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EXHIBIT (a)(1)
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
XXXXX HOMES, INC.
AT
$19.10 NET PER SHARE
BY
HELIOS ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
TECHNICAL OLYMPIC USA, INC.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON FRIDAY, NOVEMBER 17, 2000, UNLESS THE OFFER IS EXTENDED.
THE BOARD OF DIRECTORS OF XXXXX HOMES, INC. (THE "COMPANY") HAS UNANIMOUSLY
APPROVED THE MERGER AGREEMENT, THE OFFER AND THE MERGER (EACH AS DEFINED
HEREIN), HAS DETERMINED THAT THE OFFER AND THE MERGER ARE FAIR TO, AND IN THE
BEST INTERESTS OF, THE SHAREHOLDERS OF THE COMPANY, AND RECOMMENDS THAT
SHAREHOLDERS TENDER THEIR SHARES (AS DEFINED HEREIN) PURSUANT TO THE OFFER.
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THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF
SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE (THE "SHARES"), OF THE COMPANY
THAT REPRESENTS AT LEAST A MAJORITY OF THE TOTAL ISSUED AND OUTSTANDING SHARES
ON A FULLY DILUTED BASIS AS OF THE DATE SUCH SHARES ARE PURCHASED PURSUANT TO
THE OFFER (THE "MINIMUM CONDITION") AND THE SATISFACTION OR WAIVER OF CERTAIN
CONDITIONS DESCRIBED IN SECTION 12 OF THIS OFFER TO PURCHASE.
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THE OFFER IS NOT CONDITIONED ON THE PURCHASER (AS DEFINED HEREIN) OBTAINING
FINANCING.
IMPORTANT
Any shareholder desiring to tender all or any portion of such shareholder's
Shares should: (1) complete and sign the Letter of Transmittal (or a facsimile
thereof) in accordance with the instructions in the Letter of Transmittal,
including any required signature guarantees, and (A) mail or deliver the Letter
of Transmittal (or such facsimile) with such shareholder's certificate(s) for
the tendered Shares and any other required documents to the Depositary (as
defined herein), or (B) follow the procedure for book-entry transfer of Shares
set forth in Section 3 of this Offer to Purchase or (2) request such
shareholder's broker, dealer, commercial bank, trust company or other nominee to
effect the transaction for such shareholder. A shareholder whose Shares are
registered in the name of a broker, dealer, commercial bank, trust company or
other nominee must contact such person if such shareholder desires to tender
such Shares.
A shareholder who desires to tender Shares and whose certificates for such
Shares are not immediately available, or who cannot comply with the procedure
for book-entry transfer on a timely basis, may tender such Shares by following
the procedures for guaranteed delivery set forth in Section 3 of this Offer to
Purchase.
Questions and requests for assistance may be directed to the Information
Agent or the Dealer Manager at their respective addresses and telephone numbers
set forth on the back cover of this Offer to Purchase. Requests for additional
copies of this Offer to Purchase, the Letter of Transmittal, the Notice of
Guaranteed Delivery and other related materials may be directed to the
Information Agent or the Dealer Manager. Shareholders may also contact their
broker, dealer, commercial bank, trust company or other nominee for copies of
these documents.
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THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE FAIRNESS OR MERITS OF THIS TRANSACTION NOR UPON THE ACCURACY OR ADEQUACY OF
THE INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY
IS UNLAWFUL.
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The Dealer Manager for the Offer is:
BANC OF AMERICA SECURITIES LLC
October 20, 2000
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TABLE OF CONTENTS
SUMMARY TERM SHEET.......................................... 1
INTRODUCTION................................................ 5
THE TENDER OFFER............................................ 7
1. Terms of the Offer.................................... 7
2. Acceptance for Payment and Payment for Shares......... 9
3. Procedure for Tendering Shares........................ 9
4. Rights of Withdrawal.................................. 12
5. Certain U.S. Federal Income Tax Consequences.......... 13
6. Price Range of the Shares; Dividends.................. 14
7. Effect of the Offer on the Market for the Shares;
Stock Quotation; Exchange Act Registration; Margin
Regulations........................................... 14
8. Certain Information Concerning the Company............ 15
9. Certain Information Concerning the Purchaser and
Technical Olympic...................................... 17
10. Background of the Offer; Contacts with the Company.... 18
11. Purpose of the Offer; Plans for the Company; the
Merger Agreement and Related Matters; Other
Arrangements.......................................... 20
12. Certain Conditions to the Offer....................... 33
13. Source and Amount of Funds............................ 35
14. Dividends and Distributions........................... 35
15. Certain Legal Matters................................. 35
16. Fees and Expenses..................................... 38
17. Miscellaneous......................................... 38
SCHEDULE I -- DIRECTORS AND EXECUTIVE OFFICERS OF THE
PURCHASER, TECHNICAL OLYMPIC AND TECHNICAL OLYMPIC S.A.... I-1
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SUMMARY TERM SHEET
This summary of the offer highlights selected information from this Offer
to Purchase and may not contain all of the information that is important to you.
To better understand our offer to you and for a complete description of the
terms of the offer, you should read this entire Offer to Purchase and the
accompanying Letter of Transmittal carefully. Questions or requests for
assistance may be directed to the information agent or the dealer manager at
their addresses and telephone numbers listed on the last page of this Offer to
Purchase.
WHO IS OFFERING TO BUY MY SECURITIES?
Our name is Helios Acquisition Corp. We are a Florida corporation formed
for the purpose of making this offer. We are a wholly owned subsidiary of
Technical Olympic USA, Inc., a Delaware corporation, which, in turn, is an
indirect wholly owned subsidiary of Technical Olympic S.A., an international
diversified construction company based in Athens, Greece.
WHAT ARE THE CLASSES AND AMOUNTS OF SECURITIES SOUGHT IN THE OFFER?
We are offering to purchase all of the issued and outstanding shares of
common stock of Xxxxx Homes, Inc.
HOW MUCH ARE YOU OFFERING TO PAY AND WHAT IS THE FORM OF PAYMENT? WILL I HAVE TO
PAY ANY FEES OR COMMISSIONS?
We are offering to pay $19.10 per share, net to you, without interest, in
cash, upon the terms and subject to the conditions contained in this Offer to
Purchase and in the related Letter of Transmittal. If you own your shares
through a broker or other nominee and your broker tenders your shares on your
behalf, your broker or nominee may charge you a fee for doing so. You should
consult your broker or nominee to determine whether any charges will apply.
DO YOU HAVE THE FINANCIAL RESOURCES TO MAKE PAYMENT?
Technical Olympic USA, our parent company, or one of its affiliates, will
provide us with sufficient funds to purchase all shares validly tendered and not
withdrawn in the offer and to provide funding for the merger, which is expected
to follow the successful completion of the offer in accordance with the terms
and conditions of the merger agreement. Technical Olympic USA or its affiliates
will provide all such funds from a combination of existing resources and from
new borrowing arrangements. Our parent has obtained firm commitments from Bank
of America, N.A. and its affiliates, Banc of America LLC and Banc of America
Mortgage Capital Corporation, to provide some of the funds necessary to purchase
shares in the offer. Our obligation to purchase shares in the offer is not
conditioned on our obtaining financing. See Section 13.
IS YOUR FINANCIAL CONDITION RELEVANT TO MY DECISION TO TENDER IN THE OFFER?
Because the form of payment in the offer consists solely of cash and our
offer is not contingent upon our receipt of financing, we do not believe our
financial condition will be relevant to your decision to tender in the offer.
HOW LONG DO I HAVE TO DECIDE WHETHER TO TENDER IN THE OFFER?
You will have at least until 12:00 midnight, New York City time, on Friday,
November 17, 2000 to tender your shares in the offer. Further, if you cannot
deliver everything that is required in order to make a valid tender by that
time, you may be able to use a guaranteed delivery procedure, which is described
later in this Offer to Purchase. See Sections 1 and 3.
CAN THE OFFER BE EXTENDED AND UNDER WHAT CIRCUMSTANCES?
We reserve the right, subject to limitations in the merger agreement and
under applicable law, to extend the period of time during which the offer
remains open. See Section 1.
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We may also elect to provide a "subsequent offering period" for the offer.
A subsequent offering period, if one is included, will be an additional period
of time beginning after we have purchased shares tendered during the offer,
during which shareholders may tender, but not withdraw, their shares and receive
the offer consideration. See Section 1.
HOW WILL I BE NOTIFIED IF THE OFFER IS EXTENDED?
If we extend the offer, we will inform Wilmington Trust Company, the
depositary for the offer, of that fact and will make a public announcement of
the extension not later than 9:00 a.m., New York City time, on the next business
day after the day on which the offer was scheduled to expire. See Section 1.
WHAT ARE THE MOST SIGNIFICANT CONDITIONS TO THE OFFER?
- We are not obligated to purchase any shares that are validly tendered
unless the number of shares validly tendered and not withdrawn before the
expiration of the offer represents at least a majority of the outstanding
shares of Xxxxx Homes on a fully diluted basis. We call this condition
the "minimum condition."
- We are not obligated to purchase shares that are validly tendered if,
among other things, there is a material adverse change in Xxxxx Homes or
its business.
- We are not obligated to purchase shares that are validly tendered if,
among other things, we and Xxxxx Homes determine that the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act applies to the offer and its
applicable waiting period has not expired or been terminated. We and
Xxxxx Homes do not believe that the Act will apply to the offer or the
subsequent merger primarily because these transactions fall under
exemptions for the sale of real estate assets and businesses.
The offer also is subject to a number of other conditions. We can waive
some of the conditions to the offer without the Company's consent; however, we
cannot waive the minimum condition. See Section 12.
HOW DO I TENDER MY SHARES?
To tender shares, you must deliver the certificate(s) representing your
shares, together with a completed Letter of Transmittal and any other documents
required by the Letter of Transmittal, to Wilmington Trust Company, the
depositary for the offer, not later than the time the offer expires. If your
shares are held in street name, the shares can be tendered by your nominee
through The Depository Trust Company. If you are unable to deliver any required
document or instrument to the depositary by the expiration of the offer, you may
gain some extra time by having a broker, a bank or other fiduciary that is an
eligible institution guarantee that the missing items will be received by the
depositary within three Nasdaq National Market trading days. For the tender to
be valid, however, the depositary must receive the missing items within that
three trading day period. See Section 3.
UNTIL WHAT TIME MAY I WITHDRAW PREVIOUSLY TENDERED SHARES?
You may withdraw shares at any time until the offer has expired and, if we
have not accepted your shares for payment by Monday, December 18, 2000, you may
withdraw them at any time after such time until we accept shares for payment.
This right to withdraw will not apply to any subsequent offering period. See
Sections 1 and 4.
HOW DO I WITHDRAW PREVIOUSLY TENDERED SHARES?
To withdraw shares, you must deliver a written notice of withdrawal, or a
copy of one, with the required information to Wilmington Trust Company, the
depositary for the offer, while you still have the right to withdraw the shares.
See Section 4.
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WHAT DOES THE XXXXX HOMES BOARD OF DIRECTORS THINK OF THE OFFER?
The Xxxxx Homes board of directors has unanimously determined that the
offer and the merger are fair to, and in the best interests of, the holders of
Xxxxx Homes common stock, has approved and adopted the merger agreement and the
merger, and recommends that the holders of the shares accept the offer and
tender their shares in the offer.
HAVE ANY SHAREHOLDERS AGREED TO TENDER THEIR SHARES?
Yes. Shareholders who own shares representing approximately 34% of the
outstanding common stock of Xxxxx Homes (which could increase if any of these
shareholders exercise any outstanding options) have agreed to tender their
shares in the offer. See Section 11.
IF A MAJORITY OF THE SHARES ARE TENDERED AND ACCEPTED FOR PAYMENT, WILL XXXXX
HOMES CONTINUE AS A PUBLIC COMPANY?
No. Following the purchase of shares in the offer, we expect to consummate
the merger, and, following the merger, Xxxxx Homes will no longer be publicly
owned. Even if for some reason the merger does not take place, if we purchase
all of the tendered shares, there may be so few remaining shareholders and
publicly held shares that (a) Xxxxx Homes common stock will no longer meet the
published guidelines of the Nasdaq National Market for continued listing and may
be delisted from the Nasdaq National Market, (b) there may not be a public
trading market for Xxxxx Homes common stock and (c) Xxxxx Homes may cease making
filings with the Securities and Exchange Commission or otherwise cease being
required to comply with the SEC rules relating to publicly held companies. See
Section 7.
WILL THE TENDER OFFER BE FOLLOWED BY A MERGER IF ALL OF THE XXXXX HOMES SHARES
ARE NOT TENDERED IN THE OFFER?
Yes. If we accept for payment and pay for at least a majority of the
outstanding shares of Xxxxx Homes on a fully diluted basis, Helios Acquisition
Corp. will be merged with and into Xxxxx Homes. If that merger takes place,
Technical Olympic USA will own all of the shares of Xxxxx Homes. All remaining
shareholders of Xxxxx Homes (except for us and any shareholders properly
exercising dissenters' rights, if available) will receive $19.10 per share in
cash, or any higher price per share that we may pay in the offer. See the
"Introduction" to this Offer to Purchase.
IF I DECIDE NOT TO TENDER, HOW WILL THE OFFER AFFECT MY SHARES?
If the merger described above takes place, shareholders not tendering in
the offer will receive the same amount of cash per share that they would have
received had they tendered their shares in the offer. Therefore, if the merger
takes place, the only difference to you between tendering your shares and not
tendering your shares is that you will be paid earlier if you tender your
shares. However, if the merger does not take place, the number of Xxxxx Homes
shareholders and the number of shares of Xxxxx Homes which are still in the
hands of the public may be so small that there no longer will be an active
public trading market (or, possibly, there may not be any public trading market)
for the shares of Xxxxx Homes common stock. Also, as described above, Xxxxx
Homes may cease making filings with the SEC or otherwise being required to
comply with the SEC rules relating to publicly held companies. See the
"Introduction" and Section 7 of this Offer to Purchase.
WHAT IS THE MARKET VALUE OF MY SHARES AS OF A RECENT DATE?
On October 11, 2000, the last trading day before we announced the
acquisition, the closing price of Xxxxx Homes shares reported on the Nasdaq
National Market was $15.75 per share. We encourage you to obtain a recent
quotation for shares of Xxxxx Homes common stock in deciding whether to tender
your shares. See Section 6.
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WHO CAN I TALK TO IF I HAVE QUESTIONS ABOUT THE TENDER OFFER?
You can call MacKenzie Partners, Inc. at (000) 000-0000 (toll free) or
(000) 000-0000 (call collect) or Banc of America Securities LLC at (888)
583-8900 ext. 8537 (toll free) or (000) 000-0000 (call collect). MacKenzie
Partners, Inc. is acting as the information agent and Banc of America Securities
LLC is acting as the dealer manager for the offer. See the back cover of this
Offer to Purchase.
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To the Holders of Shares of Common Stock
of Xxxxx Homes, Inc.:
INTRODUCTION
Helios Acquisition Corp. (the "Purchaser"), a Florida corporation and a
wholly owned subsidiary of Technical Olympic USA, Inc. ("Technical Olympic"), a
Delaware corporation, hereby offers to purchase all outstanding shares of common
stock, par value $0.01 per share (the "Shares"), of Xxxxx Homes, Inc. (the
"Company"), a Florida corporation, at $19.10 per Share, net to the seller in
cash, without interest thereon, upon the terms and subject to the conditions set
forth in this Offer to Purchase (as may be amended or supplemented from time to
time, the "Offer to Purchase") and in the related Letter of Transmittal (as may
be amended or supplemented from time to time, the "Letter of Transmittal,"
which, together with the Offer to Purchase, as each may be amended or
supplemented from time to time, collectively constitute the "Offer").
The Purchaser and Technical Olympic are each indirect wholly owned
subsidiaries of Technical Olympic S.A., a Greek corporation based in Athens.
Technical Olympic S.A. is an international diversified general construction
company that is involved in a variety of major infrastructure projects such as
highways and roads, tunnels, airports, irrigation and land reclamation projects,
marine and harbor works, and industrial, commercial, public and private
buildings in Greece, the United Kingdom and Romania. Technical Olympic is active
in homebuilding in the United States through its 80% ownership of Newmark Homes
Corp., a publicly held homebuilder based in Texas.
Tendering shareholders who have Shares registered in their name and who
tender directly to Wilmington Trust Company, as the depositary (the
"Depositary") will not be charged brokerage fees or commissions or, except as
otherwise provided in Instruction 6 of the Letter of Transmittal, stock transfer
taxes on the purchase of Shares by the Purchaser pursuant to the Offer.
Shareholders who hold their Shares through a broker, dealer, commercial bank or
trust company should consult with such institution as to whether there are any
fees applicable to a tender of Shares. Technical Olympic or the Purchaser will
pay all charges and expenses of the Depositary, Banc of America Securities LLC,
as the dealer manager (the "Dealer Manager"), and MacKenzie Partners, Inc., as
the information agent (the "Information Agent"), incurred in connection with the
Offer. See Section 16.
The Offer is being made pursuant to the Agreement and Plan of Merger (the
"Merger Agreement") dated as of October 12, 2000, by and among the Company,
Technical Olympic and the Purchaser. The Merger Agreement provides that the
Purchaser will be merged with and into the Company (the "Merger"), with the
Company continuing as the surviving corporation, wholly owned by Technical
Olympic. The Board of Directors of the Company (the "Company Board") has
unanimously approved the Merger Agreement, the Offer and the Merger, has
determined that the Offer and the Merger are fair to, and in the best interests
of, the shareholders of the Company, and recommends that shareholders tender
their shares pursuant to the Offer.
For a discussion of the Company Board's recommendation, see "Item 4. The
Solicitation or Recommendation" set forth in the Company's
Solicitation/Recommendation Statement on Schedule 14D-9 (together with any
amendments or supplements thereto, the "Schedule 14D-9"), which is being mailed
to shareholders with this Offer to Purchase.
Xxxxxxx Xxxxx Xxxxxx Inc. ("Xxxxxxx Xxxxx Xxxxxx"), the Company's financial
advisor, has delivered to the Company Board a written opinion, dated October 12,
2000, to the effect that, as of such date and based on and subject to the
matters stated in such opinion, the $19.10 per Share cash consideration to be
received in the Offer and the Merger by the holders of Shares (other than
Technical Olympic and its affiliates) was fair, from a financial point of view,
to such holders. A copy of Xxxxxxx Xxxxx Xxxxxx'x written opinion dated October
12, 2000 to the Company Board is contained in the Schedule 14D-9. Holders of
Shares are urged to read the full text of such opinion carefully in its
entirety.
The Offer is conditioned upon, among other things, there being validly
tendered in accordance with the terms of the Offer and not withdrawn prior to
the expiration of the Offer a number of Shares that represents at least a
majority of the total issued and outstanding Shares on a fully diluted basis as
of the date such Shares are purchased pursuant to the Offer (the "Minimum
Condition") and certain other conditions. See Section 12.
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For purposes of the Offer, "on a fully diluted basis" means, as of any
time, on a basis that includes the number of Shares that are actually issued and
outstanding plus the maximum number of Shares that the Company may be required
to issue pursuant to obligations under stock options, warrants and other rights
or securities convertible into shares of Xxxxx Homes common stock, whether or
not currently exercisable.
