As filed with the Securities and Exchange Commission on February 27, 1997
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13E-4
ISSUER TENDER OFFER STATEMENT
(Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934)
DAMEN FINANCIAL CORPORATION
(Name of issuer)
DAMEN FINANCIAL CORPORATION
(Name of Person(s) Filing Statement)
Common Stock, $0.01 Par Value Per Share
(Title of Class of Securities)
235906 10 4
(CUSIP Number of Class of Securities)
Mary Beth Poronsky Stull
Damen Financial Corporation
200 West Higgins Road
Schaumburg, Illinois 60195
(847) 882-5320
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of the Person(s) Filing Statement)
Copies to:
Kip A. Weissman, P.C.
Martin L. Meyrowitz, P.C.
Silver, Freedman & Taff, L.L.P.
1100 New York Avenue, N.W.
Washington, D.C. 20005
(202) 414-6100
(Agent for Service of Process)
February 27, 1997
(Date Tender Offer First Published, Sent or Given to Security Holders)
<PAGE>
CALCULATION OF FILING FEE
Transaction Valuation* Amount of Filing Fee*
$12,537,500 $2,508
*Calculated solely for the purpose of determining the filing fee, based upon the
purchase of 850,000 shares at the maximum tender offer price of $14.75 per
share.
[ ] Check box if any 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: N/A Filing Party: N/A
Form or Registration No.: N/A Date Filed: N/A
<PAGE>
Item 1. Security and Issuer.
(a) The issuer of the securities to which this Schedule 13E-4 relates
is Damen Financial Corporation, a Delaware corporation (the "Company"), and the
address of its principal executive office, and its mailing address, is 200 West
Higgins Road, Schaumburg, Illinois 60195.
(b) This Schedule 13E-4 relates to the offer by the Company to purchase
up to 850,000 shares (or such lesser number of shares as are properly tendered)
of its common stock, $0.01 par value per share (the "Shares"), 3,770,117 of
which Shares were outstanding as of February 25, 1997, at prices not in excess
of $14.75 nor less than $13.25 per Share in cash, upon the terms and subject to
the conditions set forth in the Offer to Purchase, dated February 27, 1997 (the
"Offer to Purchase"), and in the related Letter of Transmittal (which together
constitute the "Offer"), copies of which are attached as Exhibits (a)(1) and
(a)(2), respectively, and incorporated herein by reference. Officers and
directors of the Company may participate in the Offer on the same basis as the
Company's other stockholders. The Company has been advised that no director or
executive officer of the Company intends to tender any Shares pursuant to the
Offer. The Company has also been advised that the trustee of the Company's
Employee Stock Ownership Plan does not intend to tender any Shares pursuant to
the Offer. The information set forth in "Introduction", "Section 1, Number of
Shares; Proration" and "Section 12, Interest of Directors and Officers;
Transactions and Arrangements Concerning Shares" of the Offer to Purchase is
incorporated herein by reference.
(c) The information set forth in "Introduction" and "Section 8, Price
Range of Shares; Dividends" of the Offer to Purchase is incorporated herein by
reference.
(d) Not applicable.
Item 2. Source and Amount of Funds or Other Consideration.
(a) The information set forth in "Section 11, Source and Amount of
Funds" of the Offer to Purchase is incorporated herein by reference.
(b) Not applicable.
Item 3. Purpose of the Tender Offer and Plans or Proposals of the Issuer or
Affiliate.
(a)-(j) The information set forth in "Introduction" and "Section 11,
Source and Amount of Funds," "Section 9, Purpose of the Offer; Certain Effects
of the Offer," "Section 12, Interest of Directors and Officers; Transactions and
Arrangements Concerning Shares" and "Section 13, Effects of the Offer on the
Market for Shares; Registration under the Exchange Act" of the Offer to Purchase
is incorporated herein by reference.
Item 4. Interest in Securities of the Issuer.
The information set forth in "Section 12, Interest of Directors and
Officers; Transactions and Arrangements Concerning Shares" and "Schedule A" of
the Offer to Purchase is incorporated herein by reference.
<PAGE>
Item 5. Contracts, Arrangements, Understandings or Relationships with Respect
to the Issuer's Securities.
The information set forth in "Introduction" and "Section 11, Source and
Amount of Funds," "Section 9, Purpose of the Offer; Certain Effects of the
Offer," and "Section 12, Interest of Directors and Officers; Transactions and
Arrangements C ncerning Shares" of the Offer to Purchase is incorporated herein
by reference.
Item 6. Persons Retained, Employed, or to be Compensated.
The information set forth in "Introduction" and "Section 17, Fees and
Expenses" of the Offer to Purchase is incorporated herein by reference.
Item 7. Financial Condition.
(a)-(b) The information set forth in "Section 10, Certain Information
Concerning the Company" of the Offer to Purchase is incorporated herein by
reference.
Item 8. Additional Information.
(a) Not applicable.
(b) The information set forth in "Section 14, Certain Legal
Matters; Regulatory Approvals" of the Offer to Purchase is
incorporated herein by reference.
(c) The information set forth in "Section 13, Effects of the
Offer on the Market for Shares; Registration under the
Exchange Act" of the Offer to Purchase is incorporated
herein by reference.
(d) Not applicable.
(e) The information set forth in the Offer to Purchase and
Letter of Transmittal is incorporated herein by reference.
Item 9. Material to be Filed as Exhibits.
(a) (1) Form of Offer to Purchase, dated February 27, 1997.
(2) Form of Letter of Transmittal (including Certification of
Taxpayer Identification Number on Form W-9).
(3) Form of Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
(4) Form of Letter to Clients for Use by Brokers, Dealers,
Commercial Banks, Trust Companies and Other Nominees
(including the Instruction Form).
(5) Form of Letter to Stockholders of the Company, dated
February 27, 1997, from Mary Beth Poronsky Stull, President
and Chief Executive Officer of the Company.
(6) Form of Memorandum, dated February 25, 1997, to the
Company's employees.
<PAGE>
(7) Form of Question and Answer Brochure.
(8) Text of Press Release issued by the Company, dated February
14, 1997.
(9) Text of Press Announcement to be published in local and
regional newspapers on or after February 27, 1997.
(10) Form of Letter to Participants in the Damen Federal Bank
for Savings Employees' Profit Sharing Plan.
(11) Text of Press Release issued by the Company, dated February
27, 1997.
(b) Not applicable.
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this Schedule 13E-4 is true, complete and
correct.
February 27, 1997 DAMEN FINANCIAL CORPORATION
By: /s/Mary Beth Poronsky Stull
---------------------------
Mary Beth Poronsky Stull
President and Chief Executive Officer
<PAGE>
Exhibit (a)(1)
DAMEN FINANCIAL CORPORATION
Offer to Purchase for Cash
Up to 850,000 Shares of its
Common Stock, Par Value $0.01 Per Share
At a Purchase Price Not Greater Than $14.75
Nor Less Than $13.25 Per Share
--------------------
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE
AT 5:00 P.M., NEW YORK CITY TIME, ON THURSDAY, MARCH 27, 1997,
UNLESS THE OFFER IS EXTENDED.
-------------------
Damen Financial Corporation, a Delaware corporation (the "Company"),
invites its stockholders to tender shares of its Common Stock, par value $0.01
per share (the "Shares"), at prices, net to the seller in cash, without interest
thereon, not greater than $14.75 nor less than $13.25 per Share specified by
such tendering stockholders, upon the terms and subject to the conditions set
forth herein and in the related Letter of Transmittal (which together constitute
the "Offer"). The Company will determine a single per Share price (not greater
than $14.75 nor less than $13.25 per Share) that it will pay for the Shares
validly tendered pursuant to the Offer and not withdrawn (the "Purchase Price"),
taking into consideration the number of Shares so tendered and the prices
specified by the tendering stockholders. The Company will select as the Purchase
Price the lowest price that will enable it to purchase 850,000 Shares (or such
lesser number of Shares as are validly tendered and not withdrawn at prices not
greater than $14.75 nor less than $13.25 per Share) pursuant to the Offer. The
Company will purchase all Shares validly tendered at prices at or below the
Purchase Price and not withdrawn on or prior to the Expiration Date (as defined
in Section 1), upon the terms and subject to the conditions of the Offer,
including the provisions thereof relating to proration and conditional tenders
described herein. The Purchase Price will be paid in cash, net to the seller,
without interest thereon, with respect to all Shares purchased. All Shares
tendered at prices in excess of the Purchase Price, Shares not purchased because
of proration and Shares that were conditionally tendered and not accepted for
purchase will be returned. Stockholders must complete the section of the Letter
of Transmittal relating to the price at which they are tendering Shares in order
to validly tender Shares.
---------------------
THE OFFER IS NOT CONDITIONED UPON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO OTHER CONDITIONS. SEE SECTION 7.
---------------------
IMPORTANT
Any stockholder desiring to tender all or any portion of his or her
Shares should either (1) complete and sign the Letter of Transmittal or a
facsimile thereof in accordance with the instructions in the Letter of
Transmittal, mail or deliver it and any other required documents to Registrar
and Transfer Company (the "Depositary"), and either mail or deliver the
certificates representing Shares to be tendered to the Depositary along with the
Letter of Transmittal or deliver such Shares pursuant to the procedure for
<PAGE>
book-entry transfer set forth in Section 3 or (2) request his or her broker,
dealer, commercial bank, trust company or nominee to effect the transaction for
him or her. A stockholder whose Shares are registered in the name of a broker,
dealer, commercial bank, trust company or nominee must contact such broker,
dealer, commercial bank, trust company or nominee if he or she desires to tender
such Shares.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE OFFER.
NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION
TOANY STOCKHOLDER AS TO WHETHER TO TENDER ALL OR ANY
SHARES. EACH STOCKHOLDER MUST MAKE HIS OR HER OWN
DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO,
HOW MANY TO TENDER AND AT WHAT PRICE.
THE COMPANY HAS BEEN ADVISED THAT NO DIRECTOR OR
EXECUTIVE OFFICER INTENDS TO TENDER SHARES
PURSUANT TO THE OFFER.
The Dealer Managers for the Offer are:
Robert W. Baird & Co. Incorporated Friedman, Billings, Ramsey & Co., Inc.
The date of this Offer to Purchase is February 27, 1997
As of February 25, 1997, the Company had issued and outstanding
3,770,117 Shares and 376,909 Shares issuable upon exercise of outstanding stock
options under the Company's stock option and incentive plan. The 850,000 Shares
that the Company is offering to purchase pursuant to the Offer represent
approximately 22.5% of the Shares then outstanding. The Shares are traded on the
Nasdaq National Market. The Shares trade under the symbol "DFIN." On February
25, 1997, the closing price of the Shares as reported on the Nasdaq National
Market was $14.38 per Share. STOCKHOLDERS ARE URGED TO OBTAIN CURRENT MARKET
QUOTATIONS FOR THE SHARES.
TO TENDER SHARES PROPERLY, STOCKHOLDERS MUST COMPLETE THE SECTION OF
THE LETTER OF TRANSMITTAL RELATING TO THE PRICE AT WHICH THEY ARE TENDERING
SHARES.
Questions or requests for assistance or for additional copies of this
Offer to Purchase, the Letter of Transmittal or other tender offer materials may
be directed to the Information Agent or the Dealer Managers at their respective
addresses and telephone numbers set forth on the back cover of this Offer to
Purchase, and such copies will be furnished promptly at the Company's expense.
Stockholders may also contact their local broker, dealer, commercial bank or
trust company for assistance concerning the Offer.
NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY RECOMMENDATION ON BEHALF OF
THE COMPANY AS TO WHETHER STOCKHOLDERS SHOULD TENDER SHARES PURSUANT TO THE
OFFER. NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THE OFFER OTHER THAN THOSE CONTAINED HEREIN
OR IN THE RELATED LETTER OF TRANSMITTAL. IF GIVEN OR MADE, SUCH RECOMMENDATION
AND SUCH OTHER INFORMATION AND REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE COMPANY.
<PAGE>
TABLE OF CONTENTS
Section
INTRODUCTION
1. NUMBER OF SHARES; PRORATION
2. TENDERS BY HOLDERS OF FEWER THAN 100 SHARES
3. PROCEDURE FOR TENDERING SHARES
4. WITHDRAWAL RIGHTS
5. ACCEPTANCE FOR PAYMENT OF SHARES AND PAYMENT OF PURCHASE PRICE
6. CONDITIONAL TENDER OF SHARES
7. CERTAIN CONDITIONS OF THE OFFER
8. PRICE RANGE OF SHARES; DIVIDENDS
9. PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER
10. CERTAIN INFORMATION CONCERNING THE COMPANY
11. SOURCE AND AMOUNT OF FUNDS
12. INTEREST OF DIRECTORS AND OFFICERS; TRANSACTIONS AND
ARRANGEMENTS CONCERNING SHARES
13. EFFECTS OF THE OFFER ON THE MARKET FOR SHARES; REGISTRATION
UNDER THE EXCHANGE ACT
14. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS
15. CERTAIN FEDERAL INCOME TAX CONSEQUENCES
16. EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENTS
17. FEES AND EXPENSES
18. MISCELLANEOUS
SCHEDULE A CERTAIN TRANSACTIONS INVOLVING SHARES
BY THE COMPANY OR ITS EXECUTIVE OFFICERS
OR DIRECTORS
<PAGE>
To the Holders of Shares of Common Stock of
Damen Financial Corporation:
INTRODUCTION
Damen Financial Corporation, a Delaware corporation (the "Company"),
invites its stockholders to tender shares of its Common Stock, par value $0.01
per share (the "Shares") at a price, net to the seller in cash, without interest
thereon, not greater than $14.75 nor less than $13.25 per Share specified by
such tendering stockholders, upon the terms and subject to the conditions set
forth herein and in the related Letter of Transmittal (which together constitute
the "Offer").
The Company will determine a single per Share price (not greater than
$14.75 nor less than $13.25 per Share) that it will pay for the Shares validly
tendered pursuant to the Offer and not withdrawn (the "Purchase Price"), taking
into account the number of Shares so tendered and the prices specified by
tendering stockholders. The Company will select the lowest Purchase Price that
will enable it to purchase 850,000 Shares (or such lesser number of Shares as is
validly tendered and not withdrawn at prices not greater than $14.75 nor less
than $13.25 per Share) pursuant to the Offer. The Company will purchase all
Shares validly tendered at prices at or below the Purchase Price and not
withdrawn on or prior to the Expiration Date (as defined in Section 1), upon the
terms and subject to the conditions of the Offer, including the provisions
relating to proration and conditional tenders described below. The Purchase
Price will be paid in cash, net to the seller, without interest thereon, with
respect to all Shares purchased. Shares tendered at prices in excess of the
Purchase Price, Shares not purchased because of proration and Shares that were
conditionally tendered and not accepted for purchase will be returned.
THE OFFER IS NOT CONDITIONED UPON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE
SECTION 7.
If more than 850,000 Shares have been validly tendered at or below the
Purchase Price and not withdrawn on or prior to the Expiration Date, the Company
will purchase Shares first from stockholders who owned beneficially as of the
close of business on February 25, 1997, and continue to own beneficially as of
the Expiration Date, an aggregate of fewer than 100 Shares who properly tender
all their Shares at or below the Purchase Price, and then on a pro rata basis
from all other stockholders who validly tender Shares at or below the Purchase
Price, other than stockholders who tender conditionally, and for whom the
condition is not satisfied. See Sections 1, 2 and 6. Tendering stockholders will
not be obligated to pay brokerage commissions, solicitation fees or, subject to
the Instructions to the Letter of Transmittal, stock transfer taxes on the
purchase of Shares by the Company. The Company will pay the expenses of Robert
W. Baird & Co. Incorporated and Friedman, Billings, Ramsey & Co., Inc. (the
"Dealer Managers"), Registrar and Transfer Company (the "Depositary") and D.F.
King & Co., Inc. (the "Information Agent") incurred in connection with the
Offer. See Section 17. ANY TENDERING STOCKHOLDER OR OTHER PAYEE WHO FAILS TO
COMPLETE AND SIGN THE SUBSTITUTE FORM W-9 THAT IS INCLUDED IN THE LETTER OF
TRANSMITTAL MAY BE SUBJECT TO UNITED STATES FEDERAL INCOME TAX BACKUP
WITHHOLDING EQUAL TO 31% OF THE GROSS PROCEEDS PAYABLE TO SUCH STOCKHOLDER OR
OTHER PAYEE PURSUANT TO THE OFFER. SEE SECTIONS 3 AND 15.
<PAGE>
As of February 25, 1997, the Company's Employee Stock Ownership Plan
("ESOP") held 317,400 Shares in accounts for participants therein. The Company
has been advised that the trustee of the ESOP does not intend to tender any
Shares pursuant to the Offer.
THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE OFFER. NEITHER THE
COMPANY NOR ITS BOARD OF DIRECTORS, HOWEVER, MAKES ANY RECOMMENDATION TO ANY
STOCKHOLDER AS TO WHETHER TO TENDER ALL OR ANY SHARES. EACH STOCKHOLDER MUST
MAKE HIS OR HER OWN DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO, HOW MANY
SHARES TO TENDER AND AT WHAT PRICE. THE COMPANY HAS BEEN ADVISED THAT NO
DIRECTOR OR EXECUTIVE OFFICER INTENDS TO TENDER SHARES PURSUANT TO THE OFFER.
As of February 25, 1997, the Company had issued and outstanding
3,770,117 Shares, and 376,909 Shares issuable upon exercise of outstanding stock
options under the Company's stock option and incentive plan. The 850,000 Shares
that the Company is offering to purchase pursuant to the Offer represent
approximately 22.5% of the Shares then outstanding.
The Shares are traded on the Nasdaq National Market ("NNM"). The Shares
trade under the symbol "DFIN." On February 25, 1997, the closing price of the
Shares on the NNM was $14.38 per Share. See Section 8. STOCKHOLDERS ARE URGED TO
OBTAIN CURRENT MARKET QUOTATIONS FOR THE SHARES.
Questions and requests for assistance may be directed to the
Information Agent:
D.F. King & Co., Inc.
77 Water Street, 20th Floor
New York, New York 10005
(800) 758-5880
1. NUMBER OF SHARES; PRORATION
Upon the terms and subject to the conditions described herein and in
the Letter of Transmittal, the Company will purchase up to 850,000 Shares that
are validly tendered on or prior to the Expiration Date (as defined below) (and
not properly withdrawn in accordance with Section 4) at a price (determined in
the manner set forth below) not greater than $14.75 nor less than $13.25 per
Share. The later of 5:00 p.m., New York City time, on Thursday, March 27, 1997,
or the latest time and date to which the Offer is extended pursuant to Section
16, is referred to herein as the "Expiration Date." If the Offer is
oversubscribed as described below, only Shares tendered at or below the Purchase
Price on or prior to the Expiration Date will be eligible for proration. The
proration period also expires on the Expiration Date.
The Company will determine the Purchase Price taking into consideration
the number of Shares so tendered and the prices specified by tendering
stockholders. The Company will select the lowest Purchase Price that will enable
it to purchase 850,000 Shares (or such lesser number of Shares as is validly
tendered and not withdrawn at prices not greater than $14.75 nor less than
$13.25 per Share) pursuant to the Offer. Subject to Section 16, the Company
reserves the right to purchase more than 850,000 Shares pursuant to the Offer,
but does not currently plan to do so. The Offer is not conditioned on any
minimum number of Shares being tendered. The Offer is, however, subject to
certain other conditions. See Section 7.
<PAGE>
In accordance with Instruction 5 of the Letter of Transmittal, each
stockholder who wishes to tender Shares must specify the price (not greater than
$14.75 nor less than $13.25 per Share) at which such stockholder is willing to
have the Company purchase such Shares. As promptly as practicable following the
Expiration Date, the Company will determine the Purchase Price (not greater than
$14.75 nor less than $13.25 per Share) that it will pay for Shares validly
tendered and not withdrawn pursuant to the Offer, taking into account the number
of Shares so tendered and the prices specified by tendering stockholders. All
Shares purchased pursuant to the Offer will be purchased at the Purchase Price.
All Shares not purchased pursuant to the Offer, including Shares tendered at
prices greater than the Purchase Price and Shares not purchased because of
proration or because they were conditionally tendered and not accepted for
purchase, will be returned to the tendering stockholders at the Company's
expense as promptly as practicable following the Expiration Date.
Upon the terms and subject to the conditions of the Offer, if 850,000
or fewer Shares have been validly tendered at or below the Purchase Price and
not withdrawn on or prior to the Expiration Date, the Company will purchase all
such Shares. Upon the terms and subject to the conditions of the Offer, if more
than 850,000 Shares have been validly tendered at or below the Purchase Price
and not withdrawn on or prior to the Expiration Date, the Company will purchase
Shares in the following order of priority:
(a) first, all Shares validly tendered at or below the
Purchase Price and not withdrawn on or prior to the Expiration Date by
or on behalf of any stockholder who owned beneficially, as of the close
of business on February 25, 1997 and continues to own beneficially as
of the Expiration Date, an aggregate of fewer than 100 Shares and who
validly tenders all of such Shares (partial and conditional tenders
will not qualify for this preference) and completes the box captioned
"Odd Lots" on the Letter of Transmittal; and
(b) then, after purchase of all of the foregoing Shares,
subject to the conditional tender provisions described in Section 6,
all other Shares validly tendered at or below the Purchase Price and
not withdrawn on or prior to the Expiration Date on a pro rata basis,
if necessary (with appropriate adjustments to avoid purchases of
fractional Shares).
If proration of tendered Shares is required, (i) because of the
difficulty in determining the number of Shares validly tendered, (ii) as a
result of the "odd lot" procedure described in Section 2, and (iii) as a result
of the conditional tender procedure described in Section 6, the Company does not
expect that it would be able to announce the final proration factor or to
commence payment for any Shares purchased pursuant to the Offer until
approximately seven NNM trading days after the Expiration Date. Preliminary
results of proration will be announced by press release as promptly as
practicable after the Expiration Date. Holders of Shares may obtain such
preliminary information from the Dealer Managers or the Information Agent.
