SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13E-3
(RULE 13E-100)
TRANSACTION STATEMENT UNDER SECTION 13(E) OF THE SECURITIES
EXCHANGE ACT OF 1934 AND RULE 13E-3 THEREUNDER
RULE 13E-3 TRANSACTION STATEMENT UNDER SECTION 13(E) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 2)
HURCO COMPANIES, INC.
(NAME OF ISSUER)
HURCO COMPANIES, INC.
(NAME OF PERSON(S) FILING STATEMENT)
COMMON STOCK, NO PAR VALUE
(TITLE OF CLASS OF SECURITIES)
447324104
(CUSIP NUMBER OF CLASS OF SECURITIES)
MICHAEL DOAR
CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER
HURCO COMPANIES, INC.
ONE TECHNOLOGY WAY
INDIANAPOLIS, INDIANA 46268
(317) 293-5309
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO
RECEIVE NOTICES AND COMMUNICATIONS ON BEHALF OF THE PERSON(S) FILING STATEMENT)
WITH COPIES TO:
STEPHEN H. COOPER, ESQ.
767 FIFTH AVENUE
NEW YORK, NEW YORK 10153
(212) 310-8000
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This statement is filed in connection with (check the appropriate box):
a. [ ] The filing of solicitation materials or an information statement
subject to Regulation 14A, Regulation 14C or Rule 13e-3(c) under the
Securities Exchange Act of 1934.
b. [ ] The filing of a registration statement under the Securities Act of
1993.
c. [X] A tender offer.
d. [ ] None of the above.
Check the following box if the soliciting materials or information statement
referred to in checking box (a) are preliminary copies: [ ]
Check the following box if the filing is a final amendment reporting the results
of the transaction. [ ]
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CALCULATION OF FILING FEE
================================================================================
Transaction valuation: $27,805* Amount of filing fee: $2.25
================================================================================
* Calculated solely for the purpose of determining the filing fee, based upon
the odd-lot tender offer price of $3.35 share for the eligible common
stock, multiplied by 8,300, the maximum number of shares to be purchased in
the offer.
[X] Check the box if any part of the fee is offset as provided by Rule
0-11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
Amount Previously Paid: $2.25 Filing Party: Hurco Companies, Inc.
Form or Registration No.: Schedule 13E-3 Date Filed: June 3, 2003
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This Amendment No. 2 (this "Amendment") amends and supplements the
Schedule 13E-3 Transaction Statement filed with the Securities and Exchange
Commission (the "Commission") on June 3, 2003 and Amendment No. 1 to the
Schedule 13E-3 Transaction Statement filed with the Commission on June 13, 2003
(as so amended, the "Schedule 13E-3") by Hurco Companies, Inc. (the "Company").
This Schedule 13E-3 relates to the offer (the "Offer") by the Company to
purchase for cash all shares of the Company's common stock, no par value (the
"Common Stock"), held by stockholders that own 99 or less shares of Common Stock
as of the close of business on June 2, 2003, pursuant to the Offer to Purchase,
dated June 3, 2003 and the related Letter of Transmittal.
The information set forth in the Offer to Purchase and the related
Letter of Transmittal is expressly incorporated herein by reference in response
to all the items of this Amendment, except as set forth below. In addition, the
information set forth in Items 1 through 16 of the Schedule 13E-3 are
incorporated herein by reference with respect to Items 1 through 16 of this
Amendment, except those Items as to which information specifically provided
herein is relevant, in which case the information contained in the Schedule
13E-3 is incorporated herein by reference in partial answer to those Items
unless otherwise noted hereto.
ITEM 16: EXHIBITS.
Item 16 of Schedule 13E-3 is hereby amended and supplemented by
adding the following exhibit thereto:
(a)(7) Offer to Purchase, dated June 3, 2003, as amended.
(a)(8) Letter of Transmittal, as amended.
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: June 18, 2003
HURCO COMPANIES, INC.
By: /s/ Michael Doar
----------------------------------
Name: Michael Doar
Title: Chairman of the Board and
Chief Executive Officer
EXHIBIT INDEX
EXHIBIT NO. EXHIBIT
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(a)(7) Offer to Purchase, dated June 3, 2003, as amended.
(a)(8) Letter of Transmittal, as amended.
Exhibit (a) (7)
HURCO COMPANIES, INC.
OFFER TO PURCHASE FOR CASH
ALL SHARES OF ITS COMMON STOCK, NO PAR VALUE,
HELD BY HOLDERS OF 99 OR FEWER SHARES
--------------------
Hurco Companies, Inc. is offering to purchase for cash all shares of
its common stock (NASDAQ: HURC) held by stockholders that own 99 or fewer shares
of common stock as of the close of business on June 2, 2003, subject to the
terms set forth in this offer to purchase and in the accompanying letter of
transmittal. Only stockholders that own 99 or fewer shares of common stock as of
close of business on the record date are eligible to participate in this offer.
We will pay $3.35 per share for each share of common stock properly
tendered by an eligible stockholder. This price represents a 19.6% premium over
the last sale price of our common stock on the Nasdaq National Market on June 2,
2003, the last trading day prior to the date of this Offer to Purchase. Payment
will be made promptly following the expiration of this offer.
THIS OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON TUESDAY,
JULY 1, 2003, UNLESS EXTENDED OR TERMINATED EARLIER. WE MAY EXTEND THIS OFFER AT
ANY TIME IN OUR SOLE AND ABSOLUTE DISCRETION.
If you are an eligible stockholder and would like to accept this
offer, you must tender all of your shares in the manner described in this offer
to purchase and in the letter of transmittal. PARTIAL TENDERS WILL NOT BE
ACCEPTED. ONCE YOU TENDER YOUR SHARES, YOU MAY NOT WITHDRAW THEM FROM THE OFFER.
If, after completion of this offer, we have fewer than 300
stockholders of record, we intend to terminate the registration of our common
stock under the Securities Exchange Act of 1934 and become a non-reporting
company. This means that we will no longer file periodic reports with the
Securities Exchange Commission, including, among other things, annual reports on
Forms 10-K and quarterly reports on Form 10-Q, and we will not be subject to the
SEC's proxy rules. In addition, our common stock will no longer be eligible for
trading on the Nasdaq market.
This offer is not conditioned on the receipt of any minimum number of
tenders.
If you have any questions regarding this offer, please contact
Innisfree M&A Incorporated, the Information Agent for this Offer to Purchase, at
the address and telephone number set forth on the back cover of this document.
If you would like additional copies of this document, please contact the
Information Agent and copies will be furnished to you promptly, free of charge.
You may also contact your broker, dealer, commercial bank or trust company for
assistance concerning the offer.
No person has been authorized to make any recommendation on our
behalf as to whether eligible stockholders should tender their shares pursuant
to this offer. No person has been authorized to give any information or to make
any representations in connection with this offer other than those contained in
this document or in the related Letter of Transmittal. If made or given, any
recommendation or other information should not be relied upon as having been
authorized by our company.
PLEASE READ THIS OFFER TO PURCHASE IN ITS ENTIRETY BEFORE MAKING ANY
INVESTMENT DECISION.
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THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
MERITS OR FAIRNESS OF THIS TRANSACTION NOR UPON THE ADEQUACY OR ACCURACY OF THE
INFORMATION CONTAINED IN THIS OFFER TO PURCHASE. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
The date of this offer to purchase is June 3, 2003.
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IMPORTANT
If you are a holder of 99 or fewer shares of our common stock as of
June 2, 2003, the record date, and wish to accept this offer, there are two
methods by which you can tender your shares, depending on how you hold those
shares:
o If you hold physical certificates evidencing the shares, you
should complete and sign the accompanying Letter of Transmittal
in accordance with its instructions, and mail and deliver it and
any of the other required documents to EquiServe Trust Company,
N.A., the Depositary for this offer, at the address set forth on
the back cover of this document; or
o If you are a beneficial owner whose shares are registered in the
name of a broker, dealer, bank, trust company or other nominee,
you should contact that broker or other record holder, as well as
the Depositary, at the telephone number set forth on the back
cover of this Offer to Purchase.
For more information regarding the procedure for tendering shares,
see "Terms of the Tender Offer--Procedure for Tendering Shares."
IF YOU HOLD MORE THAN 99 SHARES OF HURCO COMMON STOCK, YOU MAY NOT
PARTICIPATE IN THIS OFFER.
SPECIAL CAUTIONARY NOTICE REGARDING
FORWARD-LOOKING STATEMENTS
Certain statements made in this report may constitute
"forward-looking statements." These forward-looking statements involve known and
unknown risks, uncertainties and other factors that may cause our actual
results, performance or achievements to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. These factors include, among others, changes in
general economic and business conditions that affect market demand for machine
tools and related computer control systems, software products, and replacement
parts, changes in manufacturing markets, adverse currency movements, innovations
by competitors, quality and delivery performance by our contract manufacturers
and governmental actions and initiatives including import and export
restrictions and tariffs. We do not intend to update these forward-looking
statements during the tender offer period.
SUMMARY OF TERMS
This summary, as well as the questions and answers that follow,
highlight selected information included elsewhere in this Offer to Purchase. To
fully understand this offer and the other considerations that may be important
about whether to tender your shares, you should carefully read this Offer to
Purchase in its entirety. For further information regarding Hurco, see "Where to
Find Additional Information." Except as otherwise provided, the words "Hurco,"
the "Company," "we," "our," "ours," and "us" refer to Hurco Companies, Inc. and
its subsidiaries.
We are offering to purchase for cash all shares of our common stock
held by stockholders who own 99 or fewer shares of our common stock as of the
close of business on the record date. The material terms and conditions of the
offer are set forth below. For additional information regarding the terms of the
offer, see "Terms of the Tender Offer."
o Only stockholders that own 99 or fewer shares of our common stock
as of the close of business on the record date are eligible to
participate in this offer. See "Terms of the Tender
Offer--General" for an explanation of how to determine the number
of shares you own beneficially.
o This offer is voluntary; eligible stockholders may, but are not
required to, tender their shares. ELIGIBLE STOCKHOLDERS WHO WISH
TO ACCEPT THIS OFFER, HOWEVER, MUST TENDER ALL OF THE SHARES THEY
OWN. PARTIAL TENDERS WILL NOT BE ACCEPTED.
o We will pay $3.35 for each share of our common stock that is
properly tendered by an eligible holder. This price represents a
19.6 percent premium over $2.80, the last per share sale price of
our common stock on the Nasdaq National Market on June 2, 2003,
the last trading day prior to the date of this Offer to Purchase.
o You will not be obligated to pay any commissions in connection
with the purchase of your shares pursuant to this offer.
o THIS OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON JULY
1, 2003, UNLESS EXTENDED. IN ORDER FOR YOUR TENDER TO BE ACCEPTED
BY US, THE DEPOSITARY MUST RECEIVE YOUR DOCUMENTS AT OR PRIOR TO
THIS TIME. WE WILL MAKE A PUBLIC ANNOUNCEMENT IF WE DECIDE TO
EXTEND THE TENDER OFFER. SEE "TERMS OF THE TENDER
OFFER--EXPIRATION AND EXTENSION OF THE TENDER OFFER; AMENDMENTS."
o Once you tender your shares in the offer, you may not withdraw
them. If, however, your shares are not properly tendered on or
prior to 5:00 p.m., New York City time, on the expiration date,
we will have no obligation to accept your tender of your shares.
If we do not accept your tender of your shares, we will return
your shares to you. See "Terms of the Tender Offer--Withdrawal
Rights" and "Terms of the Tender Offer--Conditions to the Tender
Offer."
o If you sell your shares to us pursuant to this offer, you will no
longer be a stockholder of Hurco and will no longer have voting
rights or the right to receive any dividends that might be
declared in the future.
o If, after completion of this offer, we have fewer than 300
stockholders of record, we intend to deregister our common stock
under the Securities Exchange Act of 1934 and become a
non-reporting company. This means that we will no longer file
periodic reports with the SEC, including, among other things,
annual reports on Forms 10-K and quarterly reports on Form 10-Q,
and we will no longer be subject to the SEC's proxy rules. We do
intend, however, to provide our remaining stockholders with basic
information with respect to our financial condition and results
of operations on a quarterly and annual basis after we become a
non-reporting company. This information will not be as detailed
or extensive as the information we currently file with the SEC.
See "Special Factors--Effects of the Tender Offer; Plans after
Completing the Tender Offer."
2
o If we terminate the registration of our common stock under the
Exchange Act, our common stock will be ineligible for trading in
the Nasdaq market or on the "OTC bulletin board." Our common
stock may be quoted in the "pink sheets" published by the NASD,
but we cannot predict whether or when this will occur or that an
active trading market will exist for our common stock. As a
result, it may become more difficult for our remaining
stockholders to sell their shares.
o Since the offer is voluntary and shares will be purchased at a
premium to the current market price of our common stock, we have
not engaged any person or entity to issue a "fairness" or similar
opinion with respect to the offer.
o We have not granted any stockholder any voting, appraisal or
dissent rights in connection with the offer.
o Your receipt of cash in exchange for your shares will be a
taxable transaction for United States federal income tax purposes
and may be such for state and local income tax purposes as well.
You should consult with your tax advisor before tendering your
shares.
You may contact the Information Agent if you have any additional
questions or need additional copies of any of these documents or any document
containing information incorporated by reference in this document. The address
and telephone number of the Information Agent is set forth on the back cover of
this document. See "Where You Can Find Additional Information."
-----------
Our principal executive offices are located at One Technology Way,
Indianapolis, Indiana 46268. Our telephone number is (317) 293-5309.
3
QUESTIONS AND ANSWERS
WHO IS OFFERING TO PURCHASE MY SHARES?
Hurco Companies, Inc. is offering to purchase shares of its common
stock held by stockholders who hold 99 or fewer shares as of June 2, 2003.
AM I ELIGIBLE TO PARTICIPATE IN THE OFFER?
You may tender your shares only if you own 99 or fewer shares,
whether you own your shares of record (i.e., in your own name) or beneficially
(i.e., in "street name" in a brokerage account maintained by you).
If you have questions regarding your eligibility to participate in
this offer, contact the Depositary, toll free, at (877) 282-1168. We reserve the
right to make all determinations of who is eligible to participate in this
tender offer.
WHAT WILL I BE PAID FOR MY HURCO COMMON STOCK?
The purchase price being offered is $3.35 per share. This price
represents a 19.6% premium over $2.80, the last per share sale price of our
common stock on the Nasdaq National Market on June 2, 2003, the last trading day
prior to the date of this Offer to Purchase. The full price will be paid to you
in cash. We will not pay any interest on the purchase price during the period
when your shares are tendered and the date you receive your payment.
WILL I HAVE TO PAY BROKERAGE COMMISSIONS IF I TENDER MY SHARES?