The Company has advised Technical Olympic that, on October 11, 2000,
10,871,539 Shares were issued and outstanding and 965,100 Shares were subject to
stock option grants. Neither Technical Olympic, the Purchaser nor any person
listed on Schedule I hereto beneficially owns any Shares. Accordingly, the
Purchaser believes that the Minimum Condition would be satisfied if
approximately 5,918,320 Shares were validly tendered and not withdrawn prior to
the expiration of the Offer.
The Merger Agreement provides that each issued and outstanding Share (other
than Shares owned by the Company, any direct or indirect wholly owned Subsidiary
(as defined in the Merger Agreement) of the Company, Technical Olympic or the
Purchaser or any Shares that are held by shareholders who have properly
exercised dissenters' rights under Florida law, if available ("Dissenting
Shareholders")) shall, by virtue of the Merger and without any action on the
part of the holder thereof, be converted into and represent the right to receive
an amount in cash, without interest, equal to the price paid for each Share
pursuant to the Offer (the "Merger Consideration"). The Merger Agreement is more
fully described in Section 11.
The Merger Agreement provides that promptly upon the purchase of and
payment for the Shares pursuant to the Offer, Technical Olympic and the
Purchaser will be entitled to designate such number of members of the Company
Board, rounded up to the next whole number, equal to that number of directors
that equals the product of (1) the total number of directors on the Company
Board (giving effect to the directors designated by Technical Olympic or the
Purchaser) and (2) the percentage that the number of Shares so purchased and
paid for bears to the total number of Shares then outstanding. The Company has
agreed, upon the request of Technical Olympic or the Purchaser, to increase the
size of the Company Board or use its reasonable best efforts to secure the
resignations of such number of directors, or both, as is necessary to enable
Technical Olympic's and the Purchaser's designees to be so elected or appointed
to the Company Board and cause Technical Olympic's and the Purchaser's designees
to be so elected. See Section 11.
The consummation of the Merger is subject to the satisfaction or waiver of
a number of conditions, including, if required, the approval of the Merger by
the shareholders of the Company. Under Florida law, the shareholder vote
necessary to approve the Merger will be the affirmative vote of at least a
majority of the outstanding Shares, including Shares held by the Purchaser and
its affiliates. Accordingly, if the Purchaser acquires a majority of the
outstanding Shares, the Purchaser will have sufficient voting power required to
approve the Merger without the affirmative vote of any other shareholder of the
Company. In the event the Purchaser obtains 80% or more of the outstanding
Shares pursuant to the Offer or otherwise, the Purchaser may effect the Merger
pursuant to the short-form merger provisions of the Florida Business Corporation
Act ("FBCA"), without the approval of any other shareholder of the Company.
Certain shareholders of the Company owning in the aggregate 3,743,049
Shares, or approximately 34% of the Shares issued and outstanding on October 12,
2000, have entered into a Stock Voting and Tender Agreement dated as of October
12, 2000, with Technical Olympic and the Purchaser (the "Shareholders
Agreement") whereby such shareholders have agreed to tender all of their Shares
pursuant to the Offer. This agreement is more fully described in Section 11.
This Offer to Purchase and the related Letter of Transmittal contain
important information that should be read carefully before any decision is made
with respect to the Offer.
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THE TENDER OFFER
1. TERMS OF THE OFFER.
Upon the terms and subject to the conditions of the Offer (including, if
the Offer is extended or amended, the terms and conditions of such extension or
amendment), the Purchaser will accept for payment, and pay for, all Shares
validly tendered prior to the Expiration Date and not properly withdrawn as
permitted under Section 4. The term "Expiration Date" means 12:00 midnight, New
York City time, on Friday, November 17, 2000, unless the Purchaser, in
accordance with the Merger Agreement, extends the period during which the Offer
is open, in which event the term "Expiration Date" means the latest time and
date on which the Offer, as so extended, expires. Under no circumstances will
any interest be paid on the Offer price for tendered Shares, regardless of any
extension of the Offer or any delay in making such payment.
The Offer is conditioned upon, among other things, satisfaction of the
Minimum Condition. The Offer is also conditioned upon the satisfaction of each
of the other conditions described in Section 12. If any of these conditions is
not satisfied prior to the Expiration Date (as may be extended by the Purchaser
pursuant to the Merger Agreement), the Purchaser may decline to purchase any of
the Shares tendered in the Offer and may terminate the Offer and return all
tendered Shares to tendering shareholders. The Purchaser reserves the right (but
shall not be obligated), subject to the provisions of the Merger Agreement, to
waive any or all of such conditions, except the Minimum Condition or, subject to
the right of shareholders to withdraw Shares until the Expiration Date, to
retain the Shares which have been tendered during the period or periods for
which the Offer is extended.
Subject to the applicable rules and regulations of the Securities and
Exchange Commission (the "SEC") and the terms of the Merger Agreement (see
Section 11), the Purchaser 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. Any such extension will be followed as promptly as possible by a
public announcement thereof. During any such extension, all Shares previously
tendered and not withdrawn will remain subject to the Offer, subject to the
rights of a tendering shareholder to withdraw such shareholder's Shares. See
Section 4. Subject to the terms of the Merger Agreement and the applicable rules
and regulations of the SEC, the Purchaser also expressly reserves the right, in
its sole discretion, at any time or from time to time, (1) to delay acceptance
for payment of, or (regardless of whether such Shares were already accepted for
payment) payment for, any tendered Shares, or to terminate or amend the Offer as
to any Shares not then paid for, upon the occurrence of any of the conditions
specified in Section 12 and (2) to waive any condition and to set forth or
change any other term or condition of the Offer, by giving oral or written
notice of such delay, termination or amendment to the Depositary and by making a
public announcement thereof; provided that pursuant to the Merger Agreement, the
Purchaser will not, without the prior written consent of the Company (such
consent to be authorized by the Company Board), (1) waive the Minimum Condition,
(2) decrease the amount or change the form of consideration payable in the
Offer, (3) decrease the number of Shares sought in the Offer, (4) impose
additional conditions to the Offer, (5) change any of the conditions set forth
in Section 12 (the "Offer Conditions"), (6) amend any other term of the Offer in
any manner materially adverse to the holders of Shares (other than Technical
Olympic or the Purchaser) or (7) except as provided below, extend the Offer.
Notwithstanding the foregoing, the Merger Agreement provides that the
Purchaser may, without the consent of the Company, (1) extend the Offer, if at
the scheduled Expiration Date, any of the Offer Conditions have not been
satisfied or waived, for one or more periods (each such period not to exceed ten
business days) until such conditions are satisfied or waived, (2) extend the
Offer for such period as may be required by any rule, regulation, interpretation
or position of the SEC or the staff thereof applicable to the Offer, or (3)
extend the Offer for an aggregate period of not more than ten business days
beyond the latest Expiration Date that would otherwise be permitted under clause
(1) or (2) of this sentence if on such Expiration Date the Offer Conditions have
been satisfied or waived but there have not been tendered (and not withdrawn)
that number of Shares that would equal 80% or more of the then outstanding
Shares on a fully diluted basis and Technical Olympic and the Purchaser
irrevocably waive any condition (other than the Minimum Condition) that
subsequently may not be satisfied during such extension of the Offer pursuant to
this clause (3). The Merger Agreement provides that (1) if all of the Offer
Conditions are not satisfied on any scheduled Expiration Date of the Offer, the
Purchaser will, upon the Company's request, extend the Offer for a period of not
more than ten business days and (2) if on the scheduled
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Expiration Date all of the Offer Conditions have been satisfied except for the
condition set forth in clause (iii) of paragraph (c) of Section 12 of this Offer
to Purchase and less than ten business days have passed since Technical Olympic
gave the written notice contemplated by such clause, the Purchaser will, upon
the Company's request, extend the Offer until the date that is ten business days
after such notice; provided, that the Purchaser will not extend the Offer beyond
February 12, 2001 (the "Outside Date") or, if earlier, the termination of the
Merger Agreement in accordance with its terms.
Under the Merger Agreement and pursuant to Rule 14d-11 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), the Purchaser, subject to
certain conditions, may elect to provide a subsequent offering period of three
to 20 business days in length following the expiration of the Offer on the
Expiration Date (the "Subsequent Offering Period"). A Subsequent Offering Period
would be an additional period of time, following the expiration of the Offer and
the purchase of Shares in the Offer, during which shareholders may tender Shares
not tendered in the Offer. A Subsequent Offering Period, if one is included, is
not an extension of the Offer, which already will have been completed. Under the
Exchange Act, no withdrawal rights apply to Shares tendered during the
Subsequent Offering Period, and no withdrawal rights apply during the Subsequent
Offering Period with respect to Shares tendered in the Offer and accepted for
payment. If a Subsequent Offering Period is included, the Purchaser will
promptly purchase and pay for any Shares tendered at the same price paid in the
Offer.
If the Purchaser accepts any Shares for payment pursuant to the terms of
the Offer, it will accept for payment all Shares validly tendered and not
withdrawn prior to the Expiration Date, and, subject to the terms and conditions
of the Offer, including but not limited to the Offer Conditions, it will accept
for payment and promptly pay for all Shares so accepted for payment. The
Purchaser confirms that its reservation of the right to delay payment for Shares
that it has accepted for payment is limited by Rule 14e-1(c) under the Exchange
Act, which requires that a tender offeror pay the consideration offered or
return the tendered securities promptly after the termination or withdrawal of a
tender offer.
Any extension, delay, termination or amendment of the Offer will be
followed as promptly as practicable by public announcement thereof, such
announcement in the case of an extension to be issued no later than 9:00 a.m.,
New York City time, on the next business day after the previously scheduled
Expiration Date, in accordance with the public announcement requirements of Rule
14e-1(d) under the Exchange Act. Subject to applicable law (including Rules
14d-4(d) and 14d-6(c) under the Exchange Act, which require that material
changes be promptly disseminated to shareholders in a manner reasonably designed
to inform them of such changes) and without limiting the manner in which the
Purchaser may choose to make any public announcement, the Purchaser shall have
no obligation to publish, advertise or otherwise communicate any such public
announcement other than by issuing a press release to the Dow Xxxxx News
Service.
The Purchaser confirms that if it makes a material change in the terms of
the Offer or the information concerning the Offer, or if it waives a material
condition of the Offer, the Purchaser will disseminate additional tender offer
materials and extend the Offer to the extent required by Rules 14d-4(d),
14d-6(c) and 14e-1 under the Exchange Act.
If, prior to the Expiration Date, the Purchaser (with the prior written
approval of the Company) decreases the number of Shares being sought or
increases the consideration offered pursuant to the Offer, such decrease or
increase shall be applicable to all holders whose Shares are accepted for
payment pursuant to the Offer and, if at the time that notice of any decrease or
increase is first published, sent or given to holders of Shares, the Offer is
scheduled to expire at any time earlier than the tenth business day from and
including the date that such notice is first so published, sent or given, the
Offer will be extended until the expiration of such ten business day period. 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.
The Company has provided the Purchaser with a list of the record holders of
the Shares and their addresses, as well as mailing labels for such record
holders, lists of non-objecting beneficial owners and security position listings
for the purpose of disseminating the Offer to holders of Shares. This Offer to
Purchase, the Letter of Transmittal and other relevant materials will be mailed
to record holders of Shares whose names appear on the Company's shareholder list
and will be furnished to brokers, dealers, commercial banks, trust companies and
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similar persons whose names, or the names of whose nominees, appear on the
Company's shareholder 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 by the Purchaser.
2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES.
Upon the terms and subject to the conditions of the Offer (including the
Offer Conditions and, if the Offer is extended or amended, the terms and
conditions of any such extension or amendment), the Purchaser will accept for
payment, and will pay for, all Shares validly tendered prior to the Expiration
Date and not properly withdrawn pursuant to the Offer as promptly as practicable
after the Expiration Date, if the Offer Conditions have been satisfied or
waived. Subject to the Merger Agreement and compliance with Rule 14e-1(c) under
the Exchange Act, the Purchaser expressly reserves the right to delay acceptance
for payment of, or payment for, Shares in order to comply, in whole or in part,
with any applicable law. See Section 15.
Payment for Shares tendered and accepted for payment pursuant to the Offer
will be made only after timely receipt by the Depositary of certificates for
such Shares (or a confirmation of a book-entry transfer of such Shares (a
"Book-Entry Confirmation") into the Depositary's account at The Depository Trust
Company (the "Book-Entry Transfer Facility")), a properly completed and duly
executed Letter of Transmittal (or facsimile thereof) and any other required
documents.
For purposes of the Offer, the Purchaser will be deemed to have accepted
for payment, and thereby purchased, Shares validly tendered and not properly
withdrawn as, if and when the Purchaser gives oral or written notice to the
Depositary of the Purchaser's acceptance for payment of such Shares pursuant to
the Offer. Payment for Shares accepted for payment pursuant to the Offer will be
made by deposit of the purchase price therefor with the Depositary, which will
act as agent for the tendering shareholders for the purpose of receiving
payments from the Purchaser and transmitting such payments to the tendering
shareholders whose Shares have been accepted for payment.
Under no circumstances will interest on the purchase price for shares be
paid, regardless of any extension of the Offer or any delay in making such
payment.
If any tendered Shares are not accepted for payment pursuant to the terms
and conditions of the Offer for any reason, or if certificates are submitted for
more Shares than are tendered, certificates evidencing unpurchased Shares will
be returned, without expense to the tendering shareholder (or, in the case of
Shares tendered by book-entry transfer of such Shares into the Depositary's
account at the Book-Entry Transfer Facility pursuant to the procedures set forth
in Section 3, such Shares will be credited to an account maintained with the
Book-Entry Transfer Facility), as soon as practicable following expiration or
termination of the Offer.
The Purchaser reserves the right to transfer or assign, in whole or from
time to time in part, to one or more of its affiliates, the right to purchase
all or any portion of the Shares tendered pursuant to the Offer, but any such
transfer or assignment will not relieve the Purchaser of its obligations under
the Offer and will in no way prejudice the rights of tendering shareholders to
receive payment for Shares validly tendered and accepted for payment pursuant to
the Offer.
3. PROCEDURE FOR TENDERING SHARES.
Valid Tenders. In order for a shareholder validly to tender Shares pursuant
to the Offer, either (1) a properly completed and duly executed Letter of
Transmittal (or a facsimile thereof), together with any required signature
guarantees, certificates for Shares to be tendered and any other documents
required by the Letter of Transmittal, must be received by the Depositary at one
of its addresses set forth on the back cover of this Offer to Purchase prior to
the Expiration Date, (2) such Shares must be delivered pursuant to the
procedures for book-entry transfer described below (and a Book-Entry
Confirmation of such delivery, including an Agent's Message (as defined below),
must be received by the Depositary) prior to the Expiration Date or (3) the
tendering shareholder must comply with the guaranteed delivery procedures set
forth below.
The term "Agent's Message" means a message, transmitted by the Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of a
Book-Entry Confirmation, that states that the Book-Entry
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Transfer Facility has received an express acknowledgment from the participant in
the Book-Entry Transfer Facility tendering the Shares that are the subject of
such Book-Entry Confirmation, that such participant has received and agrees to
be bound by the terms of the Letter of Transmittal and that the Purchaser may
enforce such agreement against the participant.
Book-Entry Delivery. The Depositary will establish accounts with respect to
the Shares at the Book-Entry Transfer Facility for purposes of the Offer within
two business days after the date of this Offer to Purchase. Any financial
institution that is a participant in the Book-Entry Transfer Facility's systems
may make a book-entry delivery of Shares by causing the Book-Entry Transfer
Facility to transfer such Shares into the Depositary's account at the Book-Entry
Transfer Facility in accordance with the Book-Entry Transfer Facility's
procedures for such transfer. However, although delivery of Shares may be
effected through book-entry transfer, either the Letter of Transmittal (or a
facsimile thereof), properly completed and duly executed, with any required
signature guarantees, or an Agent's Message in lieu of a Letter of Transmittal,
and any other required documents, must, in any case, be transmitted to, and
received by, the Depositary at one of its addresses set forth on the back cover
of this Offer to Purchase prior to the Expiration Date, or the tendering
shareholder must comply with the guaranteed delivery procedures described below.
Delivery of documents to the Book-Entry Transfer Facility in accordance
with the Book-Entry Transfer Facility's procedures does not constitute delivery
to the Depositary.
THE METHOD OF DELIVERY OF SHARES, THE LETTER OF TRANSMITTAL AND ALL OTHER
REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK-ENTRY TRANSFER FACILITY,
IS AT THE OPTION AND RISK OF THE TENDERING SHAREHOLDER, AND THE DELIVERY WILL BE
DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY (INCLUDING, IN THE
CASE OF A BOOK-ENTRY TRANSFER, BY BOOK-ENTRY CONFIRMATION). IF DELIVERY IS BY
MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS
RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY
DELIVERY.
Signature Guarantees. Except as otherwise provided below, all signatures on
a Letter of Transmittal must be guaranteed by a financial institution (including
most commercial banks, savings and loan associations and brokerage houses) that
is a participant in the Securities Transfer Agents Medallion Program, the New
York Stock Exchange Medallion Signature Guarantee Program or the Stock Exchange
Medallion Program (each, an "Eligible Institution"). No signature guarantee is
required on the Letter of Transmittal (1) if the Letter of Transmittal is signed
by the registered holder(s) (which term, for purposes of this Section 3,
includes any participant in any of the Book-Entry Transfer Facility's systems
whose name appears on a security position listing as the owner of the Shares) of
Shares tendered therewith and such registered holder has not completed either
the box entitled "Special Delivery Instructions" or the box entitled "Special
Payment Instructions" on the Letter of Transmittal or (2) if such Shares are
tendered for the account of an Eligible Institution. See Instructions 1 and 5 to
the Letter of Transmittal. If the certificates for Shares are registered in the
name of a person or persons other than the signer of the Letter of Transmittal,
or if payment is to be made or delivered to, or certificates for Shares not
tendered or not accepted for payment are to be returned to, a person other than
the registered holder of the certificates surrendered, the tendered certificates
for such Shares must be endorsed or accompanied by appropriate stock powers, in
either case signed exactly as the name or names of the registered holder(s)
appear on the certificates, with the signatures on the certificates or stock
powers guaranteed in the manner described above. See Instructions 1 and 5 to the
Letter of Transmittal.
Guaranteed Delivery. A shareholder desiring to tender Shares pursuant to
the Offer and whose certificates for Shares are not immediately available or who
cannot comply with the procedures for book-entry transfer on a timely basis or
who cannot deliver all required documents to the Depositary prior to the
Expiration Date, may nevertheless tender such Shares, provided that all of the
following conditions are satisfied:
(1) such tender is made by or through an Eligible Institution;
(2) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form made available by the Purchaser, is
received by the Depositary, as provided below, prior to the Expiration
Date; and
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(3) the certificates for all tendered Shares, in proper form for
transfer (or a Book-Entry Confirmation with respect to all such Shares),
together with a properly completed and duly executed Letter of Transmittal
(or a facsimile thereof), with any required signature guarantees (or, in
the case of a book-entry transfer, an Agent's Message in lieu of a Letter
of Transmittal), and any other required documents are received by the
Depositary within three trading days after the date of execution of such
Notice of Guaranteed Delivery. A "trading day" is any day on which the
Nasdaq National Market operated by the National Association of Securities
Dealers, Inc. (the "NASD") is open for business.