The Company expressly reserves the right, in its sole discretion, at
any time or from time to time, to extend the period of time during which the
Offer is open by giving oral or written notice of such extension to the
Depositary and making a public announcement thereof. See Section 16. There can
be no assurance, however, that the Company will exercise its right to extend the
Offer.
<PAGE>
For purposes of the Offer, a "business day" means any day other than a
Saturday, Sunday or federal holiday and consists of the time period from 12:01
a.m. through 12:00 midnight, New York City time.
Copies of this Offer to Purchase and the related Letter of Transmittal
are being mailed to record holders of Shares and will be furnished to brokers,
banks and similar persons whose names, or the names of whose nominees, appear on
the Company's stockholder list or, if applicable, who are listed as participants
in a clearing agency's security position listing for subsequent transmittal to
beneficial owners of Shares.
2. TENDERS BY HOLDERS OF FEWER THAN 100 SHARES
Except to the extent that the Company's purchase would result in the
delisting of the Shares on the NNM, all Shares validly tendered at or below the
Purchase Price and not withdrawn on or prior to the Expiration Date by or on
behalf of any stockholder who owned beneficially, as of the close of business on
February 25, 1997, and continues to own beneficially as of the Expiration Date,
an aggregate of fewer than 100 Shares, will be accepted for purchase before
proration, if any, of other tendered Shares. Partial or conditional tenders will
not qualify for this preference, and it is not available to beneficial holders
of 100 or more Shares, even if such holders have separate stock certificates for
fewer than 100 Shares. By accepting the Offer, a stockholder owning beneficially
fewer than 100 Shares will avoid the payment of brokerage commissions and the
applicable odd lot discount payable in a sale of such Shares in a transaction
effected on a securities exchange.
As of February 25, 1997, there were approximately 288 holders of record
of Shares. Approximately 32 of these holders of record held individually fewer
than 100 Shares and held in the aggregate approximately 933 Shares. Because of
the large number of Shares held in the names of brokers and nominees, the
Company is unable to determine the exact number of beneficial owners of fewer
than 100 Shares or the aggregate number of Shares they own. Any stockholder
wishing to tender all of his or her Shares pursuant to this Section should
complete the box captioned "Odd Lots" on the Letter of Transmittal.
3. PROCEDURE FOR TENDERING SHARES
To tender Shares validly pursuant to the Offer, a properly completed
and duly executed Letter of Transmittal or facsimile thereof, together with any
required signature guarantees and any other documents required by the Letter of
Transmittal, must be received by the Depositary at its address set forth on the
back cover of this Offer to Purchase and either (i) certificates for the Shares
to be tendered must be received by the Depositary at such address or (ii) such
Shares must be delivered pursuant to the procedures for book-entry transfer
described below (and a confirmation of such delivery received by the
Depositary), in each case on or prior to the Expiration Date.
<PAGE>
IN ACCORDANCE WITH INSTRUCTION 5 OF THE LETTER OF TRANSMITTAL, IN ORDER
TO TENDER SHARES PURSUANT TO THE OFFER, A STOCKHOLDER MUST INDICATE IN THE
SECTION CAPTIONED "PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING
TENDERED" ON THE LETTER OF TRANSMITTAL THE PRICE (IN MULTIPLES OF $0.125) AT
WHICH SUCH SHARES ARE BEING TENDERED, EXCEPT THAT ANY STOCKHOLDER WHO OWNED
BENEFICIALLY AS OF THE CLOSE OF BUSINESS ON FEBRUARY 25, 1997, AND CONTINUES TO
OWN BENEFICIALLY AS OF THE EXPIRATION DATE, AN AGGREGATE OF FEWER THAN 100
SHARES MAY CHECK THE BOX IN THE SECTION OF THE LETTER OF TRANSMITTAL ENTITLED
"ODD LOTS" INDICATING THAT THE STOCKHOLDER IS TENDERING ALL OF SUCH
STOCKHOLDER'S SHARES AT THE PURCHASE PRICE.
Stockholders wishing to tender Shares at more than one price must complete
separate Letters of Transmittal for each price at which such Shares are being
tendered. The same Shares cannot be tendered at more than one price. FOR A
TENDER OF SHARES TO BE VALID, A PRICE BOX, BUT ONLY ONE PRICE BOX, ON EACH
LETTER OF TRANSMITTAL MUST BE CHECKED.
The Depositary will establish an account with respect to the Shares at
The Depository Trust Company ("DTC") or Philadelphia Depository Trust Company
("PDTC") (hereinafter collectively referred to as the "Book-Entry Transfer
Facilities") for purposes of the Offer within two business days after the date
of this Offer to Purchase, and any financial institution that is a participant
in the system of any Book-Entry Transfer Facility may make delivery of Shares by
causing such Book-Entry Transfer Facility to transfer such Shares into the
Depositary's account in accordance with the procedures of such Book-Entry
Transfer Facility. Although delivery of Shares may be effected through
book-entry transfer, a properly completed and duly executed Letter of
Transmittal or a manually signed copy thereof, or an Agent's Message (as defined
below), together with any required signature guarantees and any other required
documents, must, in any case, be transmitted to and received by the Depositary
at its address set forth on the back cover of this Offer to Purchase on or prior
to the Expiration Date. Delivery of required documents to one of the Book-Entry
Transfer Facilities in accordance with its procedures does not constitute
delivery to the Depositary and will not constitute a valid tender.
The term "Agent's Message" means a message transmitted by a Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of a
Book-Entry confirmation, which states that such Book-Entry Transfer Facility has
received an express acknowledgement from the participant in such Book-Entry
Transfer Facility tendering the Shares, that such participant has received and
agrees to be bound by the terms of the Letter of Transmittal and that the
Company may enforce such agreement against the participant.
Except as set forth below, all signatures on a Letter of Transmittal
must be guaranteed by a firm that is a member of a registered national
securities exchange or the National Association of Securities Dealers, Inc., or
by a commercial bank, a trust company, a savings bank, a savings and loan
association or a credit union which has membership in an approved Signature
Guarantee Medallion Program (each of the foregoing being referred to as an
"Eligible Institution"). Signatures on a Letter of Transmittal need not be
guaranteed if (a) the Letter of Transmittal is signed by the registered holder
of the Shares (which term, for the purposes of this Section, includes any
participant in any Book-Entry Transfer Facility whose name appears on a security
position listing as the holder of the Shares) tendered therewith and such holder
has not completed the box entitled "Special Payment Instructions" or the box
entitled "Special Delivery Instructions" on the Letter of Transmittal or (b)
such Shares are tendered for the account of an Eligible Institution. See
Instructions 1 and 6 of the Letter of Transmittal.
<PAGE>
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT
THE OPTION AND RISK OF THE TENDERING STOCKHOLDER. IF DELIVERY IS BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
IN ALL CASES SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE TIMELY DELIVERY.
TO PREVENT UNITED STATES FEDERAL INCOME TAX BACKUP WITHHOLDING EQUAL TO
31% OF THE GROSS PAYMENTS MADE PURSUANT TO THE OFFER, EACH TENDERING STOCKHOLDER
MUST PROVIDE THE DEPOSITARY WITH SUCH STOCKHOLDER'S CORRECT TAXPAYER
IDENTIFICATION NUMBER AND CERTAIN OTHER INFORMATION BY PROPERLY COMPLETING THE
SUBSTITUTE FORM W-9 INCLUDED IN THE LETTER OF TRANSMITTAL. FOREIGN STOCKHOLDERS
(AS DEFINED IN SECTION 15) MUST SUBMIT A PROPERLY COMPLETED FORM W-8 (WHICH MAY
BE OBTAINED FROM THE DEPOSITARY) IN ORDER TO PREVENT BACKUP WITHHOLDING. IN
GENERAL, BACKUP WITHHOLDING DOES NOT APPLY TO CORPORATIONS OR TO FOREIGN
STOCKHOLDERS SUBJECT TO 30% (OR LOWER TREATY RATE) WITHHOLDING ON GROSS PAYMENTS
RECEIVED PURSUANT TO THE OFFER (AS DISCUSSED IN SECTION 15), For a discussion of
certain federal income tax consequences to tendering stockholders, see Section
15. EACH STOCKHOLDER IS URGED TO CONSULT WITH HIS OR HER OWN TAX ADVISOR
REGARDING HIS, HER OR ITS QUALIFICATION FOR EXEMPTION FROM BACKUP WITHHOLDING
AND THE PROCEDURE FOR OBTAINING ANY APPLICABLE EXEMPTION.
It is a violation of Rule 14e promulgated under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), for a person to tender Shares for
his or her own account unless the person so tendering (i) has a net long
position equal to or greater than the amount of (x) Shares tendered or (y) other
securities immediately convertible into, exercisable or exchangeable for the
amount of Shares tendered and will acquire such Shares for tender by conversion,
exercise or exchange of such other securities and (ii) will cause such Shares to
be delivered in accordance with the terms of the Offer. Rule 14e-4 provides a
similar restriction applicable to the tender on behalf of another person. The
tender of Shares pursuant to any one of the procedures described above will
constitute the tendering stockholder's representation and warranty that (i) such
stockholder has a net long position in the Shares being tendered within the
meaning of Rule 14e-4 promulgated under the Exchange Act, and (ii) the tender of
such Shares complies with Rule 14e-4. The Company's acceptance for payment of
Shares tendered pursuant to the Offer will constitute a binding agreement
between the tendering stockholder and the Company upon the terms and subject to
the conditions of the Offer.
All questions as to the Purchase Price, the form of documents, the
number of Shares to be accepted and the validity, eligibility (including time of
receipt) and acceptance for payment of any tender of Shares will be determined
by the Company, in its sole discretion, which determination shall be final and
binding on all parties. The Company reserves the absolute right to reject any or
all tenders of Shares that it determines are not in proper form or the
acceptance for payment of or payment for Shares that may, in the opinion of the
Company's counsel, be unlawful. The Company also reserves the absolute right to
waive any defect or irregularity in any tender of any particular Shares. None of
the Company, the Dealer Managers, the Depositary, the Information Agent or any
other person is or will be under any duty to give notice of any defect or
irregularity in tenders, nor shall any of them incur any liability for failure
to give any such notice.
CERTIFICATES FOR SHARES, TOGETHER WITH A PROPERLY COMPLETED LETTER OF
TRANSMITTAL (OR, IN THE CASE OF A BOOK-ENTRY TRANSFER, AN AGENT'S MESSAGE) AND
ANY OTHER DOCUMENTS REQUIRED BY THE LETTER OF TRANSMITTAL, MUST BE DELIVERED TO
THE DEPOSITARY AND NOT TO THE COMPANY. ANY SUCH DOCUMENTS DELIVERED TO THE
COMPANY WILL NOT BE FORWARDED TO THE DEPOSITARY AND THEREFORE WILL NOT BE
PROPERLY TENDERED.
<PAGE>
4. WITHDRAWAL RIGHTS
Tenders of Shares made pursuant to the Offer may be withdrawn at any
time prior to the Expiration Date. Thereafter, such tenders are irrevocable,
except that they may be withdrawn after 12:00 midnight, New York City time,
April 20, 1997 unless theretofore accepted for payment by the Company as
provided in this Offer to Purchase. If the Company extends the period of time
during which the Offer is open, is delayed in purchasing Shares or is unable to
purchase Shares pursuant to the Offer for any reason, then, without prejudice to
the Company's rights under the Offer, the Depositary may, on behalf of the
Company, retain all Shares tendered, and such Shares may not be withdrawn except
as otherwise provided in this Section 4, subject to Rule 13e-4(f)(5) under the
Exchange Act, which provides that the issuer making the tender offer shall
either pay the consideration offered, or return the tendered securities promptly
after the termination or withdrawal of the tender offer.
Withdrawal of Shares Held in Physical Form. Tenders of Shares made
pursuant to the Offer may not be withdrawn after the Expiration Date, except
that they may be withdrawn after 12:00 midnight, New York City time, April 20,
1997 unless accepted for payment by the Company as provided in this Offer to
Purchase. For a withdrawal to be effective prior to that time, a stockholder of
Shares held in physical form must provide a written, telegraphic or facsimile
transmission notice of withdrawal to the Depositary at its address set forth on
the back cover page of this Offer to Purchase before the Expiration Date, which
notice must contain: (A) the name of the person who tendered the Shares; (B) a
description of the Shares to be withdrawn (including the number of Shares being
withdrawn); (C) the certificate numbers shown on the particular certificates
evidencing such Shares; (D) the signature of such stockholder executed in the
same manner as the original signature on the Letter of Transmittal (including
any signature guarantee (if such original signature was guaranteed)); and (E) if
such Shares are held by a new beneficial owner, evidence satisfactory to the
Company that the person withdrawing the tender has succeeded to the beneficial
ownership of the Shares. A purported notice of withdrawal which lacks any of the
required information will not be an effective withdrawal of a tender previously
made.
Withdrawal of Shares Held with the Book-Entry Transfer Facility.
Tenders of Shares made pursuant to the Offer may not be withdrawn after the
Expiration Date, except that they may be withdrawn after 12:00 midnight, New
York City time, April 20, 1997 unless accepted for payment by the Company as
provided in this Offer to Purchase. For a withdrawal to be effective prior to
that time, a stockholder of Shares held with any of the Book-Entry Transfer
Facilities must call such stockholder's broker and instruct such broker to
withdraw such tender of Shares and instruct such broker to provide a written,
telegraphic or facsimile transmission notice of withdrawal to the Depositary on
or before the Expiration Date. A purported notice of withdrawal which lacks any
of the applicable required information noted above will not be an effective
withdrawal of a tender previously made.
Any permitted withdrawals of tenders of Shares may not be rescinded,
and any Shares so withdrawn will thereafter be deemed not validly tendered for
purposes of the Offer; provided, however, that withdrawn Shares may be
re-tendered by following the procedures for tendering prior to the Expiration
Date.
<PAGE>
All questions as to the form and validity (including time of receipt)
of any notice of withdrawal will be determined by the Company, in its sole
discretion, which determination shall be final and binding on all parties. None
of the Company, the Dealer Managers, the Depositary, the Information Agent or
any other person is or will be under any duty to give notification of any defect
or irregularity in any notice of withdrawal or incur any liability for failure
to give any such notification.
5. ACCEPTANCE FOR PAYMENT OF SHARES AND PAYMENT OF PURCHASE PRICE
Upon the terms and subject to the conditions of the Offer and as
promptly as practicable after the Expiration Date, the Company will determine
the Purchase Price, taking into consideration the number of Shares tendered and
the prices specified by tendering stockholders, announce the Purchase Price, and
(subject to the proration and conditional tender provisions of the Offer) accept
for payment and pay the Purchase Price for Shares validly tendered and not
withdrawn at or below the Purchase Price. Thereafter, payment for all Shares
validly tendered on or prior to the Expiration Date and accepted for payment
pursuant to the Offer will be made by the Depositary by check as promptly as
practicable. In all cases, payment for Shares accepted for payment pursuant to
the Offer will be made only after timely receipt by the Depositary of
certificates for such Shares (or of a timely confirmation of a book-entry
transfer of such Shares into the Depositary's account at one of the Book-Entry
Transfer Facilities), a properly completed and duly executed Letter of
Transmittal or a manually signed copy thereof, with any required signature
guarantees, or, in the case of a book-entry delivery an Agent's Message, and any
other required documents.
For purposes of the Offer, the Company shall be deemed to have accepted
for payment (and thereby purchased), subject to proration and conditional
tenders, Shares that are validly tendered and not withdrawn as, if and when it
gives oral or written notice to the Depositary of the Company's acceptance for
payment of such Shares. In the event of proration, the Company will determine
the proration factor and pay for those tendered Shares accepted for payment as
soon as practicable after the Expiration Date. However, the Company does not
expect to be able to announce the final results of any such proration until
approximately seven NNM trading days after the Expiration Date. The Company will
pay for Shares that it has purchased pursuant to the Offer by depositing the
aggregate Purchase Price therefor with the Depositary. The Depositary will act
as agent for tendering stockholders for the purpose of receiving payment from
the Company and transmitting payment to tendering stockholders. Under no
circumstances will interest be paid on amounts to be paid to tendering
stockholders, regardless of any delay in making such payment.
Certificates for all Shares not purchased, including all Shares
tendered at prices greater than the Purchase Price, Shares not purchased because
of proration and Shares that were conditionally tendered and not accepted, will
be returned (or, in the case of Shares tendered by book-entry transfer, such
Shares will be credited to an account maintained with one of the Book-Entry
Transfer Facilities by the participant therein who so delivered such Shares) as
promptly as practicable following the Expiration Date without expense to the
tendering stockholder.
Payment for Shares may be delayed in the event of difficulty in
determining the number of Shares properly tendered or if proration is required.
See Section 1. In addition, if certain events occur, the Company may not be
obligated to purchase Shares pursuant to the Offer. See Section 7.
<PAGE>
The Company will pay or cause to be paid any stock transfer taxes with
respect to the sale and transfer of any Shares to it or its order pursuant to
the Offer. If, however, payment of the Purchase Price is to be made to, or a
portion of the Shares delivered (whether in certificated form or by book entry)
but not tendered or not purchased are to be registered in the name of, any
person other than the registered holder, or if tendered Shares are registered in
the name of any person other than the person signing the Letter of Transmittal
(unless such person is signing in a representative or fiduciary capacity), the
amount of any stock transfer taxes (whether imposed on the registered holder,
such other person or otherwise) payable on account of the transfer to such
person will be deducted from the Purchase Price unless satisfactory evidence of
the payment of such taxes, or exemption therefrom, is submitted. See Instruction
7 to the Letter of Transmittal.
ANY TENDERING STOCKHOLDER OR OTHER PAYEE WHO FAILS TO COMPLETE FULLY
AND SIGN THE SUBSTITUTE FORM W-9 INCLUDED IN THE LETTER OF TRANSMITTAL (OR, IN
THE CASE OF A FOREIGN INDIVIDUAL, A FORM W-8) MAY BE SUBJECT TO REQUIRED FEDERAL
INCOME TAX WITHHOLDING OF 31% OF THE GROSS PROCEEDS PAID TO SUCH STOCKHOLDER OR
OTHER PAYEE PURSUANT TO THE OFFER. SEE SECTION 3.
6. CONDITIONAL TENDER OF SHARES
Under certain circumstances and subject to the exceptions set forth in
Section 1, the Company may prorate the number of Shares purchased pursuant to
the Offer. As discussed in Section 15, the number of Shares to be purchased from
a particular stockholder might affect the tax treatment of such purchase to such
stockholder and such stockholder's decision whether to tender. EACH STOCKHOLDER
IS URGED TO CONSULT WITH HIS OR HER OWN TAX ADVISOR. Accordingly, a stockholder
may tender Shares subject to the condition that a specified minimum number of
such holder's Shares tendered pursuant to a Letter of Transmittal must be
purchased if any such Shares so tendered are purchased, and any stockholder
desiring to make such a conditional tender must so indicate in the box captioned
"Conditional Tender" in such Letter of Transmittal.
Any tendering stockholders wishing to make a conditional tender must
calculate and appropriately indicate such minimum number of Shares. If the
effect of accepting tenders on a pro rata basis would be to reduce the number of
Shares to be purchased from any stockholder (tendered pursuant to a Letter of
Transmittal) below the minimum number so specified, such tender will
automatically be regarded as withdrawn (except as provided in the next
paragraph) and all Shares tendered by such stockholder pursuant to such Letter
of Transmittal will be returned as promptly as practicable thereafter.
If conditional tenders, that would otherwise be so regarded as
withdrawn, would cause the total number of Shares to be purchased to fall below
850,000, then, to the extent feasible, the Company will select enough of such
conditional tenders that would otherwise have been so withdrawn to permit the
Company to purchase 850,000 Shares. In selecting among such conditional tenders,
the Company will select by lot and will limit its purchase in each case to the
minimum number of Shares designated by the stockholder in the applicable Letter
of Transmittal as a condition to his or her tender.