No. You will have no obligation to pay any commissions as a result of
your participation in this offer.
WHEN WILL I RECEIVE MY MONEY?
Your check will be mailed promptly after the expiration of the tender
offer. Please allow sufficient time for the Postal Service to deliver your
check.
DO I HAVE TO TENDER MY SHARES?
No, you may elect to continue to hold your shares and retain your
rights as a stockholder, including the right to vote your shares and to receive
any dividends that might be declared in the future.
HOW DO I TENDER MY SHARES?
o If you are a "record holder" and hold your shares in your own
name, complete and sign the Letter of Transmittal (the blue
document in your package) and deliver it, along with your stock
certificate(s) for all your shares, to the Depositary at its
address set forth on the back cover of this Offer to Purchase.
Please send your documents so that they are received at or before
5:00 p.m., New York City time, on Tuesday, July 1, 2003. Make
sure you include your taxpayer identification number, which is
your Social Security Number if you are an individual or your
Federal Employer Identification Number if you are a corporation,
partnership, trust or other entity. If you fail to do this, the
proceeds from the sale of your shares may be subject to a 28%
backup withholding tax.
o If your shares are registered in the name of a broker, dealer,
commercial bank, trust company or other nominee, you should
contact them if you desire to tender your shares. You will need
to provide them with instructions on the yellow form in your
package. In addition, you may contact the Depositary, toll free,
at (877) 282-1168 for further information.
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o If you cannot deliver your share certificates or other required
documents prior to the expiration date of the tender offer, you
may tender your shares by delivering the notice of guaranteed
delivery (the green document in your package) followed by your
certificates and other documents within three days.
See "Terms of the Tender Offer--Procedure for Tendering Shares" for
more detailed instructions.
HOW MUCH TIME DO I HAVE TO TENDER MY SHARES?
You may tender your shares at any time up to and including 5:00 p.m.,
New York City time, on July 1, 2003. Your tender documents must be received in
good order by the Depositary by that time. We may choose to extend the offer for
any reason. If we do so, we will issue a press release by 9:00 a.m., New York
City time, on the business day after the previously scheduled expiration date.
CAN I TENDER LESS THAN ALL OF MY SHARES?
No. If you wish to tender any of your shares, you must tender all of
your shares. Partial tenders will not be accepted.
WHAT IF I HAVE LOST MY STOCK CERTIFICATE?
If you have lost any or all of the stock certificate(s) evidencing
your shares and wish to participate in the offer, please contact the Depositary,
toll free, at (877) 282-1168.
WHY IS HURCO MAKING THE OFFER?
We are making the offer in order to reduce the number of holders of
record of our common stock to less than 300 and thereafter to terminate the
registration of our common stock under the Securities Exchange Act of 1934 and
delist our common stock from the Nasdaq market. By so doing, we will no longer
be required to file periodic reports and proxy materials with the SEC.
Preparation of these SEC reports and proxy materials involves substantial costs.
In addition, as a reporting and Nasdaq-listed company we are subject to a
substantial number of requirements regarding our corporate governance, many of
which have been imposed within the past twelve months as a result of the
Sarbanes-Oxley legislation enacted by Congress in the wake of the Enron scandal.
These remedial measures, while well intended, have imposed significant
additional costs on listed companies, and these costs, and the associated
incremental demands on management's time, are particularly burdensome for small
companies, such as Hurco. By ceasing to be a reporting company and terminating
our Nasdaq listing, we expect to achieve substantial cost savings. In addition,
we believe the offer will provide an economical means for small holders of our
common stock to sell their shares at a premium to current market prices without
incurring any brokerage commissions.
WILL THE COMMON STOCK REMAIN LISTED FOLLOWING THE COMPLETION OF THE OFFER?
If this offer results in the number of our stockholders of record
falling below 300 and we terminate the registration of our common stock under
the Securities Exchange Act of 1934, our common stock also will be delisted from
the Nasdaq National Market. Moreover, as the Nasdaq SmallCap Market requires
that listed companies have at least 300 record stockholders, we do not expect
that our common stock will be eligible for listing in the Nasdaq SmallCap Market
or on the "OTC bulletin board." Thereafter, our common stock may be quoted in
the "pink sheets," but we cannot predict whether or when this will occur or that
an active market will exist for our common stock. As a result, it may become
even more difficult for our remaining stockholders to sell their shares.
WHAT ARE THE FEDERAL INCOME TAX CONSEQUENCES OF PARTICIPATING IN THE OFFER?
Generally, your receipt of cash in consideration for your shares
pursuant to the offer will be a taxable transaction for U.S. federal income tax
purposes and may be a taxable transaction for state, local foreign and other tax
purposes as well.
5
Please consult with your tax advisor to determine the federal, state,
local, foreign and other tax consequences of sales made by you pursuant to the
offer in view of your own particular circumstances before tendering your shares.
Foreign persons are urged to consult their tax advisers regarding the
application of U.S. federal income tax withholding and backup withholding,
including eligibility for a withholding tax reduction or exemption, and the
refund procedure. See "Certain U.S. Federal Income Tax Consequences" below for a
more detailed general discussion.
WHOM CAN I CONTACT IF I HAVE ADDITIONAL QUESTIONS ABOUT THE OFFER?
If you have additional questions, you may contact the Information
Agent at the address or telephone number set forth on the back cover of this
document.
SPECIAL FACTORS
PURPOSES OF THE OFFER
The purposes of this offer are set forth below.
o TERMINATE REGISTRATION OF OUR COMMON STOCK UNDER THE EXCHANGE ACT
AND OUR NASDAQ LISTING. As a "reporting company" under the
Securities Exchange Act of 1934, we are obligated to prepare and
file with the SEC annual reports on Form 10-K, quarterly reports
on Form 10-Q, current reports on Form 8-K and proxy statements
that comply with Section 14 of the Exchange Act. In addition,
Nasdaq listing requirements and the Securities Exchange Act
require us to maintain an audit committee consisting of
independent directors and a disclosure committee that will assure
appropriate management review of information that forms the basis
of our SEC reports. Finally, as a reporting and listed company we
are subject to increased regulatory requirements that have been
imposed as a result of the Sarbanes-Oxley legislation enacted by
Congress last Summer in the wake of the Enron scandal and other
major revelations of corporate malfeasance.
The current market environment and the price of our common stock
greatly hinder our ability to raise capital in the public
markets. Accordingly, we believe that we derive virtually no
benefit from our Nasdaq listing or our status as a reporting
company. No major securities analyst currently reports on Hurco
and our common stock trades infrequently and at low volumes.
Moreover, we estimate that the annual costs associated with being
a reporting company are currently in excess of approximately
$400,000. The management time and attention associated with the
preparation of these reports is also considerable.
If most or all eligible stockholders participate in the offer, we
expect to have fewer than 300 record stockholders upon the
completion of the offer and intend to terminate the registration
of our common stock under the Exchange Act. After we terminate
the registration of our common stock, we will no longer be
required to file periodic reports or proxy statements with the
SEC, will cease to be listed on Nasdaq and will no longer be
subject to many of the regulations imposed by the SEC pursuant to
the Sarbanes-Oxley legislation. We expect that this will result
in significant cost savings to us and allow our management to
spend far more time on business matters that bear a direct
relationship to our operations and profitability. We believe that
these cost and other savings ultimately will benefit all of our
stockholders, including those ineligible to participate in the
offer as well as those eligible stockholders that choose not to
participate in the offer. See "--Effects of the Offer; Plans
After Completing the Offer."
o REDUCE EXPENSES ASSOCIATED WITH ADMINISTERING SMALL STOCKHOLDER
ACCOUNTS. The expense of administering the accounts of small
stockholders is disproportionate to their ownership interest in
us. As of the record date, we had approximately 191 stockholders
of record that held 99 or fewer shares, holding an aggregate of
approximately 5,300 shares of our common stock. As of the same
date, an estimated 209 stockholders of record of record held 100
or more shares, holding an aggregate of approximately 5,577,858
shares of our common stock. As a result, nearly half of the
6
administrative expense relating to our stockholder accounts
relates to the administration of stockholder accounts
constituting less than 0.1% percent of our issued and outstanding
shares. Even if the record stockholder base is not reduced to
below 300, we believe that every tender by a stockholder will
reduce expenses going forward.
o PROVIDE SMALL STOCKHOLDERS AN OPPORTUNITY TO SELL THEIR SHARES AT
A PREMIUM IN AN ILLIQUID TRADING MARKET WITHOUT INCURRING
BROKERAGE COMMISSIONS. As the trading market for our common stock
is relatively illiquid, it is often difficult for our
stockholders to dispose of their shares when they choose. In
particular, holders of small amounts of our common stock often
find it uneconomical to dispose of their shares due to the
minimum brokerage commissions typically charged. We believe the
offer will provide a more economical means for small holders of
our common stock to sell their shares at a premium to market
prices without incurring any brokerage commissions.
OUR REASONS FOR PURSUING THE OFFER AS OPPOSED TO OTHER ALTERNATIVES
We have determined that making this offer is the best means to
achieve the objectives described in "Purposes of the Offer" above. In making
this determination, we also considered effecting a reverse stock split. However,
we concluded that a reverse stock split would not be preferable to this offer
for the following reasons:
o a reverse stock split would not be voluntary, as odd-lot holders
would be forced out; and
o a reverse stock split would impact all stockholders rather than
the target group, as many stockholders would be left holding
fractional shares.
Accordingly, we concluded that this tender offer would be the least expensive
and most efficient way to:
o reduce the number of our record stockholders and allow us to
terminate the registration of our common stock and eliminate the
annual accounting and legal expenses associated with complying
with the periodic reporting requirements of the Securities
Exchange Act and the enhanced regulatory burdens imposed pursuant
to the Sarbanes-Oxley legislation;
o provide an economical means for small holders of our common stock
to sell their shares at an attractive price without incurring
brokerage expenses; and
o save on the costs of administering many small stockholder
accounts.
For these reasons, we have decided to make this offer. Moreover, we
have decided to make the offer at this time because the current market price of
our common stock allows us to offer eligible stockholders a purchase price that
represents a substantial premium to the current market price of our common stock
but a discount to the per share book value of our common stock. See "--Our
Position as to the Fairness of the Offer to Unaffiliated Stockholders."
POTENTIAL ADVERSE EFFECTS OF THE OFFER
Our board of directors also was aware of and considered the following
potential adverse effects of this offer:
o Loss of Nasdaq Listing and Trading Market. As indicated above, if
as a result of this offer we become eligible to do so, we intend
to terminate the registration of our common stock under the
Securities Exchange Act and the listing of our common stock in
the Nasdaq market. Because of the lack of significant interest in
our shares and the absence of an analyst following, trading in
our shares and the liquidity of the market for our shares has
been limited. Delisting of our common stock may further reduce
that liquidity and make it more difficult for our remaining
stockholders to sell their shares.
7
o Reduction in Public Information. After the completion of the
offer and the subsequent deregistration of our common stock as
planned, we will no longer be required to file periodic reports
with the SEC. As a result, it may be difficult for our remaining
stockholders to receive timely information concerning the
development of our business or our financial condition or results
of operations.
OUR POSITION AS TO THE FAIRNESS OF THE OFFER TO UNAFFILIATED STOCKHOLDERS
Our board of directors believes that the offer is fair to eligible
stockholders that are unaffiliated with us. This belief is based on the board's
consideration of the following factors:
o The Offer is Voluntary. Eligible stockholders are not required to
tender their shares.
o The Purchase Price being Offered Represents a Premium to Current
Trading Price. We are offering to pay $3.35 for each share of our
common stock tendered in the offer by an eligible stockholder,
which represents a 19.6 percent premium to $2.80, the last per
share sale price of our common stock as quoted by Nasdaq on June
2, 2003.
o The Purchase Price Represents Highest Trading Price Since Fiscal
2001. The purchase price of $3.35 per share represents the
highest trading price of our common stock over the past two
years.
o No Brokerage Commissions Payable. Eligible stockholders who
choose to participate in the offer will avoid the brokerage
commissions that they would otherwise incur if they disposed of
their shares in an open market transaction (although a holder
will have federal and state income tax consequences, discussed
below).
Our board of directors also believes that the offer is fair to our
unaffiliated stockholders that are not eligible to participate in the offer or
decide not to tender. This belief is based on the board's consideration of the
following material factors:
o The Purchase Price being Offered represents a Discount from the
Book Value of our Common Stock. Although the $3.35 we are
offering to pay for each share of common stock tendered in the
offer represents a premium to the current trading price of our
common stock, the offer price also represents a 31.5% discount
from the book value of our common stock.
o Cost Savings Associated with Deregistration and Delisting. We
believe that the cost savings associated with the planned
deregistration and delisting of our common stock will benefit
stockholders who are ineligible to participate in the offer as
well as those eligible stockholders that choose not to
participate in the offer, because it should enhance our ability
to return to profitability.
o Increased Ownership Interest of Remaining Stockholders. Following
the completion of the offer, the ownership interest of our
remaining stockholders will increase and these stockholders may
enjoy an increase in return on equity and earnings per share as a
result of the reduced number of shares outstanding.
The above discussion is not intended to be exhaustive, but includes
the material factors upon which we based our determination that the offer is
fair to our unaffiliated stockholders. Because of the voluntary nature of the
transaction and the fact that purchases will be made at a premium to current
market price, our board of directors did not deem it relevant to consider the
offer price as compared to going concern value or liquidation value. In reaching
its determination that the offer is fair to unaffiliated stockholders, our board
of directors considered all factors as a whole and have not assigned specific
weights to particular factors, though individual directors may have given
differing weights to these factors. None of the factors that our board of
directors considered led the board to believe that the offer is unfair to our
unaffiliated stockholders.
Our board of directors is not aware of any firm offers made by any
person during the past two years for (1) the merger or consolidation of Hurco
with or into another company, (2) the purchase of all or a substantial part of
8
Hurco's assets or (3) a purchase of Hurco's securities that would enable the
holder to exercise control of Hurco, and we have no plans or arrangements for
any such transaction.
This offer was approved by a unanimous vote of our board of
directors, including all of the directors who are not employees of Hurco or any
of its subsidiaries. Given the consensus among our directors, based on the
factors set forth above, that the offer is fair to our unaffiliated stockholders
whether or not they are eligible to participate, our board of directors did not
believe it was necessary to retain an unaffiliated representative to act solely
on the behalf of our unaffiliated stockholders for purposes of negotiating the
terms of the offer or to prepare any report, opinion or appraisal relating to
the consideration or the fairness of the consideration to be offered pursuant to
the offer or relating to the fairness of the transaction to the Company or any
stockholder. The engagement of such a representative was deemed not to be
necessary because the transaction is voluntary and the purchase price to be paid
in the offer represents a 19.6% premium to current market prices and will
actually be less costly to tendering stockholders than ordinary open market
sales because of the absence of brokerage commissions. Further, because neither
management nor the board has any present intent in pursuing a sale of our
company, neither management nor the board solicited from third parties offers
for the purchase of our common stock.