The Notice of Guaranteed Delivery may be delivered by hand or overnight
courier to the Depositary or transmitted by facsimile or mailed to the
Depositary and must include a guarantee by an Eligible Institution in the form
set forth in the form of Notice of Guaranteed Delivery made available by the
Purchaser.
Other Requirements. Notwithstanding any other provision hereof, payment for
Shares accepted for payment pursuant to the Offer will in all cases be made only
after timely receipt by the Depositary of (1) certificates for (or a timely
Book-Entry Confirmation with respect to) such Shares, (2) a Letter of
Transmittal (or a facsimile thereof), properly completed and duly executed, with
any required signature guarantees (or, in the case of a book-entry transfer, an
Agent's Message in lieu of a Letter of Transmittal) and (3) any other documents
required by the Letter of Transmittal. Accordingly, tendering shareholders may
be paid at different times depending upon when certificates for Shares or
Book-Entry Confirmations with respect to such Shares are actually received by
the Depositary.
Tender Constitutes an Agreement. The valid tender of Shares pursuant to one
of the procedures described above will constitute a binding agreement between
the tendering shareholder and the Purchaser upon the terms and subject to the
conditions of the Offer.
Appointment. By executing a Letter of Transmittal as set forth above
(including through delivery of an Agent's Message), the tendering shareholder
irrevocably appoints designees of the Purchaser as such shareholder's
attorneys-in-fact and proxies in the manner set forth in the Letter of
Transmittal, each with full power of substitution, to the full extent of such
shareholder's rights with respect to the Shares tendered by such shareholder and
accepted for payment by the Purchaser (including with respect to any and all
other Shares or other securities or rights issued or issuable in respect of such
Shares on or after the date of this Offer to Purchase). All such proxies will be
considered coupled with an interest in the tendered Shares. Such appointment
will be effective when, and only to the extent that, the Purchaser accepts for
payment the Shares tendered by such shareholder as provided herein. Upon such
appointment, all prior powers of attorney, proxies and consents given by such
shareholder with respect to such Shares (and such other Shares and securities or
rights) will, without further action, be revoked, and no subsequent powers of
attorney, proxies, consents or revocations may be given (and, if given, will be
deemed not effective). The designees of the Purchaser will thereby be empowered
to exercise all voting and other rights with respect to such Shares (and other
Shares and securities or rights) in respect of any annual, special or adjourned
or postponed meeting of the Company's shareholders, actions by written consent
in lieu of any such meeting or otherwise, as they in their sole discretion deem
proper. The Purchaser reserves the right to require that, in order for Shares to
be deemed validly tendered, immediately upon the Purchaser's acceptance for
payment of such Shares, the Purchaser must be able to exercise full voting and
other rights with respect to such Shares, including, without limitation, voting
at any meeting of shareholders then scheduled.
Determination of Validity. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance for payment of any tender
of Shares will be determined by the Purchaser in its sole discretion, which
determination will be final and binding on all parties. The Purchaser reserves
the absolute right to reject any or all tenders determined by it not to be in
proper form or the acceptance for payment of which may, in the opinion of the
Purchaser's counsel, be unlawful. The Purchaser also reserves the absolute right
to waive any defect or irregularity in the tender of any Shares of any
particular shareholder, whether or not similar defects or irregularities are
waived in the case of other shareholders. No tender of Shares will be deemed to
have been validly made until all defects or irregularities relating thereto have
been cured or waived to the satisfaction of Purchaser. None of the Purchaser,
Technical Olympic, the Depositary, the Information Agent, the Dealer Manager or
any other person will be under any duty to give notification of any defects or
irregularities in tenders
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or incur any liability for failure to give any such notification. The
Purchaser's interpretation of the terms and conditions of the Offer (including
the Letter of Transmittal and the instructions thereto) will be final and
binding.
Backup Withholding. Under the "backup withholding" provisions of U.S.
federal income tax law, the Depositary may be required to withhold 31% of the
amount of any payments pursuant to the Offer. In order to prevent backup federal
income tax withholding with respect to payments of cash pursuant to the Offer, a
U.S. Holder (as defined herein) surrendering Shares in the Offer must, unless an
exemption applies, provide the Depositary with such U.S. Holder's correct
taxpayer identification number ("TIN") on a Substitute Form W-9 and certify
under penalties of perjury that such TIN is correct and that such U.S. Holder is
not subject to backup withholding. If a U.S. Holder does not provide a correct
TIN or fails to provide the certifications described above, the Internal Revenue
Service (the "IRS") may impose a penalty on such U.S. Holder and payment of cash
to such shareholder pursuant to the Offer may be subject to backup withholding.
All U.S. Holders surrendering Shares pursuant to the Offer should complete and
sign the Substitute Form W-9 included as part of the Letter of Transmittal to
provide the information and certification necessary to avoid backup withholding
(unless an applicable exemption exists and is proved in a manner satisfactory to
the Purchaser and the Depositary). Certain shareholders are not subject to
backup withholding. Noncorporate foreign shareholders should complete and sign a
Form W-8, Certificate of Foreign Status, a copy of which may be obtained from
the Depositary, in order to avoid backup withholding. See Section 5 of this
Offer to Purchase and Instruction 9 to the Letter of Transmittal.
4. RIGHTS OF WITHDRAWAL.
Tenders of Shares made pursuant to the Offer are irrevocable, except that
Shares tendered pursuant to the Offer may be withdrawn pursuant to the
procedures set forth below at any time prior to the Expiration Date and, unless
theretofore accepted for payment by the Purchaser pursuant to the Offer, may
also be withdrawn at any time after Monday, December 18, 2000 (or such later
date as may apply if the Offer is extended).
For a withdrawal to be effective, a written, telegraphic or facsimile
transmission notice of withdrawal must be timely received by the Depositary at
one of its addresses set forth on the back cover of this Offer to Purchase and
must specify the name, address and TIN of the person having tendered the Shares
to be withdrawn, the number of Shares to be withdrawn and the name of the
registered holder of the Shares to be withdrawn, if different from the name of
the person who tendered such Shares. If certificates evidencing Shares to be
withdrawn have been delivered or otherwise identified to the Depositary, then,
prior to the physical release of such certificates, the serial numbers shown on
such certificates must be submitted to the Depositary and, unless such Shares
have been tendered for the account of an Eligible Institution, the signature(s)
on the notice of withdrawal must be guaranteed by an Eligible Institution. If
Shares have been delivered pursuant to the procedures for book-entry transfer as
set forth in Section 3, any notice of withdrawal must also specify the name and
number of the account at the Book-Entry Transfer Facility to be credited with
the withdrawn Shares and otherwise comply with the Book-Entry Transfer
Facility's procedures.
All questions as to the form and validity (including time of receipt) of
notices of withdrawal will be determined by the Purchaser, in its sole
discretion, whose determination will be final and binding. None of the
Purchaser, Technical Olympic, the Depositary, the Information Agent, the Dealer
Manager or any other person will be under any duty to give notification of any
defects or irregularities in any notice of withdrawal or incur any liability for
failure to give any such notification.
Withdrawals of tenders of Shares may not be rescinded, and any Shares
properly withdrawn will thereafter be deemed not validly tendered for purposes
of the Offer. However, withdrawn Shares may be re-tendered by following one of
the procedures described in Section 3 at any time prior to the Expiration Date.
If the Purchaser extends the Offer, is delayed in its acceptance for
payment of Shares, or is unable to accept for payment Shares pursuant to the
Offer for any reason, then, without prejudice to the Purchaser's rights under
the Offer, the Depositary may, nevertheless, on behalf of the Purchaser, retain
tendered Shares, and such Shares may not be withdrawn except to the extent that
tendering shareholders are entitled to withdrawal rights as set forth in this
Section 4. Any such delay will be an extension of the Offer to the extent
required by applicable rules and regulations.
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In the event the Purchaser provides a Subsequent Offering Period following
the Offer, no withdrawal rights will apply to Shares tendered during such
Subsequent Offering Period or to Shares tendered in the Offer and accepted for
payment.
5. CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES.
The following is a general discussion of certain U.S. federal income tax
consequences of the receipt of cash by a holder of Shares pursuant to the Offer
or the Merger. The discussion is based on the Internal Revenue Code of 1986, as
amended to the date hereof (the "Code"), Treasury Regulations, administrative
pronouncements and judicial decisions, in each case as in effect on the date
hereof, all of which are subject to change (possibly with retroactive effect)
and possibly to differing interpretations. No ruling will be requested from the
IRS regarding the tax consequences of the Offer or the Merger, and there can be
no assurance that the IRS will agree with the discussion set forth below. This
discussion does not address state, local or foreign tax laws and, except as
specifically noted, applies only to a U.S. Holder.
A "U.S. Holder" means a holder of Shares that is for U.S. federal income
tax purposes (1) a citizen or resident of the United States, (2) a corporation
or other entity taxable as a corporation created or organized in or under the
laws of the United States or any political subdivision thereof or therein, (3)
an estate the income of which is subject to U.S. federal income taxation
regardless of its source or (4) a trust if (x) a court within the United States
is able to exercise primary supervision over the administration of the trust and
(y) one or more U.S. persons have the authority to control all substantial
decisions of the trust. In the case of a partnership that holds Shares, any
partner described in any of clauses (1) through (4) above generally is also a
U.S. Holder. A "Non-U.S. Holder" is a holder of Shares, generally including any
partner in a partnership that holds Shares, that is not a U.S. Holder.
The transfer of Shares pursuant to the Offer or the Merger will be a
taxable transaction for U.S. federal income tax purposes under the Code and may
also be a taxable transaction under applicable state, local or foreign income or
other tax laws. Generally, for U.S. federal income tax purposes, a U.S. Holder
will recognize gain or loss equal to the difference between the amount of cash
received by the U.S. Holder pursuant to the Offer or the Merger and the
aggregate tax basis in the Shares transferred by such U.S. Holder pursuant to
the Offer (or canceled pursuant to the Merger). Gain or loss will be calculated
separately for each block of Shares tendered and purchased pursuant to the Offer
(or canceled pursuant to the Merger).
Gain (or loss) will be capital gain (or loss), assuming that such Shares
are held as a capital asset. Capital gains of individuals, estates and trusts
generally are subject to preferential U.S. federal income tax rates if, at the
time the Company accepts the Shares for payment, the shareholder held the Shares
for more than one year. Capital gains of corporations generally are taxed at the
same federal income tax rates applicable to corporate ordinary income. In
addition, under present law, the ability to use capital losses to offset
ordinary income is limited.
A U.S. Holder that tenders Shares pursuant to the Offer or surrenders
Shares pursuant to the Merger may be subject to 31% backup withholding unless
the U.S. Holder provides its TIN and certifies that such number is correct or
properly certifies that it is awaiting a TIN, or unless an exemption applies. A
shareholder that does not furnish its TIN may be subject to a penalty imposed by
the IRS. See Section 3.
If backup withholding applies to a holder of Shares, the Depositary is
required to withhold 31% from payments to such holder. Backup withholding is not
an additional tax. Rather, the amount of the backup withholding can be credited
against the U.S. federal income tax liability of the person subject to the
backup withholding, provided that the required information is given to the IRS.
If backup withholding results in an overpayment of tax, a refund can be claimed
by the shareholder on a timely filed U.S. federal income tax return.
The foregoing discussion may not be applicable with respect to shares
received pursuant to the exercise of employee stock options or otherwise as
compensation or with respect to holders of shares who are subject to special tax
treatment under the Code, such as Non-U.S. Holders, life insurance companies,
tax-exempt organizations, financial institutions, dealers in securities or
currencies, persons who hold shares as a position in a "straddle" or as part of
a "hedging," "conversion" or "constructive sale" transaction and persons that
have a
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functional currency other than the U.S. dollar. The discussion may not apply to
a holder of shares in light of such xxxxxx's individual circumstances and may
not discuss every aspect of U.S. federal tax law that may be relevant to holders
(including, but not limited to, the applicability of any estate or gift tax
laws). Shareholders are urged to consult their own tax advisors to determine the
particular tax consequences to them (including the application and effect of any
state, local or foreign income and other tax laws) of the Offer and the Merger.
6. PRICE RANGE OF THE SHARES; DIVIDENDS.
The Shares are listed for trading on the Nasdaq National Market under the
symbol "ENGL." The following table sets forth, for the periods indicated, the
high and low closing sales prices for the Shares on the Nasdaq National Market
based upon published financial sources:
HIGH LOW DIVIDENDS
------ ------ ---------
YEAR ENDED OCTOBER 31, 2000:
Fourth Quarter (through October 18, 2000).............. $18.81 $ 9.56 $ --
Third Quarter.......................................... 10.63 9.06 0.06
Second Quarter......................................... 11.13 9.09 0.06
First Quarter.......................................... 13.63 10.31 0.06
YEAR ENDED OCTOBER 31, 1999:
Fourth Quarter......................................... 13.00 8.63 0.06
Third Quarter.......................................... 14.13 11.63 0.06
Second Quarter......................................... 14.00 8.75 0.04
First Quarter.......................................... 15.31 12.75 0.04
YEAR ENDED OCTOBER 31, 1998:
Fourth Quarter......................................... 15.63 11.00 0.04
Third Quarter.......................................... 17.50 13.69 0.04
Second Quarter......................................... 18.00 14.44 0.04
First Quarter.......................................... 19.50 13.88 0.04
On October 11, 2000, the last full trading day before the first public
announcement of the execution of the Merger Agreement, the closing price of the
Shares on the Nasdaq National Market was $15.75 per Share. On October 18, 2000,
the closing price of the Shares on the Nasdaq National Market was $18.75 per
Share. Shareholders are urged to obtain current market quotations for the
Shares.
The Merger Agreement prohibits the Company from declaring or paying any
dividends until the earlier of (1) effectiveness of the Merger, (2) such time as
designees of Technical Olympic and the Purchaser constitute a majority of the
Company Board and (3) such time as the Merger Agreement may be terminated in
accordance with its terms.
7. EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES; STOCK QUOTATION; EXCHANGE
ACT REGISTRATION; MARGIN REGULATIONS.
Market for the Shares. The purchase of Shares by the Purchaser pursuant to
the Offer will reduce the number of holders of Shares and the number of Shares
that might otherwise trade publicly, which could adversely affect the liquidity
and market value of the remaining Shares held by the shareholders other than the
Purchaser.
Stock Quotation. Depending upon the number of Shares purchased pursuant to
the Offer and the aggregate market value of any Shares not purchased pursuant to
the Offer, the Shares may no longer meet the requirements for continued
inclusion in the Nasdaq National Market, which among other things require that
an issuer have either:
- at least 750,000 publicly held shares, held by at least 400 shareholders
of round lots (holders of 100 shares or more), with an aggregate market
value of publicly held shares of at least $5 million, net tangible assets
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of at least $4 million, a minimum bid price of at least $1 per share, and
at least two registered and active market makers providing quotations for
the shares, or
- at least 1.1 million publicly held shares, held by at least 400
shareholders of round lots, with an aggregate market value of publicly
held shares of at least $15 million, a minimum bid price of at least $5
per share and either (1) a market capitalization of at least $50 million
or (2) total assets and total revenue of at least $50 million each for
the most recently completed fiscal year or two of the last three most
recently completed fiscal years and at least four registered and active
market makers providing quotations for the shares.
If neither of the foregoing standards is met, the Shares would be subject
to being delisted on the Nasdaq National Market. Shares held directly or
indirectly by directors, officers or beneficial owners of more than 10% of the
outstanding Shares are not considered as being publicly held for this purpose.
According to information provided by the Company, as of October 11, 2000, there
were approximately 52 shareholders of record.
The Purchaser cannot predict whether the reduction in the number of Shares
that might otherwise trade publicly would have an adverse or beneficial effect
on the market price for, or marketability of, the Shares or whether such
reduction would cause future market prices to be greater or less than the Offer
price.
If the Shares were to cease to be quoted on the Nasdaq National Market, the
market for the Shares could be adversely affected. It is possible that the
Shares would be traded or quoted on other securities exchanges or in the
over-the-counter market and that price quotations would be reported by such
exchange or through Nasdaq or other sources. The extent of the public market for
the Shares and the availability of such quotations would depend, however, upon
the number of shareholders and/or the aggregate market value of the Shares
remaining at such time, the interest in maintaining a market in the Shares on
the part of securities firms, the possible termination of registration of the
Shares under the Exchange Act and other factors.
Exchange Act Registration. The Shares are currently registered under the
Exchange Act. Such registration may be terminated by the Company upon
application to the SEC if the outstanding Shares are not listed on a national
securities exchange and there are fewer than 300 holders of record of the
Shares. Termination of registration of the Shares under the Exchange Act would
substantially reduce the information required to be furnished by the Company to
its shareholders and to the SEC and would make certain provisions of the
Exchange Act no longer applicable to the Company, such as the short-swing profit
recovery provisions of Section 16(b) of the Exchange Act, the requirement of
furnishing a proxy statement pursuant to Section 14(a) of the Exchange Act in
connection with shareholders' meetings and the related requirement of furnishing
an annual report to shareholders and the requirements of Rule 13e-3 under the
Exchange Act with respect to "going private" transactions. Furthermore, the
ability of "affiliates" of the Company and persons holding "restricted
securities" of the Company to dispose of such securities pursuant to Rule 144
promulgated under the Securities Act of 1933, as amended (the "Securities Act"),
may be impaired or eliminated. If registration of the Shares under the Exchange
Act were terminated, the Shares would no longer be eligible for Nasdaq National
Market reporting or for continued inclusion on the list of "margin securities"
of the Board of Governors of the Federal Reserve System (the "Federal Reserve
Board").
Margin Regulations. The Shares are currently "margin securities" under the
regulations of the Federal Reserve Board, which has the effect, among other
things, of allowing brokers to extend credit on the collateral of the Shares.
Depending upon factors similar to those described above regarding listing and
market quotations, it is possible that, following the Offer, the Shares would no
longer constitute "margin securities" for the purposes of the margin regulations
of the Federal Reserve Board and therefore could no longer be used as collateral
for loans made by brokers. In any event, the Shares will cease to be "margin
securities" if registration of the Shares under the Exchange Act is terminated.
8. CERTAIN INFORMATION CONCERNING THE COMPANY.
The Company is a Florida corporation with its principal executive offices
located at 000 X.X. 00xx Xxxxxx, Xxxxx 000, Xxxx Xxxxx, Xxxxxxx 00000, and its
telephone number is (000) 000-0000. The Company designs,
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constructs, markets and sells detached single-family residences, townhomes,
patio homes and condominiums to entry level and move-up buyers, retirees and
second home, seasonal buyers.
Except as otherwise stated in this Offer to Purchase, the information
concerning the Company contained herein has been taken from or based upon
publicly available documents on file with the SEC and other publicly available
information. Although the Purchaser, Technical Olympic, the Information Agent
and the Dealer Manager do not have any knowledge that any such information is
untrue in any material respect, none of the Purchaser, Technical Olympic, the
Information Agent or the Dealer Manager takes any responsibility for the
accuracy or completeness of such information or for any failure by the Company
to disclose events that may have occurred and may affect the significance or
accuracy of any such information.
Certain Financial Projections. The Company does not, as a matter of course,
make public forecasts or projections as to its future financial performance.
