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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. 2)
VIASOFT, INC.
(Name of Subject Company)
ASG SUB, INC.
ALLEN SYSTEMS GROUP, INC.
(Names of Filing Persons--Offerors)
COMMON STOCK, PAR VALUE $0.001 PER SHARE
(Title of Class of Securities)
92552U102
(CUSIP Number of Class of Securities)
...............................................................................
Kristine Kennedy Rieger, Esq.
Senior Vice President, Secretary
and General Counsel
Allen Systems Group, Inc.
1333 Third Avenue South
Naples, Florida 34102
(800) 932-5536
(Name, address and telephone number of persons authorized to receive notices and
communications on behalf of filing persons)
...............................................................................
Copies to:
Robert E. McLaughlin, Esq.
Steptoe & Johnson LLP
1330 Connecticut Avenue, N.W.
Washington, D.C. 20036
Telephone: (202) 429-3000
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CALCULATION OF FILING FEE
<TABLE>
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Transaction valuation* Amount of filing fee
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$155,653,952 $31,131
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</TABLE>
* Estimated for purposes of calculating the amount of the filing fee
only. The amount assumes the purchase of all outstanding shares of common stock,
$0.001 par value, of Viasoft, Inc. on April 28, 2000 (18,178,001) at $8.40 per
share, plus the aggregate amount required to be paid to holders of outstanding
stock options ($8.40 per share less the option exercise price), in accordance
with terms of the offer described herein. The amount of the filing fee was
calculated in accordance with Rule 0-11(b) and (d) under the Securities Exchange
Act of 1934 (the "Exchange Act").
[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: $31,131
Form or Registration No.: TO.
Filing Parties: ASG SUB, INC.
ALLEN SYSTEMS GROUP, INC.
VIASOFT, INC.
Date Filed: May 4, 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: [ ]
Exhibit Index Begins on Page: 11
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This Amendment No. 2 (this "Amendment") amends and supplements the
Tender Offer Statement on Schedule TO originally filed by ASG Sub, Inc., a
Delaware corporation ("ASG Sub"), Allen Systems Group, Inc., a Delaware
corporation ("Allen Systems") and Viasoft, Inc., a Delaware corporation (the
"Company"), on May 4, 2000, as amended by Amendment No. 1 to the Schedule TO
filed by Allen Systems, ASG Sub and the Company, on May 10, 2000 (the "Schedule
TO") relating to the combined tender offer to purchase all of the outstanding
shares of common stock, par value $0.001 per share (the "Common Stock"), of the
Company, together with the associated preferred share purchase rights issued
pursuant to the Rights Agreement, dated as of April 20, 1998, as amended between
the Company and Harris Trust and Savings Bank, as Rights Agent (the "Rights"
and, together with the Common Stock, the "Shares"), tendered pursuant to the
tender offer at a purchase price of $8.40 per Share, net to the seller in cash,
without interest, upon the terms and subject to the conditions set forth in the
Offer to Purchase dated May 4, 2000, as amended as set forth below (the "Offer
to Purchase") and in the related Letter of Transmittal, copies of which are
attached as Exhibits (a)(1) and (a)(2) to the Schedule TO. ASG Sub is a
wholly-owned subsidiary of Allen Systems.
Items 1, 4, 5 and 12 of the Schedule TO are hereby amended by including
the following information in the Offer to Purchase, which is hereby expressly
incorporated by reference herein:
ITEM 1. SUMMARY TERM SHEET.
The paragraph in the Offer to Purchase under the caption "SUMMARY TERM
SHEET - IS IT POSSIBLE THAT THE BANKS WILL NOT LOAN ALLEN SYSTEMS AND ASG SUB
THE FUNDS UNDER THE CREDIT AGREEMENT THAT ARE NECESSARY TO COMPLETE THE OFFER?"
at page Q-1 of the Offer to Purchase is amended by adding the following at the
end of the first sentence in such section:
"In addition to the customary conditions found in credit
agreements, such as the delivery of documents, accuracy of the parties'
representations and warranties, and compliance with applicable laws and
regulations, other significant conditions to the loan include:
(1) the total amount paid by ASG Sub for the purchase of
shares cannot exceed (a) three times Viasoft's pro forma
maintenance revenues for the 12 month period ending
March 31, 2000 ($81,915,000); or (b) $94 million,
whichever is smaller;
(2) ASG Sub must purchase a majority of the shares, and
Viasoft must have the funds to purchase the remaining
outstanding shares;
(3) Viasoft must guarantee the loan from the banks by
pledging its assets;
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(4) Allen Systems' existing debt of approximately $20.5
million must be paid out of the initial funding of the
credit agreement (this condition has been met);
(5) the fees and expenses of the offer and the merger cannot
exceed $7 million; and
(6) Allen Systems must be in pro forma compliance with the
financial covenants in the credit agreement immediately
after giving effect to the offer and the merger."
