WASHINGTON, DC 20549
SCHEDULE TO
(RULE 14d-100)
TENDER OFFER STATEMENT UNDER SECTION 14(D)(1) OR 13(E)(1) OF
THE SECURITIES EXCHANGE ACT OF 1934
DUCK HEAD APPAREL COMPANY, INC.
(Name of Subject Company (Issuer)
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HB ACQUISITION CORP.
TROPICAL SPORTSWEAR INT'L CORP.
(Names of Filing Persons (Offeror))
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Common Stock, $0.01 par value
(Title of Class of Securities)
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26410P 10 3
(CUSIP Number of Class of Securities)
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Gregory L. Williams, Esq.
Tropical Sportswear Int'l Corp.
4902 West Waters Avenue
Tampa, Florida 33634-1302
(813) 249-4900
(Name, address, and telephone numbers of person authorized to
receive notices and communications on behalf of filing persons)
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Copy to:
Stephen A. Opler, Esq.
Alston & Bird LLP
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
(404) 881-7000
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CALCULATION OF FILING FEE
- ----------------------------------------- --------------------------------------
Transaction Valuation Amount Of Filing Fee
- ----------------------------------------- --------------------------------------
- ----------------------------------------- --------------------------------------
Not Applicable Not Applicable
- ----------------------------------------- --------------------------------------
/ / 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:
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Form or Registration No.:
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Filing Party:
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Date Filed:
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/X/ Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
Check the appropriate boxes below to designate any transaction to which the
statement relates:
/X/ third-party tender offer subject to Rule 14d-1.
/ / issuer tender offer subject to Rule 13e-4.
/ / going-private transaction subject to Rule 13e-3.
/ / amendment to Schedule 13D under Rule 13d-2.
Check the following box if the filing is a final amendment reporting the
results of the tender offer: / /
The description contained herein is neither an offer to purchase nor a
solicitation of an offer to sell shares of Duck Head Apparel Company, Inc. At
the time the tender offer is commenced, Tropical Sportswear Int'l Corp. will
file a Tender Offer Statement and Duck Head Apparel Company, Inc. will file a
Soliciation/Recommendation Statement with respect to the offer. The Tender Offer
Statement (including an offer to purchase, a related letter of transmittal and
other offer doucments) and the Solicitation/Recommendation Statement will
contain important information, and investors and security holders are strongly
advised to read both such statements carefully before any decision is made with
respect to the offer.
The offer to purchase, the related transmittal letter and certain other
documents, as well as the Solicitation/Recommendation Statement, will be made
available to all shareholders of Duck Head Apparel Company, Inc. at no expense
to them. The Tender Offer Statement (including an offer to purchase, a related
letter of transmittal and other offer documents) and the
Solicitation/Recommendation Statement will also be available at no charge at the
SEC's website at www.sec.gov.
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Tropical Contact:
Michael Kagan Symbol: TSIC
Executive Vice President & Traded: Nasdaq National Market
Chief Financial Officer
Tropical Sportswear Int'l Corporation
Tel: (813) 249-4900
Fax: (813) 249-4904
Duck Head Contact:
K. Scott Grassmyer Symbol: DHA
Senior Vice President & Traded: AMEX
Chief Financial Officer
Duck Head Apparel Company, Inc.
Tel: (770) 867-3111
Fax: (770) 307-1800
FOR IMMEDIATE RELEASE
Tropical Sportswear to Acquire Duck Head Apparel
TAMPA, Florida, June 27, 2001 - Tropical Sportswear Int'l Corporation
(NASDAQ: TSIC) and Duck Head Apparel Company, Inc. (AMEX: DHA) today announced
that they have entered into an agreement whereby Tropical Sportswear ("TSI")
will acquire 100% of the common stock of Duck Head pursuant to a tender offer
and subsequent merger. The offer is subject to the tender of a majority of the
shares of Duck Head on a fully-diluted basis. Prior to July 25, 2001, the offer
is also subject to a satisfactory due diligence review of Duck Head by TSI. The
agreement provides that TSI will make a cash tender offer for 100% of the
approximately 2.9 million issued and outstanding common shares of Duck Head at a
price of $4.75 per share. Following completion of the tender offer, TSI expects
to consummate a merger in which any remaining Duck Head shareholders would
receive in cash the same price per share paid in the tender offer.
Giving effect to the exercise of outstanding stock options and issuance of
incentive shares under existing programs, the value of Duck Head's common stock
at $4.75 per share is approximately $16.0 million. In addition, at June 2, 2001,
Duck Head had debt of approximately $4.8 million and cash balances of
approximately $5.0 million. The transaction is expected to close in the third
calendar quarter of 2001 (TSI's fourth fiscal quarter of 2001) and is subject to
additional customary closing conditions.
The members of the board of directors of Duck Head unanimously support the
agreement with TSI. The members of the board of directors of Duck Head, who
together beneficially own approximately 40% of Duck Head's common stock on a
fully-diluted basis, have agreed with TSI to tender all of their shares in the
tender offer, have granted TSI irrevocable proxies to vote their shares against
any competing proposals and have granted TSI options to acquire their shares at
the tender offer price.