<PAGE>
7. CERTAIN CONDITIONS OF THE OFFER
Notwithstanding any other provision of the Offer, the Company will not
be required to accept for payment or pay for any Shares tendered, and may
terminate or amend and may postpone (subject to the requirements of the Exchange
Act for prompt payment for or return of Shares tendered) the acceptance for
payment of Shares tendered, if at any time after February 27, 1997 and at or
before acceptance for payment of any Shares any of the following shall have
occurred:
(a) there shall have been threatened, instituted or pending
any action or proceeding by any government or governmental, regulatory
or administrative agency or authority or tribunal or any other person,
domestic or foreign, or before any court, authority, agency or tribunal
that (i) challenges the acquisition of Shares pursuant to the Offer or
otherwise in any manner relates to or affects the Offer or (ii) in the
sole judgment of the Company, could materially and adversely affect the
business, condition (financial or other), income, operations or
prospects of the Company and its subsidiaries, taken as a whole, or
otherwise materially impair in any way the contemplated future conduct
of the business of the Company or any of its subsidiaries or materially
impair the Offer's contemplated benefits to the Company;
(b) there shall have been any action threatened, pending or
taken, or approval withheld, or any statute, rule, regulation,
judgment, order or injunction threatened, proposed, sought,
promulgated, enacted, entered, amended, enforced or deemed to be
applicable to the Offer or the Company or any of its subsidiaries, by
any legislative body, court, authority, agency or tribunal which, in
the Company's sole judgment, would or might directly or indirectly (i)
make the acceptance for payment of, or payment for, some or all of the
Shares illegal or otherwise restrict or prohibit consummation of the
Offer, (ii) delay or restrict the ability of the Company, or render the
Company unable, to accept for payment or pay for some or all of the
Shares, (iii) materially impair the contemplated benefits of the Offer
to the Company or (iv) materially affect the business, condition
(financial or other), income, operations or prospects of the Company
and its subsidiaries, taken as a whole, or otherwise materially impair
in any way the contemplated future conduct of the business of the
Company or any of its subsidiaries;
(c) it shall have been publicly disclosed or the Company shall
have learned that (i) any person or "group" (within the meaning of
Section 13(d)(3) of the Exchange Act) has acquired or proposes to
acquire beneficial ownership of more than 5% of the outstanding Shares
whether through the acquisition of stock, the formation of a group, the
grant of any option or right, or otherwise (other than as disclosed in
a Schedule 13D or 13G on file with the U.S. Securities and Exchange
Commission (the "Commission") on February 27, 1997) or (ii) any such
person or group that on or prior to February 27, 1997 had filed such a
Schedule with the Commission thereafter shall have acquired or shall
propose to acquire, whether through the acquisition of stock, the
formation of a group, the grant of any option or right, or otherwise,
beneficial ownership of additional Shares representing 2% or more of
the outstanding Shares;
<PAGE>
(d) there shall have occurred (i) any general suspension of
trading in, or limitation on prices for, securities on any national
securities exchange or in the over-the-counter market, (ii) any
significant decline in the market price of the Shares or in the general
level of market prices of equity securities in the United States or
abroad, (iii) any change in the general political, market, economic or
financial condition in the United States or abroad that could have a
material adverse effect on the Company's business, condition (financial
or otherwise), income, operations, prospects or ability to obtain
financing generally or the trading in the Shares, (iv) the declaration
of a banking moratorium or any suspension of payments in respect of
banks in the United States or any limitation on, or any event which, in
the Company's sole judgment, might affect the extension of credit by
lending institutions in the United States, (v) the commencement of a
war, armed hostilities or other international or national calamity
directly or indirectly involving the United States or (vi) in the case
of any of the foregoing existing at the time of the commencement of the
Offer, in the Company's sole judgment, a material acceleration or
worsening thereof;
(e) a tender or exchange offer with respect to some or all of
the Shares (other than the Offer), or a merger, acquisition or other
business combination proposal for the Company, shall have been
proposed, announced or made by another person or group (within the
meaning of Section 13(d)(3) of the Exchange Act);
(f) there shall have occurred any event or events that has
resulted, or may in the sole judgment of the Company result, directly
or indirectly, in an actual or threatened change in the business,
condition (financial or other), income, operations, stock ownership or
prospects of the Company and its subsidiaries;
and, in the sole judgment of the Company, such event or events make it
undesirable or inadvisable to proceed with the Offer or with such acceptance for
payment.
The foregoing conditions are for the sole benefit of the Company and
may be asserted by the Company regardless of the circumstances (including any
action or inaction by the Company) giving rise to any such condition, and any
such condition may be waived by the Company, in whole or in part, at any time
and from time to time in its sole discretion. The failure by the Company at any
time to exercise any of the foregoing rights shall not be deemed a waiver of any
such right and each such right shall be deemed an ongoing right which may be
asserted at any time and from time to time. Any determination by the Company
concerning the events described above will be final and binding on all parties.
Acceptance of Shares validly tendered in the Offer is subject to the
condition that, as of the Expiration Date, and after giving pro forma effect to
the acceptance of Shares validly tendered, the Company would continue to have at
least 300 stockholders and the Shares would remain listed for quotation on the
NNM. This condition may not be waived.
<PAGE>
The Exchange Act requires that all conditions to the Offer must be
satisfied or waived before the Expiration Date.
8. PRICE RANGE OF SHARES; DIVIDENDS
<TABLE>
<CAPTION>
Dividends
High Low Declared
---- --- --------
<S> <C> <C> <C>
Fiscal 1996
1st Quarter(1) $12.25 $11.25 $ ---
2nd Quarter 11.75 10.75 ---
3rd Quarter 12.25 11.25 0.06
4th Quarter 12.13 11.00 0.06
Fiscal 1997
1st Quarter $12.88 $11.81 $ 0.06
2nd Quarter (through February 25,
1997) 14.75 12.63 ---
- -------------
(1) Reflects the period from October 2, 1995 through December 31, 1995.
</TABLE>
On February 25, 1997, the closing price of the Shares on the NNM was
$14.38 per Share. STOCKHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS FOR
THE SHARES.
9. PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER
The Company believes that the purchase of Shares is an attractive use
of a portion of the Company's available capital on behalf of its stockholders
and is consistent with the Company's long-term goal of increasing stockholder
value. The Company believes it has adequate sources of capital to complete the
Share repurchase and pursue business opportunities.
Over time, the Company's profitable operations have contributed to the
growth of a capital base that exceeds all applicable regulatory standards and
the amount of capital needed to support the Company's banking business. After
evaluating a variety of alternatives to utilize more effectively its capital
base and to attempt to maximize stockholder value, the Company's management and
its Board of Directors believe that the purchase of Shares pursuant to the Offer
is a positive action that is intended to accomplish the desired objectives.
Other actions previously employed, including an open market purchase of Shares,
have enhanced stockholder value, but capital remains at high levels.
The Offer is designed to restructure the Company's balance sheet in
order to increase return on equity by reducing the amount of equity outstanding.
Based upon the current market price of its Shares, the Company believes that the
purchase of Shares is an attractive use of its funds. Following the purchase of
the Shares, the Company believes funds provided by earnings, combined with its
other sources of liquidity, will be fully adequate to meet its funding needs for
the foreseeable future. Upon completion of the Offer, the Company expects that
it and its wholly owned subsidiary bank, Damen National Bank (the "Bank"), will
continue to maintain the highest regulatory standard for capital, which is
designated as "well capitalized" under the prompt corrective action scheme
enacted by the Federal Deposit Insurance Corporation Improvement Act of 1991.
<PAGE>
The Offer will enable stockholders who are considering the sale of all
or a portion of their Shares the opportunity to determine the price or prices
(not greater than $14.75 nor less than $13.25 per Share) at which they are
willing to sell their Shares, and, if any such Shares are purchased pursuant to
the Offer, to sell those Shares for cash without the usual transaction costs
associated with open-market sales. The Offer may also give stockholders the
opportunity to sell Shares at prices greater than market prices prevailing prior
to the announcement of the Offer. See Section 8. In addition, qualifying
stockholders owning beneficially fewer than 100 Shares, whose Shares are
purchased pursuant to the Offer, not only will avoid the payment of brokerage
commissions but will also avoid any applicable odd lot discounts to the market
price typically charged by brokers for executing odd lot trades.
Stockholders who do not tender their Shares pursuant to the Offer and
stockholders who otherwise retain an equity interest in the Company as a result
of a partial tender of Shares or a proration pursuant to Section 1 of the Offer
will continue to be owners of the Company with the attendant risks and rewards
associated with owning the equity securities of the Company. As noted above, the
Company, following completion of the Offer, will maintain the highest regulatory
capital ranking. Consequently, the Company believes that stockholders will not
be subject to materially greater risk as a result of the reduction of the
capital base.
Stockholders who determine not to accept the Offer will realize a
proportionate increase in their relative equity interest in the Company and,
thus, in the Company's earnings and assets, subject to any risks resulting from
the Company's purchase of Shares and the Company's ability to issue additional
equity securities in the future. In addition, to the extent the purchase of
Shares pursuant to the Offer results in a reduction of the number of
stockholders of record, the Company's costs for services to stockholders may be
reduced. Finally, the Offer may affect the Company's ability to qualify for
pooling-of-interests accounting treatment for any merger transaction for
approximately the next two years.
If fewer than 850,000 Shares are purchased pursuant to the Offer, the
Company may repurchase the remainder of such Shares on the open market, in
privately negotiated transactions or otherwise. In the future, the Company may
determine to purchase additional Shares on the open market, in privately
negotiated transactions, through one or more tender offers or otherwise. Any
such purchases may be on the same terms as, or on terms which are more or less
favorable to stockholders than, the terms of the Offer. However, Rule 13e-4
under the Exchange Act prohibits the Company and its affiliates from purchasing
any Shares, other than pursuant to the Offer, until at least ten business days
after the Expiration Date. Any future purchases of Shares by the Company would
depend on many factors, including the market price of the Shares, the Company's
business and financial position, and general economic and market conditions.
Shares the Company acquires pursuant to the Offer will be restored to
the status of authorized and unissued Shares, or placed in the Company's
treasury, and will be available for the Company to issue without further
stockholder action (except as required by applicable law or the rules of the NNM
or any other securities exchange on which the Shares are listed) for purposes
including, but not limited to, the acquisition of other businesses, the raising
of additional capital for use in the Company's business and the satisfaction of
obligations under existing or future employee benefit plans. The Company has no
current plans for reissuance of the Shares repurchased pursuant to the Offer.
<PAGE>
NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY
RECOMMENDATION TO ANY STOCKHOLDER AS TO WHETHER TO TENDER ALL OR ANY SHARES.
EACH STOCKHOLDER MUST MAKE HIS OR HER OWN DECISION WHETHER TO TENDER SHARES AND,
IF SO, HOW MANY SHARES TO TENDER AND AT WHAT PRICE. THE COMPANY HAS BEEN ADVISED
THAT NO DIRECTOR OR EXECUTIVE OFFICER INTENDS TO TENDER SHARES PURSUANT TO THE
OFFER. THE COMPANY HAS ALSO BEEN ADVISED THAT THE TRUSTEE OF THE ESOP DOES NOT
INTEND TO TENDER ANY SHARES PURSUANT TO THE OFFER.
10. CERTAIN INFORMATION CONCERNING THE COMPANY
General
The Company, which was incorporated in the State of Delaware in 1995,
is the holding company for the Bank, which was originally organized in 1916,
converted to a federal savings bank in 1990 and converted to a national bank in
1997. The Bank is a community-oriented financial institution offering a variety
of financial services to meet the needs of the communities it serves. The Bank
attracts retail deposits from the general public and invests those funds
primarily in first mortgages secured by owner-occupied, one- to four-family
residences and in mortgage-backed and other investment securities. To a much
lesser extent, the Bank also originates permanent multi-family, commercial real
estate and consumer loans. Its income is derived largely from interest on loans,
mortgage-backed securities and other investment securities. Its principal
expenses are interest paid on deposits and borrowings and operating expenses.
The Bank currently serves the northwest and southwest suburbs and the
south side of Chicago, Illinois through its three retail banking offices.
The Bank is subject to examination and supervision by the Office of
the Comptroller of the Currency and the Federal Deposit Insurance Corporation.
The Company, as a bank holding company, is subject to examination and
supervision by the Board of Governors of the Federal Reserve System.
The Company's principal executive offices are located at 200 West
Higgins Road, Schaumburg, Illinois 60195 and its telephone number is (847)
882-5320.
<PAGE>
Summary Historical Consolidated Financial Data and
Summary Unaudited Pro Forma Consolidated Financial Data
The following summary historical consolidated financial data has been
derived from the consolidated financial statements of the Company. The data
should be read in conjunction with the consolidated financial statements and
notes thereto included in the Company's Quarterly Report on Form 10-Q for the
quarter ended December 31, 1996 and the Company's Annual Report on Form 10-K for
the year ended September 30, 1996. Copies of these reports may be obtained as
described in Section 18 of this Offer. The income statement data for the years
ended September 30, 1995 and 1996 and the balance sheet data as of the same
dates have been derived from the audited consolidated financial statements of
the Company. The income statement data for the three months ended December 31,
1995 and 1996 and the balance sheet data as of December 31, 1996 have been
derived from the unaudited condensed consolidated financial statements of the
Company which, in the opinion of management, include all adjustments (consisting
of normal recurring adjustments) necessary for a fair presentation of financial
position and results of operations for such periods. Operating results for the
three months ended December 31, 1996 are not necessarily indicative of the
results that may be expected for the entire year ending September 30, 1997.
The following summary unaudited pro forma consolidated financial data
has been derived from the historical consolidated financial statements of the
Company adjusted for certain costs and expenses to be incurred as a result of
the purchase of Shares pursuant to the Offer. The summary unaudited pro forma
consolidated financial data should be read in conjunction with the summary
historical consolidated financial data included herein. The pro forma income
statement data and balance sheet data are not necessarily indicative of the
financial position or results of operations that would have been obtained had
the Offer been completed as of the dates indicated.
<PAGE>
<TABLE>
<CAPTION>
Historical
-------------------------------------------------
Balance Sheet Data: September 30, December 31,
----------------------------- -----------
1995 1996 1996
---------- ---------- -----------
(Dollars in thousands, except per share data)
<S> <C> <C> <C>
ASSETS
Cash and cash equivalents $ 20,363 $ 1,181 $ 1,486
Investment securities, available for sale 33,690 43,343 43,560
Investment securities 1,090 1,777 1,772
Mortgage-backed securities 42,533 35,504 34,067
Mortgage-backed securities, available for sale 39,658 52,594 55,355
Loans receivable, net 87,555 91,146 90,383
Other assets 7,469 9,010 8,641
---------- ---------- ----------
Total assets $ 232,358 $ 234,555 $ 235,264
========== ========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits $ 126,632 $ 118,973 $ 120,029
Borrowed funds 45,500 59,600 58,000
Other liabilities 4,516 3,112 3,405
---------- ---------- ----------
Total liabilities 176,648 181,685 181,434
---------- ---------- ----------
Stockholders' equity:
Common stock 40 40 40
Additional paid-in capital 38,280 38,346 38,358
Retained earnings 19,778 21,131 21,314
Treasury stock --- (2,311) (2,311)
Unrealized gain on securities available for sale, net 786 167 787
Common stock purchased by:
Employee Stock Ownership Plan (3,174) (2,762) (2,710)
Recognition and Retention Plans --- (1,741) (1,648)
----------- ----------- ----------
Total stockholders' equity 55,710 52,870 53,830
---------- ---------- ----------
Total liabilities and stockholders' equity $ 232,358 $ 234,555 $ 235,264
========== ========== ==========
Shares outstanding 3,967,500 3,770,117 3,770,117
<PAGE>
<CAPTION>
Pro Forma
------------------------------------------------------------------
Balance Sheet Data: September 30, 1996 December 31, 1996
------------------------------- -----------------------------
$13.25 per $14.75 per $13.25 per $14.75 per
share share share share
------------- ----------- ------------- -----------
(Dollars in thousands, except per share data)
<S> <C> <C> <C> <C>
ASSETS
Cash and cash equivalents $ 1,031 $ 1,031 $ 1,336 $ 1,336
Investment securities, available for sale 33,980 32,705 34,172 32,897
Investment securities 1,777 1,777 1,772 1,772
Mortgage-backed securities 35,504 35,504 34,067 34,067
Mortgage-backed securities, available for sale 50,694 50,694 53,480 53,480
Loans receivable, net 91,146 91,146 90,383 90,383
Other assets 9,010 9,010 8,641 8,641
-------- -------- -------- --------
Total assets $223,142 $221,867 $223,851 $222,576
======== ======== ======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits $118,973 $118,973 $120,029 $120,029
Borrowed funds 59,600 59,600 58,000 58,000
Other liabilities 3,112 3,112 3,405 3,405
-------- -------- -------- --------
Total liabilities 181,685 181,685 181,434 181,434
-------- -------- -------- --------
Stockholders' equity:
Common stock 40 40 40 40
Additional paid-in capital 38,346 38,346 38,358 38,358
Retained earnings 21,131 21,131 21,314 21,314
Treasury stock (13,724) (14,999) (13,724) (14,999)
Unrealized gain on securities available for sale, net 167 167 787 787
Common stock purchased by:
Employee Stock Ownership Plan (2,762) (2,762) (2,710) (2,710)
Recognition and Retention Plans (1,741) (1,741) (1,648) (1,648)
--------- -------- -------- --------
Total stockholders' equity 41,457 40,182 42,417 41,142
Total liabilities and stockholders' equity $223,142 $221,867 $223,851 $222,576
========= ======== ======== ========
Shares outstanding 2,920,117 2,920,117 2,920,117 2,920,117
<PAGE>
<CAPTION>
Historical
-----------------------------------------------------------
Years ended Three months ended
September 30, December 31,
------------------------- -------------------------
Income Statement Data: 1995 1996 1995 1996
---------- --------- ------- --------
(Dollars in thousands, except per share data)
<S> <C> <C> <C> <C>
Total interest income $ 14,029 $ 16,661 $ 4,042 $ 4,157
Total interest expense 9,397 9,672 2,407 2,442
--------- --------- ------- -------
Net interest income 4,632 6,989 1,635 1,715
Provision for loan losses 163 70 15 5
--------- --------- -------- -------
Net interest income after provision
for loan losses 4,469 6,919 1,620 1,710
Total non-interest income (739) 267 42 37
Total non-interest expense (3,610) (5,243) (1,101) (1,292)
--------- --------- ------- -------
Income before federal and state
income taxes and change in
accounting principles 120 1,943 561 455
Federal and state income taxes
(provision) benefit 348 (163) (90) (63)
Cumulative effect of change in
accounting principles 907 --- --- ---
---------- --------- ------- --------
Net income $ 1,375 $ 1,780 $ 471 $ 392
========= ========= ======= ========
Earnings (loss) per share $ --- $0.49 $.13 $.11
========= ========= ======= ====
Dividends declared per share $ --- $0.12 $ --- $.06
Weighted average shares outstanding --- 3,806,394 3,967,500 3,770,117
<PAGE>
<CAPTION>
Pro Forma
-------------------------------------------------------------
Year ended Three months ended
September 30, 1996 December 31, 1996
-------------------------- ---------------------------
$13.25 per $14.75 per $13.25 per $14.75 per
share share share share
(Dollars in thousands, except per share data)
<S> <C> <C> <C> <C>
Total interest income $ 15,985 $ 15,909 $ 3,988 $ 3,969
Total interest expense 9,672 9,672 2,442 2,442
---------- --------- --------- --------
Net interest income 6,313 6,237 1,546 1,527
Provision for loan losses 70 70 5 5
---------- --------- --------- --------
Net interest income after provision
for loan losses 6,243 6,167 1,541 1,522
Total non-interest income 267 267 37 37
Total non-interest expense (5,243) (5,243) (1,292) (1,292)
---------- --------- --------- --------
Income before federal and state
income taxes and change in
accounting principles 1,267 1,191 286 267
Federal and state income taxes
(provision) benefit (96) (88) (38) (36)
Cumulative effect of change in
accounting principles --- --- --- ---
---------- --------- --------- --------
Net income $ 1,171 $ 1,103 $ 248 $ 231
========= ========= ========= ==========
Earnings (loss) per share $ .42 $ .40 $ .09 $ .08
========= ========= ========= =========
Dividends declared per share $ .12 $ .12 $ .06 $ .06
Weighted average shares outstanding 2,956,394 2,956,394 2,920,117 2,920,117
<PAGE>
<CAPTION>
Historical
-------------------------------------------------------
Years ended Three months ended
September 30, December 31,
----------------------- ------------------------
1995 1996 1995 1996
------- ------- ------- -------
(annualized)
<S> <C> <C> <C> <C>
Selected Financial Ratios:
Return on average assets (ratio of net
income to average total assets) 0.69% 0.76% 0.81% 0.67%
Return on average stockholders' equity
(ratio of net income to average equity) 6.75% 3.21% 3.34% 2.94%
Dividend payout ratio ---% 26.08% ---% 57.66%
Stockholders' equity to total assets at
end of period 23.98% 22.54% 24.28% 22.88%
Book value per share $14.04 $14.02 $14.40 $14.28
Non-performing assets to total assets
at end of period 0.03% 0.15% .08% 0.15%
Allowance for loan losses to non-
performing assets 420.71% 98.42% 154.58% 95.09%
<CAPTION>
Pro Forma
------------------------------------------------------------
Year ended Three months ended
September 30, 1996 December 31, 1996
---------------------------- ---------------------------
$13.25 per $14.75 per $13.25 per $14.75 per
share share share share
----- ----- ----- -----
(annualized)
<S> <C> <C> <C> <C>
Selected Financial Ratios:
Return on average assets (ratio of net
income to average total assets) 0.52% 0.50% 0.44% 0.42%
Return on average stockholders' equity
(ratio of net income to average equity) 2.66% 2.58% 2.37% 2.27%
Dividend payout ratio
39.65% 42.09% 91.21% 97.93%
Stockholders' equity to total assets at
end of period 18.58% 18.11% 18.95% 18.48%
Book value per share $14.20 $13.76 $14.53 $14.09
Non-performing assets to total assets
at end of period 0.16% 0.16% 0.16% 0.16%
Allowance for loan losses to non-
performing assets 98.42% 98.42% 95.09% 95.09%
</TABLE>
<PAGE>
DAMEN FINANCIAL CORPORATION
Notes to Unaudited Pro Forma Financial Information
(1) The pro forma financial information reflects the repurchase of 850,000
Shares at $13.25 and $14.75 per share, as appropriate.
(2) The balance sheet data give effect to the purchase of shares as of the
balance sheet date. The income statement data give effect to the
purchase of shares as of the beginning of each period presented.
(3) The funds used to purchase shares were considered to have been
proceeds from the sale or maturity of securities available for sale.
The pro forma data assumes a rate of interest of 6.0% on the
securities and an effective tax rate of 15%.
(4) The cost incurred in connection with the Offer is estimated to be
$150,000. Such costs will be capitalized as part of the cost of the
stock purchased.
<PAGE>
11. SOURCE AND AMOUNT OF FUNDS
Assuming that the Company purchases 850,000 Shares pursuant to the
Offer at a price of $14.75 per Share, the total amount required by the Company
to purchase such Shares will be $12,537,500, exclusive of fees and other
expenses. The Company will fund such purchase with cash and securities held by
the Company.
