[LOGO]
November 28, 1997
Dear Stockholders:
I am pleased to inform you that Deflecta-Shield Corporation (the "Company")
has entered into an Agreement and Plan of Merger dated as of November 25, 1997
(the "Merger Agreement") with Xxxx International Holdings, Inc. ("Parent") and
Zephyros Acquisition Corporation, a wholly-owned subsidiary of Parent
("Purchaser"), pursuant to which Purchaser has today commenced a cash tender
offer (the "Offer") to purchase all of the outstanding shares of the common
stock, par value $0.01 per share (the "Shares") of the Company at a purchase
price of $16.00 per Share, net to the seller in cash. The Merger Agreement
provides for the making of the Offer which, if consummated, will be followed by
a merger of Purchaser with and into the Company (the "Merger"), with the Company
as the surviving entity.
In the Merger, Shares will be converted into the right to receive an amount
in cash equal to the price per Share paid pursuant to the Offer, without
interest thereon.
YOUR BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE MERGER AGREEMENT, THE
OFFER AND THE MERGER AND DETERMINED THAT THE OFFER AND THE MERGER ARE FAIR TO,
AND IN THE BEST INTERESTS OF, THE STOCKHOLDERS OF THE COMPANY. YOUR BOARD OF
DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS OF THE COMPANY ACCEPT THE OFFER AND
TENDER THEIR SHARES PURSUANT TO THE OFFER.
In arriving at its recommendation, the Board of Directors gave careful
consideration to the factors described in the attached Schedule 14D-9 that is
being filed today with the Securities and Exchange Commission, including, among
other things, the opinion of Xxxxxxxxxxx Xxxxxxx & Co., Inc., the Company's
financial advisors, that the consideration to be offered to the holders of
Common Stock in the Offer and the Merger pursuant to the Merger Agreement is
fair to such stockholders from a financial point of view.
In addition to the attached Schedule 14D-9, enclosed is the Offer to
Purchase dated November 28, 1997, together with related materials, including a
Letter of Transmittal, to be used for tendering your shares pursuant to the
Offer. These documents state the terms and conditions of the Offer and the
Merger, provide detailed information about the transactions and include
instructions as to how to tender your Shares. We urge you to read these
documents carefully in making your decision with respect to tendering your
Shares pursuant to the Offer.
Very truly yours,
/s/ Xxxxxxx X. Xxxxxxxxx
PRESIDENT AND
CHIEF EXECUTIVE OFFICER