No vote of stockholders is required under Indiana law, and the board
of directors did not deem a vote of stockholders necessary given the voluntary
nature of the transaction and because all stockholders, including those
ineligible to participate in the odd-lot tender offer, have been notified of the
offer and have the opportunity to sell their shares before or after completion
of the offer.
NEITHER WE NOR OUR BOARD OF DIRECTORS IS MAKING ANY RECOMMENDATION
REGARDING WHETHER YOU SHOULD TENDER YOUR SHARES IN THE OFFER. ACCORDINGLY, YOU
MUST MAKE YOUR OWN DETERMINATION AS TO WHETHER TO TENDER YOUR SHARES.
EFFECTS OF THE OFFER; PLANS AFTER COMPLETING THE OFFER
As of June 2, 2003, the record date, there were 400 record holders of
our common stock. As of that date there were approximately 191 holders who owned
99 or fewer shares of our common stock of record and approximately 70 holders
who were believed by us to own 99 or fewer shares beneficially. Accordingly,
approximately 261 holders are eligible to participate in the offer. As a result,
if most or all of the eligible record holders participate in the offer, we
expect that there will be less than 300 record holders of our common stock
following the completion of the offer.
To the extent that, upon expiration of the offer, an insufficient
number of stockholders will have tendered to reduce the number of record holders
of our common stock to less than 300, we may seek to extend the offer to allow
eligible stockholders additional time to tender their shares. In addition,
whether or not we extend the offer, if, following the completion of the offer,
we continue to have 300 or more record holders of our common stock, we may make
an additional offer to purchase shares of our common stock held by stockholders
that continue to own 99 or fewer shares.
Following the completion of the offer, if we are eligible to do so,
we intend to terminate the registration of our common stock under the Securities
Exchange Act, and thereby terminate our Nasdaq listing for the following
reasons:
o we believe that our company derives virtually no benefit from its
Nasdaq listing or its status as an SEC reporting company;
o the cost associated with being a reporting company, which we
estimate was approximately $300,000 in our last fiscal year and
which is likely to be in excess of approximately $400,000 this
fiscal year due to new regulations, is a substantial burden for
our company; and
o the time spent by our management on the preparation of these
reports could be more productively spent on other business
matters that bear a more direct relationship to our operations
and ultimate return to profitability.
9
Under applicable SEC rules, issuers are permitted to terminate the
registration of, and suspend their SEC reporting obligations with respect to,
any class of securities held of record by less than 300 persons. Once these
obligations have been suspended, issuers are no longer required to file periodic
reports, including annual reports on Form 10-K, quarterly reports on Form 10-Q
and current reports on Form 8-K, or to comply with the SEC's proxy rules.
Because our common stock is our only class of securities outstanding, once we
suspend our reporting obligations with respect to our common stock, we will have
no obligation under federal securities laws to provide our stockholders with any
periodic reports as to new developments in our business, our financial condition
or results of operations. Therefore, following the suspension of our reporting
obligations, it will be difficult for our stockholders to obtain information
about us. We do intend, however, to provide our remaining stockholders with
summary quarterly balance sheet and income statement data and copies of our
annual audited financial statements after we become a non-reporting company.
This information will not be as detailed or extensive as the information we
currently file with the SEC and will not be accompanied by a separate
management's discussion and analysis.
If we terminate the registration of our common stock, it will no
longer be eligible for trading in the Nasdaq market or on the "OTC bulletin
board." Although our common stock may thereafter be quoted in the "pink sheets,"
we cannot guarantee whether or when this will occur or that an active market
will exist for our shares. As a result, the trading market for our common stock
may cease to exist and it may be difficult for holders to dispose of their
shares.
We estimate that there are 261 stockholders eligible to participate
in the offer, holding approximately 8,300 shares of our common stock. Assuming
all eligible stockholders participate, we expect to pay approximately $27,805 in
aggregate consideration in the offer. As a result, we do not believe the
completion of the offer will have a material effect on our financial condition
or results of operations. All purchases we make pursuant to this offer will be
funded with our cash and other liquid assets. All shares of common stock
purchased by us pursuant to this offer will be cancelled.
EXCEPT AS PROVIDED IN THIS OFFER, WE HAVE NO PRESENT INTENTION TO
ACQUIRE ANY ADDITIONAL SHARES OF COMMON STOCK FROM OUR STOCKHOLDERS. IN
ADDITION, TO OUR KNOWLEDGE, NONE OF OUR EXECUTIVE OFFICERS, DIRECTORS OR
CONTROLLING STOCKHOLDERS HAS ANY PRESENT INTENTION TO PURCHASE, OR SEEK TO
PURCHASE, SHARES OF OUR COMMON STOCK. HOWEVER, IF AN APPROPRIATE OPPORTUNITY FOR
THE PURCHASE OF OUR COMMON STOCK SHOULD ARISE IN THE FUTURE, WE OR ONE OR MORE
OF OUR EXECUTIVE OFFICERS OR DIRECTORS OR CONTROLLING STOCKHOLDERS MAY CONSIDER
THE PURCHASE OF ADDITIONAL SHARES OF OUR COMMON STOCK.
RECENT TRANSACTIONS, NEGOTIATIONS AND CONTACTS
During the past two years, we have not been engaged in any
negotiations, transactions or material contacts with any of our affiliates
concerning any merger, consolidation, acquisition, tender offer for or other
acquisition of any of our securities, election of our directors or sale or other
transfer of a material amount our of assets.
Upon joining our company in November 2001, Michael Doar, our Chairman
of the Board and Chief Executive Officer, began a comprehensive review of our
cost structure, including the relative costs and benefits of our status as a
reporting public company. Together with other members of management, Mr. Doar
concluded that our company was deriving virtually no benefit from our status as
a public company: no analysts followed or reported on the company, shares of our
common stock traded infrequently and in very low volume and, due to our limited
size and variable operating results, we did not have ready access to the capital
markets. In addition, the costs associated with being a reporting company had
been and continue to be rising dramatically. Management, including Mr. Doar,
informally raised the issue with our board of directors, which authorized
management to explore available means of terminating Hurco's status as a
reporting company. In addition to considering this offer, management and our
board also considered a reverse stock split, but, for the reasons described
under "Our Reasons for Pursuing the Offer as Opposed to Other Alternatives,"
determined that this offer was the best means to achieve the objectives
described in "Purposes of the Offer."
The purchase price was determined based on the highest trading price
of our common stock over the past two years and the fact that it provided a
significant premium over the current trading price.
10
STOCKHOLDER APPROVAL, APPRAISAL RIGHTS AND AGREEMENTS CONCERNING SECURITIES
Under Indiana law, neither the commencement or consummation of the
offer nor the purchase of any shares pursuant to the offer requires approval by
our stockholders. In addition, under Indiana law, stockholders are not entitled
to exercise dissent or appraisal rights in connection with the offer.
Neither we nor any of our directors or executive officers are party
to any agreement, arrangement or understanding with respect to any of our
securities.
CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES
Set forth below is a summary of the principal U.S federal income tax
consequences of a sale of common stock pursuant to this offer under the Internal
Revenue Code of 1986 (the "Code").
The summary is based on the Code, existing and proposed Treasury
regulations, administrative pronouncements and judicial decisions now in effect,
all of which are subject to change, possibly on a retroactive basis. The
following summary does not purport to be a complete analysis of all the
potential U.S. federal income tax effects relating to the sale of common stock
pursuant to this offer and is limited to those stockholders whose shares are
treated as capital assets. Without limiting the generality of the foregoing, the
summary does not address the effect of any special rules applicable to certain
types of holders, including dealers in securities or currencies, insurance
companies, financial institutions, thrifts, tax-exempt entities, regulated
investment companies, real estate investment trusts, brokers, persons who hold
shares as part of a straddle, hedge, conversion transaction, or other integrated
investment, traders in securities that elect to use a mark-to-market method of
accounting for their securities holdings, persons subject to alternative minimum
tax, persons that have a "functional currency" other than the U.S. dollar or
certain expatriates or former long-term residents of the United States,
partnerships or pass-through entities or investors in partnerships or
pass-through entities that hold the shares. This discussion does not address the
effect of any U.S. state or local income or other tax laws, any U.S. federal
estate and gift tax laws, any foreign tax laws, or any tax treaties.
If a partnership tenders shares pursuant to this offer, the tax
treatment of a partner will generally depend on the status of that partner and
the activities of the partnership. If you are a partner of a partnership
tendering shares pursuant to this offer, you should consult your tax advisor.
U.S. STOCKHOLDER
In general, for the purposes of this summary, the term "U.S.
Stockholder" shall mean, a beneficial owner of shares of common stock that for
U.S. federal income tax purposes is:
(1) a citizen or resident of the United States;
(2) a corporation or partnership (or other entity table as a
corporation or partnership) created or organized in or under the laws of the
United States or any State or the District of Columbia;
(3) an estate the income of which is subject to United States federal
income taxation regardless of its source; or
(4) a trust, if a court within the Untied States is able to exercise
primary supervision over the administration of the trust and one or more United
States persons has the authority to control all substantial decisions of the
trust, or certain other trusts considered U.S. Stockholders for federal income
tax purposes.
In general, a transfer of shares of common stock by a U.S.
Stockholder to us pursuant to this offer will be treated as a "sale or exchange"
of such shares (rather than a dividend distribution) under Section 302 of the
Code if the receipt of cash by the stockholder from us pursuant to this offer
meets any of the following three alternative tests (the "Section-302-Tests"):
11
(a) is "substantially disproportionate" with respect to the
stockholder,
(b) results in a "complete termination" of the stockholder's interest
in the Company, or
(c) is "not essentially equivalent to a dividend" with respect to the
stockholder.
These Section-302-Tests" are further discussed below.
For purposes of determining whether any of the Section-302-Tests has
been satisfied, a U.S. Stockholder must take into account not only shares
actually owned by such stockholder, but also shares that are constructively
owned by such stockholder within the meaning of Section 318 of the Code. Under
Section 318 of the Code, a U.S. Stockholder may constructively own shares
actually owned, and in some cases constructively owned, by certain related
individuals or entities and shares which may be acquired by exercise of an
option or by conversion. Contemporaneous dispositions or acquisitions of shares
by a U.S. Stockholder or related individuals or entities (including market
purchases and sales) may be deemed to be part of a single integrated transaction
to be taken into account in determining whether any of the Section-302-Tests has
been satisfied.
Section-302-Tests. The three alternative Section-302-Tests are as
follows:
(a) SUBSTANTIALLY DISPROPORTIONATE TEST. The receipt of cash by a
U.S. Stockholder will be substantially disproportionate with respect to
the stockholder if the percentage of the outstanding shares actually and
constructively owned by the stockholder immediately following the sale of
shares pursuant to this offer (treating shares sold pursuant to this offer
as not outstanding) is less than 80% of the percentage of the outstanding
shares actually and constructively owned by the stockholder immediately
before the sale of shares pursuant to the offer, treating sale of shares
sold pursuant to the offer as outstanding.
(b) COMPLETE TERMINATION TEST. The receipt of cash by a U.S.
Stockholder will be a complete termination of the stockholder's interest
in us if either (1) all of the shares actually and constructively owned by
the stockholder are sold pursuant to this offer or (2) all of the shares
actually owned by the stockholder are sold pursuant to this offer and the
stockholder is eligible to waive, and effectively waives, the attribution
of shares constructively owned by the stockholder in accordance with the
procedures described in Section 302(c)(2) of the Code. U.S. Stockholders
considering terminating their interest in accordance with Section
302(c)(2) of the Code should consult with their own tax advisors.
(c) NOT ESSENTIALLY EQUIVALENT TO A DIVIDEND TEST. The receipt of
cash by a U.S. Stockholder will be not essentially equivalent to a
dividend if the stockholder's sale of shares pursuant to this offer
results in a "meaningful reduction" in the stockholder's interest in us
(both actual and constructive) as compared to such stockholder's interest
immediately before this offer is consummated. Whether the receipt of cash
by a stockholder will be "not essentially equivalent to a dividend" will
depend upon the individual stockholder's facts and circumstances. The
Internal Revenue Service (the "IRS") has indicated in published rulings
that even a small reduction in the proportionate interest of a small
minority stockholder in a publicly held corporation who exercises no
control over corporate affairs may constitute such a "meaningful
reduction." The IRS held in Rev. Rul. 76-385, 1976-2 C.B. 92, that a
reduction in the percentage ownership interest of a stockholder in a
publicly held corporation from .0001118% to .0001081% (only a 3.3%
reduction of the stockholder's prior percentage ownership interest) would
constitute a "meaningful reduction." U.S. Stockholders expecting to rely
upon the "not essentially equivalent to a dividend" test should consult
their own tax advisors as to its application in their particular
situation.
If any of the Section-302-Tests is satisfied, and the sale of the
shares is therefore treated as a "sale or exchange" for federal income tax
purposes, the tendering U.S. Stockholder will recognize a gain or loss equal to
the difference, if any, between the amount of cash received and such
stockholder's "tax basis" in the shares sold pursuant to the offer. Such gain or
loss will be capital gain or loss, provided such shares are held as capital
assets and any such capital gain or loss will be long term if, as of the date
such shares are sold, they are held for more than one year or will be short term
if, as of such date, such shares are held for one year or less.
12
Treatment as a Dividend. If none of the Section-302-Tests is
satisfied, the amount of cash received by a tendering U.S. Stockholder will be
treated as a dividend taxable as ordinary income (without reduction for the tax
basis of the shares sold pursuant to the offer) to the extent of the U.S.
Stockholder's share of our earnings and profits. The U.S. Stockholder's basis in
the shares sold pursuant to the offer would be added to such U.S. Stockholder's
basis in its remaining shares, if any. If none of the Section-302-Tests is
satisfied, any cash received by the stockholders for shares pursuant to the
offer in excess of the allocable portion of our earnings and profits will be
treated, first, as a non-taxable return of capital to the extent of the
stockholder's basis for all of such stockholder's shares, and, thereafter, as a
capital gain to the extent it exceeds such basis, and will be long term capital
gain if the shares have been held for more than one year.
Special Rules for Corporate U.S. Stockholders. If a sale of shares by
a corporate U.S. Stockholder is treated as a dividend, the corporate U.S.
Stockholder may be entitled to claim a deduction equal to 70% of the dividend
under Section 243 of the Code, subject to applicable limitations. Rules may
apply, however, to limit or even disallow such deduction as to certain corporate
U.S. Stockholders. Additionally, a corporate U.S. Stockholder claiming such
deduction will be subject to the "extraordinary dividend" rules under Section
1059 of the Code. Corporate U.S. Stockholders should consult with their tax
advisors regarding their ability to claim "dividend received deduction" and the
possible applications under the "extraordinary dividend" rules.