However, in connection with the negotiations between Technical Olympic and the
Company, the Company made available to Technical Olympic and its representatives
certain nonpublic information (the "Projections") regarding the Company's
projected operating performance. Such information included, among other things,
the Company's projections of revenues, net income and earnings before interest,
taxes, depreciation and amortization ("EBITDA") for the Company for the
Company's fiscal years 2000 and 2001. Set forth below is a summary of such
projections. These projections should be read together with the financial
statements of the Company that can be obtained from the SEC as described below.
FISCAL 2000 FISCAL 2001
----------- -----------
(IN MILLIONS)
Revenues....................................... $796.1 $931.0
Net income..................................... 34.2 38.8
EBITDA......................................... 80.2 92.4
The Projections were prepared solely for internal use and not with a view
to public disclosure or compliance with the published guidelines of the SEC or
the American Institute of Certified Public Accountants regarding projections and
were not prepared with the assistance of, or reviewed by, independent
accountants. The Projections are included in this Offer to Purchase solely
because such information was furnished to Technical Olympic and the Purchaser by
the Company. The Projections were not prepared in accordance with generally
accepted accounting principles and were not audited or reviewed by any
independent accounting firm, nor did any such firm perform any other services
with respect thereto. The Projections are based on a variety of assumptions
relating to the business of the Company, industry performance, general business
and economic conditions and other matters, which are inherently subject to
significant uncertainties and contingencies, many of which are beyond the
Company's control. These assumptions involve judgments with respect to, among
other things, future economic and competitive conditions, inflation rates and
future business conditions. Accordingly, there can be no assurance that the
assumptions made in preparing the Projections will prove accurate, and actual
results may be materially greater or less than those contained in the
Projections. The inclusion of the Projections herein should not be regarded as
an indication that the Company, Technical Olympic, the Purchaser or their
respective affiliates or representatives considered or consider the Projections
to be a reliable prediction of future events, and the Projections should not be
relied upon as such. None of Technical Olympic, the Purchaser, the Company or
any of their respective affiliates assumes any responsibility for the validity,
reasonableness, accuracy or completeness of the Projections. None of Technical
Olympic, the Purchaser or the Company is under any obligation to or has any
intention to update the Projections at any future time.
Available Information. The Company is subject to the informational
requirements of the Exchange Act and, in accordance therewith, is required to
file reports and other information relating to its business, financial condition
and other matters. Information as of particular dates concerning the Company's
directors and officers, their remuneration, stock options and other matters, the
principal holders of the Company's securities and any material interest of such
persons in transactions with the Company is required to be disclosed in proxy
statements distributed to the Company's shareholders and filed with the SEC.
Such reports, proxy statements and other information should be available for
inspection at the public reference facilities of the SEC at 000 Xxxxx Xxxxxx,
X.X., Xxxxxxxxxx, X.X. 00000, and at the regional offices of the SEC located at
Seven World Trade Center, 13th Floor, New York, NY 10048 and at Citicorp Center,
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX
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60661. Copies of such information should be obtainable, by mail, upon payment of
the SEC's customary charges, by writing to the SEC's principal office at 000
Xxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000. The SEC maintains a web site that
contains reports, proxy and information statements and other information
regarding registrants that file electronically with the SEC. Such reports, proxy
and information statements and other information may be found on the SEC's web
site address, xxxx://xxx.xxx.xxx. Although neither Technical Olympic nor the
Purchaser has any knowledge that any such information is untrue in any material
respect, Technical Olympic and the Purchaser take no responsibility for the
accuracy or completeness of information contained in this Offer to Purchase with
respect to the Company or for any failure by the Company to disclose events
which may have occurred or may affect the significance or accuracy of any such
information.
9. CERTAIN INFORMATION CONCERNING THE PURCHASER AND TECHNICAL OLYMPIC.
The Purchaser is a Florida corporation and, to date, has engaged in no
activities other than those incident to its formation, its entering into the
Merger Agreement and the Shareholders Agreement and the commencement of the
Offer. The principal executive office of the Purchaser is located at 0000
Xxxxxxxx Xxxxx Xxxxx, Xxxxx Xxxx, Xxxxx 00000, and its telephone number is (281)
243-0127. All outstanding shares of common stock of the Purchaser are presently
owned by Technical Olympic. In connection with satisfying certain financing
requirements for Technical Olympic, it is expected that, prior to the
consummation of the Offer, Technical Olympic will contribute all of the
outstanding capital stock of Purchaser to a newly formed wholly owned subsidiary
of Technical Olympic, which will be a Delaware corporation ("Xxxxx Holdings").
Xxxxx Holdings will be a holding company established solely to hold the
common stock of the Purchaser and will not engage in any activities other than
those incident to its formation and the holding of Purchaser stock. The
principal executive office of Xxxxx Holdings is expected to be located at 0000
Xxxxxxxx Xxxxx Xxxxx, Xxxxx Xxxx, Xxxxx 00000, and its telephone number will be
(000) 000-0000.
Technical Olympic is a Delaware corporation with its principal executive
offices located at 0000 Xxxxxxxx Xxxxx Xxxxx, Xxxxx Xxxx, Xxxxx 00000, and its
telephone number is (000) 000-0000. Technical Olympic invests directly or
indirectly in various companies. Technical Olympic currently is the shareholder
of record of 80% of the outstanding shares of Newmark Homes Corp. Technical
Olympic is a wholly owned subsidiary of Technical Olympic (UK) Plc, a company
incorporated under the laws of Great Britain.
Technical Olympic is not subject to the informational reporting
requirements of the Exchange Act and, as such, is not required to file reports,
proxy statements or other information with the SEC. Technical Olympic has filed
certain limited information with the SEC under Rules 13d-1 and 13d-2 of the
Exchange Act.
Technical Olympic (UK) Plc is a holding company that invests directly or
indirectly in various companies and engages in the real estate industry. Its
principal executive offices are located at 00 Xxxxxxx Xxxxxx, Xxx Xxxxxxxx,
Xxxxxx, Xxxxxx 17456, and its phone number is 000-000-000-0000. Technical
Olympic (UK) Plc is a wholly owned subsidiary of Technical Olympic S.A.
Technical Olympic S.A. is an international diversified general construction
company incorporated under the laws of Greece. Technical Olympic S.A. is
involved in a variety of major infrastructure projects such as highways and
roads, tunnels, airports, irrigation and land reclamation projects, marine and
harbor works, industrial, commercial, and public and private buildings in
Greece, the United Kingdom and Romania. Its principal executive offices are
located at 00 Xxxxxxx Xxxxxx, Xxx Xxxxxxxx, Xxxxxx, Xxxxxx 17456 and, its phone
number is 000-000-000-0000.
The name, citizenship, business address, business phone number, current
principal occupation or employment and five-year employment history of each of
the directors and executive officers of the Purchaser, Technical Olympic and
Technical Olympic S.A. are set forth in Schedule I hereto.
During the last five years, none of the Purchaser, Xxxxx Holdings,
Technical Olympic, Technical Olympic (UK) Plc or Technical Olympic S.A. or, to
the best of their respective knowledge, any of the persons listed on Schedule I
hereto has been convicted in a criminal proceeding (excluding traffic violations
or similar misdemeanors) or was a party to any judicial or administrative
proceeding (except for matters that were dismissed without sanction or
settlement) that resulted in a judgment, decree or final order enjoining the
person from future
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violations of, or prohibiting activities subject to, federal or state securities
laws, or a finding of any violation of federal or state securities laws.
Except as set forth in this Offer to Purchase, none of the Purchaser, Xxxxx
Holdings, Technical Olympic, Technical Olympic (UK) Plc or Technical Olympic
S.A. or, to the best of their respective knowledge, any of the persons listed on
Schedule I hereto, or any associate or majority-owned subsidiary of the
foregoing, (1) beneficially owns or has a right to acquire, directly or
indirectly, any equity security of the Company or (2) has effected any
transaction in any equity security of the Company during the past 60 days.
Except as set forth in this Offer to Purchase, none of the Purchaser, Xxxxx
Holdings, Technical Olympic, Technical Olympic (UK) Plc or Technical Olympic
S.A. or, to the best of their respective knowledge, any of the persons listed on
Schedule I hereto has any other contract, arrangement, understanding or
relationship with any other person 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 such securities,
finder's fees, joint ventures, loan or option arrangements, puts or calls,
guarantees of loans, guarantees against loss, guarantees of profits, division of
profits or loss, or the giving or withholding of proxies.
Except as set forth in this Offer to Purchase, none of the Purchaser, Xxxxx
Holdings, Technical Olympic, Technical Olympic (UK) Plc or Technical Olympic
S.A. or, to the best of their respective knowledge, any of the persons listed on
Schedule I hereto, has had any business relationship or transaction with the
Company or any of its executive officers, directors or affiliates that would
require reporting under the rules of the SEC applicable to the Offer. Except as
set forth in this Offer to Purchase, there have been no contracts, negotiations
or transactions between the Purchaser, Xxxxx Holdings, Technical Olympic,
Technical Olympic (UK) Plc or Technical Olympic or to the best of their
respective knowledge, any of the persons listed on Schedule I hereto, on the one
hand, and the Company or its affiliates, on the other hand, concerning a merger,
consolidation or acquisition, a tender offer or other acquisition of securities,
an election of directors or a sale or other transfer of a material amount of
assets.
10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY.
In December 1999, Technical Olympic entered the U.S. homebuilding market
through its acquisition of a controlling interest in Newmark Homes Corp.
("Newmark"). After the acquisition, Technical Olympic remained interested in
increasing its homebuilding operations in the United States. In the early summer
of 2000, representatives of Technical Olympic believed that the Company might be
receptive to opening discussions regarding the sale of all of, or a controlling
equity interest in, the Company. In late June 2000, representatives of Technical
Olympic expressed to the Company's financial advisor Technical Olympic's
interest in pursuing these discussions with the Company. The initial inquiries
of Technical Olympic were regarding a possible acquisition of a controlling
block of the Shares.
In July 2000, the Company and Technical Olympic agreed to exchange
information under a confidentiality arrangement. On July 18, 2000,
representatives of Technical Olympic and members of the Company's senior
management team met in Miami, Florida to discuss a potential acquisition
transaction and, shortly thereafter, additional information was provided. During
late July and early August, representatives of Technical Olympic evaluated
publicly available information related to the Company and other information
provided by the Company.
On August 24, 2000, after completion of a preliminary financial evaluation,
Technical Olympic provided the Company with a non-binding preliminary term sheet
indicating a possible purchase price of $215 million for the Company. At such
time, Technical Olympic conditioned its further negotiations with the Company on
an exclusive dealings arrangement and the ability to conduct a substantial due
diligence investigation of the Company. On August 28, 2000, the Company executed
an agreement to negotiate exclusively with Technical Olympic through September
30, 2000. A revised preliminary term sheet was also provided by Technical
Olympic, which formed the basis for further discussions regarding a proposed
transaction.
In September 2000, representatives of Technical Olympic advised senior
executives of Newmark of its interest in the Company. On September 14, 2000, the
special committee of three independent Newmark directors met and determined that
Newmark would not pursue an acquisition of the Company due to the lack of
necessary
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financial resources and the potential impact that such a large acquisition would
have on Newmark's financial condition.
Throughout September 2000, Technical Olympic conducted an extensive due
diligence investigation of the Company and its subsidiaries, and representatives
of the Company and Technical Olympic negotiated the terms of the Merger
Agreement. In addition, at the insistence of the Company, Technical Olympic
provided the Company with a firm commitment letter from a major financial
institution with respect to the proposed borrowings required to fund the Offer
and the Merger. On September 30, 2000, the Company extended the Technical
Olympic exclusive negotiating period through October 12, 2000.
As a condition to Technical Olympic's consideration of an acquisition
transaction, Technical Olympic, the Company and representatives of the Company's
executive officers and division presidents entered into negotiations for the New
Employment Agreements (as defined below). Technical Olympic and certain
shareholders of the Company also negotiated the terms of the Shareholders
Agreement.
Technical Olympic was informed that on October 6, 2000, the Company Board
held a special meeting to consider the terms of the proposed acquisition of the
Company by Technical Olympic. Technical Olympic was also advised that a special
committee (the "Special Committee") of the Company's three independent directors
was appointed to review the terms of the New Employment Agreements and to
determine whether to recommend them to the full Company Board.
Technical Olympic was informed that on October 10, 2000, the Company Board
met again to consider the proposed transaction with Technical Olympic and that
the Special Committee recommended that the Company Board approve the New
Employment Agreements, and the Company Board unanimously approved such
agreements.
On October 11, 2000, the Board of Directors of Technical Olympic authorized
and approved the Offer, the Merger and the Merger Agreement.
Technical Olympic was advised that on the evening of October 11, 2000, the
Company Board held a telephonic meeting to further consider the Technical
Olympic offer, including the terms and proposed timing of the transaction, as
well as the terms and status of the equity contribution and financing to be
obtained by Technical Olympic in connection with the Offer. Technical Olympic
was also advised that Xxxxxxx Xxxxx Xxxxxx rendered to the Company Board an oral
opinion (which opinion was confirmed by delivery of a written opinion dated
October 12, 2000, the date of the Merger Agreement), to the effect that, as of
the date of the opinion and based upon and subject to certain matters stated in
such opinion, the $19.10 per Share cash consideration to be received in the
Offer and the Merger by holders of Shares (other than Technical Olympic and its
affiliates) was fair, from a financial point of view, to such holders. Technical
Olympic was further advised that, at the conclusion of this meeting, the Company
Board unanimously approved the Offer, the Merger and Merger Agreement,
determined that the Offer, the Merger and the Merger Agreement are fair to and
in the best interests of the Company's shareholders, and recommended that the
shareholders accept the Offer and tender their Shares pursuant thereto.
Early on October 12, 2000, Technical Olympic provided representatives of
the Company with a fully executed updated commitment letter from Technical
Olympic's lenders for the debt financing required for consummation of the Merger
Agreement, as well as evidence that a required equity contribution or
intercompany subordinated loan of at least $80 million had been obtained. The
Company provided Technical Olympic with evidence that the New Employment
Agreements were fully executed among the Company and its executive officers and
division presidents. The Merger Agreement was thereafter finalized and executed
prior to the opening of trading on October 12, 2000, and a joint press release
announcing the proposed Offer and the Merger was issued.
On October 20, 2000, the Purchaser commenced the Offer.
For additional information regarding the background of the Offer, see Item
4 of the Schedule 14D-9.
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11. PURPOSE OF THE OFFER; PLANS FOR THE COMPANY; THE MERGER AGREEMENT AND
RELATED MATTERS; OTHER ARRANGEMENTS.
Purpose of the Offer
The purpose of the Offer is to acquire control of, and the entire equity
interest in, the Company. The purpose of the Merger is to acquire all
outstanding Shares not tendered and purchased pursuant to the Offer. If the
Offer is successful, the Purchaser intends to consummate the Merger as promptly
as practicable.
If the Minimum Condition is satisfied, the Purchaser will have the votes
necessary under the FBCA to approve the Merger of the Purchaser with and into
the Company. Therefore, based on information provided by the Company, if at
least approximately 5,918,320 Shares are acquired pursuant to the Offer or
otherwise, the Purchaser will be able to, and intends to, effect the Merger
without the affirmative vote of any person other than the Purchaser. In
addition, under the FBCA, Technical Olympic may cause the Purchaser to merge
with and into the Company without a vote of the Company's shareholders if the
Purchaser owns at least 80% of the outstanding Shares.
Plans for the Company
Pursuant to the terms of the Merger Agreement, promptly upon the purchase
of and payment for any Shares by the Purchaser pursuant to the Offer, Technical
Olympic currently intends to seek maximum representation on the Company Board,
subject to the requirement in the Merger Agreement that if Shares are purchased
pursuant to the Offer, there shall be until the Effective Time (as defined in
the Merger Agreement) at least two members of the Company Board who are neither
officers of Technical Olympic or the Purchaser nor designees, shareholders or
affiliates of Technical Olympic or the Purchaser or Technical Olympic's
affiliates. The Purchaser currently intends, as soon as practicable after
consummation of the Offer, to consummate the Merger.
Except as otherwise provided herein, it is expected that, initially
following the Merger, the business and operations of the Company will be
continued substantially as they are currently being conducted. Technical Olympic
will continue to evaluate the business and operations of the Company during the
pendency of the Offer and after the consummation of the Offer and the Merger and
will take such actions as it deems appropriate under the circumstances then
existing. Technical Olympic intends to seek additional information about the
Company during this period. Thereafter, Technical Olympic intends to review such
information as part of a comprehensive review of its U.S. homebuilding
businesses, operations, capitalization and management with a view to developing
an integrated business strategy. This review may include an evaluation of
alternatives for a restructuring of the Company and Technical Olympic's other
U.S. operations.
Except as otherwise described in this Offer to Purchase, neither Technical
Olympic nor the Purchaser has any current plans or proposals that relate to or
would result in (1) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Company or any of its subsidiaries;
(2) a purchase, sale or transfer of a material amount of assets of the Company
or any of its subsidiaries; (3) any change in the present board of directors or
management of the Company including, but not limited to, any plans or proposals
to change the number or the term of directors or to fill any existing vacancies
on the board of directors of the Company or to change any material term of the
employment contract of any executive officer; (4) any material change in the
present dividend rate or policy, or indebtedness or capitalization of the
Company; (5) any other material change in the Company's corporate structure or
business; (6) a class of securities of the Company to be delisted from a
national securities exchange or cease to be authorized to be quoted in an
automated quotations system operated by a national securities association or (7)
a class of equity securities of the Company becoming eligible for termination of
registration under Section 12(g)(4) of the Exchange Act.
The Merger Agreement
The following is a summary of material terms of the Merger Agreement. This
summary is not a complete description of the terms and conditions thereof and is
qualified in its entirety by reference to the full text thereof, which is
incorporated herein by reference and a copy of which has been filed with the SEC
as an exhibit to
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Schedule TO. The Merger Agreement may be examined, and copies thereof may be
obtained, as set forth in Section 8.
The Offer. The Merger Agreement provides for the commencement of the Offer
as described in Section 1.
The Merger. The closing of the Merger will take place no later than the
third business day after satisfaction or waiver of the conditions of the Merger,
unless another time or date is agreed to in writing by the parties. The Merger
Agreement provides that, upon the closing of the Merger, the Company and the
Purchaser will file Articles of Merger with the Department of State of the State
of Florida. The Merger will become effective at such time as the Articles of
Merger are duly filed with the Florida Department of State or at such later time
as is specified in the Articles of Merger (the time the Merger becomes effective
being the "Effective Time"). The Merger Agreement provides that, upon the terms
and subject to the conditions set forth in the Merger Agreement, and in
accordance with the FBCA, at the Effective Time, the Purchaser will be merged
with and into the Company. Following the Merger, the separate corporate
existence of the Purchaser shall cease, and the Company will be the surviving
corporation (hereinafter sometimes called the "Surviving Corporation"). In
accordance with the FBCA, the Company will continue to be governed by the laws
of the State of Florida.
As of the Effective Time, by virtue of the Merger and without any action on
the part of Technical Olympic, the Purchaser, the Company, or any shareholder,
(1) each Share issued and outstanding at the Effective Time (other than any
Shares owned by the Company, any direct or indirect wholly owned subsidiary of
the Company, Technical Olympic or any Dissenting Shareholders) will be converted
into the right to receive $19.10 in cash, or such greater amount paid pursuant
to the Offer, without interest (the "Merger Consideration") and (2) each share
of capital stock of the Purchaser issued and outstanding at the Effective Time
will be converted into and become one fully paid and nonassessable share of
common stock, par value $0.01 per share, of the Surviving Corporation.