Duck Head produces men's and boy's casual sportswear products, including
shirts, shorts and pants, which are marketed under its Duck Head(R)brand to
leading apparel retailers and through its chain of 25 outlet retail stores. In
addition, Duck Head licenses its Duck Head(R)brand to producers of other apparel
and accessory products. For the year ending June 30, 2001, Duck Head management
expects that Duck Head will report net sales of approximately $45 million.
"Duck Head offers an outstanding strategic fit for us," commented William
W. Compton, Chairman and Chief Executive Officer of TSI. "Duck Head produces
similar lines of pants and shorts which fit well within our operating blueprint.
Duck Head also has a well-established complementary line of men's and boys'
casual shirts, which we plan to expand through leveraging our extensive
distribution channels. In addition, we have strong relationships with Duck
Head's major customers and we see excellent opportunities to expand key
wholesale and licensing programs."
Michael Kagan, TSI's Executive Vice President and Chief Financial Officer,
commented "we expect that Duck Head's operations will be accretive to our
earnings and cash flow for fiscal 2002. We plan to quickly consolidate Duck
Head's distribution into our operations and do not anticipate any disruption to
customer service." Mr. Kagan added, "we have received the approval of our banks
to finance this transaction under our existing revolving credit facility."
After consummating the merger, TSI intends to continue Duck Head's pending
efforts to sell its headquarters and distribution center in Winder, Georgia and
will evaluate the consolidation of Duck Head's production facilities in Costa
Rica into our existing network of contract manufacturers. In addition, TSI
expects to retain selected management and operating personnel of Duck Head.
William V. Roberti, Chairman of the Board, President & Chief Executive
Officer of Duck Head, commented "We see this combination as an opportunity to
preserve and enhance the Duck Head(R)name, which has been a time-tested and
time-honored brand since 1866. Those retailers and customers loyal to Duck
Head(R)will be well served by the marketing and operating strengths that TSI
will bring to this combined enterprise."
TSI markets and manufactures branded and private brand men's and women's
casual and dress sportswear through all major retail distribution channels.
Major owned brands include Savane(R), Farah(R), Bay to Bay(R), Flyers(TM), The
Original Khaki Co.(R), Two Pepper(R), and Authentic Chino Casuals(R). Licensed
brands include Bill Blass(R), John Henry(R), Van Heusen(R)and Victorinox(R). TSI
distinguishes itself by providing major retailers with comprehensive brand
management programs and uses advanced technology to provide retailers with
customer, product and market analyses, apparel design, and merchandising
consulting and inventory forecasting with a focus on return on investment.
Duck Head Apparel Company, Inc., which was spun-off as a separate public
reporting company on June 30, 2000 by Delta Woodside Industries, Inc., is
headquartered in Winder, Georgia, and manufactures and sells men's and boys'
apparel under the Duck Head(R)brand. The company, which employs about 500
people, operates a distribution center in Winder, Georgia, a garment assembly
plant in Costa Rica and 25 retail outlet stores primarily in the southeastern
United States.
This press release contains forward-looking statements, which are subject
to the safe harbor created by the Private Securities Litigation Reform Act of
1995. TSI and Duck Head caution that these statements represent current
expectations of future events and involve certain risks and uncertainties that
could cause actual results to differ materially from those anticipated in these
forward-looking statements as a result of factors including, without limitation,
conditions and contingencies in connection with the tender offer and merger,
difficulties in integrating the operations of Duck Head with TSI, delays or
other difficulties in implementing TSI's operating plans for Duck Head after the
merger, the inability to achieve projected revenue and earnings in fiscal 2001;
the inability to achieve cost savings related to recent reductions in staff;
general economic conditions, including recession or other cyclical effects
impacting our customers in the US or abroad; potential changes in demand in the
retail market; the continued acceptance of TSI's and Duck Head's existing and
new products by their major customers; the financial strength of TSI's and Duck
Head's major customers; delays associated with the timing of introduction,
shipment and acceptance of the Victorinox(R)apparel line; the ability of TSI to
continue to use certain licensed trademarks and tradenames, including
Victorinox(R), John Henry(R), Bill Blass(R), and Van Heusen(R); potential
changes in price and availability of raw materials and global manufacturing
costs and restrictions; increases in costs; and other risk factors listed from
time to time in TSI's and Duck Head's reports (including their Annual Reports on
Forms 10-K) filed with the Securities and Exchange Commission.
This announcement is neither an offer to purchase nor a solicitation of an
offer to sell securities of Duck Head. The tender offer will be made pursuant to
a tender offer statement and related materials. Investors and security holders
are strongly advised to read both the tender offer statement and the
solicitation/recommendation statement regarding the tender offer when they
become available because they will contain important information that should be
read carefully before any decision is made with respect to the offer. The tender
offer statement will be filed by TSI and its acquisition subsidiary, HB
Acquisition Corp., with the Securities and Exchange Commission, and
solicitations/recommendation statement will be filed by Duck Head with the
Securities and Exchange Commission. Investors and security holders may obtain a
free copy of these statements (when available) and other documents filed by TSI
and Duck Head at the SEC's website, www.sec.gov or upon request.