NON-U.S. STOCKHOLDERS.
In general, for the purposes of this summary, the term "Non-U.S.
Stockholder" shall mean, a beneficial owner of shares other than a U.S.
Stockholder.
U.S. Federal Income Tax Withholding For Non-U.S. Stockholders. The
Depositary generally will treat the cash received by Non-U.S. Stockholders
participating in this offer as a dividend distribution from us. Accordingly, the
Depositary generally will withhold U.S. federal income taxes equal to 30% of the
gross proceeds payable to the Non-U.S. Stockholder or his or her agent unless
the Depositary determines that a reduced rate of withholding is available
pursuant to a tax treaty or that an exemption from withholding is applicable
because the gross proceeds are effectively connected with the Non-U.S.
Stockholder's conduct of a trade or business within the U.S.
In order to claim the benefit of a tax treaty or to claim exemption
from withholding because the income is effectively connected with the Non-U.S.
Stockholder's conduct of a trade or business within the U.S, a Non-U.S
Stockholder must provide a properly executed IRS Form W-8BEN for treaty benefits
or IRS Form W-8ECI for effectively connected income (or such successor forms as
the IRS designates). The Depositary will determine a stockholder's withholding
status based on such forms unless facts and circumstances indicate that such
reliance is not warranted. A Non-U.S Stockholder that qualifies for an exemption
from withholding by delivering IRS Form W-8ECI generally will be required to
file a U.S. federal income tax return and will be subject to U.S. federal income
tax on income derived from the sale of shares pursuant to the offer in the
manner and to the extent to which a U.S. Stockholder is subject to such (and for
certain corporate holders under certain circumstances, the branch profits tax).
If the exchange is characterized as a sale (as opposed to a dividend)
with respect to a Non-U.S. Stockholder, the stockholder generally will not be
subject to U.S. federal income tax, and therefore may be entitled to a refund of
the tax withheld by the Depositary with respect to the exchange unless:
(1) the gain is effectively connected with a trade or business of the
Non-U.S. Stockholder in the U.S. and, if certain tax treaties apply, is
attributable to a permanent establishment in the U.S. maintained by such holder;
(2) in the case of a non-resident alien individual who holds the
stock as a capital asset, the individual is present in the U.S. for 183 or more
days in the taxable year of the disposition and certain other conditions are
met; or
(3) in the case of a Non-U.S. Stockholder who owns or has owned
during the relevant statutory period more than 5% of the shares, we are or have
been a "U.S. real property holding corporation" and certain other requirements
are met.
13
Non-U.S. Stockholders are urged to consult their tax advisors
regarding the application of U.S. federal income tax withholding, including
eligibility for a withholding tax reduction or exemption, and the refund
procedure.
BACKUP WITHHOLDING.
Each tendering stockholder must provide certain information through
the Letter of Transmittal to avoid the 28% federal "backup withholding" tax on
the gross proceeds payable pursuant to the Offer. See "Backup U.S. Federal
Income Tax Withholding", below.
THE U.S. FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED
FOR GENERAL INFORMATION ONLY AND IS NOT TAX ADVICE. STOCKHOLDER ARE URGED TO
CONSULT WITH THEIR OWN TAX ADVISOR TO DETERMINE THE FEDERAL, STATE, LOCAL,
FOREIGN AND OTHER TAX CONSEQUENCES OF SALES MAKE BY THEM PURSUANT TO THIS OFFER
IN VIEW OF THEIR OWN PARTICULAR CIRCUMSTANCES.
14
TERMS OF THE OFFER
GENERAL
We are offering to purchase for cash all shares of our common stock
held by stockholders that own 99 or fewer shares of our common stock as of the
close of business on the record date. Properly tendered shares by odd-lot
stockholders will be purchased at $3.35 per share, which is a 19.6% premium over
the last sale price of our common stock on the Nasdaq National Market on June 2,
2003, the last trading day prior to the date of this Offer to Purchase. A proper
tender will include delivery of a properly executed Letter of Transmittal to the
Depositary, EquiServe Trust Company, N.A.. Payment for properly tendered shares
will be made promptly following the expiration of the tender offer.
You may tender your shares only if your total ownership of our stock
is 99 or fewer shares, whether of record (i.e., in your own name) or
beneficially (i.e., in "street name" in a brokerage account maintained by you).
All questions about the eligibility of any stockholder to participate
in the tender offer will be determined by us, in our sole discretion, and our
determination will be final and binding. If you have questions regarding your
eligibility to participate in the tender offer, you may contact the Depositary,
toll free, at (877) 282-1168.
Participation in the tender offer is entirely voluntary. You may
choose to continue to hold your shares and retain your rights as a stockholder,
including the right to vote your shares and receive dividends, to the extent
declared by our board of directors. HOWEVER, IF YOU ARE A HOLDER OF 99 OR FEWER
SHARES AND ELECT TO ACCEPT THIS OFFER, YOU MUST TENDER ALL OF YOUR SHARES. In
addition, this offer is subject to the conditions set forth below.
We estimate that approximately 191 of our 400 stockholders of record,
plus approximately 70 beneficial stockholders, holding an aggregate of
approximately 8,300 shares of common stock, are eligible to participate in the
offer. Assuming all of these stockholders elected to participate in the offer
and the shares tendered were purchased at the offer price of $3.35 per share,
the total cost to us of purchasing these shares would be $27,805. All purchases
we make pursuant to this offer will be funded with our cash and other liquid
assets.
Because we are offering to purchase shares only from stockholders who
own 99 or fewer shares of our common stock, the offer constitutes an "odd-lot
tender offer" and is being conducted pursuant to Rule 13e-4(h)(5) under the
Securities Exchange Act. In addition, because we expect the completion of the
offer to reduce the number of our stockholders of record below 300, the offer
also constitutes a "going-private transaction" and is being conducted in
compliance with Rule 13e-3 under the Securities Exchange Act.
CONDITIONS OF THE OFFER
This offer is not conditioned on the receipt of tenders for any
minimum number of shares. We will not accept any alternative, conditional or
contingent tenders.
EXPIRATION AND EXTENSION OF THE OFFER; AMENDMENT
This offer will expire on July 1, 2003, unless extended to a later
date at our discretion. Your tender offer documents must be received by the
Depositary no later than 5:00 p.m., New York City time, on the expiration date,
or on any date thereafter to which the offer is extended.
We reserve the right, in our sole discretion, to extend the period of
time during which the offer is open and thereby delay acceptance for payment of,
and payment for, shares. We can extend the offer by making a public announcement
of the extension. We may do so regardless of whether or not the events set forth
above as conditions to the offer shall have occurred. We also reserve the right,
in our sole discretion, to terminate the offer and not accept for payment or pay
for any shares not theretofore accepted for payment or paid for or, subject to
applicable law, to postpone payment for shares upon the occurrence of any of the
conditions specified as conditions to the offer above by making public
announcement of the termination or postponement.
15
Subject to compliance with applicable law, we further reserve the
right, in our sole discretion, and regardless of whether or not the events set
forth above as conditions to the offer shall have occurred, to amend the offer
in any respect. Amendments to the offer may be made at any time and from time to
time effected by public announcement. In the case of an extension, we will make
such announcement no later than 9:00 a.m., New York City time, on the business
day after the previously scheduled or announced expiration date. A business day
means any day other than a Saturday, Sunday or United States federal holiday.
Any period measured in business days includes the first day of the period.
We will disseminate any such public announcement promptly to
stockholders in a manner reasonably designed to inform stockholders of the
change. Except as required by applicable law, we have no obligation to publish,
advertise or otherwise communicate any such public announcement other than by
issuing a press release.
PROCEDURE FOR TENDERING SHARES
RECORD HOLDERS. If you wish to tender the shares for which you are
the record holder, you should complete and sign the Letter of Transmittal
according to its instructions and mail or deliver it, together with the
certificates for your shares, any required signature guarantee, and any other
required documents, in the enclosed envelope to the Depositary at the address
set forth on the back cover of this offer to purchase on or prior to 5:00 p.m.,
New York City time, on July 1, 2003.
No signature guarantee is required as long as the Letter of
Transmittal is signed by the record holder of the tendered shares (including any
participant in The Depository Trust Company, which is a securities depository
("DTC"), whose name appears on a security position listing as the owner of the
shares) unless such holder has completed either the box captioned "Special
Delivery Instructions" or the box captioned "Special Payment Instructions" on
the Letter of Transmittal. Likewise, no signature guarantee is required for
shares tendered for the account of a bank, broker, dealer, credit union, savings
association or other financial institution that is a member of an approved
signature guarantee medallion program (an "eligible guarantor institution").
Otherwise, the signature on the Letter of Transmittal must be guaranteed by an
eligible guarantor institution in accordance with the instructions in the Letter
of Transmittal.
If a certificate for shares is registered in the name of a person
other than the person executing the Letter of Transmittal, or if payment is to
be made to a person other than the record holder, then the certificate must be
endorsed on its reverse side or it must be accompanied by an appropriate stock
power, in either case signed exactly as the name of the record holder appears on
the certificate, with the signature guaranteed by an eligible guarantor
institution.
BENEFICIAL HOLDERS. If your shares are registered in the name of a
broker, dealer, commercial bank, trust company or other nominee, you should
contact that institution if you desire to tender your shares. In addition, you
may contact the Depositary, toll free, at (877) 282-1168 for further
information.
GUARANTEED DELIVERY. If you cannot deliver your share certificates or
other required documents to the Depositary before the expiration date of this
offer, you may tender your shares by using the guaranteed delivery procedure. To
tender your shares by this method, you must complete and sign the Notice of
Guaranteed Delivery in the form we have provided with this document, and deliver
it to the Depositary before the expiration date of the offer. The Notice of
Guaranteed Delivery must be guaranteed by a broker-dealer, commercial bank,
trust company or other eligible guarantor institution. For your tender to be
effective, the certificates for your shares along with a properly completed and
signed Letter of Transmittal (or an agent's message) and any other documents
required by the Letter of Transmittal, must be received by the Depositary within
three business days of expiration of the offer.
METHOD OF DELIVERY. The method of delivery of all documents,
including certificates for shares, the Letter of Transmittal and any other
required documents, is at the election and risk of the tendering stockholder. In
all cases, sufficient time should be allowed to assure timely delivery of
documents. If delivery is by mail, we recommend that you use registered mail and
request a return receipt.
16
The Depositary will set up a separate account at DTC for purposes of
this tender offer. Participants in DTC may make delivery of tendered shares by
causing DTC to transfer the shares into the Depositary's account. Even if shares
are delivered in this manner, DTC participants will need to complete and sign a
Letter of Transmittal and deliver it to the Depositary by the expiration date.
DTC participants can use an "agents message" as a substitute for a Letter of
Transmittal. An agents message is a message transmitted by DTC to the Depositary
which states that DTC has received an express acknowledgment from a DTC
participant tendering the shares that such participant has received the Letter
of Transmittal and agrees to be bound by its terms and that we may enforce that
agreement against the participant.
BACKUP U.S. FEDERAL INCOME TAX WITHHOLDING. Under the U.S. backup
federal income tax withholding rules applicable to certain stockholders other
than certain exempt stockholders, including, among others, all corporations and
certain foreign entities, the Depositary will be required to withhold 28% of any
payments made to those stockholders pursuant to the offer. To prevent backup
federal income tax withholding on payments with respect to the purchase price of
shares purchased pursuant to the offer, each stockholder should certify to the
Depositary that he is not subject to backup federal income tax withholding by
properly providing the Depositary with: (1) a properly executed Form W-8BEN,
W-8ECI, W-8EXP or W-8IMY (with applicable attachments) as appropriate, or (2)
such stockholders' taxpayer identification number on a properly executed Form
W-9 (included in the Letter of Transmittal). See Instruction 9 of the Letter of
Transmittal. Non-U.S. Stockholders are also subject to the income tax
withholding rules (see "Certain U.S. Federal Income Tax Consequences - Non-U.S.
Stockholder"). However, in the aggregate, the Depositary will not withhold under
both these withholding regimes more than 30% from any payment. Please consult
your own tax advisor regarding your qualification for exemption from backup
withholding and the procedure for obtaining any applicable exemption.
REJECTION; DETERMINATION OF VALIDITY
We reserve the absolute right to reject any or all tenders of any
shares that we determine are not in proper form or are not eligible to
participate in this tender offer or the acceptance for payment of or payment for
which we determine may be unlawful. We also reserve the absolute right to waive
any of the conditions of the offer or any defect or irregularity in any tender,
and our interpretation of the terms of the offer will be final and binding on
all parties. To the extent we waive a condition, defect or irregularity, we will
apply such waiver to all tendering stockholders. No tender of shares will be
deemed to have been properly made until all defects or irregularities have been
cured by the tendering stockholder or waived by us. All questions as to the
number of shares to be accepted and the validity, form, eligibility (including
time of receipt) and acceptance for payment of any tender of shares will be
determined by us, in our sole discretion, and our determination will be final
and binding on all parties. Neither we nor any other person will be under any
duty to give notification of any defects or irregularities in any tender or will
incur any liability for failure to give any such notification.
REPRESENTATIONS OF TENDERING STOCKHOLDERS
A tender of shares by you will be treated as a representation by you
that (i) you are the beneficial owner of 99 or fewer shares as of the record
date, (ii) you are tendering all of your shares and (iii) you hold a net long
position in our common stock equal to the number of tendered shares. You are
also deemed to represent that you own the tendered shares free and clear of any
liens or other encumbrances and have the authority to sell the tendered shares
to us. It is a violation of federal securities laws for anyone to tender shares
unless, at the time of tender and at the expiration date (including any
extensions), the tendering person (1) has a net long position equal to or
greater than the number of shares tendered and (2) will deliver, or cause to be
delivered, the shares in accordance with the terms of the tender offer. You must
also agree to complete any additional documents that we request in order to
complete the sale of your shares to us.
LOST OR DESTROYED CERTIFICATES
If you have lost, misplaced or destroyed your certificates for all or
part of your shares, please call the Depositary, toll free, at (877) 282-1168
for instructions on submitting a lost share affidavit and a fee for a surety
bond in lieu of submitting the lost, misplaced or destroyed certificates.
17
NO DISSENTERS' RIGHTS
Whether or not you tender your shares, dissenters' rights are not
available in this tender offer.
ABSENCE OF STOCKHOLDER VOTE
The tender offer is not subject to stockholder vote.
WITHDRAWAL RIGHTS
Once you tender your shares you may not withdraw them from the offer.