As soon as reasonably practicable after the Effective Time, Technical
Olympic will cause the Exchange Agent (as defined in the Merger Agreement) to
mail to each shareholder of record a Letter of Transmittal and instructions for
use in exchanging certificates evidencing Shares for the Merger Consideration.
The Exchange Agent will pay to the shareholder of record, who surrendered Share
certificate(s) for cancellation along with the Letter of Transmittal to the
Exchange Agent, the Merger Consideration due, less any withholding taxes, and
will cancel the surrendered certificates. Any shareholder who does not surrender
their Share certificate(s) to the Exchange Agent within six months after the
Effective Time must, thereafter, look only to Technical Olympic for payment of
their claim for Merger Consideration. If any Share certificate has not been
surrendered prior to five years after the Effective Time (or immediately prior
to such earlier date on which Merger Consideration in respect of such Share
certificate would otherwise escheat to or become the property of any public
official), any such Shares, cash, dividends or distributions in respect of such
Share certificate will become the property of the Surviving Corporation, free
and clear of all claims or interest of any person previously entitled thereto.
Technical Olympic, the Purchaser, the Company and the Exchange Agent will not be
liable to any person in respect of any Merger Consideration delivered to a
public official pursuant to any applicable abandoned property, escheat or
similar law.
Company Actions. The Company Board unanimously (1) determined that each of
the Merger Agreement, the Offer and the Merger are fair to, and in the best
interests of, the shareholders of the Company, (2) approved the Merger
Agreement, the Offer, the Merger and the Shareholders Agreement and the
transactions contemplated thereby and (3) recommended that the Company
shareholders accept the Offer, tender their Shares and approve and adopt the
Merger Agreement.
Concurrent with the filing of this Offer to Purchase, the Company is filing
with the SEC and causing to be disseminated to the Company shareholders, the
Schedule 14D-9, which includes the recommendations described in the preceding
paragraph. Subject to the provisions of the Merger Agreement, the Company Board
may amend, modify or withdraw its recommendation, or make no recommendation, if
the Company Board determines, following consultation with the Company's outside
legal counsel, that such action is required to comply with applicable law.
Shareholders Meeting. If required or if requested by Technical Olympic, the
Company will, at Technical Olympic's option and direction and as soon as
practicable, either (1) duly call, give notice of, convene and hold a
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meeting of its shareholders (the "Company Shareholders Meeting") or (2) submit
the Merger to its shareholders for approval through shareholder action by
written consent in lieu of a meeting for the purpose of obtaining the requisite
number of votes to adopt the Merger and the Merger Agreement. In addition, the
Company will, through the Company Board, recommend to its shareholders that they
vote in favor of the approval and adoption of the Merger and the Merger
Agreement; provided, however, that the Company Board may amend, modify or
withdraw such recommendation if the Company Board determines, following
consultation with the Company's outside legal counsel, that such action is
required in order to comply with applicable law and so long as the Company Board
submits the Merger to the Company's shareholders for approval at a meeting or by
written consent with no recommendation in accordance with the FBCA. The Merger
Agreement provides that, if applicable, Technical Olympic and the Purchaser will
vote or cause to be voted all Shares owned of record by Technical Olympic, the
Purchaser or any of its other Subsidiaries in favor of the approval and adoption
of the Merger and the Merger Agreement.
Notwithstanding the preceding paragraph or any other provision of the
Merger Agreement, the Merger Agreement provides that, in the event that
Technical Olympic, the Purchaser or any other subsidiary of Technical Olympic
shall beneficially own in the aggregate at least 80% of the outstanding Shares
and Technical Olympic, in its sole discretion, shall elect to effect the Merger
pursuant to Section 607.1104 of the FBCA, the Company shall not be required to
call a Company Shareholders Meeting or to file or mail a proxy statement or an
information statement, and the parties to the Merger Agreement shall, subject to
the provisions of Section 12 hereof, at the request of Technical Olympic, take
all necessary and appropriate action to cause the Merger to become effective as
soon as practicable after the acceptance for payment of and payment for Shares
by the Purchaser pursuant to the Offer without a meeting of shareholders of the
Company.
If required by applicable law or requested by Technical Olympic, as soon as
practicable following Technical Olympic's request, subsequent to payment for the
Shares pursuant to the Offer, the Company and Technical Olympic will prepare and
file with the SEC the proxy statement or the information statement, as
applicable. Each of the Company and Technical Olympic shall use its reasonable
best efforts to cause the proxy statement or the information statement, as
applicable, to be mailed to the Company's shareholders, as promptly as
practicable and to solicit proxies, if applicable, in favor of the adoption of
the Merger Agreement and the approval of the Merger; provided, however, in the
event that the Company Board withdraws its recommendation for the adoption of
the Merger Agreement and the approval of the Merger, the Company will solicit
proxies regarding the Merger Agreement and the Merger in a neutral fashion;
provided, further, that such obligation to solicit proxies in a neutral fashion
will not prohibit the Company Board from communicating the basis for its
determination not to make a recommendation to the extent required under the
FBCA.
HSR Act Filings. The Company and Technical Olympic will each make as
promptly as practicable any filing that may be required under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR Act")
with regard to the transactions which are the subject of the Merger Agreement
and each of them will take, if applicable, all reasonable steps within its
control (including providing information to the Federal Trade Commission and the
Department of Justice) to cause the waiting periods required by the HSR Act to
be terminated or to expire as promptly as practicable. The Company and Technical
Olympic will each provide information and cooperate in all other respects to
assist the other of them in making its filing, or securing an exemption from
filing, under the HSR Act. However, Technical Olympic and the Company believe
that a filing under the HSR Act for the Offer or the Merger is not required and
each does not presently intend to make such a filing. See Section 15.
Conduct of Business. The Company has covenanted and agreed as to itself and
its subsidiaries that, among other things and subject to certain exceptions,
during the period from the date of the Merger Agreement until the earlier of (1)
the Effective Time, (2) such time as designees of Technical Olympic and the
Purchaser constitute a majority of the Company Board and (3) such time as the
Merger Agreement may be terminated in accordance with its terms, the Company
will and will cause each of its subsidiaries to:
- operate its business in the ordinary course and in a manner consistent
with the manner in which it is being operated at the date of the Merger
Agreement;
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- take all reasonable steps available to it to maintain the goodwill of its
business and the continued employment of its executives and other
employees and to maintain good relationships with the vendors, suppliers,
contractors and others with which it does business;
- at its expense, maintain all its assets in good repair and condition;
- not make any borrowings other than borrowings in the ordinary course of
business under working capital lines which are disclosed in the Company's
1999 Annual Report on Form 10-K or under the Company's existing credit
agreement;
- not enter into any contractual commitments involving capital
expenditures, loans or advances, and not voluntarily incur any contingent
liabilities, except in each case in the ordinary course of business;
- not redeem or purchase any of its stock and not declare or pay any
dividends or make any other distributions or repayments of debt to its
shareholders;
- not make any loans or advances (other than advances for travel and other
normal business expenses and other advances to non-officers that do not
exceed $50,000 in the aggregate) to shareholders, directors, officers or
employees;
- maintain its books of account and records in the usual manner, in
accordance with GAAP applied on a basis consistent with the basis on
which they were applied in prior years, subject to normal year-end
adjustments and accruals;
- comply in all material respects with all applicable laws and regulations
of governmental agencies;
- not purchase, sell or otherwise dispose of or encumber any property or
assets, or engage in any activities or transactions, except in each case
in the ordinary course of business; provided that any new land purchase
contract exceeding $8 million and any new land sale contract (other than
an individual lot sale) is deemed not to be in the ordinary course of
business;
- not enter into or amend any employment, severance or similar agreements
or arrangements (other than the hiring of any non-officer for at-will
employment), or increase the salaries of any employees (other than
through normal annual increases or as required by any Plan existing on
the date of the Merger Agreement);
- not adopt or become an employer with regard to any employee compensation,
employee benefit or post-employment benefit plan or amend any Plan (as
defined in the Merger Agreement);
- not amend its articles of incorporation or bylaws;
- not (1) issue or sell any of its stock (except upon exercise of options
which are outstanding on the date of the Merger Agreement) or any
options, warrants or convertible or exchangeable securities or (2) split,
combine, or reclassify its outstanding stock;
- not intentionally take, or intentionally fail to take, any action that
would result in any of the representations and warranties of the Company
contained in the Merger Agreement not being complete and accurate; and
- not authorize or enter into any agreement to take any of the actions
referred to herein.
Access and Press Releases. Pursuant to the Merger Agreement and subject to
certain terms therein, from the date of the Merger Agreement until the Effective
Time, the Company has agreed to, upon reasonable request, afford Technical
Olympic's representatives full access during normal business hours to all of its
and its Subsidiaries' properties, books and records.
Technical Olympic and the Company will consult with each other before
issuing any press release or otherwise making any public statements with respect
to the Merger Agreement, the Offer or the Merger.
Director and Officer Liability. Under the Merger Agreement, subject to
certain terms therein, Technical Olympic and the Surviving Corporation will at
all times after the Effective Time indemnify and hold harmless
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each person who is at the date of the Merger Agreement, or has been at any time
prior to the date of the Merger Agreement, a director, officer or employee of
the Company or any of its Subsidiaries ("Indemnified Parties"), in each case to
the fullest extent permitted by applicable law, with respect to any claim,
liability, loss, damage, cost or expense (whenever asserted or claimed) based in
whole or in part on, or arising in whole or in part out of, any act or omission
by that person at or prior to the Effective Time in connection with that
person's duties as a director, officer or employee of the Company or any of its
Subsidiaries or affiliates to the same extent and on the same terms (including
with respect to advancement of expenses) provided in the Company's articles of
incorporation or bylaws, or in any indemnification agreements, in effect on the
date of the Merger Agreement. Technical Olympic and the Surviving Corporation
will pay all reasonable expenses, including attorneys' fees, that may be
incurred by any Indemnified Party in enforcing the indemnity and other related
obligations of Technical Olympic and the Surviving Corporation.
Additionally, Technical Olympic will cause the Surviving Corporation to
maintain, for a period of six years after the Effective Time, the Company's
existing directors' and officers' liability insurance (provided that Technical
Olympic may substitute therefor policies having the same coverage and amounts
containing terms which are no less advantageous); provided, however, that
neither Technical Olympic nor the Surviving Corporation will be obligated to
make annual premium payments for such insurance to the extent such premiums
exceed three times the annual premium paid during the year in which the Merger
Agreement was executed, but in such case will purchase as much coverage as
possible for that amount.
Third Party Purchaser Proposals. Neither the Company nor any of its
Subsidiaries will, and the Company will use its best efforts to cause its and
its Subsidiaries' respective directors, officers, employees, investment bankers,
attorneys and other agents and representatives not to, (1) solicit, initiate or
knowingly facilitate or encourage (including by way of furnishing information)
any inquiry or the making of any offer or proposal by a Third Party (as defined
in the Merger Agreement) with respect to, or that could reasonably be expected
to lead to, an Acquisition Transaction (as defined in the Merger Agreement) or
(2) negotiate, explore or otherwise communicate in any way with any Third Party
with respect to any possible Acquisition Transaction, or enter into, approve or
recommend any agreement requiring it to fail to consummate the Merger or any of
the other material transactions contemplated by the Merger Agreement.
Notwithstanding the foregoing, the Company may, in response to a proposal
which was not solicited after the date of the Merger Agreement, furnish
information to, and engage in discussions or negotiations with, a Third Party,
if, but only if, (1) the Company Board determines in good faith, after
consultation with a financial advisor of nationally recognized reputation, that
the Third Party is financially capable of completing the transaction that is the
subject of the proposal and that, if completed, such transaction would result in
greater value to the Company's shareholders than the transactions contemplated
by the Merger Agreement and would be more favorable to the Company and its
shareholders than the transactions contemplated by the Merger Agreement and (2)
before furnishing or disclosing any non-public information to, or entering into
discussions or negotiations with, the Third Party, the Company receives from the
Third Party an executed confidentiality agreement with terms no less favorable
in the aggregate to the Company than those contained in the Confidentiality
Agreement between Technical Olympic and the Company, which confidentiality
agreement does not provide for any exclusive right to negotiate with the Company
or any payments by the Company; provided that nothing in this paragraph will
prohibit the Company Board from complying with rules under the Exchange Act with
regard to a tender offer or an exchange offer or prohibit the Company from
selling assets or properties in the ordinary course of business.
The Company will (1) no later than the end of the first business day after
the Company receives an inquiry, proposal or offer with respect to a possible
Acquisition Transaction or a request for non-public information relating to the
Company in connection with a possible Acquisition Transaction or for access to
its or any of its Subsidiaries' properties, books or records by any Third Party
that informs the Company Board that the Third Party is considering making, or
has made, a proposal or offer with respect to an Acquisition Transaction (any
such inquiry, proposal, offer or request being an "Acquisition Proposal"),
notify Technical Olympic in writing of the inquiry, proposal, offer or request,
(2) in that written notice, indicate in reasonable detail the terms and
conditions of the proposal or offer and, to the extent consistent with
agreements to which the Company is bound as of the date of the Merger Agreement,
the identity of the Third Party (including the name of the Third Party), (3)
promptly notify Technical Olympic of any determination by the Company Board that
the Company should
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furnish information to, or engage in discussions or negotiations with, any Third
Party and (4) keep Technical Olympic reasonably informed of the progress of any
discussions or negotiations with any Third Party.
The Company will immediately cease and cause to be terminated any existing
activities, discussions or negotiations with any parties (other than Technical
Olympic and the Purchaser) which have been conducted before the date of the
Merger Agreement with respect to any possible Acquisition Transaction and, if
contacted by any such parties, will inform any such parties of the Company's
obligations under the Merger Agreement.
Company Stock Options. As promptly as practicable following the execution
of the Merger Agreement, the Company will use its best efforts to cause each
holder of an unexercised and then-outstanding option for Shares granted under
any Company employee benefit plan or otherwise to either (1) exercise all such
options prior to the consummation of the Offer, (2) execute and deliver an
agreement with the Company and Technical Olympic prior to the consummation of
the Offer agreeing to exercise all unexercised options immediately preceding the
consummation of the Merger and acknowledging that all such options shall be
cancelled and cease to be outstanding upon consummation of the Merger or (3)
execute and deliver an agreement with the Company and Technical Olympic prior to
the consummation of the Offer agreeing to exchange such option within five days
following the consummation of the Offer for payment of an amount in respect
thereof equal to the product of (a) the excess, if any, of the Price Per Share
(as defined in the Merger Agreement) over the per share exercise price thereof
and (b) the number of Shares subject thereto (such payment to be net of
applicable withholding taxes).
Representations and Warranties. Pursuant to the Merger Agreement, the
Company has made customary representations and warranties to Technical Olympic
and the Purchaser, including representations relating to corporate existence and
good standing; corporate power, authority, authorizations and approvals; absence
of violations; government authorizations; qualifications to do business;
capitalization; repurchases of Shares; subsidiaries; SEC filings; financial
statements; conduct of business in the ordinary course; absence of occurrences
having a Material Adverse Effect (as defined below); compliance with laws;
licenses and permits; taxes; environmental matters; employee matters; labor
matters; the opinion of the Company's financial advisor; litigation; and absence
of applicability of any state take-over statutes.
Certain representations and warranties in the Merger Agreement made by the
Company are qualified as to materiality or "Material Adverse Effect." For
purposes of the Merger Agreement and this Offer to Purchase, the term "Material
Adverse Effect" on a company means a material adverse effect on (1) the
business, operations, results of operations, properties, assets, liabilities or
financial condition of that company and its Subsidiaries taken as a whole or (2)
the ability of that company to consummate the Offer or the Merger, other than a
material adverse effect resulting from (a) a change in U.S. generally accepted
accounting principles, (b) a change or occurrence affecting the homebuilding
industry generally, or (c) a change in general economic conditions (including,
without limitation, a change in interest rates).
Pursuant to the Merger Agreement, Technical Olympic and the Purchaser have
made customary representations and warranties to the Company, including
representations relating to their corporate existence and good standing;
corporate power, authority and authorizations; absence of violations; government
authorizations; litigation; their receipt of a financing commitment letter and
their ability to finance the Offer and the Merger; and the Purchaser's lack of
business activities other than as described herein.
Absence of Brokers. The Company and Technical Olympic each represents and
warrants to the other of them that nobody acted as a broker, a finder or in any
similar capacity in connection with the transactions which are the subject of
the Merger Agreement, except that Banc of America Securities LLC acted as a
financial adviser to Technical Olympic and the Purchaser, and Xxxxxxx Xxxxx
Xxxxxx acted as a financial advisor to the Company. Technical Olympic will pay
all the fees and other charges of Banc of America Securities LLC. The Company
will pay all the fees and other charges of Xxxxxxx Xxxxx Xxxxxx. The Company
indemnifies Technical Olympic and the Purchaser against, and agrees to hold each
of them harmless from, all losses, liabilities and expenses (including, but not
limited to, reasonable fees and expenses of counsel and costs of investigation)
incurred because of any claim by anyone for compensation as a broker, a finder
or in any similar capacity by reason of services allegedly rendered to the
Company. Technical Olympic indemnifies the Company against, and agrees to hold
it harmless from, all losses, liabilities and expenses (including, but not
limited to, reasonable fees and
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expenses of counsel and costs of investigation) incurred because of any claim by
anyone for compensation as a broker, a finder or in any similar capacity by
reason of services allegedly rendered to Technical Olympic or the Purchaser.
Conditions to the Merger. The obligations of each of the Company, Technical
Olympic and the Purchaser to effectuate the Merger are subject to the
satisfaction or waiver on or prior to the Effective Time of the following
conditions:
- Shareholder Approval. The Company will have obtained all approvals of
holders of Shares necessary to approve the Merger Agreement and the
Merger to the extent required by law.
- No Injunction or Restraints; Illegality. No temporary restraining order,
preliminary or permanent injunction or other order issued by a court or
other governmental entity of competent jurisdiction will be in effect and
have the effect of making the Merger illegal or otherwise prohibiting the
consummation of the Merger; provided that each party has used
commercially reasonable efforts to prevent the entry of any such
injunction or order.
- Required Regulatory Approvals. All Required Regulatory Approvals (as
defined in the Merger Agreement) will have been obtained and will be in
full force and effect.
- Completion of the Offer. The Purchaser will have purchased, pursuant to
the terms and conditions of the Offer, all Shares duly tendered and not
withdrawn; provided, however, that neither Technical Olympic nor the
Purchaser will be entitled to rely on this condition if either of them
has failed to purchase Shares pursuant to the Offer in breach of their
obligations under the Merger Agreement.