12. INTEREST OF DIRECTORS AND OFFICERS; TRANSACTIONS AND ARRANGEMENTS
CONCERNING SHARES
As of February 25, 1997, the Company had issued and outstanding
3,770,117 Shares, and had reserved 376,909 Shares for issuance upon exercise of
outstanding stock options. The 850,000 Shares that the Company is offering to
purchase represent approximately 22.5% of the outstanding Shares. As of February
25, 1997, the Company's directors and executive officers as a group (8 persons)
beneficially owned an aggregate of 305,130 Shares (including awards granted
under the Company's 1996 Stock Option and Incentive Plan) representing
approximately 8.10% of the outstanding Shares, assuming the exercise by such
persons of their currently exercisable options. The Company has been advised
that no director or executive officer of the Company intends to tender any
Shares pursuant to the Offer. In addition, 317,400 Shares, or approximately
8.42% of the outstanding Shares, are held in the ESOP. The Company has been
advised that the trustee of the ESOP does not intend to tender any Shares
pursuant to the Offer.
If the Company purchases 850,000 Shares pursuant to the Offer, then
after the purchase of Shares pursuant to the Offer, the Company's executive
officers and directors as a group would own beneficially approximately 10.45% of
the outstanding Shares, assuming the exercise by such persons of their currently
exercisable options. In addition, the ESOP would own approximately 10.87% of the
outstanding Shares.
Except as set forth in Schedule A, neither the Company, nor any
subsidiary of the Company nor, to the best of the Company's knowledge, any of
the Company's directors and executive officers, nor any affiliate of any of the
foregoing, had any transactions involving the Shares during the 40 business days
prior to the date hereof.
Except for outstanding options to purchase Shares granted to certain
employees (including executive officers) of the Company pursuant to the
Company's 1996 Stock Option and Incentive Plan, and outstanding awards of
restricted Shares under the Company's Recognition and Retention Plan, and except
as otherwise described herein, neither the Company nor, to the best of the
Company's knowledge, any of its affiliates, directors or executive officers, or
any of the directors or executive officers of any of its affiliates, is a party
to any contract, arrangement, understanding or relationship with any other
person relating, directly or indirectly, to the Offer with respect to any
securities of the Company including, but not limited to, any contract,
arrangement, understanding or relationship concerning the transfer or the voting
of any such securities, joint ventures, loan or option arrangements, puts or
calls, guaranties of loans, guaranties against loss or the giving or withholding
of proxies, consents or authorizations.
<PAGE>
Except as disclosed in this Offer, the Company has no plans or
proposals which relate to or would result in: (a) the acquisition by any person
of additional securities of the Company or the disposition of securities of the
Company; (b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Company or any of its subsidiaries;
(c) a sale or transfer of a material amount of assets of the Company or any of
its subsidiaries; (d) any change in the present Board of Directors or management
of the Company; (e) any material change in the present dividend rate or policy,
or indebtedness or capitalization of the Company; (f) any other material change
in the Company's corporate structure or business; (g) any change in the
Company's Certificate of Incorporation or Bylaws or any actions which may impede
the acquisition of control of the Company by any person; (h) a class of equity
security of the Company being delisted from a national securities exchange; (i)
a class of equity securities of the Company becoming eligible for termination of
registration pursuant to Section 12(g)(4) of the Exchange Act; or (j) the
suspension of the Company's obligation to file reports pursuant to Section 15(d)
of the Exchange Act.
13. EFFECTS OF THE OFFER ON THE MARKET FOR SHARES; REGISTRATION
UNDER THE EXCHANGE ACT
The Company's purchase of Shares pursuant to the Offer will reduce the
number of Shares that might otherwise be traded publicly and may reduce the
number of stockholders. Nonetheless, the Company anticipates that there will be
a sufficient number of Shares outstanding and publicly traded following
consummation of the Offer to ensure a continued trading market for the Shares.
Based upon published guidelines of the NNM, the Company believes that following
its purchase of Shares pursuant to the Offer, the Company's remaining Shares
will continue to qualify to be quoted on the NNM.
The Shares are currently "margin securities" under the rules of The
Board of Governors of the Federal Reserve System (the "Federal Reserve Board").
This has the effect, among other things, of allowing brokers to extend credit to
their customers using such Shares as collateral. The Company believes that,
following the purchase of Shares pursuant to the Offer, the Shares will continue
to be "margin securities" for purposes of the Federal Reserve Board's margin
regulations.
The Shares are registered under the Exchange Act, which requires,
among other things, that the Company furnish certain information to its
stockholders and the U.S. Securities and Exchange Commission (the "Commission")
and comply with the Commission's proxy rules in connection with meetings of the
Company's stockholders.
14. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS
The Company is not aware of any license or regulatory permit that
appears to be material to the Company's business that might be adversely
affected by the Company's acquisition of Shares as contemplated herein or of any
approval or other action by, or any filing with, any government or governmental,
administrative or regulatory authority or agency, domestic or foreign, that
would be required for the acquisition or ownership of Shares by the Company as
contemplated herein. Should any such approval or other action be required, the
<PAGE>
Company presently contemplates that such approval or other action will be
sought. The Company is unable to predict whether it may determine that it is
required to delay the acceptance for payment of or payment for Shares tendered
pursuant to the Offer pending the outcome of any such matter. There can be no
assurance that any such approval or other action, if needed, would be obtained
or would be obtained without substantial conditions or that the failure to
obtain any such approval or other action might not result in adverse
consequences to the Company's business. The Company's obligations under the
Offer to accept for payment and pay for Shares is subject to certain conditions.
See Section 7.
15. CERTAIN FEDERAL INCOME TAX CONSEQUENCES
In General. The following is a discussion of the material United
States federal income tax consequences to stockholders with respect to a sale of
Shares pursuant to the Offer. The discussion is based upon the provisions of the
Internal Revenue Code of 1986, as amended (the "Code"), U.S. Department of
Treasury regulations, Internal Revenue Service ("IRS") rulings and judicial
decisions, all in effect as of the date hereof and all of which are subject to
change (possibly with retroactive effect) by subsequent legislative, judicial or
administrative action. The discussion does not address all aspects of United
States federal income taxation that may be relevant to a particular stockholder
in light of such stockholder's particular circumstances or to certain types of
holders subject to special treatment under the United States federal income tax
laws (such as certain financial institutions, tax-exempt organizations, life
insurance companies, dealers in securities or currencies, employee benefit plans
or stockholders holding the Shares as part of a conversion transaction, as part
of a hedge or hedging transaction, or as a position in a straddle for tax
purposes). In addition, the discussion below does not consider the effect of any
foreign, state, local or other tax laws that may be applicable to particular
stockholders. The discussion assumes that the Shares are held as "capital
assets" within the meaning of Section 1221 of the Code. The Company has neither
requested nor obtained a written opinion of counsel or a ruling from the IRS
with respect to the tax matters discussed below.
EACH STOCKHOLDER SHOULD CONSULT HIS OR HER OWN TAX ADVISOR AS TO THE
PARTICULAR UNITED STATES FEDERAL INCOME TAX CONSEQUENCES TO THAT STOCKHOLDER
TENDERING SHARES PURSUANT TO THE OFFER AND THE APPLICABILITY AND EFFECT OF ANY
STATE, LOCAL OR FOREIGN TAX LAWS AND RECENT CHANGES IN APPLICABLE TAX LAWS.
Characterization of the Surrender of Shares Pursuant to the Offer. The
surrender of Shares by a stockholder to the Company pursuant to the Offer will
be a taxable transaction for United States federal income tax purposes and may
also be a taxable transaction under applicable state, local and foreign tax
laws. The United States federal income tax consequences to a stockholder may
vary depending upon the stockholder's particular facts and circumstances. Under
Section 302 of the Code, the surrender of Shares by a stockholder to the Company
pursuant to the Offer will be treated as a "sale or exchange" of such Shares for
United States federal income tax purposes (rather than as a distribution by the
Company with respect to the Shares held by the tendering stockholder) if the
receipt of cash upon such surrender (i) is "substantially disproportionate" with
respect to the stockholder, (ii) results in a "complete redemption" of the
stockholder's interest in the Company, or (iii) is "not essentially equivalent
to a dividend" with respect to the stockholder (each as described below).
<PAGE>
If any of the above three tests is satisfied, and the surrender of the
Shares is therefore treated as a "sale or exchange" of such Shares for United
States federal income tax purposes, the tendering stockholder will recognize
gain or loss equal to the difference between the amount of cash received by the
stockholder and the stockholder's tax basis in the Shares surrendered pursuant
to the Offer. Any such gain or loss will be capital gain or loss, and will be
long term capital gain or loss if the Shares have been held for more than one
year.
If none of the above three tests is satisfied, the tendering
stockholder will be treated as having received a distribution by the Company
with respect to such stockholder's Shares in an amount equal to the cash
received by the stockholder pursuant to the Offer. The distribution will be
treated as a dividend taxable as ordinary income to the extent of the Company's
current or accumulated earnings and profits for tax purposes. The amount of the
distribution in excess of the Company's current or accumulated earnings and
profits will be treated as a return of the stockholder's tax basis in the
Shares, and then as gain from the sale or exchange of such Shares. The tendering
stockholder's basis in the Shares surrendered pursuant to the Offer generally
will be added to such stockholder's basis in his or her remaining Shares, if
any.
Constructive Ownership. In determining whether any of the three tests
under Section 302 of the Code is satisfied, stockholders must take into account
not only the Shares that are actually owned by the stockholder, but also Shares
that are constructively owned by the stockholder within the meaning of Section
318 of the Code. Under Section 318 of the Code, a stockholder may constructively
own Shares actually owned, and in some cases constructively owned, by certain
related individuals or entities and Shares that the stockholder has the right to
acquire by exercise of an option or by conversion.
Proration. Contemporaneous dispositions or acquisitions of Shares by a
stockholder or related individuals or entities may be deemed to be part of a
single integrated transaction and may be taken into account in determining
whether any of the three tests under Section 302 of the Code has been satisfied.
Each stockholder should be aware that because proration may occur in the Offer,
even if all the Shares actually and constructively owned by a stockholder are
tendered pursuant to the Offer, fewer than all of such Shares may be purchased
by the Company. Thus, proration may affect whether the surrender by a
stockholder pursuant to the Offer will meet any of the three tests under Section
302 of the Code. See Section 6 for information regarding each stockholder's
option to make a conditional tender of a minimum number of Shares. A stockholder
should consult his or her own tax advisor regarding whether to make a
conditional tender of a minimum number of Shares, and the appropriate
calculation thereof.
Section 302 Tests. The receipt of cash by a stockholder will be
"substantially disproportionate" if the percentage of the outstanding Shares in
the Company actually and constructively owned by the stockholder immediately
following the surrender of Shares pursuant to the Offer is less than 80% of the
percentage of the outstanding Shares actually and constructively owned by such
stockholder immediately before the sale of Shares pursuant to the Offer.
Stockholders should consult their tax advisors with respect to the application
of the "substantially disproportionate" test to their particular situation.
<PAGE>
The receipt of cash by a stockholder will be a "complete redemption"
if either (i) the stockholder owns no Shares in the Company either actually or
constructively immediately after the Shares are surrendered pursuant to the
Offer, or (ii) the stockholder actually owns no Shares in the Company
immediately after the surrender of Shares pursuant to the Offer and, with
respect to Shares constructively owned by the stockholder immediately after the
Offer, the stockholder is eligible to waive (and effectively waives)
constructive ownership of all such Shares under procedures described in Section
302(c) of the Code.
Even if the receipt of cash by a stockholder fails to satisfy the
"substantially disproportionate" test or the "complete redemption" test, a
stockholder may nevertheless satisfy the "not essentially equivalent to a
dividend" test if the stockholder's surrender of Shares pursuant to the Offer
results in a "meaningful reduction" in the stockholder's interest in the
Company. Whether the receipt of cash by a stockholder will be "not essentially
equivalent to a dividend" will depend upon the individual stockholder's facts
and circumstances. The IRS has indicated in published rulings that even a small
reduction in the proportionate interest of a small minority stockholder in a
publicly held corporation who exercises no control over corporate affairs may
constitute such a "meaningful reduction." Stockholders expecting to rely upon
the "not essentially equivalent to a dividend" test should consult their own tax
advisors as to its application in their particular situation.
Corporate Stockholder Dividend Treatment. If a sale of Shares by a
corporate stockholder is treated as a dividend, the corporate stockholder may be
entitled to claim a deduction equal to 70% of the dividend under Section 243 of
the Code, subject to applicable limitations. Corporate stockholders should,
however, consider the effect of Section 246(c) of the Code, which disallows the
70% dividends-received deduction with respect to stock that is held for 45 days
or less. For this purpose, the length of time a taxpayer is deemed to have held
stock may be reduced by periods during which the taxpayer's risk of loss with
respect to the stock is diminished by reason of the existence of certain options
or other transactions. Moreover, under Section 246A of the Code, if a corporate
stockholder has incurred indebtedness directly attributable to an investment in
Shares, the 70% dividends-received deduction may be reduced.
In addition, amounts received by a corporate stockholder pursuant to
the Offer that are treated as a dividend may constitute an "extraordinary
dividend" under Section 1059 of the Code. Generally, an "extraordinary dividend"
is a dividend that (i) equals or exceeds 10% of the stockholder's basis in the
Shares (treating all dividends having ex-dividend dates within an 85-day period
as a single dividend) or (ii) exceeds 20% of the stockholder's adjusted basis in
the Shares (treating all dividends having ex-dividend dates within a 365-day
period as a single dividend). Accordingly, if applicable, a corporate
stockholder would be required under Section 1059(a) of the Code to reduce its
basis (but not below zero) in its Shares by the non-taxed portion of the
dividend (i.e., the portion of the dividend for which a deduction is allowed),
and if such portion exceeds the stockholder's tax basis for its Shares, to treat
the excess as gain from the sale of such Shares in the year in which a sale or
disposition of such Shares occurs (which, in certain circumstances, may be the
year in which Shares are sold pursuant to the Offer).
Additional Tax Considerations. The distinction between long-term
capital gains and ordinary income is relevant because, in general, individuals
currently are subject to taxation at a reduced rate on their "net capital gain"
(i.e., the excess of net long-term capital gains over net short-term capital
losses) for the year.
<PAGE>
Stockholders are urged to consult their own tax advisors regarding any
possible impact on their obligation to make estimated tax payments as a result
of the recognition of any capital gain (or the receipt of any ordinary income)
caused by the surrender of any Shares to the Company pursuant to the Offer.
Foreign Stockholders. The Company will withhold United States federal
income tax at a rate of 30% from gross proceeds paid pursuant to the Offer to a
foreign stockholder or his agent, unless the Company determines that a reduced
rate of withholding is applicable pursuant to a tax treaty or that an exemption
from withholding is applicable because such gross proceeds are effectively
connected with the conduct of a trade or business by the foreign stockholder
within the United States. For this purpose, a foreign stockholder is any
stockholder that is not (i) a citizen or resident of the United States, (ii) a
corporation, partnership or other entity created or organized in or under the
laws of the United States, or (iii) an estate or trust the income of which is
subject to United States federal income taxation regardless of its source.
Without definite knowledge to the contrary, the Company will determine whether a
stockholder is a foreign stockholder by reference to the stockholder's address.
A foreign stockholder may be eligible to file for a refund of such tax or a
portion of such tax if such stockholder (i) meets the "complete redemption,"
"substantially disproportionate" or "not essentially equivalent to a dividend"
tests de scribed above, (ii) is entitled to a reduced rate of withholding
pursuant to a treaty and the Company withheld at a higher rate, or (iii) is
otherwise able to establish that no tax or a reduced amount of tax was due. In
order to claim an exemption from withholding on the ground that gross proceeds
paid pursuant to the Offer are effectively connected with the conduct of a trade
or business by a foreign stockholder within the United States or that the
foreign stockholder is entitled to the benefits of a tax treaty, the foreign
stockholder must deliver to the Depositary (or other person who is otherwise
required to withhold United States tax) a properly executed statement claiming
such exemption or benefits. Such statements may be obtained from the Depositary.
Foreign stockholders are urged to consult their own tax advisors regarding the
application of United States federal income tax withholding, including
eligibility for a withholding tax reduction or exemption and the refund
procedures.
Backup Withholding. See Section 3 with respect to the application of
the United States federal income tax backup withholding.
THE TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION
ONLY AND MAY NOT APPLY TO SHARES ACQUIRED IN CONNECTION WITH THE EXERCISE OF
STOCK OPTIONS OR PURSUANT TO OTHER COMPENSATION ARRANGEMENTS WITH THE COMPANY.
THE TAX CONSEQUENCES OF A SALE PURSUANT TO THE OFFER MAY VARY DEPENDING UPON,
AMONG OTHER THINGS, THE PARTICULAR CIRCUMSTANCES OF THE TENDERING STOCKHOLDER.
NO INFORMATION IS PROVIDED HEREIN AS TO THE STATE, LOCAL OR FOREIGN TAX
CONSEQUENCES OF THE TRANSACTION CONTEMPLATED BY THE OFFER. STOCKHOLDERS ARE
URGED TO CONSULT THEIR OWN TAX ADVISORS TO DETERMINE THE PARTICULAR FEDERAL,
STATE, LOCAL AND FOREIGN TAX CONSEQUENCES TO THEM OF TENDERING SHARES PURSUANT
TO THE OFFER AND THE EFFECT OF THE STOCK OWNERSHIP ATTRIBUTION RULES DESCRIBED
ABOVE.
<PAGE>
16. EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENTS
The Company expressly reserves the right, in its sole discretion and
at any time or from time to time, to extend the period of time during which the
Offer is open by giving oral or written notice of such extension to the
Depositary and making a public announcement thereof. There can be no assurance,
however, that the Company will exercise its right to extend the Offer. During
any such extension, all Shares previously tendered will remain subject to the
Offer, except to the extent that such Shares may be withdrawn as set forth in
Section 4. The Company also expressly reserves the right, in its sole
discretion, (i) to terminate the Offer and not accept for payment any Shares not
theretofore accepted for payment or, subject to Rule 13e-4(f)(5) under the
Exchange Act, which requires the Company either to pay the consideration offered
or to return the Shares tendered promptly after the termination or withdrawal of
the Offer, to postpone payment for Shares upon the occurrence of any of the
conditions specified in Section 7 hereof, by giving oral or written notice of
such termination to the Depositary and making a public announcement thereof and
(ii) at any time, or from time to time, to amend the Offer in any respect.
Amendments to the Offer may be effected by public announcement. Without limiting
the manner in which the Company may choose to make public announcement of any
extension, termination or amendment, the Company shall have no obligation
(except as otherwise required by applicable law) to publish, advertise or
otherwise communicate any such public announcement, other than by making a
release to the Dow Jones News Service, except in the case of an announcement of
an extension of the Offer, in which case the Company shall have no obligation to
publish, advertise or otherwise communicate such announcement other than by
issuing a notice of such extension by press release or other public
announcement, which notice shall be issued no later than 9:00 a.m., New York
City time, on the next business day after the previously scheduled Expiration
Date. Material changes to information previously provided to holders of the
Shares in this Offer or in documents furnished subsequent thereto will be
disseminated to holders of Shares in compliance with Rule 13e-4(e)(2)
promulgated by the Commission under the Exchange Act.
If the Company materially changes the terms of the Offer or the
information concerning the Offer, or if it waives a material condition of the
Offer, the Company will extend the Offer to the extent required by Rules
13e-4(d)(2) and 13e-4(e)(2) under the Exchange Act. Those rules require that the
minimum period during which an offer must remain open following material changes
in the terms of the offer or information concerning the offer (other than a
change in price, change in dealer's soliciting fee or change in percentage of
securities sought) will depend on the facts and circumstances, including the
relative materiality of such terms or information. In a published release, the
Commission has stated that in its view, an offer should remain open for a
minimum of five business days from the date that notice of such a material
change is first published, sent or given. The Offer will continue or be extended
for at least ten business days from the time the Company publishes, sends or
gives to holders of Shares a notice that it will (a) increase or decrease the
price it will pay for Shares or the amount of the Dealer Managers' soliciting
fee or (b) increase (except for an increase not exceeding 2% of the outstanding
Shares) or decrease the number of Shares it seeks.
<PAGE>
17. FEES AND EXPENSES
Robert W. Baird & Co. Incorporated ("Baird") and Friedman, Billings,
Ramsey & Co., Inc. ("FBR") will act as Dealer Managers for the Company in
connection with the Offer. The Company has agreed to pay the Dealer Managers,
upon acceptance for and payment of Shares pursuant to the Offer, a total of
$0.07 per Share purchased by the Company pursuant to the Offer. The Dealer
Managers will also be indemnified against certain liabilities, including
liabilities under the federal securities laws, in connection with the Offer.
Baird rendered investment banking and other advisory services to the
Company in connection with its initial public offering. They received customary
compensation from the Company for such services. FBR has not previously rendered
any investment banking or other advisory services to the Company for which it
received compensation.
The Company has retained Registrar and Transfer Company as Depositary
and D.F. King & Co., Inc. as Information Agent in connection with the Offer. The
Information Agent may contact stockholders by mail, telephone, facsimile, telex,
telegraph, or other electronic means and personal interviews, and may request
brokers, dealers and other nominee stockholders to forward materials relating to
the Offer to beneficial owners. The Depositary and the Information Agent will
receive reasonable and customary compensation for their services and will also
be reimbursed for certain out-of-pocket expenses. The Company has agreed to
indemnify the Depositary and the Information Agent against certain liabilities,
including certain liabilities under the federal securities laws, in connection
with the Offer. Neither the Information Agent nor the Depositary has been
retained to make solicitations or recommendations in connection with the Offer.
The Company will not pay any fees or commissions to any broker, dealer
or other person for soliciting tenders of Shares pursuant to the Offer (other
than the fee of the Dealer Managers). The Company will, upon request, reimburse
brokers, dealers, commercial banks and trust companies for reasonable and
customary handling and mailing expenses incurred by them in forwarding materials
relating to the Offer to their customers.