PURCHASE AND PAYMENT
Promptly following the expiration date, we will accept for payment
and pay for, and thereby purchase, shares properly tendered before the
expiration date. When we accept your shares for payment, we will have entered
into a binding agreement with you on the terms and conditions described in this
Offer to Purchase. Under the Letter of Transmittal, you will waive any right to
be notified of our acceptance of your tender. We will pay for the shares
purchased by sending payment to the tendering stockholders. Under no
circumstances will we pay interest on the purchase price to be paid regardless
of any delay in making such payment.
We will pay all share transfer taxes, if any, payable on the transfer
to us of shares purchased under the offer. If, however, payment of the purchase
price is to be made to any person other than the record holder, or if tendered
certificates are registered in the name of any person other than the person
signing the letter of transmittal, the amount of all share transfer taxes, if
any (whether imposed on the record holder or the other person), payable on
account of the transfer to the person will be deducted from the purchase price
unless satisfactory evidence of the payment of the share transfer taxes, or
exemption therefrom, is submitted.
Certificates for all shares tendered and not purchased will be
returned to the tendering stockholder at our expense promptly after the
expiration date or termination of the offer.
SOURCE AND AMOUNT OF FUNDS
We believe that the total number of shares that may be sold by
eligible stockholders pursuant to this offer is approximately 8,300. Assuming
all of these stockholders elect to participate in the offer and the shares
offered are purchased at the offer price of $3.35 per share, the total cost to
us of purchasing these shares would be $27,805. This amount does not include our
expenses associated with the offer, which are estimated to be approximately
$100,000, as set forth below under "Fees and Expenses."
We intend to pay for all validly offered shares, as well as for the
costs and expenses of this offer, with cash on hand.
18
FEES AND EXPENSES
We will be responsible for paying all expenses associated with the
offer. We estimate that our total expenses associated with the offer will be
$100,000, consisting of the following:
Information Agent Fee $ 6,500
Depositary Fee 7,500
Legal Fees 75,000
Accounting Fees 2,000
Printing and Mailing 7,500
SEC Filing Fees 2
Miscellaneous 1,498
-----
Total Estimated Expense $100,000
========
Tenders may also be solicited by directors, officers and employees of
the Company in person, by telephone or through other forms of communication, but
such persons will not receive any additional compensation for such solicitation.
The Information Agent and the Depositary will receive reasonable and
customary compensation for their services and will also be reimbursed for
certain out-of-pocket expenses. The Company has agreed to indemnify the
Depositary against certain liabilities in connection with this offer to
purchase.
The Company will not pay any fees or commissions to any broker,
dealer or other person for soliciting tenders of shares pursuant to the offer to
purchase (other than the fee of the dealer manager and the soliciting dealer).
The Company will, upon request, reimburse brokers, dealers, commercial banks and
trust companies for reasonable and customary handling and mailing expenses
incurred by them in forwarding materials relating to the offer to purchase to
their customers.
All requests for additional copies of this offer to purchase, the
letter of transmittal and other tender offer materials may be directed to the
Information Agent at the telephone number or address set forth on the back cover
of this offer to purchase. In addition, any questions regarding the procedures
for tendering in the offer and requests for assistance in tendering your shares
should also be directed to the Information Agent.
DELIVERY OF A LETTER OF TRANSMITTAL AND/OR SHARES OF COMMON STOCK TO
A PERSON OTHER THAN THE DEPOSITARY OR TRANSMISSION OF INSTRUCTIONS BY FACSIMILE
OTHER THAN AS SET FORTH ON THE BACK COVER OF THIS OFFER TO PURCHASE IS NOT VALID
DELIVERY OF THE LETTER OF TRANSMITTAL OR SHARES AND MAY RESULT IN YOUR SHARES
NOT BEING ACCEPTED FOR PURCHASE.
RECOMMENDATION
NEITHER WE NOR OUR BOARD OF DIRECTORS IS MAKING ANY RECOMMENDATION
REGARDING WHETHER YOU SHOULD ACCEPT THIS OFFER AND TENDER YOUR SHARES.
ACCORDINGLY, YOU MUST MAKE YOUR OWN DETERMINATION AS TO WHETHER TO TENDER YOUR
SHARES FOR PURCHASE.
19
MARKET PRICE AND DIVIDEND INFORMATION
Our common stock is listed, and principally trades, on the Nasdaq
National Market under the trading symbol "HURC." The following table sets forth
the high and low sale prices for our common stock as quoted by Nasdaq for each
quarter during the past two years.
High Low
FISCAL 2001:
First Quarter $ 3.88 $ 3.25
Second Quarter 4.19 3.15
Third Quarter 3.66 2.15
Fourth Quarter 2.99 2.08
FISCAL 2002:
First Quarter $ 2.78 $ 2.05
Second Quarter 3.35 2.03
Third Quarter 2.95 1.50
Fourth Quarter 2.22 1.45
FISCAL 2003:
First Quarter $ 2.03 $ 1.30
Second Quarter 1.67 1.40
Third Quarter (through June 2, 2003) 2.98 1.52
We have not paid any dividends on our common stock for more than the
past five years. We intend to continue to retain earnings for working capital,
capital expenditures and debt reduction.
20
SUMMARY CONSOLIDATED FINANCIAL INFORMATION
Before making a decision to tender your shares, you should read the
following financial information, as well as the financial information
incorporated by reference into this offer to purchase, and the accompanying
notes, in their entirety. For information on how to obtain the financial
information incorporated by reference, see "Where You Can Find Additional
Information."
The following table sets forth our summary consolidated financial
information for the twelve months ended October 31, 2001 and 2002 and for the
three months ended January 2002 and 2003. This summary financial information has
been derived from, and should be read in conjunction with, our audited
consolidated financial statements as of, and for the twelve months ended,
October 31, 2001 and 2002, which is incorporated herein by reference to our
annual report on Form 10-K for the year ended October 31, 2002, and our
unaudited consolidated condensed financial information as of, and for the three
months ended, January 31, 2002 and 2003, which is incorporated herein by
reference to our quarterly report on Form 10-Q for the three months ended
January 31, 2003.
Year ended Three months ended
October 31, January 31,
------------------------------ -------------------------------
Statement of Income Data: ($000's) 2001 2002 2002 2003
------------- ------------- ------------- --------------
(Audited) (Unaudited)
Sales and service fees (1) $ 92,267 $ 70,486 $ 18,520 $ 15,953
Gross profit 23,262 15,246 4,003 3,994
Operating loss (921) (7,167) (1,567) (434)
Net loss (1,597) (8,263) (1,641) (477)
Net loss per common share-diluted $ (.28) $ (1.48) $ (.29) $ (.10)
Ratio of earnings to fixed charges (2) -- -- -- --
(1) Sales and service fees for discontinued products were $6,067, and $4,756,
for the years ended 2001 and 2002, respectively, and $1,240 and $209 for
the three month periods ended January 31, 2002 and 2003 respectively.
(2) Earnings were insufficient to cover fixed charges by $820 and $7,674 for
the years ended 2001 and 2002, respectively, and $1,542 and $477 for the
three month periods ended January 31, 2002 and 2003, respectively.
Year ended Three months ended
October 31, January 31,
------------------------------ ------------------------------
Balance Sheet Data: ($000's) 2001 2002 2002 2003
------------- ------------- ------------- -------------
(Audited) (Unaudited)
Current assets $ 49,510 $ 41,535 $ 44,305 $ 42,704
Non-current assets 16,707 15,617 16,295 15,676
Total assets 66,217 57,152 60,600 58,380
Current liabilities 18,217 21,185 25,691 25,950
Non-current liabilities 12,532 7,950 1,035 5,115
Shareholders' equity $ 35,468 $ 28,017 $ 33,874 $ 27,315
Book value per share $ 4.89
21
The following table sets forth pro forma information giving effect to
the transaction on the summary Statement of Income Data for the twelve months
ended October 31, 2002 and for the three months ended January 31, 2003. The pro
forma effect on the Balance Sheet is not material.
Twelve months ended Three months ended
October 31, 2002 January 31, 2003
--------------------------------- --------------------------------
Statement of Income Data: ($000's) As Reported Pro-forma (a) As Reported Pro-forma (a)
--------------- -------------- -------------- --------------
(Audited) (Unaudited)
Sales and service fees (1) $ 70,486 $ 70,486 $ 15,953 $ 15,953
Gross profit 15,246 15,246 3,994 3,994
Operating loss (7,167) (6,867) (434) (354)
Net loss (8,263) (7,963) (582) (502)
Net loss per common share-diluted $ (1.48) $ (1.43) $ (.10) $ (.09)
Ratio of earnings to fixed charges (2) -- -- -- --
(1) After giving effect to estimated cost savings resulting from this
transaction for the periods presented of $300,000 and $80,000 respectively.
(2) Earnings were insufficient to cover fixed charges for the periods presented
by $7,674, $7,374, $477 and $397, respectively.
22
MANAGEMENT INFORMATION
DIRECTORS AND EXECUTIVE OFFICERS
NAME POSITION(S) WITH THE COMPANY
---- ----------------------------
Michael Doar Chairman of the Board and Chief Executive
Officer
Robert W. Cruickshank Director
Richard T. Niner Director
O. Curtis Noel Director
Charles E. Mitchell Rentschler Director
Gerald V. Roch Director
James D. Fabris President and Chief Operating Officer
Roger J. Wolf Senior Vice President, Secretary, Treasurer
and Chief Financial Officer
David E. Platts Vice President, Technology
Stephen J. Alesia Corporate Controller and Assistant Secretary
Set forth below is certain information with respect to our directors
and executive officers as of the date of this offer to purchase. Each of our
directors and executive officers is a citizen of the United States. None of our
directors or executive officers has been convicted in a criminal proceeding
during the past five years (excluding traffic violations or similar
misdemeanors) nor has any been a party to any judicial or administrative
proceeding during the past five years that resulted in a judgment, decree or
final order enjoining such person from future 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 otherwise noted, the
business address of each person is in care of Hurco Companies, Inc., One
Technology Way, Indianapolis, Indiana 46268.
Michael Doar was elected Chairman of the Board of Directors and Chief
Executive Officer on November 13, 2001. Previously, Mr. Doar served as Vice
President of Sales and Marketing of Ingersoll Contract Manufacturing Company, a
subsidiary of Ingersoll International, an international engineering and machine
tool systems business. Mr. Doar had held various management positions with
Ingersoll International since 1989. Mr. Doar has been a director since May 2000.
Robert W. Cruickshank has been a director of Hurco since May 2000. He
has been a consultant providing private clients with financial advice since
1981. Mr. Cruickshank is also a director of Calgon Carbon Corporation, a
producer of products and services for the purification, reparation and
concentration of liquids and gases, and Friedman's Jewelers, Inc., a retail
jewelry business.
Richard T. Niner has been a director of the company since June 1986.
He was appointed Chairman of the Executive/Nominating Committee of the Board of
Directors on November 13, 2001. Mr. Niner had previously held the position of
Chairman of the Board of Directors from March 9, 1999. Mr. Niner is a general
partner of Wind River Associates L.P., a private investment firm. Mr. Niner is a
director of Arrow International, Inc., a cardiac and critical care products
business. Mr. Niner's business address is c/o Wind River Associates L.P., 1055
Washington Blvd., Box 9-5th Floor, Stamford, CT 06901.
O. Curtis Noel has been a director of Hurco since May 1993. He has
been an independent business consultant for more than ten years, specializing in
market and industry studies, competitive analyses and corporate development
programs with clients in the U.S. and abroad.
Charles E. Mitchell Rentschler has been a director of Hurco since
June 1986. He has been an independent business consultant since 2001, providing
general business consulting services to the foundry industry. Mr. Rentschler
23
served as President and Chief Executive Officer of The Hamilton Foundry &
Machine Co. from 1985 until 2001. The Hamilton Foundry & Machine Co. filed a
petition for relief under Chapter 11 of the Bankruptcy Code on October 10, 2000.
Gerald V. Roch has been a director of Hurco since April 2001. He has
been an independent business consultant providing general business and
technology consulting services since 1994. Mr. Roch was a co-founder of the
Company in 1968 and in 1986 was the founder of Made2Manage Systems, Inc., a
manufacturing software company. Mr. Roch served as President and Chief Executive
Officer of Made2Manage Systems, Inc. from 1986 until 1994.
James D. Fabris was appointed President and Chief Operating Officer
on November 14, 2001. Mr. Fabris served as Executive Vice President - Operations
from November 1997 until his current appointment and previously served as a Vice
President of the Company since February 1995.
Roger J Wolf has been Senior Vice President, Secretary, Treasurer and
Chief Financial Officer since January 1993.
David E. Platts has been employed by the Company since 1982, and was
elected Vice President, Technology in May 2000. Mr. Platts previously served as
Vice President of Research and Development since 1989.
Stephen J. Alesia has been the Corporate Controller since joining
Hurco in June 1996 and was elected an executive officer in September 1996. Prior
to joining the Company, Mr. Alesia was employed for seven years by an
international public accounting firm.
BENEFICIAL OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth information regarding the beneficial
ownership of our common stock by each person described above, as of June 2,
2003. Except as otherwise noted, each person indicated has sole voting and
investment power with respect to the securities listed.
Shares Beneficially Owned
Name --------------------- ----------------
----
Number Percent
Michael Doar 48,667 (1) 0.8%
Robert W. Cruickshank 45,000 (2) 0.8%
Richard T. Niner 942,312 (3) 16.0%
O. Curtis Noel 25,000 (3) 0.4%
Charles E. Mitchell Rentschler 63,100 (3)(4) 1.1%
Gerald V. Roch 15,000 (2) 0.3%
James D. Fabris 89,167 (5) 1.5%
Roger J. Wolf 103,459 (6) 1.7%
David E. Platts 48,033 (7) 0.8%
Stephen J. Alesia 26,333 (8) 0.4%
-----------------------------------
(1) Includes 41,667 shares subject to options that are exercisable within 60
days.
(2) Includes 15,000 shares subject to options that are exercisable within 60
days.
(3) Includes 25,000 shares subject to options that are exercisable within 60
days.
(4) Includes 11,100 shares owned by Mr. Rentschler's wife, as to which he may
be deemed to have beneficial ownership.
(5) Includes 87,667 shares subject to options that are exercisable within 60
days.
(6) Includes 86,667 shares subject to options that are exercisable within 60
days.
(7) Includes 36,333 shares subject to options that are exercisable within 60
days. (8) Includes 26,333 shares subject to options that are exercisable
within 60 days.
24
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We file annual, quarterly and current reports, proxy statements and
other information with the SEC. We have also filed a Transaction Statement on
Schedule 13E-3 with the SEC relating to the offer. You may read and copy this or
any other report or information that we file with the SEC at the SEC's Public
Reference Room located at 450 Fifth Street, N.W., Washington D.C. 20549. You may
also receive copies of these documents upon payment of a duplicating fee, by
writing to the SEC's Public Reference Section. Please call the SEC at
1-800-SEC-0330 for further information on the Public Reference Room in
Washington D.C. and other locations. Our filings are also available to the
public through the SEC's web site at http://www.sec.gov.