The following paragraph is added to the Offer to Purchase between the
paragraph under the caption "SUMMARY TERM SHEET - WHAT DOES VIASOFT'S BOARD OF
DIRECTORS THINK OF THE OFFER?" and the paragraph under the caption "SUMMARY TERM
SHEET - IS THIS THE FIRST STEP IN A GOING-PRIVATE TRANSACTION?" at page Q-3 of
the Offer to Purchase:
"DO THE OFFICERS AND DIRECTORS OF VIASOFT HAVE INTERESTS THAT DIFFER
FROM OTHER SHAREHOLDERS' INTERESTS IN THE OFFER?
As a result of the offer and the merger, stock options held by
officers and directors will become immediately exercisable and these
individuals will be entitled to receive the offer price, less the option
exercise price, for their vested and unvested options. In addition,
Viasoft officers will be entitled to receive from 12 to 18 months of
severance payments and health and life insurance benefits as a result of
the offer and the merger. Further, Viasoft's directors and officers will
also be entitled to continued directors and officers insurance coverage
and indemnification benefits for six years following the merger. See
"SPECIAL FACTORS - 6. Interests of Certain Persons in the Offer and the
Merger" for a description of these and other possible conflicts of
interest." "
The paragraph in the Offer to Purchase under the caption "SUMMARY TERM
SHEET - IS THIS THE FIRST STEP IN A GOING-PRIVATE TRANSACTION?" at page Q-3 of
the Offer to Purchase is amended by deleting the fourth sentence through to the
end of such paragraph in such section.
The paragraph in the Offer to Purchase under the caption "SUMMARY TERM
SHEET - WILL THE OFFER BE FOLLOWED BY A MERGER IF ALL THE SHARES OF VIASOFT
COMMON STOCK ARE NOT TENDERED?" at page Q-3 of the Offer to Purchase is amended
to read as follows:
"Yes, if shareholders tender at least 51% of Viasoft's
fully-diluted outstanding shares, and the other offer conditions are
met, we will purchase all tendered shares in the offer. ASG Sub will
then own a majority of the outstanding shares of Viasoft common stock
and will vote all of those shares in favor of the merger. Under Delaware
law, the affirmative vote of a majority of the outstanding shares is
sufficient to
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approve the merger. After the purchase in the offer, until the
effectiveness of the merger, Viasoft may have so few remaining
shareholders and publicly held shares that the common stock will no
longer be eligible to be traded through the Nasdaq National Market or
any other securities market. In that event, there may be no public
trading market for the common stock, and Viasoft may no longer be
required to comply with the Securities and Exchange Commission's rules
relating to publicly held companies, such as filing reports with the
SEC."
ITEM 4. TERMS OF THE TRANSACTION.
The section of the Offer to Purchase entitled "INTRODUCTION" at page 2
of the Offer to Purchase is amended by adding the following new paragraph after
the twelfth paragraph of such section:
"Legally, a "joint" tender offer may be interpreted to mean that
each party to the offer is jointly and severally liable to purchase all
the shares that any one party has committed to purchase. Although we
have characterized the Offer as a "joint" tender offer, neither ASG Sub
nor Viasoft is required to purchase all of the Shares. Rather, if the
Minimum Condition is met, ASG Sub is only liable to purchase a majority
of the Shares and Viasoft is only liable to purchase the remaining
Shares tendered. Therefore, you should interpret the phrase "joint
offer" throughout this Offer to Purchase to mean a "combined offer.""
