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(ORANGE-CO LOGO)
EXHIBIT A2
ORANGE-CO, INC.
2020 U. S. HIGHWAY 17 SOUTH
POST OFFICE BOX 0000
XXXXXX, XXXXXXX 00000-2158
OCTOBER 1, 1999
Dear Shareholder:
As you may be aware, on September 27 the Company executed an Agreement and
Plan of Merger (the "Merger Agreement") with affiliates of Reservoir Capital
Group, L.L.C., a Delaware limited liability company (collectively, "Parent"),
and OJ Acquisition Corp., a Florida corporation ("Purchaser") controlled by
Parent, and as of that same date Purchaser acquired from affiliates of Xxx Xxxx
Xxxxxxx III, the Company's Chairman and Chief Executive Officer (the "Xxxxxxx
Affiliates"), 5,405,660 shares of the Company's common stock, $.50 par value,
comprising 52.4% of the 10,309,975 common shares presently outstanding.
Under the terms of the Merger Agreement, Parent is required, within five
business days following the date of its execution, to cause Purchaser to
commence a tender offer (the "Offer") to acquire any and all outstanding Company
shares, for the same $7.00 per share net cash price that was paid to the Xxxxxxx
Affiliates. Following the conclusion of the Offer, Purchaser will be merged with
and into the Company and the Company will thereafter continue in existence, with
Parent as its sole owner (the "Merger"). Detailed terms and conditions of the
Offer are set forth in an Offer to Purchase document, dated October 1, 1999, and
a related Letter of Transmittal which are being furnished to you concurrently
with this letter.
Also on September 27, the Company executed a separate Asset Purchase
Agreement with Pasco Acquisition, Inc., a Delaware corporation ("Pasco"),
pursuant to which Pasco acquired the Company's beverage and food servicing
business (the "Food Service Business") and agreed to acquire the Company's
processing and packaging business (the "Processing Business"). Concurrently with
that execution, Xxxxx paid to the Company $17,925,000, as well as the additional
sum of $11,767,548, which constituted the estimated value of the Food Service
Business working capital, and assumed those liabilities of the Company relating
to such business. The Asset Purchase Agreement further provides that within the
five business day period following consummation of the Merger and satisfaction
of certain other conditions, Pasco will acquire the Company's Processing
Business and will make a cash payment to the Company equal to the value of the
Company's net working capital associated with the Processing Business (with such
cash payments being subject to certain post-closing adjustments) and assume the
Company liabilities associated therewith.
AT ITS MEETING OF SEPTEMBER 9, 1999, ACTING IN RELIANCE UPON THE UNANIMOUS
RECOMMENDATION OF ITS SPECIAL COMMITTEE OF INDEPENDENT DIRECTORS, THE COMPANY'S
BOARD OF DIRECTORS CONCLUDED, BY UNANIMOUS VOTE, THAT EACH OF THE MERGER
AGREEMENT AND ASSET PURCHASE AGREEMENT, AND THE TRANSACTIONS CONTEMPLATED
THEREBY, WERE FAIR TO AND IN THE BEST INTERESTS OF THE COMPANY AND ITS
UNAFFILIATED SHAREHOLDERS; THE CONSIDERATION TO BE PAID TO EACH OF THE COMPANY'S
UNAFFILIATED SHAREHOLDERS UNDER THE MERGER AGREEMENT FOR EACH OF THE COMPANY'S
COMMON SHARES OWNED BY SUCH HOLDER WAS FAIR; AND THE CONSIDERATION TO BE PAID TO
THE COMPANY UNDER THE ASSET PURCHASE AGREEMENT FOR THE ASSETS TO BE ACQUIRED
THEREUNDER WAS ALSO FAIR TO AND IN THE BEST INTERESTS OF THE COMPANY AND ITS
UNAFFILIATED SHAREHOLDERS. THE BOARD THEREFORE RESOLVED TO FAVORABLY RECOMMEND
TO THE COMPANY'S UNAFFILIATED SHAREHOLDERS THAT THEY ACCEPT THE OFFER AND TENDER
THEIR COMPANY SHARES.
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In reaching its own recommendation the Special Committee of the Board
relied upon a formal written opinion (a copy of which is being furnished to you
as an exhibit to the Schedule 14D-9, Solicitation/Recommendation Statement, a
copy of which is also included with this letter and has separately been filed
with the Securities and Exchange Commission) of Xxxxxxxx Inc., the qualified
independent financial advisor which it had engaged to undertake an analysis of
the transactions as proposed in the Agreements and the letters of intent upon
which they were based, given after applying selected financial criteria to such
transactions, to the effect that the Offer and the Merger are fair from a
financial point of view to the Company's unaffiliated shareholders, and also
gave careful consideration to a variety of factors which are disclosed in the
referenced Schedule 14D-9.
Accordingly, I am writing on behalf of the Company to encourage you,
following your review of the enclosed Offer to Purchase, dated October 1, 1999,
and the related Letters of Transmittal that are to be used to effect a tender of
your shares, to accept the Offer, tender all of your Shares pursuant to their
terms, and timely complete and return any documentation requested of you.
If you have questions concerning this matter, they may be addressed to me
or the Company's Vice President and Chief Financial Officer, Xxxx X.
Xxxxxxxxxxx.
Yours truly,
/s/ Xxxx Xxxxxx
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Xxxx Xxxxxx, President and Chief
Operating Officer
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