The SEC allows us to incorporate by reference into this offer to
purchase information contained in our annual and quarterly reports. This means
that we can disclose this information to you by referring you to other documents
that we have previously filed separately with the SEC. The information
incorporated by reference is considered to be a part of this offer to purchase,
except for any information that is modified or superseded by information
contained in this offer to purchase or any other subsequently filed document.
The financial information incorporated by reference is an important part of this
offer to purchase and we urge all eligible stockholders to read this financial
information in its entirety before tendering their shares.
The following financial information has been filed by us with the SEC
and is incorporated by reference into this offer to purchase:
1. Annual Report on Form 10-K for the fiscal year ended October 31,
2002; and
2. Quarterly Report on Form 10-Q for the quarter ended January 31,
2003.
No person is authorized to give any information or represent anything
not contained in this Offer to Purchase. We are only making the offer in places
where offers to purchase our common stock are permitted. The information
contained in this Offer to Purchase, as well as any report or information we
file with the SEC, is only current as of the date of that information. Our
business, financial condition, results of operations and prospects may have
changed since that date.
THE DOCUMENTS CONTAINING INFORMATION INCORPORATED BY REFERENCE INTO
THIS OFFER TO PURCHASE ARE AVAILABLE FROM US WITHOUT CHARGE UPON REQUEST TO THE
INFORMATION AGENT. IN ORDER TO ENSURE TIMELY DELIVERY, ANY REQUEST SHOULD BE
SUBMITTED NO LATER THAN JUNE 20, 2003. ANY DOCUMENTS SO REQUESTED WILL BE MAILED
TO YOU BY FIRST CLASS MAIL, OR ANOTHER EQUALLY PROMPT MEANS, WITHIN ONE BUSINESS
DAY AFTER YOUR REQUEST IS RECEIVED.
25
The Information Agent is:
INNISFREE M&A INCORPORATED
501 Madison Avenue, 20th Floor
New York, New York 10022
Banks and Brokers Call Collect: (212) 750-5833
All Others Call Toll Free: (888) 750-5834
The Depositary is:
EQUISERVE TRUST COMPANY, N.A.
By Mail: Overnight Courier: In Person By Hand Only:
EquiServe Trust Company EquiServe Trust Company Securities Transfer & Reporting Services
P.O. Box 43014 150 Royall Street 100 Williams Street, Galleria
Providence RI 02940-3014 Canton MA 02021 New York NY 10038
Attention: Corporate Actions Attention: Corporate Actions
By Facsimile Transmission:
(for Eligible Institutions only)
(781) 575-2901
Confirm Facsimile Transmission
by Telephone:
(877) 282-1168
Additional copies of this offer to purchase, the letter of
transmittal or other offer materials may be obtained from the Information Agent.
Questions and requests for assistance with the tender procedures also
should be directed to the Information Agent.
26
Exhibit (a)(8)
HURCO COMPANIES, INC.
LETTER OF TRANSMITTAL
to Accompany
Shares of Common Stock of Hurco Companies, Inc.
Tendered Pursuant to the Offer to Purchase
Dated June 3, 2003
THE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON JULY 1, 2003, UNLESS
EXTENDED OR EARLIER TERMINATED
The Information Agent is:
INNISFREE M&A INCORPORATED
Banks and Brokers Call Collect: (212) 750-5833
All Others Call Toll Free: (888) 750-5834
The Depositary for the Offer is:
EQUISERVE TRUST COMPANY, N.A.
By Mail: Overnight Courier: In Person By Hand Only:
EquiServe Trust Company EquiServe Trust Company Securities Transfer & Reporting Services
P.O. Box 43014 150 Royall Street 100 Williams Street, Galleria
Providence RI 02940-3014 Canton MA 02021 New York NY 10038
Attention: Corporate Actions Attention: Corporate Actions
By Facsimile Transmission:
(for Eligible Institutions only)
(781) 575-2901
Confirm Facsimile Transmission
by Telephone:
(877) 282-1168
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS, OR TRANSMISSION VIA
FACSIMILE, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
- ---------------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
(USE ADDITIONAL SHEET IF NECESSARY)
- ---------------------------------------------------------------------------------------------------------------------------------
Name* and Address** Certificate Common Number of
of Registered Owner Numbers* Stock Shares***
- ------------------------------------------------------------------------------------------------- -------------- ----------------
------------------ -------------- ----------------
------------------ -------------- ----------------
------------------ -------------- ----------------
------------------ -------------- ----------------
------------------ -------------- ----------------
------------------ -------------- ----------------
------------------ -------------- ----------------
Total: Total:
- ---------------------------------------------------------------------------------------------------------------------------------
* Name(s) should be exactly as name(s) appears on the stock certificate.
Check will be payable to this name unless Special Payment Instructions are
completed.
** Address should be current address to which check is to be sent, unless
Special Delivery Instructions are completed.
*** Since this Offer is open only to odd-lot shareholders tendering all shares
beneficially owned by them, it will be assumed that all Shares evidenced by
certificates accompanied by this Letter of Transmittal are being tendered.
- -----------------------------------------------------------------------------------------------------------------------------------
NY2:\1263003\04\R2JF04!.DOC\53459.0004
This Letter of Transmittal is to be used only if certificates are to
be forwarded herewith. If you have questions regarding your eligibility to
participate in the Offer, please contact EquiServe Trust Company, N.A., our
Depositary, at (877) 282-1168 (toll free). All other questions should be
directed to Innisfree M&A Incorporated, our Information Agent, at (212) 750-5833
(toll free: (888) 750-5834).
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to Hurco Companies, Inc., an Indiana
corporation ("Hurco"), the enclosed and/or below-described shares of its common
stock (the "Shares") pursuant to Hurco's offer to purchase Shares at $3.35 per
Share, net to the seller in cash, upon the terms and subject to the conditions
of the Offer to Purchase dated June 3, 2003 (the "Offer to Purchase"), of which
the undersigned acknowledges receipt, and this Letter of Transmittal (which
together with the Offer to Purchase constitute the "Offer").
Subject to, and effective upon, acceptance for payment of any or all of the
Shares tendered with this Letter, in accordance with the terms of the Offer, the
undersigned hereby sells, assigns and transfers to, or upon the order of, Hurco
all right, title and interest in and to all the Shares that are being tendered
hereby that are accepted for payment and all distributions and rights in respect
to such shares after the date hereof. Hurco's acceptance of any Shares from the
undersigned will constitute a binding agreement between the undersigned and
Hurco upon the terms and subject to the conditions of the Offer. All obligations
of the undersigned hereunder shall be binding upon the heirs, personal
representatives, successors and assigns of the undersigned.
The undersigned hereby irrevocably constitutes and appoints the
depositary the true and lawful agent and attorney-in-fact of the undersigned
with respect to the Shares, with full power of substitution, such power of
attorney being deemed to be an irrevocable power coupled with an interest, to
(a) deliver certificates for the Shares, together, in any case, with all
accompanying evidences of transfer and authenticity, to or upon the order of
Hurco upon receipt by the depositary, as the undersigned's agent of the purchase
price with respect to the Shares, (b) present certificates for the Shares for
cancellation and transfer on the books of Hurco, and (c) receive all benefits
and otherwise exercise all rights of beneficial ownership of the Shares, all in
accordance with the terms of the Offer.
The undersigned hereby represents and warrants that the undersigned
was the beneficial owner as of the close of business on June 2, 2003, and will
continue to be the beneficial owner as of the expiration date, of an aggregate
of 99 or fewer Shares, all of which are being tendered. The undersigned further
represents and warrants that the undersigned has full power and authority to
tender, sell, assign and transfer the Shares tendered hereby, that when any of
such Shares are accepted for payment by Hurco, Hurco will acquire good,
marketable and unencumbered title thereto, free and clear of all liens,
restrictions, charges and encumbrances, and that none of the Shares will be
subject to any adverse claim. The undersigned will, upon request, execute and
deliver any additional documents deemed by the depositary or Hurco to be
necessary or desirable to complete the sale, assignment and transfer of the
Shares tendered hereby.
The undersigned hereby represents that the undersigned holds a
net-long position in our common stock equal to the number of tendered Shares and
that the undersigned owns the tendered Shares free and clear of any liens or
other encumbrances. The undersigned recognizes that it is a violation of federal
securities laws for anyone to tender Shares unless, at the time of tender and at
the expiration date (including any extensions), the tendering person (1) has a
net-long position equal to or greater than the number of Shares tendered and (2)
will deliver, or cause to be delivered, the Shares in accordance with the terms
of the tender offer.
The undersigned recognizes that Hurco may terminate or amend the
Offer or may postpone the acceptance for payment of, or the payment for, Shares
tendered or may not be required to purchase any of the Shares tendered hereby.
The undersigned also recognizes that Hurco reserves the right to reject any and
all tenders of any Shares that Hurco determines are not in proper form or are
made by persons not eligible to participate in the Offer.
2
Unless otherwise indicated under "Special Payment Instructions,"
please issue the check for the purchase price of any Shares purchased in the
name(s) of the undersigned. Similarly, unless otherwise indicated under "Special
Delivery Instructions," please mail the check for the purchase price of any
Shares purchased, and accompanying documents, as appropriate, to the undersigned
at the address shown below the undersigned's signature(s). In the event that
both "Special Payment Instructions" and "Special Delivery Instructions" are
completed, please issue the check for the purchase price of any Shares in the
name(s) of, and mail said check to, the person(s) so indicated.
3
- ---------------------------------------------------------------------------------------------------------------------------------
SPECIAL PAYMENT SPECIAL DELIVERY
INSTRUCTIONS INSTRUCTIONS
To be completed ONLY if the check for the purchase price of Shares To be completed ONLY if the check for purchase
purchased is to be issued in the name of someone other than the price of Shares purchased to be mailed to someone
registered owner appealing on the label. other than the undersigned at an address other than
that shown below the undersigned signature(s).
Issue check to:
Mail check to:
Name:_____________________________________________________
(Please Print) Name:_____________________________________________________
(Please Print)
Address:__________________________________________________
___________________________________________________________
___________________________________________________________ _________________________________________________
(Include Zip Code)
_________________________________________________
___________________________________________________________ (Include Zip Code)
___________________________________________________________ _________________________________________________
(Taxpayer Identification or Social Security
Number) _________________________________________________
(Taxpayer Identification or Social Security
Number)
(Such person(s) must properly complete the Form W-9 herein, a
Form W-8BEN, a Form W-8ECI or a Form W-8IMY, as applicable) (Such person(s) must properly complete the Form
W-9 herein, a Form W-8BEN, a Form W-8ECI or a
Form W-8IMY, as applicable)
If this section applies, you must have your
signature guaranteed. See "Guarantee of If this section applies, you must have your
Signature(s)" on the following page. signature guaranteed. See "Guarantee of
Signature(s)" on the following page.
- ------------------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
IMPORTANT SIGN HERE
This Letter of Transmittal must be signed by registered holder(s) exactly as
name(s) appear(s) on stock certificate(s) or on a security position listing or
by person(s) authorized to become registered holder(s) by certificates and
documents transmitted herewith. If signature by a trustee, executor,
administrator, guardian, attorney-in-fact, officer of a corporation or other
person acting in a fiduciary or representative capacity, please set forth full
title and see Instruction 4.
IF THE SIGNATURE APPEARING BELOW IS NOT OF THE REGISTERED HOLDER(S),
THEN THE REGISTERED HOLDER(S) MUST SIGN A PROXY, WHICH SIGNATURE MUST BE
GUARANTEED BY AN ELIGIBLE INSTITUTION. THE CONSENT PROXY SHOULD ACCOMPANY THIS
LETTER OF TRANSMITTAL.
X_______________________________________________________________________________
X_______________________________________________________________________________
Signature(s) of Owner(s) or Authorized Signatory
Dated:__________________________, 2003
Name(s):________________________________________________________________________
________________________________________________________________________________
(Please Print)
Capacity:_______________________________________________________________________
Address:________________________________________________________________________
(Including Zip Code)
Area Code and Telephone No.:____________________________________________________
Tax Identification or Social Security No.:______________________________________
IMPORTANT: COMPLETE FORM W-9 HEREIN OR APPLICABLE FORM W-8
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTION 1 AND 4 BELOW)
________________________________________________________________________________
(Name of Eligible Institution Guaranteeing Signatures)
________________________________________________________________________________
(Address (including zip code) and Telephone Number
(including area code) of Firm)
________________________________________________________________________________
(Authorized Signature)
________________________________________________________________________________
(Title)
Date:__________________, 2003
- --------------------------------------------------------------------------------
5
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm that is an
eligible institution because it is a member of a registered national securities
exchange or the National Association of Securities Dealers, Inc., or by a
commercial bank, a trust company, a savings bank, a savings and loan association
or a credit union which has membership in an approved signature guarantee
medallion program. Signatures on this Letter of Transmittal need not be
guaranteed (a) if this Letter of Transmittal is signed by the registered
holder(s) of the Shares tendered herewith and such holder(s) have not completed
the box entitled "Special Payment Instructions or the box entitled "Special
Delivery Instructions" on this Letter of Transmittal or (b) if the Shares are
tendered for the account of an eligible institution.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARES. This Letter of
Transmittal is to be used if certificates are to be forwarded herewith.
Certificates evidencing all physically tendered Shares, as well as a properly
completed and duly executed Letter of Transmittal and any other documents
required by this Letter of Transmittal, must be received by the depositary prior
to the expiration date (as defined in the Offer to Purchase). If certificates
are forwarded to the depositary in multiple deliveries, a properly completed and
duly executed Letter of Transmittal must accompany each such delivery.
The method of delivery of this Letter of Transmittal, certificate(s)
and all other required documents is at the option and risk of the tendering
shareholder, and the delivery will be deemed made only when actually received by
the depositary.
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.
No alternative, conditional or contingent tenders will be accepted.
By execution of this Letter of Transmittal, all tendering shareholders waive any
right to receive any notice of the acceptance of their Shares for payment.
3. INADEQUATE SPACE. If the space provided in any part of this Letter
of Transmittal is inadequate, any further information may be listed on a
separate schedule and attached hereto.
4. SIGNATURES ON LETTER OF TRANSMITTAL, STOCK POWER AND ENDORSEMENTS.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares tendered hereby, the signature(s) must correspond with the name(s) as
written on the face of the certificates evidencing such Shares without
alteration, enlargement or any other change whatsoever.
If any Shares tendered hereby is owned of record by two or more
persons, all such persons must sign this Letter of Transmittal.