The subclause (c) of the first paragraph of the section of the Offer to
Purchase entitled "THE OFFER - 9. CONDITIONS TO THE OFFER - CONDITIONS TO THE
ALLEN SYSTEMS OFFER" at page 49 of the Offer to Purchase is amended to read as
follows:
"(c) at any time after the date of the Merger Agreement and
before 12:00 Midnight on the Expiration Date (or in the case of any action by a
Governmental Entity described in (i) or (ii) below, at any time before the
acceptance of such Shares for payment or the payment therefor (whether or not
any Shares have heretofore been accepted for payment or paid pursuant to the
Allen Systems Offer)), any of the following conditions exists and is
continuing:"
The subclause (c) of the first paragraph of the section of the Offer to
Purchase entitled "THE OFFER - 9. CONDITIONS TO THE OFFER - CONDITIONS TO THE
VIASOFT OFFER" at page 52 of the Offer to Purchase is amended to read as
follows:
"(c) at any time after the date of the Merger Agreement and
before 12:00 Midnight on the Expiration Date (or in the case of any action by a
Governmental Entity described in (i) or (ii) below, at any time before the
acceptance of such Shares for payment or the payment therefor (whether or not
any Shares have heretofore been accepted for payment or paid pursuant to the
Viasoft Offer)), any of the following conditions exists and is continuing:"
ITEM 5. PAST CONTACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS.
The first two sentences of the sixth paragraph of the section of the
Offer to Purchase entitled "SPECIAL FACTORS - 1. BACKGROUND OF THE TRANSACTION -
BACKGROUND" at page 4 of the Offer to Purchase are amended to read as follows:
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"On June 28, 1999, Mr. Whiteman received an unsolicited letter
of interest from another company ("Other Interested Party") regarding a
possible all cash acquisition of Viasoft. The proposed price range of
approximately $5.40 per share was substantially below the price then
under discussion with Compuware."
The twelfth paragraph of the section of the Offer to Purchase entitled
"SPECIAL FACTORS - 1. BACKGROUND OF THE TRANSACTION - BACKGROUND" at page 5 of
the Offer to Purchase is amended to read as follows:
"Viasoft agreed to terminate the Compuware Merger Agreement
because the Viasoft Board did not believe that continuing the DOJ
Litigation for many months, with its inherent risks, substantial costs
and potential for irreparable damage to the Viasoft business and
relationships with customers, distributors and employees, was in the
best interest of Viasoft shareholders. Viasoft believes that its
business, results of operations, financial condition and liquidity have
been materially adversely affected by the announcement of the proposed
acquisition by Compuware, the DOJ Litigation and resulting termination
of the transaction. Relationships with customers were adversely affected
and revenues from product licenses and professional services declined as
customers delayed or reconsidered purchase decisions. Among the reasons
for these adverse customer effects was Viasoft's inability to commit to
customers that a particular strategic direction or development plan
would be followed following the Compuware transaction. In addition, some
customers expressed concern about continued customer support and
enhancement of Viasoft products after the proposed merger and other
customers who were considering replacement of Compuware products with
Viasoft products put their decisions on hold when the transaction was
announced. Viasoft learned of customer concerns primarily through
discussions with its sales managers and sales representatives and is not
able to determine how many customers were impacted or how many
relationships were adversely affected, given the nature of these
concerns. In addition, Viasoft experienced significant employee
attrition as a result of the announcement of the Compuware transaction
and the subsequent delays and uncertainty. Loss of employees has been
most significant in the marketing and administration functions and in
the sales force, particularly in the United States. From June 30, 1999,
when the Company had approximately 430 employees, until January 30,
2000, a date shortly after the termination of the Compuware Merger
Agreement, the Company lost approximately 115 employees. Viasoft
believes, based on its interviews of departing employees and their
coworkers, that approximately 70% of these terminations were related, at
least in part, to the terminated Compuware transaction. The functional
areas that experienced the most attrition were U.S. sales, which lost
approximately 44% of its employees, marketing, which lost 34%, and
finance and administration, which lost approximately 26%. Viasoft
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revenue also declined during and after the period that the Compuware
transaction was pending. Total revenues decreased from $23.5 million in
the quarter ended June 30, 1999 (the last quarter prior to announcement
of the Compuware transaction) to $18.6 million, $15.5 million and $11.2
million in the quarters ended September 30, 1999, December 31, 1999 and
March 31, 2000, respectively. License revenue during these periods
decreased from $10.8 million in the quarter ended June 30, 1999 to $7.1
million, $5.0 million and $2.3 million in the quarters ended September
30, 1999, December 31, 1999 and March 31, 2000, respectively. The
Company believes that these revenue declines are attributable in part to
the effects of the terminated Compuware transaction, among other
factors, including loss of sales personnel and the end of the market for
the Company's year 2000 products and services.