Termination. The Merger Agreement may be terminated at any time prior to
the Effective Time, by action taken or authorized by the Board of Directors of
the terminating party or parties, whether before or after approval of the Merger
Agreement, by the shareholders of the Company:
(a) by mutual written consent of Technical Olympic and the Company, by
action of their respective Boards of Directors;
(b) by either the Company or Technical Olympic if (1) the Offer has
expired without any Shares being purchased or (2) the Offer has not been
consummated by the date that is four months from the date of the Merger
Agreement (the "Outside Date"); provided that the right to terminate the
Merger Agreement under this clause (b) will not be available to any party
whose failure to fulfill any obligation under the Merger Agreement has been
the cause of, or resulted in, the failure of the Offer to be consummated on
or before such date;
(c) by either the Company or Technical Olympic if any court or other
governmental entity has issued an order, decree or ruling or taken any
other action (that has not been vacated, withdrawn or overturned)
permanently restraining, enjoining or otherwise prohibiting the Offer or
the Merger, and such order, decree, ruling or other action shall have
become final and nonappealable;
(d) by Technical Olympic, prior to the purchase by the Purchaser of
Shares pursuant to the Offer, if (1) the Company Board (or any committee
thereof) has withdrawn or adversely modified (including by amendment of the
Schedule 14D-9) its approval or recommendation of the Offer, the Merger or
the Merger Agreement or the Company Board, upon request by Technical
Olympic following receipt by the Company of an Acquisition Proposal, fails
to reaffirm such approval or recommendation within ten business days after
such request, or has resolved to do any of the foregoing; (2) the Company
Board has recommended to the shareholders of the Company that they approve
an Acquisition Proposal other than the transactions contemplated by the
Merger Agreement; (3) a tender offer or exchange offer is commenced for
Shares (other than by Technical Olympic or an affiliate of Technical
Olympic) and the Company Board recommends that the shareholders of the
Company tender their Shares in such tender or exchange offer; or (4) any
Person other than Technical Olympic, the Purchaser or any of their
affiliates or any group of which any of them is a member has entered into a
definitive agreement or an agreement in principle with the Company or any
of its
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Subsidiaries with respect to an Acquisition Proposal or the Company Board
(or any committee thereof) has approved any of the foregoing;
(e) by Technical Olympic, prior to the purchase by the Purchaser of
Shares pursuant to the Offer, if (1) any of the representations and
warranties of the Company contained in the Merger Agreement is not complete
and accurate, individually or in the aggregate with the other
representations and warranties of the Company contained in the Merger
Agreement, without regard to any qualification or limitation contained in
or related to any such representation or warranty relating to materiality
or to Material Adverse Effect, in a manner that has, or could reasonably be
expected to have, a Material Adverse Effect on the Company, as if such
representations and warranties were made as of such time on or after the
date of the Merger Agreement (except to the extent that such
representations and warranties speak as of a specific date, in which case
such representations and warranties shall not be so complete and accurate
in a manner that has, or could reasonably be expected to have, a Material
Adverse Effect on the Company as of such specific date), (2) certain of the
representations and warranties regarding the Company's capitalization and
the Company's subsidiaries are not complete and accurate in all material
respects as of such time on or after the date of the Merger Agreement,
provided that for the purposes of this provision, such representations and
warranties regarding the Company's subsidiaries will be deemed complete and
accurate in all material respects if they are complete and accurate in all
material respects with respect to the Significant Subsidiaries (set forth
on a schedule to the Merger Agreement), (3) the Company has breached in any
material respect any covenant or agreement contained in the Merger
Agreement and has not cured that breach within ten business days after
written notice from Technical Olympic or (4) any change or event shall have
occurred that has, or could reasonably be expected to have, a Material
Adverse Effect on the Company;
(f) by the Company, if (1) it is determined that any of the
representations and warranties of Technical Olympic or the Purchaser
contained in the Merger Agreement is not complete and accurate,
individually or in the aggregate with the other representations and
warranties of Technical Olympic and the Purchaser contained in the Merger
Agreement, without regard to any qualification or limitation contained in
or related to any such representation or warranty relating to materiality,
in a manner that has, or could reasonably be expected to have, a Material
Adverse Effect on the ability of Technical Olympic or the Purchaser to
consummate the Offer or the Merger or (2) Technical Olympic or the
Purchaser has breached in any material respect any covenant or agreement
contained in the Merger Agreement and has not cured that breach within ten
business days after written notice from the Company;
(g) by the Company, if the Purchaser fails to (1) commence the Offer
or keep the Offer open as required in the Merger Agreement or (2) purchase
validly tendered Shares in violation of the terms of the Offer and the
Merger Agreement; or
(h) by the Company, prior to the purchase by the Purchaser of Shares
pursuant to the Offer, if (1) the Company receives an Acquisition Proposal
in which a person or group (a "Potential Acquiror") makes a specific
proposal for an Acquisition Transaction on specific terms (a "Firm
Proposal"), or a Potential Acquiror commences a cash tender offer or
exchange offer for at least a majority of the Company's outstanding stock
(other than any already owned by the Potential Acquiror), (2) within 15
business days after the Company receives the Firm Proposal or the tender
offer or exchange offer is commenced, the Company Board determines that the
Firm Proposal or the tender offer or exchange offer is a Superior Proposal
(as defined below) and resolves to accept the Superior Proposal, or to
recommend that shareholders vote for, authorize, or tender their Shares in
response to, the Superior Proposal, unless Technical Olympic and the
Purchaser agree within five business days to increase the Price Per Share
to an amount per share at least as great as the consideration per share the
Company's shareholders would receive as a result of the Superior Proposal,
(3) the Company has given Technical Olympic at least five business days'
prior notice (A) of the terms of the Superior Proposal (including the
consideration per share, valuing non-cash consideration as described below,
which the Company's shareholders would receive as a result of the Superior
Proposal), and (B) that unless Technical Olympic agrees in writing within
the five business day period to increase the Price Per Share to an amount
per share at least as great as the consideration per share the Company's
shareholders would receive as a result of the Superior Proposal, as set
forth in the notice, the Merger Agreement will terminate, and (4) the
Company has (A) paid Technical Olympic $8.5 million, (B) reimbursed
Technical
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Olympic for all Technical Olympic Expenses (defined as Parent Expenses in
the Merger Agreement) regarding which Technical Olympic has presented
reasonable documentation to the Company, and (C) agreed in writing to
reimburse Technical Olympic for all Technical Olympic Expenses for which
Technical Olympic subsequently presents reasonable documentation to the
Company (up to a total reimbursement of Technical Olympic Expenses under
clauses (B) and (C) not exceeding $3 million). For the purposes of the
Merger Agreement, a "Superior Proposal" is a proposal for an Acquisition
Transaction or a tender offer or exchange offer which (A) would result in
the Company's shareholders receiving consideration which is greater than
the Price Per Share (valuing non-cash consideration at its fair value as
determined in good faith by the Company Board after consultation with its
financial advisor), (B) is not subject to the outcome of due diligence or
any other form of investigation, (C) is not subject to a financing
contingency and is from a proposed acquiror which the Company Board
determines in good faith after consultation with its independent financial
advisor has the financial resources necessary to carry out the transaction
and (D) the Company Board determines in good faith to be more favorable to
the Company's shareholders than the transactions contemplated by the Merger
Agreement. A notice that the Merger Agreement will terminate given pursuant
to clause (3) of the first sentence of this paragraph (h) will be
irrevocable (unless Technical Olympic consents in writing to its being
withdrawn by the Company) and (unless Technical Olympic and the Purchaser
agree within five business days to increase the Price Per Share to an
amount per share at least as great as the consideration per share the
Company's shareholders would receive as a result of the Superior Proposal)
will result in the termination of the Merger Agreement on the later of the
date specified in the notice or the date the Company makes the payments and
provides the agreement described in clause (4) of the first sentence of
this paragraph (h).
In the event that the Merger Agreement is terminated by either the Company
or Technical Olympic as provided above, neither party will have any further
rights or obligations under the Merger Agreement, except that certain provisions
in the Merger Agreement, including provisions relating to the payment of
termination fees and the payment of, and reimbursement for, expenses, will
survive any termination of the Merger Agreement. However, nothing contained in
the Merger Agreement will relieve either party of liability for any breach of
the Merger Agreement that occurs before the Merger Agreement was terminated.
In the event that the Merger Agreement is terminated by Technical Olympic
pursuant to paragraph (d) or clause (3) of paragraph (e) above, then the Company
will pay Technical Olympic $8.5 million and up to $3 million of Technical
Olympic Expenses incurred in connection with the Offer and the Merger. In the
event that (1) the Merger Agreement is terminated pursuant to paragraph (b)
above and the Minimum Condition has not been satisfied or pursuant to clause
(1), (2) or (4) of paragraph (e) above, (2) prior to such termination, an
Acquisition Proposal was made or any person (other than Technical Olympic or the
Purchaser) acquired beneficial ownership of more than 20% of the outstanding
voting securities of the Company or was granted an option or right to acquire
more than 20% of such voting securities of the Company and (3) an Acquisition
Transaction is consummated within 12 months of the date of such termination,
then the Company will pay Technical Olympic $8.5 million and up to $3 million of
Technical Olympic Expenses incurred in connection with the Offer and the Merger.
Amendment. The Merger Agreement may be amended by an agreement in writing
signed by both the Company and Technical Olympic.
Board of Directors. Pursuant to the Merger Agreement, promptly upon the
acceptance for payment of, and payment by the Purchaser in accordance with the
Offer for, not less than a majority of the outstanding Shares pursuant to the
Offer, Technical Olympic and the Purchaser will be entitled to designate members
of the Company Board such that they will have a number of representatives on the
Company Board, rounded up to the next whole number, equal to the product of (1)
the total number of directors on the Company Board (giving effect to the
directors elected pursuant to this sentence) multiplied by (2) the percentage of
such number of Shares owned in the aggregate by Technical Olympic or the
Purchaser bears to the number of Shares outstanding; provided, however, that
until the Effective Time, there will be at least two directors (the "Independent
Directors") who are neither officers of Technical Olympic or the Purchaser nor
designees, shareholders or affiliates of Technical Olympic or the Purchaser or
Technical Olympic's affiliates. The Company will, upon
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request by Technical Olympic or the Purchaser, on the date of such request, (1)
either increase the size of the Company Board or use its reasonable efforts to
secure the resignations of such number of its incumbent directors, or both, as
is necessary to enable Technical Olympic's and the Purchaser's designees to be
elected or appointed to the Company Board and (2) cause Technical Olympic's and
the Purchaser's designees to be so elected or appointed, including mailing to
its shareholders an information statement containing the information required by
Section 14(f) of the Exchange Act and Rule 14f-1 promulgated thereunder, which
information statement is attached as Annex A to the Schedule 14D-9.
Following the election or appointment of Technical Olympic's and the
Purchaser's designees and prior to the Effective Time, any (1) amendment or
termination of the Merger Agreement by the Company, (2) extension of time for
the performance, or waiver, of the obligations of other acts of Technical
Olympic or the Purchaser or (3) waiver of the Company's rights under the Merger
Agreement, will require approval by a majority of the Independent Directors in
addition to any required approval by the full Company Board.
Charter and Bylaws. The Merger Agreement provides that, at the Effective
Time and without any further action on the part of the Company and the
Purchaser, the articles of incorporation of the Company will be amended to read
in their entirety as the articles of incorporation of the Purchaser as in effect
immediately prior to the Effective Time until thereafter amended, provided that
such articles of incorporation will be further amended to reflect Xxxxx Homes,
Inc. as the name of the Surviving Corporation. Under the Merger Agreement, the
bylaws of the Purchaser as in effect immediately prior to the Effective Time
will be the bylaws of the Surviving Corporation until thereafter changed or
amended.
Officers and Directors of Surviving Corporation. The officers and directors
of the Purchaser and/or any individuals designated by the Purchaser immediately
prior to the Effective Time shall be the initial officers and directors,
respectively, of the Surviving Corporation, until the earlier of their
resignation or removal or otherwise ceasing to be an officer or director, as the
case may be, or until their respective successors are duly elected and
qualified.
Other Actions; Filings; Consents. Subject to the terms and conditions of
the Merger Agreement, Technical Olympic and the Company each will (1) use its
commercially reasonable efforts to take, or cause to be taken, all actions, and
to do, or cause to be done, all other things, which are necessary (or, upon the
reasonable request of any party, proper or appropriate) under applicable laws
and regulations, or are required to be taken by any governmental authorities, to
consummate the transactions contemplated by the Merger Agreement as promptly as
practicable, (2) use its commercially reasonable efforts to make as promptly as
practicable all necessary filings, and subsequently make any other required
submissions, with regard to the Merger Agreement or the transactions
contemplated by the Merger Agreement under (A) the Securities Act, the Exchange
Act and any other applicable federal or state securities laws or regulations,
(B) the HSR Act and any related governmental requests under that Act and (C) any
other applicable federal, state, local or foreign statutes, laws, rules or
regulations, (3) use its commercially reasonable efforts to obtain from
governmental authorities any consents, licenses, permits, waivers, approvals,
authorizations and orders required to be obtained by the Company or Technical
Olympic or any of their respective Subsidiaries in connection with the
authorization, execution and delivery of the Merger Agreement and the
consummation of the transactions contemplated by the Merger Agreement, (4) use
its commercially reasonable efforts to resolve any objections which may be
asserted by any governmental authority with regard to the Merger or any other
transactions contemplated by the Merger Agreement under any antitrust, trade or
regulatory laws or regulations, (5) furnish the other of them, upon request,
with copies of all correspondence, filings and communications between it and its
affiliates and representatives, on the one hand, and any governmental authority
or member of the staff of any governmental authority, on the other hand, with
respect to the Merger Agreement or the transactions contemplated by the Merger
Agreement, (6) furnish the other of them with all information and reasonable
assistance which the other of them may reasonably request in connection with the
preparation of filings, registrations or submissions of information required by
any governmental authorities and (7) use its commercially reasonable efforts to
cause any injunction, restraining order or other order of any court or
governmental authority which adversely affects the ability of the parties to
consummate the transactions contemplated by the Merger Agreement to be
dissolved, and to defend vigorously any litigation seeking to enjoin, prevent or
delay the consummation of the Offer or the Merger or seeking material changes in
the terms of the Offer or the Merger. At Technical Olympic's reasonable request,
the Company will use its commercially
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reasonable efforts to obtain the consent of any third party required to be
obtained by the Company under any agreement or instrument to which either the
Company or any of its Subsidiaries is a party or by which any of them is bound
in connection with the transactions contemplated by the Merger Agreement;
provided, however, that the Company will not be required to obtain the consent
of any of the Company's lenders or noteholders.
Governing Law. The Merger Agreement is governed by the laws of the State of
Delaware.
Merger-Related Matters
Shareholder Approval. Under the FBCA and the Company's articles of
incorporation, the approval of the Company Board and the affirmative vote of the
holders of a majority of the outstanding Shares are required to adopt and
approve the Merger Agreement and the transactions contemplated thereby, unless
the Merger is consummated pursuant to the short-form merger provisions under the
FBCA described below (in which case no further corporate action by the
shareholders of the Company will be required to complete the Merger). The Merger
Agreement provides that, if applicable, Technical Olympic and the Purchaser will
cause to be voted in favor of the Merger all of the Shares then owned by
Technical Olympic, the Purchaser or any other Subsidiary of Technical Olympic.
In the event that the Minimum Condition is satisfied, the Purchaser will have
sufficient voting power to cause the approval of the Merger Agreement and the
transactions contemplated thereby without the affirmative vote of any other
shareholders of the Company.
Short-Form Merger. Section 607.1104 of the FBCA provides that, if the
parent corporation owns at least 80% of the outstanding shares of each class of
the subsidiary corporation, the merger into the subsidiary corporation of the
parent corporation may be effected by a plan of merger adopted by the board of
directors of the parent corporation and the appropriate filings with the Florida
Department of State, without the approval of the shareholders of the subsidiary
corporation (a "short-form merger"). Under the FBCA, if the Purchaser acquires
at least 80% of the outstanding Shares, the Purchaser will be able to effect the
Merger without a vote of the shareholders of the Company. In such event, the
Company has agreed in the Merger Agreement to take, at the request of Technical
Olympic, all necessary and appropriate action to cause the Merger to become
effective, as soon as practicable after such acquisition, without a meeting of
the Company's shareholders. In the event that less than 80% of the Shares then
outstanding on a fully diluted basis are tendered pursuant to the Offer on the
initial Expiration Date, the Purchaser may extend the Offer for up to ten
business days so that the Merger may be consummated as a short-form merger. In
addition, Technical Olympic and the Purchaser may elect to have a subsequent
offering period. See Section 1. In the event that less than 80% of the Shares
are acquired by the Purchaser in the initial offering period, a subsequent
offering period may assist the Purchaser in reaching the 80% minimum necessary
to engage in a short-form merger with the Company.
Appraisal Rights. Holders of Shares do not have dissenters' rights as a
result of the Offer. If the Merger is consummated, holders of Shares may have
certain rights pursuant to the provisions of Sections 607.1301 through 607.1320
of the FBCA to dissent and obtain payment of the fair value of their Shares
(excluding any appreciation or depreciation in anticipation of the Merger unless
exclusion would be inequitable). However, pursuant to the FBCA, dissenters'
rights will not be available if on the record date fixed to determine the
shareholders entitled to vote at the meeting of shareholders at which the Merger
is to be acted upon or to consent to any such action without a meeting, the
Shares are either (1) registered on a national securities exchange or designated
as a national market system security on an interdealer quotation system by the
National Association of Securities Dealers, Inc. or (2) held of record by not
fewer than 2,000 shareholders.
If dissenters' rights were available and the statutory procedures were
complied with, such rights could lead to a judicial determination of the fair
value required to be paid in cash to such dissenting holders for their Shares.
Any such judicial determination of the fair value of Shares could be based upon
considerations other than or in addition to the Offer price or the market value
of the Shares. Shareholders should recognize that the value so determined could
be higher or lower than the Offer price or the Merger Consideration. Moreover,
Technical Olympic may argue in an appraisal proceeding that, for purposes of
such a proceeding, the fair value of each Share is less than the price paid in
the Offer or the Merger.
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If any holder of Shares who demands appraisal under Section 607.1302 of the
FBCA fails to perfect, or effectively withdraws or loses such holder's right to
appraisal, as provided in the FBCA, the Shares of such holder will be converted
into the Merger Consideration in accordance with the Merger Agreement.
The foregoing discussion is not a complete statement of law pertaining to
appraisal rights under the FBCA and is qualified in its entirety by the full
text of Sections 607.1301 through 607.1320 of the FBCA.
FAILURE TO FOLLOW THE STEPS REQUIRED BY SECTIONS 607.1301 THROUGH 607.1320
OF THE FBCA FOR PERFECTING APPRAISAL RIGHTS MAY RESULT IN THE LOSS OF ANY SUCH
RIGHTS.
Going Private Transactions. The Merger would have to comply with any
applicable federal law operative at the time of its consummation. Rule 13e-3
under the Exchange Act is applicable to certain "going private" transactions.
The Purchaser does not believe that Rule 13e-3 will be applicable to the Merger
unless the Merger is consummated more than one year after the termination of the
Offer. If applicable, Rule 13e-3 would require, among other things, that certain
financial information concerning the Company and certain information relating to
the fairness of the Merger and the consideration offered to minority
shareholders be filed with the SEC and disclosed to minority shareholders prior
to consummation of the Merger.
Other Arrangements
Employment Agreements. Prior to execution of the Merger Agreement, the
Company had entered into an employment agreement with Xxxx Xxxxxxxxxx, its chief
executive officer, and change of control severance agreements with each of
Messrs. Xxxxx Xxxxxxxxxx, Xxxx X. Xxxxxxxx, Xxxxxxxx X. Xxxxx, Xxxxx Xxxxxxx and
Xxxx X. Xxxxxxx (collectively, with Xxxx Xxxxxxxxxx, the "Executive Officers").