If any of the Shares tendered hereby are registered in the names of
different holders, it will be necessary to complete, sign and submit as many
separate Letters of Transmittal as there are different registrations of such
Shares.
If this Letter of Transmittal is signed by the registered holder(s)
of the Shares tendered hereby, no endorsements of certificates or separate stock
powers are required.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, the certificate(s)
evidencing the Shares tendered hereby must be endorsed or accompanied by
appropriate stock powers, in either case signed exactly as the name(s) of the
registered holder(s) appear(s) on such certificate(s). Signatures on such
certificate(s) and stock powers must be guaranteed by an eligible institution.
6
If this Letter of Transmittal or any certificate or stock power is
signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or representative
capacity, such person should so indicate when signing, and proper evidence
satisfactory to Hurco of such persons authority so to act must be submitted.
5. STOCK TRANSFER TAXES. Except as otherwise provided in this
Instruction 5, Hurco will pay all stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price of any Shares purchased is to be made to
a person other than the registered holder(s), the amount of any stock transfer
taxes (whether imposed on the registered holder(s), such other person or
otherwise) payable on account of the transfer to such other person will be
deducted from the purchase price of such Shares purchased, unless evidence
satisfactory to Hurco of the payment of such taxes, or exemption therefrom, is
submitted. Except as provided in this Instruction 5, it will not be necessary
for transfer tax stamps to be affixed to the certificates evidencing the Shares
tendered hereby.
6. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check for the
purchase price of any Shares tendered herewith is to be issued in the name of a
person other than the person(s) signing this Letter of Transmittal or if such
check is to be sent to someone other than the person(s) signing this Letter of
Transmittal or to the person(s) signing this Letter of Transmittal but at an
address other than the address of the registered holder, the appropriate
sections of this Letter of Transmittal entitled "Special Payment Instructions"
and/or "Special Delivery Instructions" must be completed.
7. QUESTIONS AND REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES.
Questions or requests for assistance may be directed to Innisfree M&A
Incorporated, the Information Agent, at (212) 750-5833 (toll free: (888)
750-5834). Requests for additional copies of the Offer to Purchase, this Letter
of Transmittal or other tender offer materials should be directed to the
Information Agent and copies will be furnished promptly at Hurco's expense.
Stockholders may also contact their local broker, dealer, commercial bank or
trust company for assistance concerning this Offer.
8. LOST, DESTROYED OR STOLEN CERTIFICATES. If you have lost,
misplaced or destroyed your certificates for all or part of your Shares, please
call the depositary toll free at (877) 282-1168 for instructions on submitting a
lost share affidavit and a fee for a surety bond in lieu of submitting the lost,
misplaced or destroyed certificates.
9. TAXPAYER IDENTIFICATION NUMBER AND BACKUP WITHHOLDING. Each
tendering stockholder is required to provide the depositary with the
stockholder's correct taxpayer identification number ("TIN"), generally the
stockholder's social security or federal employee identification number, on Form
W-9, which is provided under "Important Tax Information" below, or
alternatively, to establish another basis for exemption from backup withholding.
A stockholder must cross out item (2) in the Certification box on Form W-9 if
the stockholder is subject to backup withholding. In addition to potential
penalties, failure to provide the correct information on the form may subject
the tendering stockholder to 28% federal income tax backup withholding on the
payments made to the stockholder or other payee with respect to Shares purchased
pursuant to the Offer. A stockholder shall write "applied for" in the space
provided in Part I of the form and complete the attached Certificate of Awaiting
Taxpayer Identification Number if the tendering stockholder has not been issued
a TIN and has applied for a TIN or intends to apply for a TIN in the near
future. In such case, the depositary will withhold 28% of all such payments
until a TIN is provided to the depositary, and if the depositary is not provided
with a TIN within 60 days, such amounts will be paid over to the Internal
Revenue Service. A stockholder who writes "applied for" in Part I in lieu of
furnishing his or her TIN should furnish his or her TIN as soon as it is
received. A tendering stockholder that is not a United States person may qualify
as exempt from backup withholding tax by submitting to the depositary a properly
completed Form W-8BEN, Form W-8ECI or Form W-8IMY, as applicable (which the
depositary will provide upon request) signed under penalty of perjury, attesting
to that stockholder's exempt status.
10. IRREGULARITIES. All questions as to the purchase price, the form
of the documents, and the validity, eligibility, including time of receipt, and
acceptance of any tender of Shares will be determined by Hurco, in its sole
7
discretion, and its determination shall be final and binding. Hurco reserves the
absolute right to reject any or all tenders of Shares that it determines are not
in proper form or the acceptance for payment of or payment for Shares that may,
in the opinion of Hurco's counsel, be unlawful. Except as otherwise provided in
the Offer to Purchase, Hurco also reserves the absolute right to waive any of
the conditions to the offer or any defect or irregularity in any tender of
Shares and Hurco's interpretation of the terms and conditions of the Offer,
including these instructions, shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as Hurco shall determine. None of Hurco, the depositary, or any other
person shall be under any duty to give notice of any defect or irregularity in
tenders, nor shall any of them incur any liability for failure to give any such
notice. Tenders will not be deemed to have been made until all defects and
irregularities have been cured or waived.
IMPORTANT: THIS LETTER OF TRANSMITTAL, TOGETHER WITH CERTIFICATE(S)
AND ALL OTHER REQUIRED DOCUMENTS, MUST BE RECEIVED BY THE DEPOSITARY ON OR PRIOR
TO THE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under U.S. federal income tax law, a stockholder whose tendered
Shares are accepted for payment is required to provide the depositary with such
stockholder's correct TIN on the Form W-9 herein or otherwise establish a basis
for exemption from backup withholding. If the stockholder is an individual, the
TIN is his or her social security number. If the depositary is not provided with
the correct TIN or an adequate basis for exemption, payment made to the
stockholder with respect to Shares purchased pursuant to the Offer may be
subject to backup withholding and the stockholder may be subject to a $50
penalty imposed by the Internal Revenue Service.
Certain stockholders, including, among others, corporations and
certain foreign persons, are not subject to these backup withholding and
reporting requirements. Exempt stockholders should indicate their exempt status
on Form W-9. A foreign person may qualify as an exempt recipient, by submitting
to the depositary a properly completed Internal Revenue Service Form W-8BEN,
Form W-8ECI or Form W-8IMY, as applicable, instead of a Form W 9, signed under
penalties of perjury, attesting to that stockholder's exempt status. A Form
W-8BEN, Form W-8ECI or Form W 8IMY, as applicable can be obtained from the
depositary. See the "Internal Revenue Service Form W 9 -- Request For Taxpayer
Identification Number and Certification" below for additional instructions.
Stockholders are urged to consult their own tax advisors to determine whether
they are exempt from these backup withholding and reporting requirements.
If backup withholding applies, the depositary is required to withhold
28% of any payments paid to the stockholder or other payee. Backup withholding
is not an additional federal income tax. If the required information is
furnished to the Internal Revenue Service in a timely manner, the federal income
tax liability of persons subject to backup withholding may be reduced by the
amount of tax withheld, and, if withholding results in an overpayment of taxes,
a refund may be obtained from the Internal Revenue Service.
PURPOSE OF FORM W-9
To prevent backup withholding on any payments with respect to Shares
purchased pursuant to the Offer, the stockholder is required to provide the
depositary with (1) the stockholder's correct TIN by completing the form below,
certifying (x) that the TIN provided on Form W-9 is correct, or that the
stockholder is awaiting a TIN, (y) and that (A) the stockholder is exempt from
backup withholding, (B) the stockholder has not been notified by the Internal
Revenue Service that the stockholder is subject to backup withholding as a
result of failure to report all interest or dividends or (C) the Internal
Revenue Service has notified the stockholder that the stockholder is no longer
subject to backup withholding, and (z) that the stockholder is a U.S. person
(including a U.S. resident alien), or (2) if applicable, an adequate basis for
exemption.
8
WHAT NUMBER TO GIVE THE DEPOSITARY
The stockholder is required to give the depositary the TIN (e.g.,
social security number or employer identification number) of the registered
stockholder. If the Shares are held in more than one name or are not held in the
name of the actual owner, consult the "Internal Revenue Service Form W 9 --
Request For Taxpayer Identification Number and Certification" below for
additional guidance on which number to report. If the tendering shareholder has
not been issued a TIN and has applied for a number or intends to apply for a
number in the near future, such stockholder should write "Applied For" in the
space provided for the TIN in Part 1, sign and date the Form W-9, and complete
the Certificate of Awaiting Taxpayer Identification Number below in order to
avoid backup withholding. Notwithstanding that "Applied For" is written in Part
1 and the Certificate of Awaiting Taxpayer Identification Number is completed,
the Depositary will withhold 28% on all payments made prior to the time a
properly certified TIN is provided to the Depositary and if the Depositary is
not provided with a TIN within 60 days following such payment, such amounts will
be paid over to the Internal Revenue Service.
9
Form W-9
(Rev. January 2003)
REQUEST FOR TAXPAYER GIVE FORM TO THE
Department of the Treasury IDENTIFICATION NUMBER AND CERTIFICATION REQUESTER. DO NOT
Internal Revenue Service SEND TO THE IRS.
- ------------------------------------------------------------------------------------------------------------------------------------
PRINT OR TYPE
See SPECIFIC INSTRUCTIONS on page 2.
- ------------------------------------------------------------------------------------------------------------------------------------
Name
- ------------------------------------------------------------------------------------------------------------------------------------
Business name, if different from above
- ------------------------------------------------------------------------------------------------------------------------------------
Individual/ Exempt from backup
Check appropriate box: [ ] Sole proprietor [ ] Corporation [ ] Partnership [ ]Other - [ ] withholding
- ------------------------------------------------------------------------------------------------------------------------------------
Address (number, street, and apt. or suite no.) Requester's name and Address (optional)
- ------------------------------------------------------------------------------------------------------------------------------------
City, state, and ZIP code
- ------------------------------------------------------------------------------------------------------------------------------------
List account number(s) here (optional)
- ------------------------------------------------------------------------------------------------------------------------------------
PART I TAXPAYER IDENTIFICATION NUMBER (TIN)
- ------------------------------------------------------------------------------------------------------------------------------------
Enter your TIN in the appropriate box. For individuals, this is your social SOCIAL SECURITY NUMBER
security number (SSN). PROPRIETOR, OR DISREGARDED ENTITY, SEE THE PART I
INSTRUCTIONS ON PAGE ployer identification number (EIN). If you do not have a - - - / - -/- - - -
number, see HOW TO GET A TIN on page 3.Enter your TIN in the appropriate box.
For individuals, this is your social security number (SSN). PROPRIETOR, OR
DISREGARDED ENTITY, SEE THE PART I INSTRUCTIONS ON PAGE ployer identification
number (EIN). If you do not have a number, see HOW TO GET A TIN on page 3.
NOTE: If the account is in more than one name, see the chart on page 4 for EMPLOYER IDENTIFICATION NUMBER
guidelines on whose number to enter
- -/ - - - - - - -
PART II CERTIFICATION
- --------------------------------------------------------------------------------
Under penalties of perjury, I certify that:
1. The number shown on this form is my correct taxpayer identification number
(or I am waiting for a number to be issued to me), AND
2. I am not subject to backup withholding because: (A) I am exempt from backup
withholding, or (B) I have not been notified by the Internal Revenue Service
(IRS) that I am subject to backup withholding as a result of a failure to
report all interest or dividends, or (C) the IRS has notified me that I am
no longer subject to backup withholding, AND
3. I am a U.S. person (including a U.S. resident alien).
CERTIFICATION INSTRUCTIONS. You must cross out item 2 above if you have been
notified by the IRS that you are currently subject to backup withholding because
you have failed to report all interest and dividends on your tax return. For
real estate transactions, item 2 does not apply. For mortgage interest paid,
acquisition or abandonment of secured property, cancellation of debt,
contributions to an individual retirement arrangement (IRA), and generally,
payments other than interest and dividends, you are not required to sign the
Certification, but you must provide your correct TIN. (See the instructions on
page 4.)
- ------------ -------------------------------------------------------------------
SIGN HERE SIGNATURE OF
U.S. PERSON - DATE:
- ------------ -------------------------------------------------------------------
PURPOSE OF FORM
A person who is required to file an information return with the IRS, must obtain
your correct taxpayer identification number (TIN) to report, for example, income
paid to you, real estate transactions, mortgage interest you paid, acquisition
or abandonment of secured property, cancellation of debt, or contributions you
made to an IRA.
U.S. PERSON. Use Form W-9 only if you are a U.S. person (including a resident
alien), to provide your correct TIN to the person requesting it (the requester)
and, when applicable, to:
1. Certify that the TIN you are giving is correct (or you are waiting for
a number to be issued),
2. Certify that you are not subject to backup withholding, or
3. Claim exemption from backup withholding if you are a U.S. exempt
payee.
NOTE: If a requester gives you a form other than Form W-9 to request your TIN,
you must use the requester's form if it is substantially similar to this Form
W-9.
FOREIGN PERSON. If you are a foreign person, use the appropriate Form W-8 (see
PUB. 515, Withholding of Tax on Nonresident Aliens and Foreign Entities).
NONRESIDENT ALIEN WHO BECOMES A RESIDENT ALIEN. Generally, only a nonresident
alien individual may use the terms of a tax treaty to reduce or eliminate U.S.
tax on certain types of income. However, most tax treaties contain a provision
known as a "saving clause." Exceptions specified in the saving clause may permit
an exemption from tax to continue for certain types of income even after the
recipient has otherwise become a U.S. resident alien for tax purposes.
If you are a U.S. resident alien who is relying on an exception contained in
the saving clause of a tax treaty to claim an exemption from U.S. tax on certain
types of income, you must attach a statement that specifies the following five
items:
1. The treaty country. Generally, this must be the same treaty under
which you claimed exemption from tax as a nonresident alien.
2. The treaty article addressing the income.
3. The article number (or location) in the tax treaty that contains the
saving clause and its exceptions.
4. The type and amount of income that qualifies for the exemption from
tax.
5. Sufficient facts to justify the exemption from tax under the terms of
the treaty article.
10
EXAMPLE. Article 20 of the U.S.-China income tax treaty allows an exemption from
tax for scholarship income received by a Chinese student temporarily present in
the United States. Under U.S. law, this student will become a resident alien for
tax purposes if his or her stay in the United States exceeds 5 calendar years.
However, paragraph 2 of the first Protocol to the U.S.-China treaty (dated April
30, 1984) allows the provisions of Article 20 to continue to apply even after
the Chinese student becomes a resident alien of the United States. A Chinese
student who qualifies for this exception (under paragraph 2 of the first
protocol) and is relying on this exception to claim an exemption from tax on his
or her scholarship or fellowship income would attach to Form W-9 a statement
that includes the information described above to support that exemption.