18. MISCELLANEOUS
The Company is subject to the informational requirements of the
Exchange Act and in accordance therewith files reports, proxy statements and
other information with the Commission relating to its business, financial
condition and other matters. Certain information as of particular dates
concerning the Company's directors and officers, their remuneration, options
granted to them, the principal holders of the Company's securities and any
material interest of such persons in transactions with the Company is filed with
the Commission. The Company has also filed an Issuer Tender Offer Statement on
Schedule 13E-4 with the Commission, which includes certain additional
information relating to the Offer. Such reports, as well as such other material,
may be inspected and copies may be obtained at the Commission's public reference
facilities at 450 Fifth Street, N.W., Washington, D.C., and should also be
available for inspection and copying at the regional offices of the Commission
located at 7 World Trade Center, 13th Floor, New York, New York 10048, and Suite
1400, Northwestern Atrium Center, 500 West Madison Street, Chicago, Illinois
60661. Copies of such material may be obtained by mail, upon payment of the
Commission's customary fees, from the Commission's Public Reference Section at
450 Fifth Street, N.W., Washington, D.C. 20549. The Company's Schedule 13E-4 may
not be available at the Commission's regional offices.
<PAGE>
The Offer is being made to all holders of Shares. The Company is not
aware of any state where the making of the Offer is prohibited by administrative
or judicial action pursuant to a valid state statute. If the Company becomes
aware of any valid state statute prohibiting the making of the Offer, the
Company will make a good faith effort to comply with such statute. If, after
such good faith effort, the Company cannot comply with such statute, the Offer
will not be made to, nor will tenders be accepted from or on behalf of, holders
of Shares in such state. In those jurisdictions whose securities, blue sky or
other laws require the Offer to be made by a licensed broker or dealer, the
Offer shall be deemed to be made on behalf of the Company by the Dealer Managers
or one or more registered brokers or dealers licensed under the laws of such
jurisdictions.
DAMEN FINANCIAL CORPORATION
February 27, 1997
<PAGE>
SCHEDULE A
CERTAIN TRANSACTIONS INVOLVING SHARES
BY THE COMPANY OR ITS EXECUTIVE OFFICERS OR DIRECTORS
During the 40 business days prior to February 27, 1997, the only
transactions effected in the Shares by the Company, its executive officers or
directors were as follows:
<TABLE>
<CAPTION>
Where and How the
Person who Effected Date of Number of Transaction was
Transaction Transaction Shares Price Effected
----------- ----------- ------ ----- --------
<S> <C> <C> <C> <C>
Mary Beth Poronsky Stull 1/10/97 2,484.107 N/A Notified of ESOP
allocation (effective
as of September 30,
1996)
Gerald J. Gartner 1/10/97 2,484.107 N/A Notified of ESOP
allocation (effective
as of September 30,
1996)
1/29/97 1,562 $13.125 Inheritance from father's
estate
Janine M. Poronsky 1/10/97 2,438.565 N/A Notified of ESOP
allocation (effective
as of September 30,
1996)
Kenneth D. Vanek 1/10/97 2,258.507 N/A Notified of ESOP
allocation (effective
as of September 30,
1996)
</TABLE>
<PAGE>
The Dealer Managers for the Offer are:
Robert W. Baird & Co. Incorporated
777 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Telephone: (414) 298-7666(call collect)
Telephone: (888) 224-7326 (toll free)
and
Friedman, Billings, Ramsey & Co., Inc.
Potomac Tower
1001 Nineteenth Street North
Arlington, Virginia 22209-1710
Telephone: (703) 312-9500 (call collect)
Telephone: (800) 846-5050 (toll free)
Any questions concerning the terms of the Offer may be directed to the
Dealer Managers.
The Information Agent for the Offer is:
D.F. King & Co., Inc.
77 Water Street, New York, New York 10005
Telephone: (212) 269-5550 (call collect)
Telephone: (800) 758-5880 (toll free)
Any questions concerning tender procedures or requests for additional
copies of this Offer to Purchase, the Letter of Transmittal or other tender
offer materials may be directed to the Information Agent.
The Depositary for the Offer is:
Registrar and Transfer Company
By Mail, Overnight Delivery or By Hand: Facsimile Transmission:
Registrar and Transfer Company
10 Commerce Drive (908) 272-9697
Cranford, New Jersey 07016
Confirm by Telephone:
(800) 368-5948 Ext. 7760
Any questions concerning tender procedures may be directed to the
Depositary at (800) 368-5948 Ext. 7760.
February 27, 1997
<PAGE>
Exhibit (a)(2)
DAMEN FINANCIAL CORPORATION
LETTER OF TRANSMITTAL
To Accompany Shares of Common Stock
of
Damen Financial Corporation
Tendered Pursuant to the Offer to Purchase
Dated February 27, 1997
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW
YORK CITY TIME, ON THURSDAY, MARCH 27, 1997, UNLESS THE OFFER IS EXTENDED.
To: REGISTRAR AND TRANSFER COMPANY, Depositary
By Hand: c/o The Depository Trust Co.
Mailing Address: Transfer Agent Drop
10 Commerce Drive 55 Water Street, 1st Floor
Cranford, New Jersey 07016 New York, NY 10041-0099
Facsimile Transmission:
(908) 272-9697
Stockholder Information:
1-800-368-5948 Ext. 7760
DESCRIPTION OF SHARES TENDERED (See
Instructions 3 and 4)
- --------------------------------------------------------------------------------
Name(s) and Address(es) of Registered Holder(s)
(Please Fill in Exactly as Name(s) Appear(s) on Certificate(s)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
Shares Tendered
(Attach Additional List if Necessary)
- --------------------------------------------------------------------------------
Total Number of Number of
Certificate Shares Represented Shares
Number(s)* by Certificate(s)* Tendered**
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TOTAL SHARES
* Need not be completed by stockholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented
by any certificates delivered to the Depositary are being tendered. See
Instruction 4.
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN ONE LISTED ABOVE
WILL NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THE LETTER OF TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be used if certificates are to be
forwarded herewith or if delivery of Shares (as defined below) is to be made by
book-entry transfer to the Depositary's account at The Depository Trust Company
("DTC") or Philadelphia Depository Trust Company ("PDTC") (hereinafter
collectively referred to as the "Book-Entry Transfer Facilities") pursuant to
the procedures set forth in Section 3 of the Offer to Purchase (as defined
below).
Delivery of documents to Damen Financial Corporation or to a Book-Entry
Transfer Facility does not constitute a valid delivery.
(BOX BELOW FOR USE BY ELIGIBLE INSTITUTIONS ONLY)
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER TO
THE DEPOSITARY'S ACCOUNT AT ONE OF THE BOOK-ENTRY TRANSFER FACILITIES AND
COMPLETE THE FOLLOWING:
Name of Tendering Institution___________________________________________________
Check Applicable Box: [ ] DTC [ ] PDTC
Account No._____________________________________________________________________
Transaction Code No.____________________________________________________________
<PAGE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Ladies and Gentlemen:
The undersigned hereby tenders to Damen Financial Corporation, a Delaware
corporation (the "Company"), the above-described shares of its Common Stock, par
value $0.01 per share (the "Shares"), at a price per Share hereinafter set
forth, pursuant to the Company's offer to purchase up to 850,000 Shares, upon
the terms and subject to the conditions set forth in the Offer to Purchase,
dated February 27, 1997 (the "Offer to Purchase"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal (which together constitute the
"Offer").
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the undersigned hereby
sells, assigns and transfers to, or upon the order of, the Company all right,
title and interest in and to all the Shares that are being tendered hereby or
orders the registration of such Shares tendered by book-entry transfer that are
purchased pursuant to the Offer to or upon the order of the Company and
irrevocably constitutes and appoints the Depositary the true and lawful agent
and attorney-in-fact of the undersigned with respect to such Shares, with full
power of substitution (such power of attorney being deemed to be an irrevocable
power coupled with an interest), to (a) deliver certificates for such Shares, or
transfer ownership of such Shares on the account books maintained by any of the
Book-Entry Transfer Facilities, together, in any such case, with all
accompanying evidences of transfer and authenticity, to or upon the order of the
Company upon receipt by the Depositary, as the undersigned's agent, of the
Purchase Price (as defined below) with respect to such Shares, (b) present
certificates for such Shares for cancellation and transfer on the books of the
Company and (c) receive all benefits and otherwise exercise all rights of
beneficial ownership of such Shares, all in accordance with the terms of the
Offer.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby and that, when and to the extent the same are accepted for
payment by the Company, the Company will acquire good, marketable and
unencumbered title thereto, free and clear of all liens, restrictions, charges,
encumbrances, conditional sales agreements or other obligations relating to the
sale or transfer thereof, and the same will not be subject to any adverse
claims. The undersigned will, upon request, execute and deliver any additional
documents deemed by the Depositary or the Company to be necessary or desirable
to complete the sale, assignment and transfer of the Shares tendered hereby.
The undersigned hereby represents and warrants that the undersigned has
read and agrees to all of the terms of the Offer. All authority herein conferred
or agreed to be conferred shall not be affected by, and shall survive the death
or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, personal representatives, successors
and assigns of the undersigned. Except as stated in the Offer, this tender is
irrevocable.
<PAGE>
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described in Section 2 or 3 of the Offer to Purchase and in the
Instructions hereto will constitute the undersigned's acceptance of the terms
and conditions of the Offer, including the undersigned's representation and
warranty that (i) the undersigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (ii) the tender of such Shares complies
with Rule 14e-4. The Company's acceptance for payment of Shares tendered
pursuant to the Offer will constitute a binding agreement between the
undersigned and the Company upon the terms and subject to the conditions of the
Offer.
The undersigned understands that the Company will determine a single per
Share price (not greater than $14.75 nor less than $13.25 per Share) net to the
seller in cash, without interest thereon, (the "Purchase Price") that it will
pay for Shares validly tendered and not withdrawn pursuant to the Offer taking
into account the number of Shares so tendered and the prices specified by
tendering stockholders. The undersigned understands that the Company will select
the lowest Purchase Price that will enable it to purchase 850,000 Shares (or
such lesser number of Shares as are validly tendered and not withdrawn at prices
not greater than $14.75 nor less than $13.25 per Share) pursuant to the Offer.
The undersigned understands that all Shares properly tendered and not withdrawn
at prices at or below the Purchase Price will be purchased at the Purchase
Price, net to the seller in cash, without interest thereon, upon the terms and
subject to the conditions of the Offer, including its proration and conditional
tender provisions, and that the Company will return all other Shares, including
Shares tendered and not withdrawn at prices greater than the Purchase Price,
Shares not purchased because of proration and Shares that were conditionally
tendered and not accepted. The undersigned understands that tenders of Shares
pursuant to any one of the procedures described in Section 2 or 3 of the Offer
to Purchase and in the instructions hereto will constitute an agreement between
the undersigned and the Company upon the terms and subject to the conditions of
the Offer.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may
postpone the acceptance for payment of, or the payment for, Shares tendered or
may not be required to purchase any of the Shares tendered hereby or may accept
for payment fewer than all of the Shares tendered hereby.
Unless otherwise indicated under "Special Payment Instructions," please
issue the check for the purchase price of any Shares purchased, and/or return
any Shares not tendered or not purchased, in the name(s) of the undersigned
(and, in the case of Shares tendered by book-entry transfer, by credit to the
account at the Book-Entry Transfer Facility designated above). Similarly, unless
otherwise indicated under "Special Delivery Instructions," please mail the check
for the purchase price of any Shares purchased and/or any certificates for
Shares not tendered or not purchased (and accompanying documents, as
appropriate) to the undersigned at the address shown below the undersigned's
signature(s). In the event that both "Special Payment Instructions" and "Special
Delivery Instructions" are completed, please issue the check for the purchase
price of any Shares purchased and/or return any Shares not tendered or not
purchased in the name(s) of, and mail said check and/or any certificates to, the
person(s) so indicated. The undersigned recognizes that the Company has no
obligation, pursuant to the "Special Payment Instructions," to transfer any
Shares from the name of the registered holder(s) thereof if the Company does not
accept for payment any of the Shares so tendered.
<PAGE>
PRICE (IN DOLLARS) PER SHARE
AT WHICH SHARES ARE BEING TENDERED
(SEE INSTRUCTION 5)
- --------------------------------------------------------------------------------
CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX
IS CHECKED (EXCEPT AS PROVIDED IN THE ODD LOTS BOX AND INSTRUCTIONS BELOW),
THERE IS NO VALID TENDER OF SHARES.
- --------------------------------------------------------------------------------
[ ]$13.250 [ ]$13.500 [ ]$13.750 [ ]$14.000 [ ]$14.250 [ ]$14.500 [ ]$14.750
- --------------------------------------------------------------------------------
[ ]$13.375 [ ]$13.625 [ ]$13.875 [ ]$14.125 [ ]$14.375 [ ]$14.625
ODD LOTS
(SEE INSTRUCTION 9)
This section is to be completed ONLY if Shares are being tendered by or on
behalf of a person owning beneficially, as of the close of business on February
25, 1997, and who continues to own beneficially as of the Expiration Date, an
aggregate of fewer than 100 Shares.
The undersigned either (check one box):
[ ] was the beneficial owner as of the close of business on February 25,
1997, and continues to be the beneficial owner as of the Expiration Date,
of an aggregate of fewer than 100 Shares, all of which are being tendered,
or
[ ] is a broker, dealer, commercial bank, trust company or other nominee
that (i) is tendering, for the beneficial owners thereof, Shares with
respect to which it is the record owner, and (ii) believes, based upon
representations made to it by each such beneficial owner, that such
beneficial owner owned beneficially as of the close of business on February
25, 1997, and continues to own beneficially as of the Expiration Date, an
aggregate of fewer than 100 Shares, and is tendering all of such Shares.
If you do not wish to specify a purchase price, check the following box, in
which case you will be deemed to have tendered at the Purchase Price determined
by the Company in accordance with the terms of the Offer (persons checking this
box need not indicate the price per Share in the box entitled "Price (In
Dollars) Per Share At Which Shares Are Being Tendered" in this Letter of
Transmittal). [ ]
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 6, 7 AND 8)
To be completed ONLY if the check for the purchase price of Shares purchased
and/or certificates for Shares not tendered or not purchased are to be issued
in the name of someone other than the undersigned.
Issue [ ] check
and/or [ ] certificate(s) to:
Name__________________________________________________________________________
(Please Print)
Address_______________________________________________________________________
______________________________________________________________________________
(Include Zip Code)
______________________________________________________________________________
(Taxpayer Identification or Social Security No.)
<PAGE>
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 6, 7 AND 8)
To be completed ONLY if the check for the purchase price of Shares purchased
and/or certificates for Shares not tendered or not purchased are to be mailed to
someone other than the undersigned or to the undersigned at an address other
than that shown below the undersigned's signature(s).
Mail [ ] check
and/or [ ] certificate(s) to:
Name____________________________________________________________________________
(Please Print)
Address_________________________________________________________________________
________________________________________________________________________________
(Include Zip Code)
CONDITIONAL TENDER
A tendering stockholder may condition his or her tender of Shares upon the
purchase by the Company of a specified minimum number of the Shares tendered
hereby, all as described in the Offer to Purchase, particularly in Section 6
thereof. Unless at least such minimum number of Shares is purchased by the
Company pursuant to the terms of the Offer, none of the Shares tendered hereby
will be purchased. It is the tendering stockholder's responsibility to calculate
such minimum number of Shares, and each stockholder is urged to consult his or
her own tax advisor. Unless this box has been completed and a minimum specified,
the tender will be deemed unconditional.
Minimum number of Shares that must be purchased, if any are purchased:
__________________ Shares
SIGN HERE
(PLEASE COMPLETE SUBSTITUTE FORM W-9 INCLUDED IN THIS LETTER OF TRANSMITTAL)
_____________________________________ ________________________________________
(Signature(s) of Owner(s))
________________________________________________________________________________
_____________________________________ ________________________________________
(Please Print Name(s))
Dated: ____________________, 1997 Capacity (full title)________________________
_____________________________
Address_____________________________________________________(Include Zip Code)
Area Code and Telephone No._____________________________
(Must be signed by registered holder(s) exactly as name(s) appear(s) on stock
certificate(s) or on a security position listing or by person(s) authorized to
become registered holder(s) by certificates and documents transmitted herewith.
If signature is by a trustee, executor, administrator, guardian,
attorney-in-fact, officer of a corporation or other person acting in a fiduciary
or representative capacity, please set forth full title and see Instruction 6.)
<PAGE>
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 6)
Name of Firm___________________________Authorized Signature_____________________
Dated _________________, 1997
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. Guarantee of Signatures. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm that is a
member of a registered national securities exchange or the National Association
of Securities Dealers, Inc., or by a commercial bank, a trust company, a savings
bank, a savings and loan association or a credit union which has membership in
an approved Signature Guarantee Medallion Program (an "Eligible Institution").
Signatures on this Letter of Transmittal need not be guaranteed (a) if this
Letter of Transmittal is signed by the registered holder(s) of the Shares (which
term, for purposes of this document, shall include any participant in one of the
Book-Entry Transfer Facilities whose name appears on a security position listing
as the owner of Shares) tendered herewith and such holder(s) have not completed
the box entitled "Special Payment Instructions" or the box entitled "Special
Delivery Instructions" on this Letter of Transmittal or (b) if such Shares are
tendered for the account of an Eligible Institution. See Instruction 6.
2. Delivery of Letter of Transmittal and Shares. This Letter of Transmittal
or, in the case of a book-entry transfer, an Agent's Message (as defined below),
is to be used either if certificates are to be forwarded herewith or if delivery
of Shares is to be made by book-entry transfer pursuant to the procedures set
forth in Section 3 of the Offer to Purchase. Certificates for all physically
delivered Shares, or a confirmation of a book-entry transfer into the
Depositary's account at one of the Book-Entry Transfer Facilities of all Shares
delivered electronically, as well as a properly completed and duly executed
Letter of Transmittal (or manually signed copy thereof) and any other documents
required by this Letter of Transmittal, must be received by the Depositary at
its address as set forth on the front page of this Letter of Transmittal on or
prior to the Expiration Date (as defined in the Offer to Purchase). The term
"Agent's Message" means a message transmitted by a Book-Entry Transfer Facility
to, and received by, the Depositary and forming a part of a Book-Entry
confirmation, which states that such Book-Entry Transfer Facility has received
an express acknowledgement from the participant in such Book-Entry Transfer
Facility tendering the Shares, that such participant has received and agrees to
be bound by the terms of the Offer to Purchase and the Letter of Transmittal and
that the Company may enforce such agreement against the participant.
THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL, SHARE CERTIFICATES
AND ALL OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING
STOCKHOLDER, AND DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
DEPOSITARY. IF CERTIFICATES FOR SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH
RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
Except as specifically permitted by Section 6 of the Offer to Purchase, no
alternative or contingent tenders will be accepted. See Section 1 of the Offer
to Purchase. By executing this Letter of Transmittal (or facsimile thereof), the
tendering stockholder waives any right to receive any notice of the acceptance
for payment of the Shares.
<PAGE>
3. Inadequate Space. If the space provided herein is inadequate, the
certificate numbers and/or the number of Shares should be listed on a separate
signed schedule attached hereto.
4. Partial Tenders (Not Applicable to Stockholders Who Tender By Book-Entry
Transfer). If fewer than all the Shares represented by any certificate delivered
to the Depositary are to be tendered, fill in the number of Shares that are to
be tendered in the box entitled "Number of Shares Tendered." In such case, a new
certificate for the remainder of the Shares represented by the old certificate
will be sent to the person(s) signing this Letter of Transmittal, unless
otherwise provided in the "Special Payment Instructions" or "Special Delivery
Instructions" boxes on this Letter of Transmittal, as promptly as practicable
following the expiration or termination of the Offer. All Shares represented by
certificates delivered to the Depositary will be deemed to have been tendered
unless otherwise indicated.
5. Indication of Price at Which Shares Are Being Tendered. For Shares to be
validly tendered, the stockholder must check the box indicating the price per
Share at which he or she is tendering Shares under "Price (In Dollars) Per Share
at Which Shares Are Being Tendered" in this Letter of Transmittal, except that
any stockholder who owned beneficially as of the close of business on February
25, 1997, and continues to own beneficially as of the Expiration Date, an
aggregate of fewer than 100 Shares, may check the box above in the section
entitled "Odd Lots" indicating that such stockholder is tendering all Shares at
the Purchase Price determined by the Company. Only one box may be checked. If
more than one box is checked or if no box is checked (except as provided in the
Odd Lots box and this Instruction 5), there is no valid tender of Shares. A
stockholder wishing to tender portions of his or her Share holdings at different
prices must complete a separate Letter of Transmittal for each price at which he
or she wishes to tender each such portion of his or her Shares. The same Shares
cannot be tendered (unless previously validly withdrawn as provided in Section 4
of the Offer to Purchase) at more than one price.
6. Signatures on Letter of Transmittal; Stock Powers and Endorsements. If
this Letter of Transmittal is signed by the registered holder(s) of the Shares
hereby, the signature(s) must correspond with the name(s) as written on the face
of the certificates without alteration, enlargement or any change whatsoever.
If any of the Shares hereby is held of record by two or more persons, all
such persons must sign this Letter of Transmittal.
If any of the Shares tendered hereby are registered in different names on
different certificates, it will be necessary to complete, sign and submit as
many separate Letters of Transmittal as there are different registrations of
certificates.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares tendered hereby, no endorsements of certificates or separate stock powers
are required unless payment of the purchase price is to be made to, or Shares
not tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s). Signatures on any such certificates or
stock powers must be guaranteed by an Eligible Institution. See Instruction 1.
<PAGE>
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates evidencing the
Shares tendered hereby must be endorsed or accompanied by appropriate stock
powers, in either case, signed exactly as the name(s) of the registered
holder(s) appear(s) on the certificates for such Shares. Signature(s) on any
such certificates or stock powers must be guaranteed by an Eligible Institution.
See Instruction 1.
If this Letter of Transmittal or any certificate or stock power is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
the Company of the authority of such person so to act must be submitted.
