fitzpatrick and other members of management to purchase up to 1,000,000
additional shares of Quality Dining common stock without triggering the "poison
pill" that stops others from buying over 15% of the Company's shares. Late on
April 14, obviously in response to our April 6 letter pointing out corporate and
securities law issues with respect to the purchase arrangements, you issued a
"clarification" seeking (unsuccessfully) to "paper over" issues we raised. IN
ADDITION, YOU HAVE NOT ADDRESSED THE VERY SERIOUS DAMAGE TO SHAREHOLDERS YOU
HAVE AUTHORIZED - ALLOWING DAN AND MANAGEMENT TO OBTAIN EFFECTIVE CONTROL OF THE
COMPANY AT NO PREMIUM TO CURRENT MARKET PRICES. The Company's purchase of shares
from other shareholders through its buyback program compounds the problem by
further increasing management's percentage ownership.
We are announcing that we intend to offer directly to your
shareholders an alternative to sales in the market and increased ownership by
management - the ability to sell all of their shares to us at $5.00 per share.
We intend to commence a tender offer for all shares which will not be subject to
a financing or due diligence condition. Following completion of the tender
offer, NBO intends to effect a merger in which all remaining Quality Dining
shareholders will also receive the same cash price paid in the tender offer.
<PAGE>
To allow us to consummate the tender offer in a
commercially reasonable manner, NBO's tender offer will be conditioned, among
other things, upon (1) there being properly tendered and not withdrawn a number
of shares that, when added to the number of shares beneficially owned by NBO,
would represent a majority of the outstanding shares, (2) Quality Dining's
approval of the offer for purposes of its "poison pill" shareholder rights plan
and Indiana corporate statutes, (3) Quality Dining agreeing with NBO that its
representatives will constitute a majority of the Quality Dining Board if the
tender offer is successful and (4) NBO being satisfied that Quality Dining will
not be in default under any instrument evidencing its outstanding indebtedness
upon consummation of the tender offer.
We further urge you to protect all shareholders by not
permitting Mr. Fitzpatrick to buy shares at a price below our offer price and
require him to offer the same price for all outstanding shares.
We believe that, if you deny the right of shareholders to
receive a control premium while permitting Mr. Fitzpatrick to buy without paying
one, you will be violating your fiduciary duties to Quality Dining's
shareholders and should be held accountable for the loss of value that results,
including any lost control premium that shareholders would have otherwise
received.
Please give your shareholders, the owners of Quality
Dining, the right to decide whether to accept our $5.00 per share offer before
handing effective control to Dan Fitzpatrick and management at no premium to
market prices.
Very truly yours,
/s/ David W. Schostak
David W. Schostak
cc: Philip J. Faccenda
Daniel B. Fitzpatrick
James K. Fitzpatrick
Ezra H. Friedlander
Steven M. Lewis
Christopher J. Murphy III
Bruce M. Jacobson