The Company also had change of control severance agreements with seven Division
Presidents of the Company or its subsidiaries (one of whom also had an
employment agreement).
Concurrently with the signing of the Merger Agreement, the Company entered
into employment agreements (the "Employment Agreements") with the Executive
Officers and certain Division Presidents (collectively the "Senior Officers") to
be effective immediately prior to the closing of the Offer contemplated by the
Merger Agreement, except as described below. As part of his Employment
Agreement, Xxxx Xxxxxxxxxx has also entered into a separate Non-Competition
Agreement that is deemed to be part of his Employment Agreement. Copies of the
Employment Agreements with the Executive Officers of the Company have been filed
as exhibits to the Schedule TO and are incorporated herein by reference, and the
following summary is qualified in its entirety by reference to such agreements.
The Employment Agreements with the Executive Officers of the Company may be
examined, and copies thereof may be obtained, as set forth in Section 8 above.
The Employment Agreements supercede the existing change of control and
severance agreements and provide for the continued employment of the Senior
Officers. They also obtain for the Company non-competition, confidentiality and
non-solicitation of employee covenants from the Senior Officers. In the absence
of the Employment Agreements, certain change of control and severance benefits
under the former agreements may have been triggered or vested upon consummation
of the Offer and the Merger.
The Employment Agreements provide for an initial employment term beginning
on the closing of the Offer and ending on December 31, 2003. Unless earlier
terminated by the Company or the Senior Officer, the Employment Agreements will
renew on a month-to-month basis commencing in 2004 (on a year-to-year basis in
the case of Xxxx Xxxxxxxxxx). The Employment Agreements provide that in the
event the closing of the Offer contemplated by the Merger Agreement does not
occur, the Employment Agreements will be of no force or effect and the former
agreements will be reinstated.
Pursuant to the Employment Agreements, the current annual base salaries of
Messrs. Xxxx Xxxxxxxxxx, Xxxxx Xxxxxxxxxx, Xxxxxxxx, Xxxxx, Xxxxxxx and Xxxxxxx
are $750,000, $355,000, $355,000, $270,000, $260,000 and $260,000, respectively,
for this calendar year, with scheduled annual increases beginning on January 1,
2001 thereafter. In addition, the Employment Agreements establish incentive
bonus formulas comparable to the criteria previously used by the Company in
determining annual discretionary incentive bonuses. The agreement with Xxxx
Xxxxxxxxxx also provides a retirement benefit upon his termination of employment
(the continuation of his base
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salary for 60 months) and also for the payment of aggregate annual premiums of
up to $90,000 per year with respect to two life insurance policies owned by a
trust established by Xx. Xxxxxxxxxx.
The Employment Agreements provide severance payments and benefits in the
event a Senior Officer is terminated without cause or resigns due to a reduction
in duties or for certain other reasons as set forth in the Employment Agreement.
In addition, upon a qualifying termination of employment following a future
change of control (as defined in the Employment Agreements), the agreements
(other than Xxxx Xxxxxxxxxx'x) provide, in general, for a payment equal to two
times the individual's base salary plus bonus. The agreement with Xxxx
Xxxxxxxxxx provides for a payment upon a change of control of three times his
base salary, bonus and the cost of certain benefits provided to him. Upon a
termination of employment, he would also be entitled to the severance benefits
provided by the agreement. The Employment Agreements also provide (1) with
respect to the Executive Officers, for an additional "make-whole" payment from
the Company if the Executive Officer is subject to the excise tax on "parachute
payments" pursuant to the Code and (2) with respect to the Division Presidents,
for a cut back on payments to them if necessary for any such payments to the
Division President not to be subject to the excise tax on "parachute payments."
Beginning with their date of execution, the Employment Agreements bar the Senior
Officers (1) from using or disclosing confidential information or trade secrets
and soliciting employees of the Company for 18 months following their
termination of employment and (2) from engaging in a competing business (as
defined in the Employment Agreement) with the Company prior to the earlier of
the first anniversary of their termination of employment or December 31, 2003.
Shareholders Agreement
The following is a summary of certain provisions of the Shareholders
Agreement. The summary is qualified in its entirety by reference to the
Shareholders Agreement which is incorporated herein by reference and a copy of
which has been filed with the Commission as an Exhibit to the Schedule TO.
Xxxx Xxxxxxxxxx, Xxxxxx Xxxxxxxxxx (Xxxx Xxxxxxxxxx'x wife), Xxxxx
Xxxxxxxxxx, Xxxxx Xxxxxxx and certain trusts for the benefit of Xxxx
Xxxxxxxxxx'x and Xxxxx Xxxxxxxxxx'x children and grandchildren (each, a
"Shareholder") have entered into the Shareholders Agreement. The Shareholders
own in the aggregate 3,743,049 Shares, representing approximately 34% of the
Shares issued and outstanding on October 12, 2000. Any Shares acquired by a
Shareholder after such date (pursuant to the exercise of an option or otherwise)
will also be subject to the terms of the Shareholders Agreement.
Each of the Shareholders has agreed to validly tender (and not withdraw),
in accordance with the terms of the Offer not later than the close of business
on the third business day after the Offer commences, all Shares held by them.
Each of the Shareholders has agreed to vote their Shares in favor of the
Merger, against any action that would result in a material breach of any of the
Company's obligations under the Merger Agreement, against any Acquisition
Transaction other than a transaction proposed by Technical Olympic and against
any proposed action or transaction that would prevent or delay the Merger. Each
Shareholder granted to Technical Olympic an irrevocable proxy with respect to
the voting of such Shares in accordance with the preceding sentence.
Each of the Shareholders has agreed not to, except as provided in the
Shareholders Agreement, (1) offer for sale, sell, transfer, tender, pledge,
encumber, assign or otherwise dispose of any or all of such Shareholder's
Shares, (2) grant any proxy or power-of-attorney with respect to such Shares or
deposit such Shares into a voting trust or enter into a voting agreement with
respect to such Shares or (3) take any other action that would have the effect
of preventing, disabling or delaying the performance of such Shareholder's
obligations under the Shareholders Agreement.
Each Shareholder granted to Technical Olympic an irrevocable option (each,
an "Option," and collectively, the "Options") to purchase such Shareholder's
Shares at a purchase price per Share equal to $19.10, or any higher price paid
in the Offer, in cash.
The Shareholders Agreement provides that Technical Olympic may exercise an
Option, in whole but not in part, at any time and from time to time, after the
first to occur of (1) any event as a result of which Technical Olympic will be
entitled to receive a termination fee pursuant to the Merger Agreement, (2) the
receipt by the
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Company of an Acquisition Proposal prior to any termination of the Merger
Agreement, (3) the acquisition by any Person (other than Technical Olympic or
the Purchaser) of beneficial ownership of more than 20% of the outstanding
voting securities of the Company or an option or rights to acquire more than 20%
of such voting securities of the Company prior to any termination of the Merger
Agreement or (4) the breach by the Shareholder who granted such Option of such
Shareholder's obligations under the Shareholders Agreement to tender and vote
such Shareholder's Shares (the first of such events to occur, a "Purchase
Event"); provided, however, that except as provided in the last sentence of this
paragraph, each Option will terminate and be of no further force and effect upon
the earliest to occur of (1) the Effective Time and (2) (a) in the event that
the Merger Agreement is terminated and a Purchase Event pursuant to clause (1)
of the first sentence of this paragraph has occurred, four months after such
termination of the Merger Agreement, (b) in the event that the Merger Agreement
is terminated and no Purchase Event has occurred, the time of such termination
of the Merger Agreement, and (c) in the event that the Merger Agreement is
terminated and a Purchase Event pursuant to clause (2), (3) or (4) of the first
sentence of this paragraph has occurred, 12 months and one day after the
termination of the Merger Agreement. Notwithstanding the termination of the
Options, Technical Olympic will be entitled to exercise any Option if it has
given written notice of its intent to exercise such Option in accordance with
the terms of the Shareholders Agreement prior to the termination of such Option
and the termination of such Option will not affect any rights in this paragraph.
Except as expressly provided in the Shareholders Agreement with respect to
the Options, the Shareholders Agreement and the covenants set forth therein will
terminate upon the earlier of any termination of the Merger Agreement and the
Effective Time.
12. CERTAIN CONDITIONS TO THE OFFER.
Notwithstanding any other provision of the Offer, and subject to the terms
and conditions of the Merger Agreement, the Purchaser shall not be obligated to
accept for payment any of the Shares until the expiration of any waiting periods
applicable under the HSR Act, and the Purchaser shall not be required to accept
for payment or, subject to any applicable rules and regulations of the SEC
(including Rule 14e-1(c) promulgated under the Exchange Act) pay for, and may
delay the acceptance for payment of or payment for, any Shares tendered in the
Offer if (i) immediately prior to the expiration of the Offer (as extended in
accordance with the Agreement) the Minimum Condition shall not have been
satisfied or (ii) prior to the time of acceptance of any Shares pursuant to the
Offer any of the following shall occur:
(a) there shall be threatened or pending any action, litigation or
proceeding (hereinafter, an "Action") by any governmental entity (i)
challenging the acquisition by Technical Olympic or the Purchaser of Shares
or seeking to restrain or prohibit the consummation of the Offer or the
Merger, (ii) seeking to prohibit or impose any material limitation
(including any hold separate obligation) on Technical Olympic's, the
Purchaser's or any of their respective affiliates' ownership or operation
of all or any material portion of the business or assets of the Company and
its Subsidiaries taken as a whole or Technical Olympic and its Subsidiaries
taken as a whole, or (iii) seeking to impose material limitations on the
ability of Technical Olympic or the Purchaser effectively to acquire or
hold, or to exercise full rights of ownership of, the Shares, including the
right to vote the Shares purchased by them on an equal basis with all other
Shares on all matters properly presented to the shareholders of the
Company;
(b) any statute, rule, regulation, order or injunction shall be
enacted, promulgated, entered, enforced or deemed to or become applicable
to the Merger Agreement, the Offer or the Merger, or a Required Regulatory
Approval shall not have been obtained or shall not be in full force and
effect or any other action shall have been taken, by any court or other
governmental entity, that, in such case, could reasonably be expected to
result in any of the effects of, or have any of the consequences sought to
be obtained or achieved in, any Action referred to in clauses (i) through
(iii) of paragraph (a) above;
(c) (i) any of the representations and warranties of the Company
contained in the Merger Agreement is not complete and accurate,
individually or in the aggregate with the other representations and
warranties of the Company contained in the Merger Agreement, without regard
to any qualification or limitation contained in or related to any such
representation or warranty relating to materiality or to Material Adverse
Effect, in a
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manner that has, or could reasonably be expected to have, a Material
Adverse Effect on the Company, as if such representations and warranties
were made as of such time on or after the date of the Merger Agreement
(except to the extent that such representations and warranties speak as of
a specific date, in which case such representations and warranties shall
not be so complete and accurate in a manner that has, or could reasonably
be expected to have, a Material Adverse Effect on the Company as of such
specific date); or (ii) any of the representations and warranties contained
in Section 3.1(f) or 3.1(h) of the Merger Agreement are not complete and
accurate in all material respects as of such time on or after the date of
the Merger Agreement; provided that for the purposes of this provision, the
representations and warranties contained in Section 3.1(h) of the Merger
Agreement shall be deemed complete and accurate in all material respects if
they are complete and accurate in all material respects with respect to the
Significant Subsidiaries listed on Schedule 6.1-E to the Merger Agreement,
(iii) the Company has breached in any material respect any covenant or
agreement contained in the Merger Agreement and has not cured that breach
within ten Business Days after written notice from Technical Olympic or
prior to the expiration of the Offer, if earlier, or (iv) any change or
event shall have occurred that has, or could reasonably be expected to
have, a Material Adverse Effect on the Company;
(d) there shall have occurred (i) any general suspension of trading
in, or limitation on prices for, securities on the New York Stock Exchange
or the National Association of Securities Dealers Automated Quotation
system; (ii) a declaration of a banking moratorium or any suspension of
payments in respect of banks in the United States or a member state of the
European Union; (iii) any limitation (whether or not mandatory) by any
governmental entity on the extension of credit by banks or other lending
institutions; (iv) a suspension of, or limitation on, the currency exchange
markets or the imposition of, or material changes in, any currency or
exchange control laws in the United States or abroad; (v) a commencement of
a war or armed hostilities or other national or international calamity
directly or indirectly involving the United States or a member state of the
European Union; or (vi) in the case of any of the foregoing existing at the
time of the commencement of the Offer, a material acceleration or a
worsening thereof;
(e) the Company Board (or any special committee thereof) shall have
withdrawn, modified or changed in any manner adverse to Technical Olympic
or the Purchaser its approval or recommendation of the Offer, the Merger or
the Merger Agreement or resolved to do any of the foregoing;
(f) the Company shall have entered into, or shall have publicly
announced its intention to enter into, an agreement or agreement in
principle with respect to any Acquisition Proposal or the Company Board
shall have resolved to do any of the foregoing;
(g) any Person, other than Technical Olympic or any of its affiliates,
shall have acquired or entered into a definitive agreement or agreement in
principle to acquire beneficial ownership (determined for the purposes of
this paragraph as set forth in Rule 13d-3 promulgated under the Exchange
Act) of 50% or more of the then outstanding Shares, or shall have been
granted any option, right or warrant, conditional or otherwise, to acquire
beneficial ownership of 50% or more of the then outstanding Shares; or
(h) the Merger Agreement shall have been terminated in accordance with
its terms.
The conditions set forth in clauses (a) through (h) above are for the sole
benefit of Technical Olympic and the Purchaser and may be asserted by Technical
Olympic and the Purchaser regardless of the circumstances giving rise to such
condition and may be waived by Technical Olympic and the Purchaser in whole or
in part at any time and from time to time, by express and specific action to
that effect, in their sole discretion. The failure by Technical Olympic or the
Purchaser at any time to exercise any of the foregoing rights shall not be
deemed a waiver of any such right, the waiver of any such right with respect to
particular facts and other circumstances shall not be deemed a waiver with
respect to any other facts and circumstances, and each such right shall be
deemed an ongoing right that may be asserted at any time and from time to time.
The capitalized terms used in this Section 12 shall have the meanings set
forth in the Merger Agreement.
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13. SOURCE AND AMOUNT OF FUNDS.
The Offer is not conditioned upon obtaining any financing arrangements. The
Purchaser estimates that the total amount of funds required to purchase all of
the outstanding Shares on a fully diluted basis pursuant to the Offer and the
Merger, to pay related fees and expenses of Technical Olympic and the Purchaser
(including fees related to expected financing) and to effect the Merger will be
approximately $242 million. The Purchaser will obtain these funds from Technical
Olympic, either directly or indirectly via Xxxxx Holdings through loans,
advances or capital contributions or available cash of the Company. Technical
Olympic has received an advance in the form of a subordinated loan from its
immediate parent company, Technical Olympic (UK) Plc, of $80 million and
currently intends to obtain additional necessary funds to consummate the Offer
and subsequent Merger through an acquisition bridge loan facility. The bridge
loan proceeds will be advanced by Technical Olympic to the Purchaser for the
purpose of providing a portion of the funds needed to complete the Offer and the
Merger.
Technical Olympic has received a firm financing commitment letter issued by
Bank of America, N.A. and its affiliates, Banc of America Securities LLC and
Banc of America Mortgage Capital Corporation, to Technical Olympic for an
acquisition bridge loan in the amount of $135 million. The bridge loan will have
an initial six month maturity subject to extension for up to an additional 12
months. Interest will be payable monthly at a ratcheting rate based on LIBOR
(London Interbank Offered Rate) plus 4% for the initial six months and
increasing to 9% after one year. The bridge loan will be secured by a pledge of
Technical Olympic's equity interests in Xxxxx Holdings and Newmark plus an
assignment of rights to certain fees and distributions payable to Technical
Olympic by its subsidiaries. Following the Merger, Technical Olympic expects to
repay the bridge loan with borrowings, distributions and contributions from its
parent and subsidiaries.
Technical Olympic also received a firm commitment letter from Bank of
America, N.A. and its affiliated companies to provide a $100 million term loan
and a $275 million revolving credit facility to the Company following the
Merger. Proceeds from these facilities will provide working capital and funds
required to repurchase the Company's $250 million of senior notes. Upon the
occurrence of the change of control which will occur at the consummation of the
Offer, the Company will be required under the terms of applicable indentures to
make within 30 days an offer to purchase its senior notes at a price of 101% of
their principal amount, plus accrued but unpaid interest.
To date, Technical Olympic has not executed any definitive loan agreements.
If and when definitive agreements regarding the financing of the Offer are
executed, copies will be filed as exhibits to the Schedule TO. Technical Olympic
is confident that it will be successful in arranging a short-term bridge loan
for the Offer. In the event Technical Olympic is unable to secure such a
facility with acceptable terms and conditions, it will investigate alternative
financing arrangements. Currently, Technical Olympic is in the process of
identifying any such alternative arrangements.
14. DIVIDENDS AND DISTRIBUTIONS.
As discussed in Section 11, the Merger Agreement provides that from the
date of the Merger Agreement until the earlier of (1) the Effective Time, (2)
such time as designees of Technical Olympic and the Purchaser constitute a
majority of the Company Board and (3) such time as the Merger Agreement may be
terminated in accordance with its terms, without the written consent of
Technical Olympic, the Company will, and will cause each of its Subsidiaries to,
(1) not redeem or purchase any of its stock and not declare or pay any
dividends, or make any other distributions or repayments of debt to its
shareholders (other than payments by Subsidiaries of the Company to the Company
or to other wholly owned Subsidiaries of the Company) (2) not issue or sell any
of its stock (except upon exercise of options which are outstanding on the date
of the Merger Agreement) or any options, warrants or convertible or exchangeable
securities and (3) not split, combine or reclassify its outstanding stock.
15. CERTAIN LEGAL MATTERS.
General. Technical Olympic and the Purchaser are not aware of any pending
legal proceeding relating to the Offer. Except as otherwise described herein,
based on a review of publicly available filings made by the Company
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with the SEC and other publicly available information concerning the Company,
neither Technical Olympic nor the Purchaser is aware of any license or
regulatory permit that appears to be material to the business of the Company and
its subsidiaries, taken as a whole, that might be adversely affected by the
Purchaser's acquisition of Shares as contemplated herein or of any approval or
other action by any governmental, administrative or regulatory agency or
authority, domestic or foreign, that would be required for the acquisition or
ownership of Shares by the Purchaser or Technical Olympic as contemplated
herein. Should any such approval or other action be required, the Purchaser and
Technical Olympic currently contemplate that such approval or other action will
be sought or taken. 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 failure to obtain any such approval or other action might not
result in consequences materially adverse to the Company's business or that
certain parts of the Company's business might not have to be disposed of in the
event such approvals were not obtained or such other actions were not taken, any
of which could cause the Purchaser to elect to terminate the Offer without the
purchase of Shares thereunder. The Purchaser's obligation under the Offer to
accept for payment and pay for Shares is subject to certain conditions. See
Section 12.