If you are a NONRESIDENT ALIEN OR A FOREIGN ENTITY not subject to backup
withholding, give the requester the appropriate completed Form W-8.
WHAT IS BACKUP WITHHOLDING? Persons making certain payments to you must under
certain conditions withhold and pay to the IRS 30% of such payments (29% AFTER
December 31, 2003; 28% AFTER December 31, 2005). This is called "backup
withholding." Payments that may be subject to backup withholding include
interest, dividends, broker and barter exchange transactions, rents, royalties,
nonemployee pay, and certain payments from fishing boat operators. Real estate
transactions are not subject to backup withholding.
You will NOT be subject to backup withholding on payments you receive if you
give the requester your correct TIN, make the proper certifications, and report
all your taxable interest and dividends on your tax return.
PAYMENTS YOU RECEIVE WILL BE SUBJECT TO BACKUP WITHHOLDING IF:
1. You do not furnish your TIN to the requester, or
2. You do not certify your TIN when required (see the Part II
instructions on page 4 for details), or
3. The IRS tells the requester that you furnished an incorrect TIN, or
4. The IRS tells you that you are subject to backup withholding because
you did not report all your interest and dividends on your tax return
(for reportable interest and dividends only), or
5. You do not certify to the requester that you are not subject to backup
withholding under 4 above (for reportable interest and dividend
accounts opened after 1983 only).
Certain payees and payments are exempt from backup withholding.
See the instructions below and the separate INSTRUCTIONS FOR THE
REQUESTER OF FORM W-9.
PENALTIES
FAILURE TO FURNISH TIN. If you fail to furnish your correct TIN to a requester,
you are subject to a penalty of $50 for each such failure unless your failure is
due to reasonable cause and not to willful neglect.
CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING. If you make a
false statement with no reasonable basis that results in no backup withholding,
you are subject to a $500 penalty.
CRIMINAL PENALTY FOR FALSIFYING INFORMATION. Willfully falsifying certifications
or affirmations may subject you to criminal penalties including fines and/or
imprisonment.
MISUSE OF TINS. If the requester discloses or uses TINs in violation of Federal
law, the requester may be subject to civil and criminal penalties.
SPECIFIC INSTRUCTIONS
NAME
If you are an individual, you must generally enter the name shown on your social
security card. However, if you have changed your last name, for instance, due to
marriage without informing the Social Security Administration of the name
change, enter your first name, the last name shown on your social security card,
and your new last name.
If the account is in joint names, list first, and then circle, the name of
the person or entity whose number you entered in Part I of the form.
SOLE PROPRIETOR. Enter your INDIVIDUAL name as shown on your social security
card on the "Name" line. You may enter your business, trade, or "doing business
as (DBA)" name on the "Business name" line.
LIMITED LIABILITY COMPANY (LLC). If you are a single-member LLC (including a
foreign LLC with a domestic owner) that is disregarded as an entity separate
from its owner under Treasury regulations section 301.7701-3, ENTER THE OWNER'S
NAME ON THE "NAME" LINE. Enter the LLC's name on the "Business name" line.
OTHER ENTITIES. Enter your business name as shown on required Federal tax
documents on the "Name" line. This name should match the name shown on the
charter or other legal document creating the entity. You may enter any business,
trade, or DBA name on the "Business name" line.
NOTE: You are requested to check the appropriate box for your status
(individual/sole proprietor, corporation, etc.).
EXEMPT FROM BACKUP WITHHOLDING
If you are exempt, enter your name as described above and check the appropriate
box for your status, then check the "Exempt from backup withholding" box in the
line following the business name, sign and date the form.
Generally, individuals (including sole proprietors) are not exempt from
backup withholding. Corporations are exempt from backup withholding for certain
payments, such as interest and dividends.
NOTE: If you are exempt from backup withholding, you should still complete this
form to avoid possible erroneous backup withholding.
EXEMPT PAYEES. Backup withholding is NOT REQUIRED on any payments made to the
following payees:
1. An organization exempt from tax under section 501(a), any IRA, or a
custodial account under section 403(b)(7) if the account satisfies the
requirements of section 401(f)(2);
2. The United States or any of its agencies or instrumentalities;
3. A state, the District of Columbia, a possession of the United States,
or any of their political subdivisions or instrumentalities;
4. A foreign government or any of its political subdivisions, agencies,
or instrumentalities; or
5. An international organization or any of its agencies or
instrumentalities. Other payees that MAY BE EXEMPT from backup
withholding include:
6. A corporation;
7. A foreign central bank of issue;
8. A dealer in securities or commodities required to register in the
United States, the District of Columbia, or a possession of the United
States;
11
9. A futures commission merchant registered with the Commodity Futures
Trading Commission;
10. A real estate investment trust;
11. An entity registered at all times during the tax year under the
Investment Company Act of 1940;
12. A common trust fund operated by a bank under section 584(a);
13. A financial institution;
14. A middleman known in the investment community as a nominee or
custodian; or
15. A trust exempt from tax under section 664 or described in section
4947.
The chart below shows types of payments that may be exempt from backup
withholding. The chart applies to the exempt recipients listed above, 1 through
15.
- ------------------------------------ ----------------------------------
IF THE PAYMENT IS FOR . . . THEN THE PAYMENT IS EXEMPT FOR .
. .
- ------------------------------------ ----------------------------------
Interest and dividend payments All exempt recipients except
FOR 9
- ------------------------------------ ----------------------------------
Broker transactions Exempt recipients 1 through 13.
Also, a person registered under
the Investment Advisers Act of
1940 who regularly acts as a
broker
- ------------------------------------ ----------------------------------
Barter exchange transactions and Exempt recipients 1 through 5
patronage dividends
- ------------------------------------ ----------------------------------
Payments over $600 required to be Generally, exempt recipients 1
reported and direct sales over through 7(2)
$5,0001
- ------------------------------------ ----------------------------------
1 See FORM 1099-MISC, Miscellaneous Income, and its instructions.
2 However, the following payments made to a corporation (including gross
proceeds paid to an attorney under section 6045(f), even if the attorney is a
corporation) and reportable on Form 1099-MISC are NOT EXEMPT from backup
withholding: medical and health care payments, attorneys' fees; and payments for
services paid by a Federal executive agency.
PART I. TAXPAYER IDENTIFICATION NUMBER (TIN)
ENTER YOUR TIN IN THE APPROPRIATE BOX. If you are a RESIDENT ALIEN and you do
not have and are not eligible to get an SSN, your TIN is your IRS individual
taxpayer identification number (ITIN). Enter it in the social security number
box. If you do not have an ITIN, see HOW TO GET A TIN below.
If you are a SOLE PROPRIETOR and you have an EIN, you may enter either your
SSN or EIN. However, the IRS prefers that you use your SSN.
If you are a single-owner LLC that is disregarded as an entity separate from
its owner (see LIMITED LIABILITY COMPANY (LLC) on page 2), enter your SSN (or
EIN, if you have one). If the LLC is a corporation, partnership, etc., enter the
entity's EIN.
NOTE: See the chart on page 4 for further clarification of name
and TIN combinations.
HOW TO GET A TIN. If you do not have a TIN, apply for one immediately. To apply
for an SSN, get FORM SS-5, Application for a Social Security Card, from your
local Social Security Administration office or get this form on-line at
WWW.SSA.GOV/ONLINE/SS5.HTML. You may also get this form by calling
1-800-772-1213. Use FORM W-7, Application for IRS Individual Taxpayer
Identification Number, to apply for an ITIN, or FORM SS-4, Application for
Employer Identification Number, to apply for an EIN. You can get Forms W-7 and
SS-4 from the IRS by calling 1-800-TAX-FORM (1-800-829-3676) or from the IRS Web
Site at WWW.IRS.GOV.
If you are asked to complete Form W-9 but do not have a TIN, write "Applied
For" in the space for the TIN, sign and date the form, and give it to the
requester. For interest and dividend payments, and certain payments made with
respect to readily tradable instruments, generally you will have 60 days to get
a TIN and give it to the requester before you are subject to backup withholding
on payments. The 60-day rule does not apply to other types of payments. You will
be subject to backup withholding on all such payments until you provide your TIN
to the requester.
NOTE: Writing "Applied For" means that you have already applied for a TIN OR
that you intend to apply for one soon.
CAUTION: A disregarded domestic entity that has a foreign owner must use the
appropriate Form W-8.
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PART II. CERTIFICATION
To establish to the withholding agent that you are a U.S. person, or resident
alien, sign Form W-9. You may be requested to sign by the withholding agent even
if items 1, 3, and 5 below indicate otherwise.
For a joint account, only the person whose TIN is shown in Part I should sign
(when required). Exempt recipients, see EXEMPT FROM BACKUP WITHHOLDING on page
2.
SIGNATURE REQUIREMENTS. Complete the certification as indicated in 1 through
5 below.
1. INTEREST, DIVIDEND, AND BARTER EXCHANGE ACCOUNTS OPENED BEFORE 1984
AND BROKER ACCOUNTS CONSIDERED ACTIVE DURING 1983. You must give your
correct TIN, but you do not have to sign the certification.
2. INTEREST, DIVIDEND, BROKER, AND BARTER EXCHANGE ACCOUNTS OPENED AFTER
1983 AND BROKER ACCOUNTS CONSIDERED INACTIVE DURING 1983. You must
sign the certification or backup withholding will apply. If you are
subject to backup withholding and you are merely providing your
correct TIN to the requester, you must cross out item 2 in the
certification before signing the form.
3. REAL ESTATE TRANSACTIONS. You must sign the certification. You may
cross out item 2 of the certification.
4. OTHER PAYMENTS. You must give your correct TIN, but you do not have to
sign the certification unless you have been notifiedthat you have
previously given an incorrect TIN. "Other payments" include payments
made in the course of the requester's trade or business for rents,
royalties, goods (other than bills for merchandise), medical and
health care services (including payments to corporations), payments to
a nonemployee for services, payments to certain fishing boat crew
members and fishermen, and gross proceeds paid to attorneys (including
payments to corporations).
5. MORTGAGE INTEREST PAID BY YOU, ACQUISITION OR ABANDONMENT OF SECURED
PROPERTY, CANCELLATION OF DEBT, QUALIFIED TUITION PROGRAM PAYMENTS
(UNDER SECTION 529), IRA OR ARCHER MSA CONTRIBUTIONS OR DISTRIBUTIONS,
AND PENSION DISTRIBUTIONS. You must give your correct TIN, but you do
not have to sign the certification.
WHAT NAME AND NUMBER TO GIVE THE REQUESTER
- ----------------------------------------------------------------------
FOR THIS TYPE OF ACCOUNT: GIVE NAME AND SSN OF:
- --------------------------------------- -------------------------------
1. Individual The individual
2. Two or more individuals The actual owner account or, if combined
(joint account) funds, the first individual on the
account (1)
3. Custodian account of a minor The minor (2)
(Uniform Gift to Minors Act)
4. a. The usual revocable savings The grantor-trustee (1)
(grantor is also trustee)
b. So-called trust account that The actual owner (1)
is not a legal or valid
trust under state law
5. Sole proprietorship or The owner (3)
single-owner LLC
- --------------------------------------- -------------------------------
FOR THIS TYPE OF ACCOUNT: GIVE NAME AND EIN OF:
- --------------------------------------- -------------------------------
6. Sole proprietorship or The owner (3)
single-owner LLC
7. A valid trust, estate, or Legal entity (4)
pension trust
8. Corporate or LLC electing The corporation
corporate status on Form 8832
9. Association, club, religious, The organization
charitable, educational, or
other tax-exempt organization
10. Partnership or multi-member LLC The partnership
11. A broker or registered nominee The broker or nominee
12. Account with the Department of The public entity
Agriculture in the name of a
public entity (such as a state
or local government, school
district, or prison) that
receives agricultural program
payments
- --------------------------------------- -------------------------------
(1) List first and circle the name of the person whose number you furnish.If
only one person on a joint account has an SSN, that person's number must be
furnished.
(2) Circle the minor's name and furnish the minor's SSN.
(3) YOU MUST SHOW YOUR INDIVIDUAL NAME, but you may also enter your business or
"DBA" name. You may use either your SSN or EIN (if you have one). 4 List
first and circle the name of the legal trust, estate, or pension trust. (Do
not furnish the TIN of the personal representative or trustee unless the
legal entity itself is not designated in the account title.) NOTE: If no
name is circled when more than one name is listed, the number will be
considered to be that of the first name listed.
- --------------------------------------------------------------------------------
PRIVACY ACT NOTICE
Section 6109 of the Internal Revenue Code requires you to provide your correct
TIN to persons who must file information returns with the IRS to report
interest, dividends, and certain other income paid to you, mortgage interest you
paid, the acquisition or abandonment of secured property, cancellation of debt,
or contributions you made to an IRA or Archer MSA. The IRS uses the numbers for
identification purposes and to help verify the accuracy of your tax return. The
IRS may also provide this information to the Department of Justice for civil and
criminal litigation, and to cities, states, and the District of Columbia to
carry out their tax laws. We may also disclose this information to other
countries under a tax treaty, or to Federal and state agencies to enforce
Federal nontax criminal laws and to combat terrorism.
You must provide your TIN whether or not you are required to file a tax
return. Payers must generally withhold 30% of taxable interest, dividend, and
certain other payments to a payee who does not give a TIN to a payer. Certain
penalties may also apply.
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YOU SHOULD COMPLETE THE FOLLOWING CERTIFICATE IF YOU WROTE "APPLIED
FOR" IN PART 1 OF FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
- --------------------------------------------------------------------------------
I certify under penalties of perjury that a Taxpayer Identification Number has
not been issued to me, and either (1) I have mailed or delivered an application
to receive a Taxpayer Identification Number to the appropriate Internal Revenue
Service Center or Social Security Administration Officer or (2) I intend to mail
or deliver an application in the near future. I understand that, notwithstanding
the information I provided in part II of the Form W-9 (and the fact that I have
completed the Certificate of Awaiting Taxpayer Identification Number), if I fail
to provide a Taxpayer Identification Number to the Depositary by the time of
payment, 30% of all reportable payments made to me thereafter will be withheld,
and if I fail to provide a certified Taxpayer Identification Number to the
Depositary within sixty (60) days, such amounts will be paid over to the
Internal Revenue Service.
- --------------------------------------------------------------------------------
SIGNATURE ______________________________ DATE ___________ ___, 2003
NOTE: FAILURE TO COMPLETE AND RETURN THE FORM W-9 MAY RESULT IN BACKUP
WITHOLDING OF 28% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE
REVIEW THE "INTERNAL REVENUE SERVICE" FORM W-9-REQUEST FOR TAXPAYER
IDENTIFICATION NUMBER AND CERTIFICATION ABOVE FOR ADDITIONAL DETAILS.
14