7. Stock Transfer Taxes. The Company will pay or cause to be paid any stock
transfer taxes with respect to the sale and transfer of any Shares to it or its
order pursuant to the Offer. If, however, payment of the purchase price is to be
made to, or Shares not tendered or not purchased are to be registered in the
name of, any person other than the registered holder(s), or if tendered Shares
are registered in the name of any person other than the person(s) signing this
Letter of Transmittal, the amount of any stock transfer taxes (whether imposed
on the registered holder(s), such other person or otherwise) payable on account
of the transfer to such person will be deducted from the purchase price unless
satisfactory evidence of the payment of such taxes, or exemption therefrom, is
submitted. See Section 5 of the Offer to Purchase. EXCEPT AS PROVIDED IN THIS
INSTRUCTION 7, IT WILL NOT BE NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE
CERTIFICATES REPRESENTING SHARES TENDERED HEREBY.
8. Special Payment and Delivery Instructions. If the check for the purchase
price of any Shares purchased is to be issued in the name of, and/or any Shares
not tendered or not purchased are to be returned to, a person other than the
person(s) signing this Letter of Transmittal or if the check and/or any
certificates for Shares not tendered or not purchased are to be mailed to
someone other than the person(s) signing this Letter of Transmittal or to an
address other than that shown above in the box captioned "Description of Shares
Tendered," then the boxes captioned "Special Payment Instructions" and/or
"Special Delivery Instructions" on this Letter of Transmittal should be
completed. Stockholders tendering Shares by book-entry transfer will have any
Shares not accepted for payment returned by crediting the account maintained by
such stockholder at the Book-Entry Transfer Facility from which such transfer
was made.
9. Odd Lots. As described in the Offer to Purchase, if fewer than all
Shares validly tendered at or below the Purchase Price and not withdrawn on or
prior to the Expiration Date are to be purchased, the Shares purchased first
will consist of all Shares tendered by any stockholder who owned beneficially as
of the close of business on February 25, 1997, and continues to own beneficially
as of the Expiration Date, an aggregate of fewer than 100 Shares and who validly
and unconditionally tendered all such Shares at or below the Purchase Price
(including by not designating a Purchase Price as described above). Partial or
conditional tenders of Shares will not qualify for this preference. This
preference will not be available unless the box captioned "Odd Lots" in this
Letter of transmittal is completed.
<PAGE>
10. Substitute Form W-9 and Form W-8. The tendering stockholder is required
to provide the Depositary with either a correct Taxpayer Identification Number
("TIN") on Substitute Form W-9, which is provided under "Important Tax
Information" below, or a properly completed Form W-8. Failure to provide the
information on either Substitute Form W-9 or Form W-8 may subject the tendering
stockholder to 31% federal income tax backup withholding on the payment of the
purchase price. The box in Part 3 of Substitute Form W-9 may be checked if the
tendering stockholder has not been issued a TIN and has applied for a number or
intends to apply for a number in the near future. If the box in Part 3 is
checked and the Depositary is not provided with a TIN by the time of payment,
the Depositary will withhold 31% on all payments of the purchase price
thereafter until a TIN is provided to the Depositary.
11. Requests for Assistance or Additional Copies. Any questions or requests
for assistance may be directed to the Information Agent or the Dealer Managers
at their respective telephone numbers and addresses listed below. Requests for
additional copies of the Offer to Purchase, this Letter of Transmittal or other
tender offer materials may be directed to the Information Agent or the Dealer
Managers and such copies will be furnished promptly at the Company's expense.
Stockholders may also contact their local broker, dealer, commercial bank or
trust company for assistance concerning the Offer.
12. Irregularities. All questions as to the Purchase Price, the form of
documents, and the validity, eligibility (including time of receipt) and
acceptance of any tender of Shares will be determined by the Company, in its
sole discretion, and its determination shall be final and binding. The Company
reserves the absolute right to reject any or all tenders of Shares that it
determines are not in proper form or the acceptance for payment of or payment
for Shares that may, in the opinion of the Company's counsel, be unlawful.
Except as otherwise provided in the Offer to Purchase, the Company also reserves
the absolute right to waive any of the conditions to the Offer or any defect or
irregularity in any tender of Shares and the Company's interpretation of the
terms and conditions of the Offer (including these instructions) shall be final
and binding. Unless waived, any defects or irregularities in connection with
tenders must be cured within such time as the Company shall determine. None of
the Company, the Dealer Managers, the Depositary, the Information Agent or any
other person shall be under any duty to give notice of any defect or
irregularity in tenders, nor shall any of them incur any liability for failure
to give any such notice. Tenders will not be deemed to have been made until all
defects and irregularities have been cured or waived.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED COPY THEREOF)
TOGETHER WITH CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, ON OR PRIOR TO THE
EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under federal income tax law, a stockholder whose tendered Shares are
accepted for payment is required to provide the Depositary (as payer) with such
stockholder's correct TIN on Substitute Form W-9 below. If such stockholder is
an individual, the TIN is his or her social security number. For businesses and
other entities, the number is the employer identification number. If the
Depositary is not provided with the correct TIN or properly completed Form W-8,
the stockholder may be subject to a $50 penalty imposed by the Internal Revenue
Service. In addition, payments that are made to such stockholder with respect to
Shares purchased pursuant to the Offer may be subject to backup withholding.
<PAGE>
Certain stockholders (including, among others, all corporations and certain
foreign individuals and entities) are not subject to these backup withholding
and reporting requirements. In order for a noncorporate foreign stockholder to
qualify as an exempt recipient, that stockholder must complete and sign a Form
W-8, Certificate of Foreign Status, attesting to that stockholder's exempt
status. The Form W-8 can be obtained from the Depositary. Exempt stockholders,
other than noncorporate foreign stockholders, should furnish their TIN in Part 1
and check the box in Part 4 of the Substitute Form W-9 below and sign, date and
return the Substitute Form W-9 to the Depositary. See the enclosed Guidelines
for Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If federal income tax backup withholding applies, the Depositary is
required to withhold 31% of any payments made to the stockholder. Backup
withholding is not an additional tax. Rather, the federal income tax liability
of persons subject to backup withholding will be reduced by the amount of the
tax withheld. If withholding results in an overpayment of taxes, a refund may be
obtained.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on payments that are made to a stockholder with
respect to Shares purchased pursuant to the Offer, the stockholder is required
to notify the Depositary of his or her correct TIN by completing the Substitute
Form W-9 included in this Letter of Transmittal certifying that the TIN provided
on Substitute Form W-9 is correct and that (1) the stockholder has not been
notified by the Internal Revenue Service that he or she is subject to federal
income tax backup withholding as a result of failure to report all interest or
dividends or (2) the Internal Revenue Service has notified the stockholder that
he or she is no longer subject to federal income tax backup withholding. Foreign
stockholders must submit a properly completed Form W-8 in order to avoid the
applicable backup withholding; provided, however, that backup withholding will
not apply to foreign stockholders subject to 30% (or lower treaty rate)
withholding on gross payments received pursuant to the Offer.
WHAT NUMBER TO GIVE THE DEPOSITARY
The stockholder is required to give the Depositary the social security
number or employer identification number of the registered owner of the Shares.
If the Shares are in more than one name or are not in the name of the actual
owner, consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidance on which
number to report.
<PAGE>
PAYER'S NAME: Registrar and Transfer Company
SUBSTITUTE
Form W-9
(See Instruction 10)
Please fill in your name and address below.
- ------------------------------------------
Name
- ------------------------------------------
Address (number and street)
- ------------------------------------------
City, State and Zip Code
Department of the Treasury
Internal Revenue Service
Payer's Request for Taxpayer
Identification Number
Part 1 -- PLEASE PROVIDE YOUR TIN IN THE BOX AT THE RIGHT AND CERTIFY BY SIGNING
AND DATING BELOW.
- ------------------------------------------
Social Security Number
OR
- ------------------------------------------
Employer Identification Number
Part 2 -- Certification -- Under Penalties of Perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification Number
(or I am waiting for a number to be issued to me), (2) I am not subject to
backup withholding because (a) I am exempt from backup withholding, or (b) I
have not been notified by the Internal Revenue Service ("IRS") that I am subject
to backup withholding as a result of failure to report all interest or dividends
or (c)the IRS has notified me that I am no longer subject to backup withholding,
and (3) all other information provided on this form is true, correct and
complete.
Part 3 --
Awaiting TIN [ ]
Part 4 -- For Payee Exempt from Backup Withholding
Exempt [ ]
<PAGE>
Certificate Instructions -- You must cross out Item (2) in Part 2 above if you
have been notified by the IRS that you are currently subject to backup
withholding because of under reporting interest or dividends on your tax return.
However, if after being notified by the IRS that you were subject to backup
withholding, you received another notification from the IRS stating that you are
no longer subject to backup withholding, do not cross out Item (2). If you are
exempt from backup withholding, check the box in Part 4 above.
SIGNATURE ___________________________________________DATE ________________, 1997
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE
ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON
SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF
THE SUBSTITUTE FORM W-9
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has
not been issued to me, and either (1) I have mailed or delivered an application
to receive a taxpayer identification number to the appropriate Internal Revenue
Service Center or Social Security Administration Office or (2) I intend to mail
or deliver an application in the near future. I understand that if I do not
provide a taxpayer identification number to you by the time of payment, you are
required to withhold 31% of all reportable payments thereafter made to me until
I provide a number.
Signature______________________________________ Date____________________________
<PAGE>
The Information Agent:
D.F. KING & CO., INC.
77 Water Street
New York, New York 10005
Bankers and Brokers Call Collect:
(212) 269-5550
ALL OTHERS CALL TOLL FREE:
1-800-758-5880
The Dealer Managers:
Robert W. Baird & Co. Incorporated
777 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Telephone: (414) 298-7666 (call collect)
Telephone: (888) 224-7326 (toll free)
Friedman, Billings, Ramsey & Co., Inc.
Potomac Tower
1001 Nineteenth Street North
Arlington, Virginia 22209-1710
Telephone: (703) 312-9500 (call collect)
Telephone: (800) 846-5050 (toll free)
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
Guidelines for Determining the Proper Identification Number to Give the Payer.
- -- Social Security numbers have nine digits separated by two hyphens: i.e.
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen: i.e. 00-0000000. The table below will help determine the number to
give the payer.
- --------------------------------------------------------------------------------
Give the
SOCIAL SECURITY
For this type of account number of--
- --------------------------------------------------------------------------------
1. An individual's account The individual
2. Two or more individuals The actual owner of the
(joint account) account or, if combined
funds, any one of the
individuals(1)
3. Husband and wife (joint The actual owner of the
account) account or, if joint
funds, either person(1)
4. Custodian account of The minor(2)
minor (Uniform Gift to
Minors Act)
5. Adult and minor (joint The adult or, if the
account) minor is the only
contributor, the minor(1)
6. Account in the name of The ward, minor, or
guardian or committee for incompetent person(3)
a designated ward, minor,
or incompetent person
7. a. The usual revocable The grantor-trustee(1)
savings trust account
(grantor is also trustee)
b. So-called trust The actual owner(1)
account that is not a
legal or valid trust
under State law
<PAGE>
- --------------------------------------------------------------------------------
Give the
SOCIAL SECURITY
For this type of account number of--
- --------------------------------------------------------------------------------
8. Sole proprietorship The owner(4)
account
9. A valid trust, estate, or The legal entity (do not
pension trust furnish the identifying
number of the personal
representative or trustee
unless the legal entity
itself is not designated
in the account title.)(5)
10. Corporate account The corporation
11. Religious, charitable, or The organization
educational organization
account
12. Partnership account held The partnership
in the name of the
business
13. Association, club, or The organization
other tax-exempt
organization
14. A broker or registered The broker or nominee
nominee
15. Account with the The public entity
Department of Agriculture
in the name of a public
entity (such as a State
or local government,
school district, or
prison) that receives
agricultural program
payments
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
(4)Show the name of the owner.
(5) List first and circle the name of the legal trust, estate, or pension trust.
NOTE: If no name is circled when there is more than one name, the number will be
considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
Obtaining a Number
If you don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
Payees Exempt fromBackup Withholding
Payees specifically exempted from backup withholding on ALLpayments include
the following:
* A corporation
* A financial institution
* An organization exempt from tax under section 501(a), or an individual
retirement plan.
* The United States or any agency or instrumentality thereof.
* A State, the District of Columbia, a possession of the United States, or
any subdivision or instrumentality thereof.
* A foreign government, a political subdivision of a foreign government, or
any agency or instrumentality thereof.
* An international organization or any agency, or instrumentality thereof.
* A registered dealer in securities or commodities registered in the U.S.
or a possession of the U.S.
* A real estate investment trust.
* A common trust fund operated by a bank under section 584(a).
* An exempt charitable remainder trust, or a non-exempt trust described in
section 4947(a)(1).
* An entity registered at all times under the Investment Company Act of
1940.
* A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to
backup withholding include the following:
* Payments to nonresident aliens subject to withholding under section 1441.
<PAGE>
* Payments to partnerships not engaged in a trade or business in the U.S.
and which have at least one nonresident partner.
* Payments of patronage dividends where the amount received is not paid in
money.
* Payments made by certain foreign organizations.
* Payments made to a nominee.
Payments of interest not generally subject to backup withholding include
the following:
* Payments of interest on obligations issued by individuals. Note:You may
be subject to backup withholding if this interest is $600 or more and is paid in
the course of the payer's trade or business and you have not provided your
correct taxpayer identification number to the payer.
* Payments of tax-exempt interest (including exempt-interest dividends
under section 852).
* Payments described in section 6049(b)(5) to nonresident aliens.
* Payments on tax-free covenant bonds under section 1451.
* Payments made by certain foreign organizations.
* Payments made to a nominee.
Exempt payees described above should file Form W-9 to avoid possible
erroneous backup withholding. FILETHIS FORM WITH THE PAYER, FURNISH YOUR
TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT"ON THE FACE OF THE FORM, AND
RETURN IT TO THE PAYER. IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE
DIVIDENDS, ALSO SIGN AND DATE THE FORM.
Certain payments other than interest, dividends, and patronage dividends,
that are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under sections 6041, 6041A(a),
6045 and 6050A.
Privacy Act Notice. -- Section 6109 requires most recipients of dividend,
interest, or other payments to give taxpayer identification numbers to payers
who must report the payments to IRS. IRS uses the numbers for identification
purposes. Payers must be given the numbers whether or not recipients are
required to file tax returns. Effective January 1, 1993, payers must generally
withhold 31% of taxable interest, dividend, and certain other payments to a
payee who does not furnish a taxpayer identification number to a payer. Certain
penalties may also apply.
Penalties
(1) Penalty for Failure to Furnish Taxpayer Identification Number. -- If
you fail to furnish your taxpayer identification number to a payer, you are
subject to a penalty of $50 for each such failure unless your failure is due to
reasonable cause and not to willful neglect.
<PAGE>
(2) Failure to ReportCertain Dividend and Interest Payments. -- If you fail
to include any portion of an includable payment for interest, dividends, or
patronage dividends in gross income, such failure will be treated as being due
to negligence and will be subject to a penalty of 5% on any portion of an
underpayment attributable to that failure unless there is clear and convincing
evidence to the contrary.
(3) Civil Penalty for False Information With Respect to Withholding. -- If
you make a false statement with no reasonable basis which results in no
imposition of backup withholding, you are subject to a penalty of $500.
(4) Criminal Penalty for Falsifying Information. -- Falsifying
certifications or affirmations may subject you to criminal penalties including
fines and/or imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL
REVENUE SERVICE.
<PAGE>
Exhibit (a)(3)
Robert W. Baird & Co. Incorporated
777 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Telephone: (414) 298-7666 (call collect)
Telephone: (888) 224-7326 (toll free)
and
Friedman, Billings, Ramsey & Co., Inc.
Potomac Tower
1001 Nineteenth Street North
Arlington, Virginia 22209-1710
Telephone: (703) 312-9500 (call collect)
Telephone: (800) 846-5050 (toll free)
---------------------------
DAMEN FINANCIAL CORPORATION
Offer To Purchase For Cash Up To
850,000 Shares Of Its Common Stock
At A Purchase Price Not In Excess Of $14.75
Nor Less Than $13.25 Per Share
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT
5:00 P.M., NEW YORK CITY TIME, ON MARCH 27, 1997,
UNLESS THE OFFER IS EXTENDED.
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
Damen Financial Corporation, a Delaware corporation (the "Company"),
has appointed us to act as Dealer Managers in connection with its offer to
purchase for cash up to 850,000 shares of its Common Stock, $0.01 par value per
share (the "Shares"), at prices not in excess of $14.75 nor less than $13.25 per
Share, specified by stockholders tendering their Shares, upon the terms and
subject to the conditions set forth in the Company's Offer to Purchase, dated
February 27, 1997, and in the related Letter of Transmittal (which together
constitute the "Offer").
The Company will determine the single per Share price, not in excess of
$14.75 nor less than $13.25 per Share, net to the seller in cash (the "Purchase
Price"), that it will pay for Shares validly tendered pursuant to the Offer,
taking into account the number of Shares so tendered and the prices specified by
tendering stockholders. The Company will select the lowest Purchase Price that
will allow it to buy 850,000 Shares (or such lesser number of Shares as are
properly tendered at prices not in excess of $14.75 nor less than $13.25 per
Share). All Shares validly tendered at prices at or below the Purchase Price and
not withdrawn on or prior to the Expiration Date (as defined in Section 1 of the
Offer to Purchase) will be purchased at the Purchase Price, subject to the terms
and conditions of the Offer, including the proration and conditional tender
provisions. See Sections 1 and 16 of the Offer to Purchase.
<PAGE>
Upon the terms and subject to the conditions of the Offer, if, at the
expiration of the Offer, more than 850,000 Shares are validly tendered at or
below the Purchase Price and not withdrawn, the Company will buy Shares (i) from
stockholders who owned beneficially as of the close of business on February 25,
1997, and continue to own beneficially as of the Expiration Date, an aggregate
of fewer than 100 Shares who properly tender all their Shares at or below the
Purchase Price, and (ii) then, on a pro rata basis, from all other stockholders
who properly tender their Shares at prices at or below the Purchase Price (and
do not withdraw them prior to the expiration of the Offer), other than
stockholders who tender conditionally, and for whom the condition is not
satisfied. See Sections 1, 2 and 6 of the Offer to Purchase. All Shares not
purchased pursuant to the Offer, including Shares tendered at prices greater
than the Purchase Price and Shares not purchased because of proration or because
they were conditionally tendered and not accepted for purchases will be returned
to the tendering stockholders at the Company's expense as promptly as
practicable following the Expiration Date.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED PURSUANT TO THE OFFER. SEE SECTION 7 OF THE OFFER TO PURCHASE.
No fees or commissions will be payable to brokers, dealers or any
person for soliciting tenders of Shares pursuant to the Offer other than fees
paid to the Dealer Managers as described in the Offer to Purchase. The Company
will, upon request, reimburse brokers and banks for reasonable and customary
handling and mailing expenses incurred by them in forwarding materials relating
to the Offer to their customers. The Company will pay all stock transfer taxes
applicable to its purchase of Shares pursuant to the Offer, subject to
Instruction 7 of the Letter of Transmittal.
No broker, dealer, bank, trust company or fiduciary shall be deemed to
be the agent of the Company, Registrar and Transfer Company as "Depositary," the
Dealer Managers or D. F. King & Co., Inc., as "Information Agent," for purposes
of the Offer.
For your information and for forwarding to your clients for whom you
hold Shares registered in your name or in the name of your nominee, we are
enclosing the following documents:
1. Offer to Purchase, dated February 27, 1997;
2. Letter to Clients which may be sent to your clients for whose
accounts you hold Shares registered in your name or in the
name of your nominee, with space provided for obtaining such
clients' instructions with regard to the Offer;
3. Letter, dated February 27, 1997, from Mary Beth Poronsky
Stull, President and Chief Executive Officer of the Company,
to stockholders of the Company;
4. Letter of Transmittal for your use and for the information of
your clients (together with accompanying Form W-9 and
guidelines); and
5. A return envelope addressed to Registrar and Transfer Company,
as Depositary.
<PAGE>
WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. THE OFFER,
PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON MARCH 27, 1997, UNLESS THE OFFER IS EXTENDED.
In order to take advantage of the Offer, a duly executed and properly
completed Letter of Transmittal and any other required documents should be sent
to the Depositary with either certificate(s) representing the tendered Shares or
confirmation of their book-entry transfer, all in accordance with the
instructions set forth in the Letter of Transmittal and the Offer to Purchase.
Any inquiries you may have with respect to the Offer should be
addressed to the Depositary, the Information Agent or the Dealer Managers at
their respective addresses and telephone numbers set forth on the back cover
page of the Offer to Purchase.
Additional copies of the enclosed material may be obtained from the
Information Agent, telephone: (800) 758-5880 or, in New York, (212) 269-5550.
Very truly yours,
Robert W. Baird & Co. Incorporated
Friedman, Billings, Ramsey & Co., Inc.
Enclosures
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR
ANY OTHER PERSON AS AN AGENT OF THE COMPANY OR ANY OF ITS AFFILIATES, THE DEALER
MANAGERS OR THE DEPOSITARY, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY
DOCUMENT OR MAKE ANY STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE
OFFER OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED
THEREIN.
<PAGE>
Exhibit (a)(4)
DAMEN FINANCIAL CORPORATION
Offer To Purchase For Cash Up To
850,000 Shares Of Its Common Stock
At A Purchase Price Not In Excess Of $14.75
Nor Less Than $13.25 Per Share
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT
5:00 P.M., NEW YORK CITY TIME, ON MARCH 27, 1997,
UNLESS THE OFFER IS EXTENDED.
To Our Clients:
Enclosed for your consideration are the Offer to Purchase, dated
February 27, 1997, and the related Letter of Transmittal (which together
constitute the "Offer") in connection with the Offer by Damen Financial
Corporation, a Delaware corporation (the "Company"), to purchase up to 850,000
shares of its Common Stock, $0.01 par value per share (the "Shares"), at prices
not in excess of $14.75 nor less than $13.25 per Share, as specified by
tendering stockholders, upon the terms and subject to the conditions set forth
in the Offer.