Viasoft believes that its business, results of operations,
financial condition and liquidity may be further materially adversely
affected, as Viasoft continues to address the effects of the terminated
Compuware transaction. Among other reasons, Viasoft believes these
effects may continue because Viasoft must seek to restructure and
rebuild its workforce and reinforce both its customer relationships and
position in the marketplace following termination of the proposed merger
with Compuware. In particular, replacement of lost sales employees is
difficult in the tight job market currently experienced in the United
States. In addition, sales representatives frequently require 6 to 9
months of training to achieve productivity. Further, the loss of key
administrative and management personnel as a result of the terminated
merger may have continuing adverse effects on Viasoft's operations
unless and until replacements can be successfully recruited and
integrated. Other continuing adverse effects may result from delays in
product and business initiatives during the pendency of the terminated
merger and the risks and uncertainties associated with the business
reorganization Viasoft announced following termination of the terminated
merger."
The sixth paragraph of the section of the Offer to Purchase entitled
"SPECIAL FACTORS - 1. BACKGROUND OF THE TRANSACTION - CONTACTS BETWEEN VIASOFT
AND ALLEN SYSTEMS" at page 6 of the Offer to Purchase is amended to include the
following additional sentence before the last sentence in such paragraph:
"Allen Systems proposed a price in the range of $7.50, subject
to due diligence and further negotiations; the other company indicated
preliminary interest in the range of $6.50 to $7.00, payable entirely in
stock of the acquiring company."
The sixth sentence of the eighth paragraph of the section of the
Offer to Purchase entitled "SPECIAL FACTORS--1. BACKGROUND OF THE
TRANSACTION--CONTACTS BETWEEN VIASOFT AND ALLEN SYSTEMS" at page 6 of the Offer
to Purchase is amended to read as follows:
"The executives also discussed the proposed price for a transaction and
Mr. Allen indicated that Allen Systems was prepared to increase the
potential transaction price to the range of $8.25 per share if Allen
Systems was permitted to conduct additional due diligence and the
results of that investigation were favorable."
The fourth sentence of the thirteenth paragraph of the section of the
Offer to Purchase entitled "SPECIAL FACTORS - 1. BACKGROUND OF THE TRANSACTION -
CONTACTS BETWEEN VIASOFT AND ALLEN SYSTEMS" at page 7 of the Offer to Purchase
is amended to read as follows:
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"The transaction proposal contemplated a purchase price in the
range of $9.00 per share, payable in stock of the Other Potential
Offeror then valued at approximately $5.50, with the remainder of the
price payable in cash."
The first sentence of the seventeenth paragraph of the section of the
Offer to Purchase entitled "SPECIAL FACTORS - 1. BACKGROUND OF THE TRANSACTION -
CONTACTS BETWEEN VIASOFT AND ALLEN SYSTEMS" at page 8 of the Offer to Purchase
is amended to read as follows:
"The Viasoft Board and Broadview representatives discussed the
fact that while the transaction prices proposed for discussion by Allen
Systems and the Other Potential Offeror had stated dollar values between
$8.25 to $9.00, Allen Systems was proposing an all cash offer, while the
Other Potential Offeror was proposing to pay the majority of the stated
value in its common stock, with only the balance payable in cash."
The final sentence of the seventeenth paragraph of the section of the
Offer to Purchase entitled "SPECIAL FACTORS - 1. BACKGROUND OF THE TRANSACTION -
CONTACTS BETWEEN VIASOFT AND ALLEN SYSTEMS" at page 8 of the Offer to Purchase
is amended to read as follows:
"The Viasoft Board instructed Mr. Whiteman to advise the Other
Potential Offeror that a significant increase in the cash component of
its proposal, or other significant improvements in the price or terms of
the offer, would be necessary before the Viasoft Board would consider
the proposal worthy of further consideration."
The final sentence of the nineteenth paragraph of the section of the
Offer to Purchase entitled "SPECIAL FACTORS - 1. BACKGROUND OF THE TRANSACTION -
CONTACTS BETWEEN VIASOFT AND ALLEN SYSTEMS" at page 8 of the Offer to Purchase
is amended to read as follows:
"On April 7, 2000, a representative of the Other Potential
Offeror telephoned Mr. Whiteman and, after a brief discussion, withdrew
its proposal. The Other Potential Acquiror was unwilling to meet the
Viasoft Board's stated expectation to either increase the cash component
of the offer or otherwise improve the terms of its offer."