State Takeover Laws. The Company is subject to Section 607.0901 (the
"Affiliated Transactions Statute") of the FBCA. The Affiliated Transactions
Statute generally prohibits a Florida corporation from engaging in an
"affiliated transaction" with an "interested shareholder," unless the affiliated
transaction is approved by a majority of the disinterested directors or by the
affirmative vote of the holders of two-thirds of the voting shares other than
the shares beneficially owned by the interested shareholder, the corporation has
not had more than 300 shareholders of record at any time during the three years
prior to the public announcement relating to the affiliated transaction or the
corporation complies with certain statutory fair price provisions.
Subject to certain exceptions, under the FBCA, an "interested shareholder"
is a person who beneficially owns more than 10% of the corporation's outstanding
voting shares. In general terms, an "affiliated transaction" includes: (i) any
merger or consolidation with an interested shareholder; (ii) the disposition to
any interested shareholder of corporate assets with a fair market value equal to
5% or more of the corporation's consolidated assets or outstanding shares or
representing 5% or more of the corporation's earning power or net income; (iii)
the issuance to any interested shareholder of shares with a fair market value
equal to 5% or more of the aggregate fair market value of all outstanding shares
of the corporation; (iv) any reclassification of securities or corporate
recapitalization that will have the effect of increasing by more than 5% the
percentage of the corporation's outstanding voting shares beneficially owned by
any interested shareholder; (v) the liquidation or dissolution of the
corporation if proposed by any interested shareholder; and (vi) any receipt by
the interested shareholder of the benefit of any loans, advances, guaranties,
pledges or other financial assistance or any tax credits or other tax advantages
provided by or through the corporation.
Because a majority of the disinterested directors of the Company Board has
approved the Merger Agreement and the Shareholders Agreement and the
transactions contemplated by each of such agreements, the provisions of the
Affiliated Transactions Statute are not applicable to the Offer, the Merger and
the other transactions contemplated by the Merger Agreement and the Shareholders
Agreement.
The Company is also subject to Section 607.0902 of the FBCA (the "Control
Share Acquisition Statute"). The Control Share Acquisition Statute provides that
shares of publicly held Florida corporations that are acquired in a "control
share acquisition" generally will have no voting rights unless such rights are
conferred on those shares by the vote of the holders of a majority of all the
outstanding shares other than interested shares. A control share acquisition is
defined, with certain exceptions, as the acquisition of the ownership of voting
shares which would cause the acquiror to have voting power within the following
ranges or to move upward from one range into another: (i) one-fifth or more but
less than one-third; (ii) one-third or more but less than a majority; or (iii) a
majority or more, of such voting power.
The Control Share Acquisition Statute does not apply to an acquisition of
shares of a publicly held Florida corporation (i) pursuant to a merger or share
exchange effected in compliance with the FBCA if the publicly held Florida
corporation is a party to the merger or share exchange agreement or (ii) if such
acquisition has been approved by the board of directors of that corporation
before the acquisition.
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Because the Control Share Acquisition Statute specifically exempts a merger
effected in compliance with the FBCA if the publicly held Florida corporation is
a party to the merger agreement and an acquisition which has been approved by
the board of directors before the acquisition, the provisions of the Control
Share Acquisition Statute are not applicable to the Offer, the Merger and the
other transactions contemplated by the Merger Agreement and the Shareholders
Agreement.
Except as described herein, the Purchaser has not attempted to comply with
any state takeover statutes in connection with the Offer. The Purchaser reserves
the right to challenge the validity or applicability of any state law allegedly
applicable to the Offer, and nothing in this Offer to Purchase nor any action
taken in connection with the Offer or the Merger is intended as a waiver of that
right. In the event that any state takeover statute is found applicable to the
Offer or the Merger, the Purchaser might be unable to accept for payment or pay
for Shares tendered pursuant to the Offer or be delayed in continuing or
consummating the Offer or the Merger. In such case, the Purchaser might not be
obligated to accept for payment or pay for any Shares tendered. See Section 12.
Antitrust Compliance. Under the HSR Act and the rules promulgated
thereunder by the Federal Trade Commission ("FTC"), certain acquisition
transactions may not be consummated unless certain information has been
furnished to the Antitrust Division of the Department of Justice (the "Antitrust
Division") and the FTC and certain waiting period requirements have been
satisfied.
Technical Olympic and the Company believe that a filing under the HSR Act
for the Offer or the Merger is not required, and each does not presently intend
to make such a filing. Technical Olympic and the Company are taking this
position based upon the advice of their respective antitrust counsel in
reliance, in part, on an exemption from filing in respect of an acquisition of
voting securities of a company, the assets of which consist of certain real
property assets. The reliance on exemptions from filing under the HSR Act is
also dependent upon a good faith determination made by Technical Olympic, within
60 days prior to the consummation of the Offer, that the value of certain assets
of the Company that are not exempt under the real property or other exemptions
does not exceed certain HSR Act filing thresholds. Technical Olympic expects to
make such a determination.
If an exemption were not available, pursuant to the HSR Act, Technical
Olympic S.A. and the Company would be required to file a Notification and Report
Form with respect to the acquisition of Shares pursuant to the Offer and the
Merger with the Antitrust Division and the FTC. Under the provisions of the HSR
Act applicable to the purchase of Shares pursuant to the Offer, such purchases
may not be made until the expiration of a 15-calendar day waiting period
following the filing made by Technical Olympic S.A. and the Company, unless
early termination of the waiting period is granted, or Technical Olympic S.A.,
any of its affiliates or the Company receives a request for additional
information or documentary material relevant to the Offer prior thereto. If
either the FTC or the Antitrust Division were to make such a request(s) for
additional information or documentary material, the waiting period would expire
at 11:59 p.m., New York City time, on the tenth calendar day after the date of
substantial compliance with such request(s), unless the waiting period is sooner
terminated by the FTC or the Antitrust Division. Thereafter, the waiting period
could be extended only by agreement or by court order. Only one extension of
such waiting period pursuant to a request for additional information is
authorized by the rules promulgated under the HSR Act, except by agreement or by
court order. Any such extension of the waiting period will not give rise to any
withdrawal rights not otherwise provided for by applicable law. See Section 4.
The Antitrust Division and the FTC scrutinize the legality under the
antitrust laws of transactions such as the acquisition of Shares by the
Purchaser pursuant to the Offer. At any time before or after the Purchaser's
acquisition of Shares pursuant to the Offer, the Antitrust Division or the FTC
could take such action under the antitrust laws of the United States as it deems
necessary or desirable in the public interest, including seeking to enjoin the
purchase of Shares pursuant to the Offer or the consummation of the Merger, or
seeking the divestiture of Shares acquired by the Purchaser, or the divestiture
of substantial assets of the Company or its subsidiaries, or of Technical
Olympic or its subsidiaries. Private parties (including individual states) also
may bring legal action under the antitrust laws of the United States under
certain circumstances. Technical Olympic and the Purchaser do not believe that
the consummation of the Offer or the Merger will result in a violation of any
applicable antitrust laws. However, there can be no assurance that a challenge
to the Offer or the Merger on antitrust grounds will not be made or, if such a
challenge is made, of the result thereof.
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16. FEES AND EXPENSES.
Banc of America Securities LLC is acting as Dealer Manager for the Offer
and as financial advisor to Technical Olympic in connection with Technical
Olympic's proposed acquisition of the Company, for which services Banc of
America Securities LLC will receive customary compensation. Technical Olympic
also has agreed to reimburse Banc of America Securities LLC for reasonable costs
and expenses, including reasonable fees and expenses of its legal counsel, and
to indemnify Banc of America Securities LLC and certain related parties against
certain liabilities, including liabilities under the federal securities laws,
arising out of its engagement. In the ordinary course of business, Banc of
America Securities LLC and its affiliates may actively trade or hold the
securities of the Company and Technical Olympic S.A. for their own account or
for the account of customers and, accordingly, may at any time hold a long or
short position in such securities. Banc of America Securities LLC and certain of
its affiliates will also receive customary fees in connection with their firm
commitment to provide certain credit facilities, including the acquisition
bridge loan, described in Section 13, and their agency services in connection
with these facilities.
The Purchaser has also retained MacKenzie Partners to act as the
Information Agent and Wilmington Trust Company to act as the Depositary in
connection with the Offer. The Information Agent may contact holders of Shares
by mail, telephone, telex, facsimile, telegraph and personal interviews and may
request banks, brokers, dealers and other nominees to forward materials relating
to the Offer to beneficial owners of Shares. The Information Agent and the
Depositary each will receive reasonable and customary compensation for their
respective services in connection with the Offer, will be reimbursed for
reasonable out-of-pocket expenses and will be indemnified against certain
liabilities and expenses in connection therewith, including certain liabilities
under federal securities laws. Brokers, dealers, commercial banks and trust
companies will, upon request, be reimbursed by the Purchaser for customary
mailing and handling expenses incurred by them in forwarding offering materials
to their customers.
17. MISCELLANEOUS.
The Offer is not being made to (nor will tenders be accepted from or on
behalf of) holders of Shares in any jurisdiction in which the making of the
Offer or the acceptance thereof would not be in compliance with the laws of such
jurisdiction. However, the Purchaser may, in its sole discretion, take such
action as it may deem necessary to make the Offer in any such jurisdiction and
extend the Offer to holders of Shares in such jurisdiction. In any jurisdiction
where the securities, blue sky or other laws require the Offer to be made by a
licensed broker or dealer, the Offer will be deemed to be made on behalf of the
Purchaser by the Dealer Manager or by one or more registered brokers or dealers
licensed under the laws of such jurisdiction.
Neither Technical Olympic nor the Purchaser is aware of any jurisdiction in
which the making of the Offer or the acceptance of Shares in connection
therewith would not be in compliance with the laws of such jurisdiction.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION ON BEHALF OF TECHNICAL OLYMPIC OR THE PURCHASER NOT CONTAINED IN
THIS OFFER TO PURCHASE OR IN THE LETTER OF TRANSMITTAL AND, IF GIVEN OR MADE,
SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED.
The Purchaser and Technical Olympic have filed with the SEC a Tender Offer
Statement on Schedule TO pursuant to Rule 14d-3 under the Exchange Act, together
with exhibits furnishing certain additional information with respect to the
Offer, and may file amendments thereto. In addition, the Company has filed with
the SEC a Solicitation/Recommendation Statement on Schedule 14D-9, together with
exhibits, pursuant to Rule 14d-9 under the Exchange Act, setting forth the
recommendation of the Company Board with respect to the Offer and the reasons
for such recommendation and furnishing certain additional related information. A
copy of such documents, and any amendments thereto, including exhibits, may be
examined at, and copies may be obtained from, the principal office of the SEC in
Washington, D.C., in the manner set forth in Section 8.
HELIOS ACQUISITION CORP.
October 20, 2000
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SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF
THE PURCHASER, TECHNICAL OLYMPIC AND TECHNICAL OLYMPIC S.A.
DIRECTORS AND EXECUTIVE OFFICERS OF HELIOS ACQUISITION CORP.
The following table sets forth the name, business address, current
principal occupation or employment and five-year employment history of each of
the directors and executive officers of Helios Acquisition Corp. Each person has
a business address at 00 Xxxxxxx Xxxxxx, Xxx Xxxxxxxx, Xxxxxx, Xxxxxx 17456 and
is a citizen of Greece, unless a different business address and/or citizenship
is indicated under his or her name. Directors are indicated by an asterisk.
NAME, BUSINESS ADDRESS CURRENT PRINCIPAL OCCUPATION OR EMPLOYMENT
AND CITIZENSHIP AND FIVE-YEAR EMPLOYMENT HISTORY
---------------------- ------------------------------------------
Xxxxxxxxxxxx Xxxxxxx*......... Chairman and Managing Director, Technical Olympic S.A. since
1965; Director, Technical Olympic (UK) Plc since November
1999; Director and President, Technical Olympic USA, Inc.
since November 1999; Director and President, Helios
Acquisition Corp. since October 2000; Chairman, Newmark
Homes Corp. since December 1999.
Xxxxx X. XxXxxx*.............. Director, Vice President and Chief Financial Officer,
3624 Long Prairie Technical Olympic USA, Inc. since January 2000; Director and
Flower Mound, Texas 75022 Vice President, Treasurer and Assistant Secretary, Helios
Citizenship: United States Acquisition Corp. since October 2000; Chief Financial
Officer, Pacific Realty Group, Inc. from 1994 to December
1999.
Xxxxx X. Xxxxxxx*............. Vice President, Secretary and General Counsel, Technical
0000 Xxxxxxxx Xxxxx Xxxxx Xxxxxxx XXX, Inc. since February 2000; Director, Vice
Sugar Land, Texas 77479 President and Secretary, Helios Acquisition Corp. since
Citizenship: United States October 2000; Associate and Of Counsel, Xxxxxx & Xxxxxx
L.L.P. from 1981 to January 2000.
DIRECTORS AND EXECUTIVE OFFICERS OF TECHNICAL OLYMPIC USA, INC.
The following table sets forth the name, business address, current
principal occupation or employment and five-year employment history of each of
the directors and executive officers of Technical Olympic USA, Inc. Each person
has a business address at 00 Xxxxxxx Xxxxxx, Xxx Xxxxxxxx, Xxxxxx, Xxxxxx 17456
and is a citizen of Greece, unless a different business address and/or
citizenship is indicated under his or her name. Directors are indicated by an
asterisk.
NAME, BUSINESS ADDRESS CURRENT PRINCIPAL OCCUPATION OR EMPLOYMENT
AND CITIZENSHIP AND FIVE-YEAR EMPLOYMENT HISTORY
---------------------- ------------------------------------------
Xxxxxxxxxxxx Xxxxxxx*......... See above.
Xxxxxx Xxxxxxxxxxx*........... Real Estate & Housing Director, Technical Olympic S.A. since
September 1999; Director and Vice President, Technical
Olympic USA, Inc. since November 1999; Director, Newmark
Homes Corp. since December 1999; Director and Manager of
Real Estate Development and Project Management Departments,
Xxxxxxx Xxxxx Xxxxxxx X.X. from 1994 to 1999.
Xxxxxxx Xxxxxxx*.............. Director, Technical Olympic S.A. since 1989 and General
Manager since 1995; Director and General Director, Technical
Olympic (UK) Plc since 1997; Director and Treasurer,
Technical Olympic USA, Inc. since November 1999; Director,
Newmark Homes Corp. since December 1999.
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NAME, BUSINESS ADDRESS CURRENT PRINCIPAL OCCUPATION OR EMPLOYMENT
AND CITIZENSHIP AND FIVE-YEAR EMPLOYMENT HISTORY
---------------------- ------------------------------------------
Xxxxxx Xxxxxxx*............... Stock Market and Purchasing Director, Technical Olympic S.A.
since 1996; Director and Corporate Secretary, Technical
Olympic (UK) Plc since 1997; Director, Assistant Secretary
and Assistant Treasurer, Technical Olympic USA, Inc. since
November 1999; Director, Newmark Homes Corp. since December
1999; student prior to 1996.
Xxx Xxxxxxx*.................. Director and Vice President, Technical Olympic S.A. since
1992; Director and Vice President, Technical Olympic (UK)
Plc since November 1999; Director and Vice President,
Technical Olympic USA, Inc. since January 2000.
Xxxxx X. XxXxxx*.............. See above.
0000 Xxxx Xxxxxx
Xxxxxx Xxxxx, Xxxxx 00000
Citizenship: United States
Xxxxx X. Xxxxxxx.............. See above.
0000 Xxxxxxxx Xxxxx Xxxxx
Xxxxx Xxxx, Xxxxx 00000
Xxxxxxxxxxx: Xxxxxx Xxxxxx
DIRECTORS AND EXECUTIVE OFFICERS OF TECHNICAL OLYMPIC S.A.
The following table sets forth the name, business address, current
principal occupation or employment and five-year employment history of each of
the directors and executive officers of Technical Olympic S.A. Each person has a
business address at 00 Xxxxxxx Xxxxxx, Xxx Xxxxxxxx, Xxxxxx, Xxxxxx 17456 and is
a citizen of Greece, unless a different business address and/or citizenship is
indicated under his or her name. Directors are indicated by an asterisk.
NAME, BUSINESS ADDRESS CURRENT PRINCIPAL OCCUPATION OR EMPLOYMENT
AND CITIZENSHIP AND FIVE-YEAR EMPLOYMENT HISTORY
---------------------- ------------------------------------------
Xxxxxxxxxxxx Xxxxxxx*......... See above.
Xxxxxxx Xxxxxxx*.............. See above.
Xxx Xxxxxxx*.................. See above.
Xxxxxxx Xxxxxxx*.............. Architectural Works Director, Technical Olympic S.A. since
1998 and Public Relations Manager from 1993 to 1998.
Xxxxxx Xxxxxxx................ See above.
Xxxxxxxxxxxx Xxxxxx*.......... Technical Director (Highway Projects), Technical Olympic
S.A. since 1989.
Xxxxxx Xxxxxxxxxxx............ See above.
Xxxxxxxx Xxxxxxxxxx*.......... Legal Matters & Arbitrations Director, Technical Olympic
S.A. since 1992.
Xxxxxx Xxxxxx................. Financial Director -- Main Offices, Technical Olympic S.A.
since June 1998; Financial Director, Erteka S.A. from 1995
to 1998.
Xxxxx Xxxxxxxxx............... Financial Director -- South & North Western Greece,
Technical Olympic S.A. since 1999; Director of Finance
Department, Mochlos S.A. from 1995 to 1999.
Xxxxxxxx Xxxxxxx.............. Public Relations Director, Technical Olympic S.A. since
December 1999; student prior to December 1999.
Xxxxxx Xxxxxxxxxx............. Financial Main Offices Director, Technical Olympic S.A.
since February 2000; Treasurer of Xxxxxx Xxxxxxxxxx and
Financial Director, Xxxxx Xxxxx S.A. from 1995 to 2000.
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Manually signed facsimile copies of the Letter of Transmittal, properly
completed and duly signed, will be accepted. The Letter of Transmittal,
certificates for Shares and any other required documents should be sent or
delivered by each shareholder of the Company or such shareholder's broker,
dealer, commercial bank, trust company or other nominee to the Depositary at one
of the addresses set forth below:
THE DEPOSITARY FOR THE OFFER IS:
WILMINGTON TRUST COMPANY
By Facsimile Transmission:
(For Eligible Institutions Only)
(000) 000-0000
Confirm by Telephone:
(000) 000-0000
By Mail: By Hand or Overnight Courier:
Wilmington Trust Company Wilmington Trust Company
Corporate Trust Division Corporate Trust Division
P.O. Box 8861 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx Xxxxx
Xxxxxxxxxx, XX 00000-0000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Any questions or requests for assistance may be directed to the Information
Agent or the Dealer Manager at their respective telephone numbers and locations
listed below. Requests for additional copies of this Offer to Purchase, the
Letter of Transmittal and the Notice of Guaranteed Delivery may be directed to
the Information Agent or the Dealer Manager as set forth below and will be
furnished promptly at the Purchaser's expense. You may also contact your broker,
dealer, commercial bank, trust company or other nominee for assistance
concerning the Offer.
THE INFORMATION AGENT FOR THE OFFER IS:
[MACKENZIE PARTNERS, INC. LOGO]
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000 (Call Collect)
or
CALL TOLL-FREE (000) 000-0000
THE DEALER MANAGER FOR THE OFFER IS:
[BANC OF AMERICA SECURITIES LLC LOGO]
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000 (Call Collect)
or
CALL TOLL-FREE (000) 000-0000 EXT. 8537