The Company will determine the single per Share price, not in excess of
$14.75 nor less than $13.25 per Share, net to the seller in cash (the "Purchase
Price"), that it will pay for Shares validly tendered pursuant to the Offer,
taking into account the number of Shares so tendered and the prices specified by
tendering stockholders. The Company will select the lowest Purchase Price that
will allow it to buy 850,000 Shares (or such lesser number of Shares as are
validly tendered at prices not in excess of $14.75 nor less than $13.25 per
Share). All Shares properly tendered at prices at or below the Purchase Price
and not withdrawn on or prior to the Expiration Date (as defined in Section 1 of
the Offer to Purchase) will be purchased at the Purchase Price, subject to the
terms and conditions of the Offer, including the proration and conditional
tender provisions. See Sections 1 and 16 of the Offer to Purchase.
Upon the terms and subject to the conditions of the Offer, if, at the
expiration of the Offer, more than 850,000 Shares are validly tendered at or
below the Purchase Price and not withdrawn, the Company will buy Shares (i) from
stockholders who owned beneficially as of the close of business on February 25,
1997, and continue to own beneficially as of the Expiration Date an aggregate of
fewer than 100 Shares who properly tender all their Shares at prices at or below
the Purchase Price, and (ii) then, on a pro rata basis, from all other
stockholders who properly tender at or below the Purchase Price (and do not
withdraw them prior to the expiration of the Offer), other than stockholders who
tender conditionally and for whom the condition is not satisfied. See Sections
1, 2 and 6 of the Offer to Purchase. All Shares not purchased pursuant to the
Offer, including Shares tendered at prices greater than the Purchase Price and
Shares not purchased because of proration or because they were conditionally
tendered and not accepted for purchase will be returned to the tendering
stockholders at the Company's expense as promptly as practicable following the
Expiration Date.
<PAGE>
We are the owner of record of Shares held for your account. As such, we
are the only ones who can tender your Shares, and then only pursuant to your
instructions. We are sending you the Letter of Transmittal for your information
only; you cannot use it to tender Shares we hold for your account.
Please instruct us as to whether you wish us to tender any or all of
the Shares we hold for your account on the terms and subject to the conditions
of the Offer.
We call your attention to the following:
1. You may tender Shares at prices not in excess of $14.75 nor
less than $13.25 per Share as indicated in the attached
Instruction Form, net to you in cash.
2. You may tender your Shares conditioned upon the Company's
purchasing all or a minimum number of your Shares.
3. The Offer is not conditioned on any minimum number of Shares
being tendered pursuant to the Offer.
4. The Offer, proration period and withdrawal rights will expire
at 5:00 p.m., New York City time, on March 27, 1997, unless
the Company extends the Offer.
5. The Offer is for 850,000 Shares, constituting approximately
22.5% of the Shares outstanding as of February 25, 1997.
6. Tendering stockholders will not be obligated to pay any stock
transfer taxes on the Company's purchase of Shares pursuant to
the Offer, subject to Instruction 7 of the Letter of
Transmittal.
7. If you beneficially held, as of the close of business on
February 25, 1997, an aggregate of fewer than 100 Shares and
you continue to beneficially own as of the Expiration Date an
aggregate of fewer than 100 Shares, and you instruct us to
tender on your behalf all such Shares at or below the Purchase
Price before the Expiration Date (as defined in the Offer to
Purchase) and complete the box captioned "Odd Lots" in the
attached Instruction Form, the Company, upon the terms and
subject to the conditions of the Offer, will accept all such
Shares for purchase before proration, if any, of the purchase
of other Shares validly tendered at or below the Purchase
Price.
8. If you wish to tender portions of your Shares at different
prices, you must complete a separate Instruction Form for each
price at which you wish to tender each such portion of your
Shares. We must submit separate Letters of Transmittal on your
behalf for each price you will accept.
If you wish to have us tender any or all of your Shares, please so
instruct us by completing, executing, detaching and returning to us the attached
Instruction Form. An envelope to return your Instruction Form to us is enclosed.
If you authorize us to tender your Shares, we will tender all such Shares unless
you specify otherwise on the attached Instruction Form.
<PAGE>
YOUR INSTRUCTION FORM SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT
US TO SUBMIT A TENDER ON YOUR BEHALF ON OR BEFORE THE EXPIRATION DATE OF THE
OFFER. THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON MARCH 27, 1997, UNLESS THE COMPANY EXTENDS THE OFFER.
As described in Section 1 of the Offer to Purchase, if more than
850,000 Shares have been validly tendered at prices at or below the Purchase
Price and not withdrawn on or prior to the Expiration Date (as defined in the
Offer to Purchase), the Company will purchase properly tendered Shares on the
basis set forth below:
(a) first, all Shares validly tendered and not withdrawn on or prior to
the Expiration Date by or on behalf of any stockholder who owned beneficially,
as of the close of business on February 25, 1997 and continues to own
beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares
who:
(1) validly tender all of such Shares at a price at or below
the Purchase Price (partial and conditional tenders will not qualify
for this preference); and
(2) completes the box captioned "Odd Lots" on the Letter of
Transmittal; and
(b) second, after purchase of all of the forgoing Shares, all other
Shares validly and conditionally tendered at prices at or below the Purchase
Price in accordance with Section 6 of the Offer to Purchase for which the
condition was satisfied, and all other Shares validly and unconditionally
tendered at or below the Purchase Price and not withdrawn on or prior to the
Expiration Date on a pro rata basis (with appropriate adjustments to avoid
purchases of fractional Shares) as described in Section 1 of the Offer to
Purchase; and
(c) third, if necessary, Shares validly and conditionally tendered at
or below the Purchase Price and not withdrawn on or prior to the Expiration
Date, selected by lot in accordance with Section 6 of the Offer to Purchase.
You may condition your tender on the Company purchasing a minimum
number of your tendered Shares. In such case, if as a result of the proration
provisions in the Offer to Purchase the Company would purchase less than such
minimum number of your Shares, then the Company will not purchase any of your
Shares, except as provided in the next sentence. If so many conditional tenders
would be deemed withdrawn that the total number of such Shares to be purchased
falls below 850,000 Shares, then to the extent feasible, the Company will select
enough of such conditional tenders that would otherwise have been so withdrawn
to permit the Company to purchase 850,000 Shares. In selecting among such
conditional tenders, the Company will select by lot and will limit its purchase
in each case to the minimum number of Shares designated. See Sections 1 and 6 of
the Offer to Purchase.
<PAGE>
The Offer is being made to all holders of Shares. The Company is not
aware of any jurisdiction where the making of the Offer is not in compliance
with applicable law. If the Company becomes aware of any jurisdiction where the
making of the Offer is not in compliance with any valid applicable law, the
Company will make a good faith effort to comply with such law. If, after such
good faith effort, the Company cannot comply with such law, the Offer will not
be made to, nor will tenders be accepted from or on behalf of, holders of Shares
residing in such jurisdiction. In any jurisdiction the securities or blue sky
laws of which require the Offer to be made by a licensed broker or dealer, the
Offer is being made on the Company's behalf by the Dealer Managers or one or
more registered brokers or dealers licensed under the laws of such jurisdiction.
<PAGE>
INSTRUCTION FORM
for Shares Held by Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees.
INSTRUCTIONS FOR TENDER OF SHARES OF DAMEN FINANCIAL CORPORATION
Please tender to Damen Financial Corporation (the "Company"), on (our) (my)
behalf, the number of Shares indicated below, which are beneficially owned by
(us) (me) and registered in your name, upon terms and subject to the conditions
contained in the Offer to Purchase of the Company dated February 27, 1997, and
the related Letter of Transmittal, the receipt of both of which is acknowledged.
Number of Shares to be tendered: ________ Shares
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED
(See Instruction on the Letter of Transmittal)
CHECK ONLY ONE BOX.
IF MORE THAN ONE BOX IS CHECKED OR IF NO BOX IS CHECKED,
THERE IS NO PROPER TENDER OF SHARES
I hereby tender Shares at the price checked below. This action could result in
none of my Shares being purchased if the Purchase Price for the Shares is less
than the price checked.
Price (in dollars) per Share at which Shares are being tendered (See Instruction
5 on the Letter of Transmittal):
[ ] $13.250 [ ] $13.625 [ ] $14.000 [ ] $14.375 [ ] $14.625
[ ] $13.375 [ ] $13.750 [ ] $14.125 [ ] $14.500 [ ] $14.750
[ ] $13.500 [ ] $13.875 [ ] $14.250
ODD LOTS
(See Instruction 9 on the Letter of Transmittal)
[ ] Check here ONLY if I was the beneficial owner as of the close of business
on February 25, 1997, and continue to be the beneficial owner as of the
Expiration Date, of an aggregate of fewer than 100 Shares, all of which are
being tendered.
[ ] The Odd Lot Shares are being tendered at the price per Share indicated
above in the box entitled "Price (In Dollars) Per Share At Which Shares Are
Being Tendered."
OR
[ ] By checking this one box INSTEAD OF ONE OF THE PRICE BOXES ABOVE, I hereby
tender Shares and I am willing to accept the Purchase Price determined by
the Company in accordance with the terms of the Offer. This action will
result in my receiving a price per Share of as low as $13.25 or as high as
$14.75.
<PAGE>
CONDITIONAL TENDER
(See the box captioned "Conditional Tender" on the Letter of Transmittal)
[ ] Check here ONLY if my tender of Shares is conditional on the Company
purchasing all or a minimum number of the tendered Shares, and as set forth
below:
Minimum number of Shares that must be purchased, if any are
purchased:
____________ Shares
The Shares I conditionally tendered are being tendered at the price per Share
indicated above in the box captioned "Price (In Dollars) Per Share At Which
Shares Are Being Tendered."
THE METHOD OF DELIVERY OF THIS DOCUMENT IS AT THE OPTION AND RISK OF
THE TENDERING STOCKHOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN
RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT
TIME SHOULD BE ALLOWED TO ASSURE DELIVERY.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE
OFFER. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS, HOWEVER, MAKES ANY
RECOMMENDATION TO ANY STOCKHOLDER AS TO WHETHER TO TENDER ALL OR ANY SHARES.
EACH STOCKHOLDER MUST MAKE HIS OR HER OWN DECISION AS TO WHETHER TO TENDER
SHARES AND, IF SO, HOW MANY TO TENDER AND AT WHAT PRICE. THE COMPANY HAS BEEN
ADVISED THAT NO DIRECTOR OR EXECUTIVE OFFICER INTENDS TO TENDER SHARES PURSUANT
TO THE OFFER. THE COMPANY HAS ALSO BEEN ADVISED THAT THE TRUSTEE OF THE
COMPANY'S EMPLOYEE STOCK OWNERSHIP PLAN DOES NOT INTEND TO TENDER ANY SHARES
PURSUANT TO THE OFFER.
Signature(s):___________________________ Address: ____________________________
________________________________________ ____________________________________
(Including Zip Code)
Name(s): _________________________________________
(Please Print)
_________________________________________
(Please Print)
Area Code and Telephone Number: ________________________
Date: __________________, 1997
___________________________________________________
(Employer Identification or Social Security Number)
IMPORTANT: STOCKHOLDERS ARE ENCOURAGED TO RETURN A COMPLETED FORM W-9 WITH THEIR
INSTRUCTION FORM.
<PAGE>
Exhibit (a)(5)
DAMEN FINANCIAL CORPORATION
February 27, 1997
Dear Stockholders of Damen Financial Corporation:
Over time, Damen Financial Corporation's profitable operations have
contributed to the growth of a capital base that exceeds all applicable
regulatory standards and the amount of capital needed to support the Company's
banking business. After evaluating a variety of alternatives to utilize this
strong capital base more effectively and to maximize value to our stockholders,
we have determined that a repurchase of our own shares is currently the best
alternative to accomplish those objectives. The Board of Directors has approved
a repurchase of 850,000 shares of the Company's common stock, or 22.5 percent of
our approximately 3.8 million outstanding shares. A copy of the Offer to
Purchase is enclosed.
The Company is conducting the offer through a procedure referred to as
a "Modified Dutch Auction." This procedure allows you to select the price at
which you are willing to sell, or tender, all or part of your shares within a
price range of not more than $14.75 per share and not less than $13.25 per
share. Upon expiration of the offer, we will select the lowest purchase price
from those shares tendered that will allow us to buy 850,000 shares. All shares
purchased in the offer will receive the same purchase price, even those shares
that are tendered below the purchase price. In addition, if you own less than
100 shares and tender all of your shares at or below the purchase price, you
will receive priority and have all of your shares purchased even if more than
850,000 shares are tendered.
We encourage each stockholder to read carefully the Offer to Purchase
and related materials. Neither Damen Financial Corporation nor our Board of
Directors makes any recommendation whether to tender shares to the Company. You
should make your decision independently after consulting with your advisors.
To assist us with this offer, we have engaged Robert W. Baird & Co.
Incorporated and Friedman, Billings, Ramsey & Co., Inc. to serve as the Dealer
Managers and D. F. King & Co., Inc. to serve as Information Agent.
Representatives from these firms may contact you by phone to make sure you have
received the Offer to Purchase and related materials and to answer any questions
you may have. If you need information or additional forms, please call toll-free
the Information Agent at 800-758-5880, Robert W. Baird & Co. Incorporated at
888-224-7326 or Friedman, Billings, Ramsey & Co., Inc. at 800-846-5050.
<PAGE>
Unless otherwise extended, the offer will expire at 5:00 p.m. New York
City time on March 27, 1997. We again encourage you to read carefully the
enclosed material.
As always, we appreciate your interest in Damen Financial Corporation.
Sincerely,
/s/Mary Beth Poronsky Stull
---------------------------
Mary Beth Poronsky Stull
President and Chief Executive Officer
<PAGE>
Exhibit (a)(6)
MEMO PLEASE CIRCULATE
DATE: February 25, 1997
TO: All Staff
FROM: Mary Beth Poronsky Stull, President and CEO
RE: Tender Offer for Damen Financial's Common Stock
Damen Financial's Board of Directors has approved the purchase of
850,000 shares of our common stock by means of what is termed a "Modified Dutch
Auction Tender." It is more fully described in the attached news release. We
have made every effort to communicate this action to members of our local
community as quickly as possible. Below you will find the answers to some
questions that are likely to arise from our public announcement. We will provide
further information if additional questions come up.
Question: Why is Damen Financial offering to repurchase its stock?
Answer: Over time, Damen Financial's profitable operations have
contributed to the growth of a capital base that exceeds all
applicable regulatory standards and the amount of capital
needed to support our banking business. After evaluating a
variety of alternatives to utilize more effectively our
capital base and to attempt to maximize stockholder value,
Damen Financial's management and its Board of Directors
believe that the purchase of Shares pursuant to the Offer is a
positive action that is intended to improve returns to our
stockholders.
Question: Who's idea was this?
Answer: With the assistance of Robert W. Baird & Co. Incorporated
("Baird") and Friedman, Billings, Ramsey & Co., Inc. ("FBR"),
management has conducted a detailed analysis of Damen
Financial's capital structure to determine how to maximize
stockholder value by improving return on stockholders' equity
while maintaining a high level of financial security and
preserving future strategic options. Based upon the results of
a series of financial models developed by Baird and FBR, a
purchase of shares appeared to be the best means to accomplish
the desired objectives. The Modified Dutch Auction Tender
method was determined to be the best way to acquire shares in
the shortest period of time.
<PAGE>
Question: How should I respond to questions?
Answer: Damen Financial has hired a special Information Agent to
handle all questions. The Information Agent is D. F. King &
Co., Inc. and their toll-free telephone number is
800-758-5880. Because Damen Financial is the purchaser of the
shares, and because securities laws are involved, it is highly
important that all questions be referred to the Information
Agent. No member of Damen Financial's staff is allowed or
authorized to answer any questions or give any advice
regarding the tender offer. We are aware that many
stockholders are customers of the bank and have ties or
relationships with staff members. You should handle these
situations as diplomatically as possible, but in any event,
all questions must be referred either to the Information Agent
or the holder's broker or investment advisor.
Question: What do I say if a stockholder asks, "Should I sell (tender)
my stock?"
Answer: Members of the Damen Financial staff must not give any
investment advice to stockholders. The stockholder must make
his or her own investment decision. You should not express an
opinion as to whether you think the tender offer is a "good
deal" or a "bad deal." While the stockholder may call the
Information Agent or the Dealer Managers (Baird and FBR), they
will not receive investment advice from either organization.
They should be directed to contact their broker or investment
advisor.
Question: What do I do if someone brings a Letter of Transmittal to me
or my office or sends it to our office by mail?
Answer: Because tenders must be received by Registrar and Transfer
Company within a limited amount of time, we cannot take the
responsibility for having any stockholder's tender delivered
by mail or by hand. Stockholders must send tenders directly to
Registrar and Transfer Company at the address provided in the
tender offer documents. That address is:
Registrar and Transfer Company
10 Commerce Drive
Cranford, New Jersey 07016
Question: May employees of Damen Financial tender shares in the offer?
Answer: Yes. Employees who own shares of Damen Financial common stock
are eligible to tender their shares. You will receive a
complete copy of the same documents that are being provided to
other stockholders.
Question: Will my shares in the ESOP be tendered?
Answer: No. The Company has been advised that the Trustee of the ESOP
does not intend to tender any shares pursuant to the Offer.
<PAGE>
Question: May my shares in the Profit Sharing Plan be tendered?
Answer: Yes. Employees who own shares as participants in the Company's
Profit Sharing Plan are eligible to tender those shares. In
addition to the documents being provided to other
stockholders, you will be given a letter from the Trustees of
the Profit Sharing Plan and an Instruction Form. Since the
shares in the Profit Sharing Plan are held of record by the
Plan, you must complete the Instruction Form to indicate how
many shares and at what price you wish to tender shares in the
Plan and submit the completed Instruction Form to the Trustees
so they may prepare a Letter of Transmittal on your behalf.
<PAGE>
Exhibit (a)(7)
DAMEN FINANCIAL CORPORATION
QUESTIONS AND ANSWERS
ABOUT THE OFFER OF
DAMEN FINANCIAL CORPORATION
TO PURCHASE FOR CASH UP TO 850,000 SHARES
OF COMMON STOCK AT A PURCHASE PRICE OF
$14.75 TO $13.25 PER SHARE
February 27, 1997
<PAGE>
QUESTIONS AND ANSWERS ABOUT THE OFFER OF
DAMEN FINANCIAL CORPORATION
TO PURCHASE ITS STOCK
The following information is designed to answer frequently asked questions about
the offer by Damen Financial Corporation to purchase shares of its common stock.
Stockholders are referred to the Offer to Purchase and Letter of Transmittal for
a detailed description of the terms and conditions of the offer.
Q. What Is This Offer To Purchase?
A. Damen Financial Corporation ("Damen" or the "Company") is inviting its
stockholders to tender shares of its common stock, $0.01 par value per
share (the "Shares"), at prices not in excess of $14.75 or less than
$13.25 per Share in cash, as specified by stockholders tendering their
Shares, upon the terms and subject to the conditions set forth in its
Offer to Purchase, dated February 27, 1997, and in the enclosed Letter
of Transmittal (which together constitute the "Offer"). The Company will
determine the single per Share price, not in excess of $14.75 nor less
than $13.25 per Share, net to the seller in cash (the "Purchase Price"),
that it will pay for Shares validly tendered pursuant to the Offer,
taking into account the number of Shares so tendered and the prices
specified by tendering stockholders. The Company will select the lowest
Purchase Price that will allow it to buy 850,000 Shares (or such lesser
number of Shares as are properly tendered at prices not in excess of
$14.75 or less than $13.25 per Share). This type of issuer tender offer
is commonly referred to as a "Modified Dutch Auction."
Q. What Is A "Modified Dutch Auction?"
A. A Modified Dutch Auction is a process whereby a company makes a direct
tender offer to its own stockholders to purchase a specified number of
shares of its stock within a specified price range per share, and pays
the highest price at which it accepts shares to all stockholders whose
shares are accepted. In this case, Damen is making a direct offer to all
of its stockholders to purchase in the aggregate 850,000 Shares of its
common stock at a price not in excess of $14.75 nor less than $13.25 per
Share. This process allows each stockholder to elect whether to sell
stock, and the price the stockholder is willing to sell at within the
given price range. After receiving tenders of Shares, at the termination
of the Offer, the Company will choose the lowest price within the
specified range that will permit it to purchase the amount of securities
sought and this price will become the Purchase Price.
Q. What Will Be The Final Purchase Price?
A. All Shares acquired in the Offer will be acquired at the Purchase Price.
The Company will select the lowest Purchase Price that will allow it to
buy up to 850,000 Shares. All stockholders tendering at or below the
Purchase Price will receive the same amount. For example, if 400,000
Shares are tendered at $13.50 per Share, 450,000 Shares are tendered at
$14.00 per Share and 300,000 are tendered at $14.75 per Share, 850,000
Shares will be purchased at $14.00 per Share from the persons who
tendered at $13.50 and $14.00, and the 300,000 Shares tendered at $14.75
per Share will be returned and not purchased.
<PAGE>
Q. What Will Happen If More Than 850,000 Shares Are Tendered At Or Below
The Purchase Price?
A. In the event more than 850,000 Shares are tendered at or below the
Purchase Price, Shares tendered at or below the Purchase Price will be
acquired by the Company (i) first from any stockholder who owned
beneficially, as of the close of business on February 25, 1997 and
continues to own beneficially as of the termination of the Offer, an
aggregate of fewer than 100 Shares and who validly tenders all of such
Shares, and (ii) then from all other tendering stockholder subject to
proration.
Q. At What Price May I Tender My Shares?
A. Stockholders may elect to tender their Shares in increments of 1/8th of
a dollar ($.125) starting at $13.25 per Share up to and including $14.75
per Share. The election as to the number of Shares and the price a
stockholder is willing to tender are to be indicated on the Letter of
Transmittal.