The second sentence of the twenty-seventh paragraph of the section of
the Offer to Purchase entitled "SPECIAL FACTORS - 1. BACKGROUND OF THE
TRANSACTION - CONTACTS BETWEEN VIASOFT AND ALLEN SYSTEMS" at page 9 of the Offer
to Purchase is amended to read as follows:
"In addition, during this period, the parties discussed
modifications to the Separation Plan to adjust the severance
compensation payable to certain key employees, including an increase in
severance compensation for two officers from 12 months to 15 months of
benefits. See "SPECIAL
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FACTORS - 6. Interests of Certain persons in the Offer and the Merger -
Separation Plan." "
ITEM 12. EXHIBITS.
Item 12 is hereby amended and supplemented by adding the following after
Exhibit (d)(4) thereof:
(d)(5) First Amendment to Agreement and Plan of Merger dated as of
May 25, 2000 by and between Allen Systems Group, Inc. ASG Sub, Inc. and
Viasoft, Inc.
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: May 25, 2000
ASG SUB, INC.
By: /s/ Patrick L. Pullen
------------------------------------
Name: Patrick L. Pullen
Title: Senior Vice President
and Chief Financial Officer
ALLEN SYSTEMS GROUP, INC.
By: /s/ Patrick L. Pullen
------------------------------------
Name: Patrick L. Pullen
Title: Senior Vice President
and Chief Financial Officer
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EXHIBIT INDEX
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Exhibit Description
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(d)(5) First Amendment to Agreement and Plan of Merger dated as of
May 25, 2000 by and between Allen Systems Group, Inc. ASG Sub, Inc.
and Viasoft, Inc.
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EXHIBIT(d)(5)
FIRST AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER, dated as of May 25, 2000 (this
"Amendment") by and between Allen Systems Group, Inc., a Delaware corporation
("Allen Systems"), ASG Sub, Inc., a Delaware corporation ("ASG Sub") and
Viasoft, Inc., a Delaware corporation ("Viasoft").
RECITALS
A. Allen Systems, ASG Sub and Viasoft have entered into that certain Agreement
and Plan of Merger dated as of April 27, 2000 (the "Merger Agreement");
B. Allen Systems, ASG Sub and Viasoft desire to amend the Merger Agreement to
revise Annex 1 and Annex 2 thereto;
THEREFORE, the parties agree as follows:
1. Subclause (c) of the first paragraph of Annex 1 to the Merger
Agreement is hereby deleted and replaced with the following:
(c) at any time after the date of the Agreement and before
12:00 Midnight on the Expiration Date (or in the case of any
action by a Governmental Entity described in (i) or (ii)
below, at any time before the acceptance of such Shares for
payment or the payment therefor (whether or not any Shares
have heretofore been accepted for payment or paid pursuant to
the Allen Systems Offer)), any of the following conditions
exists and is continuing:
2. Subclause (c) of the first paragraph of Annex 2 to the Merger
Agreement is hereby deleted and replaced with the following:
(c) at any time after the date of the Agreement and before
12:00 Midnight on the Expiration Date (or in the case of any
action by a Governmental Entity described in (i) or (ii)
below, at any time before the acceptance of such Shares for
payment or the payment therefor (whether or not any Shares
have heretofore been accepted for payment or paid pursuant to
the Viasoft Offer)), any of the following conditions exists
and is continuing:
3. Except as specifically modified by this Amendment, all of the terms of
the Merger Agreement shall continue in full force and effect.
4. This Amendment will be governed by, and construed in accordance with,
the laws of Delaware, regardless of the laws that might otherwise govern under
applicable principles of conflict of laws thereof.
5. This Amendment may be executed in counterparts, all of which taken
together shall constitute one agreement.
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IN WITNESS WHEREOF, Allen Systems, ASG Sub and Viasoft have caused this
Amendment to be signed by their respective officers thereunto duly authorized,
all as of the date first written above.
ALLEN SYSTEMS GROUP, INC. VIASOFT, INC.
/s/ PATRICK L. PULLEN /s/ STEPHEN D. WHITEMAN
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Name: Patrick L. Pullen Name: Stephen D. Whiteman
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Title: Senior Vice President Title: Chairman of the Board
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and Chief Financial Officer and Chief Executive
---------------------------- ------------------------
Officer
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ASG SUB, INC.
/s/ Patrick L. Pullen
----------------------------
Name: Patrick L. Pullen
-----------------------
Title: Senior Vice President
----------------------------
and Chief Financial Officer
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