Q. How Do I Tender My Shares?
A. If you hold your Shares in certificate form, you must return a properly
completed Letter of Transmittal (the blue form) and any other documents
required by the Letter of Transmittal, together with the certificates
for the Shares being tendered, to the Depositary, Registrar and Transfer
Company, which must be received by them by 5:00 p.m. New York City time
on March 27, 1997.
Q. How Do I Tender My Shares If My Shares Are Held By My Broker?
A. If your Shares are registered in street name with a broker, dealer,
commercial bank, trust company or other nominee, you will need to
contact your broker, bank or other nominee and instruct the nominee to
make the tender of your Shares for you. You cannot tender such Shares
using the Letter of Transmittal even though you may have received one
for your information.
If you are a broker and are tendering Shares in book-entry form for your
customers, you must comply with the Book-Entry Delivery procedure
described in Section 3 of the Offer to Purchase.
Q. What Do I Do If I Have Lost My Certificates, Or If They Have Been
Mutilated, Destroyed Or Stolen, But I Still Want To Tender Them?
A. Call the Depositary at (800) 368-5948 Ext. 7760 in New Jersey for
instructions for tendering Shares in such circumstances.
Q. Do I Have To Sell My Stock To The Company?
A. No. A stockholder is not required to tender any stock.
<PAGE>
Q. What Happens If I Do Not Tender My Stock To The Company To Purchase?
A. Nothing will happen if you do not tender any or all of your Shares. Your
Shares will remain outstanding without a change in the terms or
ownership rights. You will continue to own the same number of Shares
without any adjustment, and you will continue to receive the same
dividend and voting rights. However, since the Company will purchase up
to 850,000 of its outstanding Shares, the percentage of the outstanding
stock which you own will increase since the number of outstanding Shares
will be reduced.
Q. What If The Terms Of The Offer Change?
A. In the event the Expiration Date is extended or if the terms of the
Offer are materially changed, the Company will generally give notice of
the change and, under certain circumstances, stockholders will be able
to change or withdraw their tender for at least 10 business days from
such notice.
Q. Can I Tender Part Of My Stock At Different Prices?
A. Yes, you can elect to tender part of your stock at one price and an
additional amount at a second price. For example, if you owned 1,500
Shares, you could tender 500 Shares at $14.00, 500 Shares at $14.75 and
keep the remaining 500 Shares. However, you cannot tender the same stock
at different prices. In the prior example, the stockholder owning 1,500
Shares cannot tender 1,500 at $14.00 and 1,500 at $14.75. If you tender
some Shares at one price and other Shares at a different price, you must
use a separate Letter of Transmittal for each price.
Q. Is There Any Brokerage Commission?
A. No. The Company will purchase stock directly from each stockholder at
the Purchase Price without the use of a broker.
Q. Can I Change Or Cancel My Tender?
A. You may increase or decrease the number of Shares indicated in the
Letter of Transmittal or withdraw it entirely up until 5:00 p.m. on
March 27, 1997. Generally after March 27, 1997, you cannot withdraw your
tender. If you desire to change or withdraw your tender, you are
responsible to make certain that a valid withdrawal is received by the
March 27, 1997 deadline. Except as discussed in the Offer to Purchase,
tenders are irrevocable after the March 27, 1997 deadline.
Q. Can You Summarize The Process By Which Shares Are Validly Tendered?
A. Generally, for certificated Shares you must complete the Letter of
Transmittal (the [blue] form) as follows:
- List the certificates and the number of Shares that you are
tendering in the box captioned "Description of Shares Tendered".
- Check the box specifying the price at which you are tendering in
the box captioned "Price (in Dollars) Per Share at Which Shares
are Being Tendered".
- If you want to give us special payment instructions, complete the
box captioned "Special Payment Instructions".
<PAGE>
- If you want to give us special delivery instructions, complete the
box captioned "Special Delivery Instructions".
- If you are an Odd Lot Holder (i.e., you hold fewer than 100
Shares) who is tendering all your shares, complete the box
captioned "Odd Lots".
- If you want to make a conditional tender of Shares, complete the
box captioned "Conditional Tenders".
- If your Shares are being delivered by book-entry, complete the box
captioned "Box Below for Use By Eligible Institutions Only".
- Complete the substitute Form W-9 to certify your tax
identification number.
- Sign the Letter of Transmittal in the box captioned "Sign Here"
(in certain circumstances, signatures must be guaranteed in this
Box, see Instructions 1 and 6 in the Letter of Transmittal).
You must deliver your Share certificates or comply with the book-entry
delivery requirements. See Section 3 of the Offer to Purchase. These
documents must be received by the Depositary, Registrar and Transfer
Company, no later than 5:00 p.m. on March 27, 1997. If you are
tendering Shares held by a broker, commercial bank, trust company or
other nominee, your instructions must be given to your nominee who
will, on the basis of your instructions, tender Shares for you. Please
see Section 3 and the Letter of Transmittal for more details about how
to tender Shares.
Q. How Can I Get More Information?
A. If you have a question, please call our Information Agent, D. F. King &
Co., Inc., at (800) 758-5880 or (212) 269-5550 in New York, or our
Dealer Managers, Robert W. Baird & Co. Incorporated, at (888) 224-7326
or (414) 298-7666 in Wisconsin, or Friedman, Billings, Ramsey & Co.,
Inc., at (800) 846-5050 or (703) 312-9500 in Virginia, from 9:00 a.m. -
5:00 p.m., Monday through Friday.
This brochure is neither an offer to purchase nor a solicitation of an offer to
sell securities. The offer to purchase the stock of the Company is made only by
the Damen Financial Corporation Offer to Purchase document dated February 27,
1997 and the accompanying Letter of Transmittal.
<PAGE>
Exhibit (a)(8)
For Immediate Release For Information Contact:
Mary Beth Poronsky Stull
Date: February 14, 1997 President and CEO
(847) 882-5320
DAMEN FINANCIAL CORPORATION ANNOUNCES GOVERNMENTAL APPROVAL
TO BECOME A BANK HOLDING COMPANY; INTENTION TO
OFFER TO BUY UP TO 850,000 SHARES OF ITS COMMON STOCK
SCHAUMBURG, ILLINOIS ... Damen Financial Corporation (NASDAQ NMS: DFIN)
announced today that the Board of Governors of the Federal Reserve System has
approved its application to become a bank holding company. The transaction is
scheduled to be completed February 27, 1997, upon completion of the regulatory
waiting period.
Damen Financial also announced that its Board of Directors has
authorized the repurchase of up to 850,000 shares of its common stock, which
represents 22.7 percent of its 3,750,278 outstanding shares, once the bank
holding company reorganization has been completed. The repurchase will be made
through a "Modified Dutch Auction Tender." Under this procedure, Damen Financial
stockholders will be given the opportunity to sell part or all of their shares
to the Corporation at an estimated price range of not less than $13.25 per share
and not more than $14.75 per share. This estimated price range represents a 1.9
percent discount to a 9.3 percent premium to the February 13, 1997 closing price
of $13.50 per share. Based upon the minimum and maximum offering prices
specified in the offer, the aggregate purchase price, if 850,000 shares are
purchased, would range from approximately $11.3 million to $12.5 million. The
offer to purchase shares is currently scheduled to commence on or about February
27, 1997, and to expire at 5:00 p.m. New York City time on March 26, 1997 unless
extended by Damen Financial.
Under the procedures for a Modified Dutch Auction Tender, stockholders
may offer to sell all or a portion of the shares they own at a price not more
than the maximum price ($14.75) nor less than the minimum price ($13.25)
specified in the tender. Upon the expiration of the offer, Damen Financial will
select the lowest purchase price that will allow it to buy 850,000 shares. All
shares purchased in the offer will receive the same price. If the number of
shares tendered is equal to or less than 850,000 shares, the purchase price will
be the highest price specified by tendering stockholders. If the number of
shares tendered is greater than the number sought, the Corporation will select
the lowest price that will allow it to buy the number of shares it seeks.
Mary Beth Poronsky Stull, Damen Financial's President and Chief
Executive Officer, stated, "Damen Financial intends to make the tender offer
because its Board of Directors believes that the purchase of shares pursuant to
the offer should have beneficial effects on stockholder value while maintaining
a strong capital base to support the needs of our business and our customers.
After studying a number of alternatives, we selected the Modified Dutch Auction
Tender because it is a positive action that has the potential for improving
stockholder returns in an expeditious manner."
<PAGE>
The Corporation was organized in 1995 to act as the holding company of
Damen Federal Bank, which will convert to a national bank and change its name to
Damen National Bank on February 27, 1997. The Bank, headquartered in Schaumburg,
Illinois, primarily serves the communities in its market area through its
offices located in Schaumburg, Chicago and Burbank, Illinois.
At December 31, 1996, the Corporation had consolidated assets of $235.3
million and stockholders' equity of $53.8 million.
This announcement is neither an offer to purchase nor a solicitation of
an offer to sell shares of Damen Financial Corporation common stock. The offer
may be made solely by the Offer to Purchase and the related Letter of
Transmittal, which will be sent to all stockholders upon commencement of the
offer.
<PAGE>
Exhibit (a)(9)
This announcement is neither an Offer to Purchase nor a solicitation of an offer
to sell shares of Damen Financial Corporation common stock. The offer is made
solely by the Offer to Purchase, dated February 27, 1997, and the related Letter
of Transmittal, copies of which may be obtained from the Information Agent.
DAMEN FINANCIAL CORPORATION
Offers to
Purchase For Cash up to 850,000 Shares of its
Common Stock
At a Purchase Price Not Greater Than $14.75 Nor Less
Than $13.25 Per Share
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT
5:00 P.M., NEW YORK CITY TIME, ON MARCH 27, 1997,
UNLESS THE OFFER IS EXTENDED.
The Information Agent for the Offer is:
D. F. King & Co., Inc.
77 Water Street
New York, New York 10005
(212) 269-5550 (call collect)
or
(800) 758-5880 (toll free)
The Dealer Managers for the Offer are:
Robert W. Baird & Co. Incorporated Friedman, Billings, Ramsey & Co.,
Inc.
777 East Wisconsin Avenue Potomac Tower
Milwaukee, Wisconsin 53202 1001 Nineteenth Street North
(414) 298-7666 Arlington, Virginia 22209-1710
call toll free (888) 224-7326 (703) 312-9500
call toll free (800) 846-5050
February 27, 1997
<PAGE>
Exhibit (a)(10)
DAMEN FINANCIAL CORPORATION
Offer To Purchase For Cash Up To
850,000 Shares Of Its Common Stock
At A Purchase Price Not In Excess Of $14.75
Nor Less Than $13.25 Per Share
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT
5:00 P.M., NEW YORK CITY TIME, ON MARCH 27, 1997,
UNLESS THE OFFER IS EXTENDED.
To Participants in the Damen Federal Bank for Savings
Employees' Profit Sharing Plan (the "Profit Sharing Plan"):
Enclosed for your consideration are the Offer to Purchase, dated
February 27, 1997, and the related Letter of Transmittal (which together
constitute the "Offer") in connection with the Offer by Damen Financial
Corporation, a Delaware corporation (the "Company"), to purchase up to 850,000
shares of its Common Stock, $0.01 par value per share (the "Shares"), at prices
not in excess of $14.75 nor less than $13.25 per Share, as specified by
tendering stockholders, upon the terms and subject to the conditions set forth
in the Offer.
The Company will determine the single per Share price, not in excess of
$14.75 nor less than $13.25 per Share, net to the seller in cash (the "Purchase
Price"), that it will pay for Shares validly tendered pursuant to the Offer,
taking into account the number of Shares so tendered and the prices specified by
tendering stockholders. The Company will select the lowest Purchase Price that
will allow it to buy 850,000 Shares (or such lesser number of Shares as are
validly tendered at prices not in excess of $14.75 nor less than $13.25 per
Share). All Shares properly tendered at prices at or below the Purchase Price
and not withdrawn on or prior to the Expiration Date (as defined in Section 1 of
the Offer to Purchase) will be purchased at the Purchase Price, subject to the
terms and conditions of the Offer, including the proration and conditional
tender provisions. See Sections 1 and 16 of the Offer to Purchase.
Upon the terms and subject to the conditions of the Offer, if, at the
expiration of the Offer, more than 850,000 Shares are validly tendered at or
below the Purchase Price and not withdrawn, the Company will buy Shares (i) from
stockholders who owned beneficially as of the close of business on February 25,
1997, and continue to own beneficially as of the Expiration Date an aggregate of
fewer than 100 Shares who properly tender all their Shares at prices at or below
the Purchase Price, and (ii) then, on a pro rata basis, from all other
stockholders who properly tender at or below the Purchase Price (and do not
withdraw them prior to the expiration of the Offer), other than stockholders who
tender conditionally and for whom the condition is not satisfied. See Sections
1, 2 and 6 of the Offer to Purchase. All Shares not purchased pursuant to the
Offer, including Shares tendered at prices greater than the Purchase Price and
Shares not purchased because of proration or because they were conditionally
tendered and not accepted for purchase will be returned to the tendering
stockholders at the Company's expense as promptly as practicable following the
Expiration Date.
<PAGE>
As Trustees of the Profit Sharing Plan, we are the owner of record of
Shares held for your account in the Profit Sharing Plan. As such, we are the
only ones who can tender your Shares, and then only pursuant to your
instructions. We are sending you the Letter of Transmittal for your information
only; you cannot use it to tender Shares we hold for your account.
Please instruct us as to whether you wish us to tender any or all of
the Shares we hold for your account in the Profit Sharing Plan on the terms and
subject to the conditions of the Offer.
We call your attention to the following:
1. You may tender Shares at prices not in excess of $14.75 nor
less than $13.25 per Share as indicated in the attached
Instruction Form, net to you in cash.
2. You may tender your Shares conditioned upon the Company's
purchasing all or a minimum number of your Shares.
3. The Offer is not conditioned on any minimum number of Shares
being tendered pursuant to the Offer.
4. The Offer, proration period and withdrawal rights will expire
at 5:00 p.m., New York City time, on March 27, 1997, unless
the Company extends the Offer.
5. The Offer is for 850,000 Shares, constituting approximately
22.5% of the Shares outstanding as of February 25, 1997.
6. Tendering stockholders will not be obligated to pay any stock
transfer taxes on the Company's purchase of Shares pursuant to
the Offer, subject to Instruction 7 of the Letter of
Transmittal.
7. If you beneficially held, as of the close of business on
February 25, 1997, an aggregate of fewer than 100 Shares and
you continue to beneficially own as of the Expiration Date an
aggregate of fewer than 100 Shares, and you instruct us to
tender on your behalf all such Shares at or below the Purchase
Price before the Expiration Date (as defined in the Offer to
Purchase) and complete the box captioned "Odd Lots" in the
attached Instruction Form, the Company, upon the terms and
subject to the conditions of the Offer, will accept all such
Shares for purchase before proration, if any, of the purchase
of other Shares validly tendered at or below the Purchase
Price.
8. If you wish to tender portions of your Shares at different
prices, you must complete a separate Instruction Form for each
price at which you wish to tender each such portion of your
Shares. We must submit separate Letters of Transmittal on your
behalf for each price you will accept.
If you wish to have us tender any or all of your Shares in the Profit
Sharing Plan, please so instruct us by completing, executing, detaching and
returning to us the attached Instruction Form. An envelope to return your
Instruction Form to us is enclosed. If you authorize us to tender your Shares in
the Profit Sharing Plan, we will tender all such Shares unless you specify
otherwise on the attached Instruction Form.
<PAGE>
YOUR INSTRUCTION FORM SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT
US TO SUBMIT A TENDER ON YOUR BEHALF ON OR BEFORE THE EXPIRATION DATE OF THE
OFFER. THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON MARCH 27, 1997, UNLESS THE COMPANY EXTENDS THE OFFER.
If you do not wish to tender your Shares held in the Profit Sharing
Plan you do not need to take any action. If you own Shares outside of the Profit
Sharing Plan and with to tender some or all of such Shares, a separate Letter of
Transmittal must be used for such tender.
As described in Section 1 of the Offer to Purchase, if more than
850,000 Shares have been validly tendered at prices at or below the Purchase
Price and not withdrawn on or prior to the Expiration Date (as defined in the
Offer to Purchase), the Company will purchase properly tendered Shares on the
basis set forth below:
(a) first, all Shares validly tendered and not withdrawn on or prior to
the Expiration Date by or on behalf of any stockholder who owned beneficially,
as of the close of business on February 25, 1997 and continues to own
beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares
who:
(1) valid tender all of such Shares at a price at or below the
Purchase Price (partial and conditional tenders will not qualify for
this preference); and
(2) completes the box captioned "Odd Lots" on the Letter of
Transmittal; and
(b) second, after purchase of all of the forgoing Shares, all other
Shares validly and conditionally tendered at prices at or below the Purchase
Price in accordance with Section 6 of the Offer to Purchase for which the
condition was satisfied, and all other Shares validly and unconditionally
tendered at or below the Purchase Price and not withdrawn on or prior to the
Expiration Date on a pro rata basis (with appropriate adjustments to avoid
purchases of fractional Shares) as described in Section 1 of the Offer to
Purchase; and
(c) third, if necessary, Shares validly and conditionally tendered at
or below the Purchase Price and not withdrawn on or prior to the Expiration
Date, selected by lot in accordance with Section 6 of the Offer to Purchase.
You may condition your tender on the Company purchasing a minimum
number of your tendered Shares. In such case, if as a result of the proration
provisions in the Offer to Purchase the Company would purchase less than such
minimum number of your Shares, then the Company will not purchase any of your
Shares, except as provided in the next sentence. If so many conditional tenders
would be deemed withdrawn that the total number of such Shares to be purchased
falls below 850,000 Shares, then to the extent feasible, the Company will select
enough of such conditional tenders that would otherwise have been so withdrawn
to permit the Company to purchase 850,000 Shares. In selecting among such
conditional tenders, the Company will select by lot and will limit its purchase
in each case to the minimum number of Shares designated. See Sections 1 and 6 of
the Offer to Purchase.
<PAGE>
The Offer is being made to all holders of Shares. The Company is not
aware of any jurisdiction where the making of the Offer is not in compliance
with applicable law. If the Company becomes aware of any jurisdiction where the
making of the Offer is not in compliance with any valid applicable law, the
Company will make a good faith effort to comply with such law. If, after such
good faith effort, the Company cannot comply with such law, the Offer will not
be made to, nor will tenders be accepted from or on behalf of, holders of Shares
residing in such jurisdiction. In any jurisdiction the securities or blue sky
laws of which require the Offer to be made by a licensed broker or dealer, the
Offer is being made on the Company's behalf by the Dealer Managers or one or
more registered brokers or dealers licensed under the laws of such jurisdiction.
Southeast Financial Bank and Trust
Trustee, Damen Federal Bank for
Savings Employees' Profit Sharing Plan
<PAGE>
Exhibit (a)(11)
For Immediate Release
Date: February 27, 1997
For Information Contact:
Mary Beth Poronsky Stull Michael Brinn
President and CEO D.F. King & Co., Inc.
(847) 882-5320 (212) 269-5550
DAMEN FINANCIAL CORPORATION COMMENCES
OFFER TO BUY UP TO 850,000 SHARES OF ITS COMMON STOCK
SCHAUMBURG, ILLINOIS...Damen Financial Corporation (NASDAQ NMS: DFIN) announced
today the commencement of its offer to repurchase of up to 850,000 shares of its
common stock, which represents 22.5 percent of its 3,770,117 outstanding shares.
The repurchase will be made through a "Modified Dutch Auction Tender." Under
this procedure, Damen Financial stockholders will be given the opportunity to
sell part or all of their shares to the Corporation at a price of not less than
$13.25 per share and not more than $14.75 per share. This price range represents
a 1.9 percent discount to a 9.3 percent premium to the February 13, 1997 closing
price of $13.50 per share (the last day prior to the announcement of the
Corporation's intention to repurchase the shares). Based upon the minimum and
maximum offering prices specified in the offer, the aggregate purchase price, if
850,000 shares are purchased, would range from approximately $11.3 million to
$12.5 million. The offer to purchase shares will expire at 5:00 p.m. New York
City time on March 27, 1997 unless extended by Damen Financial.
Under the procedures for a Modified Dutch Auction Tender, stockholders may
offer to sell all or a portion of the shares they own at a price not more than
the maximum price ($14.75) nor less than the minimum price ($13.25) specified in
the tender. Upon expiration of the offer, Damen Financial will select the lowest
purchase price that will allow it to buy 850,000 shares. All shares purchased in
the offer will receive the same price. If the number of shares tendered is equal
to or less than 850,000 shares, the purchase price will be the highest price
specified by tendering stockholders. If the number of shares tendered is greater
than the number sought, the Corporation will select the lowest price that will
allow it to buy the number of shares it seeks.
Mary Beth Poronsky Stull, Damen Financial's President and Chief Executive
Officer, stated, "Damen Financial is making the tender offer because its Board
of Directors believes that the purchase of shares pursuant to the offer should
have beneficial effects on stockholder value while maintaining a strong capital
base to support the needs of our business and our customers. After studying a
number of alternatives, we selected the Modified Dutch Auction Tender because it
is a positive action that has the potential for improving stockholder returns in
an expeditious manner."
The Corporation was organized in 1995 to act as the holding company of
Damen Federal Bank for Savings, which converted to a national bank and changed
its name to Damen National Bank on February 27, 1997. The Bank, headquartered in
Schaumburg, Illinois, primarily serves the communities in its market area
through its offices located in Schaumburg, Chicago and Burbank, Illinois.
<PAGE>
At December 31, 1996, the Corporation had consolidated assets of $235.3
million and stockholders' equity of $53.8 million.
This announcement is neither an offer to purchase nor a solicitation of an
offer to sell shares of Damen Financial Corporation common stock. The offer is
made solely by the Offer to Purchase dated February 27, 1997 and the related
Letter of Transmittal.
