UNITED STATES SECURTIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 14A (RULE 14a-101) INFORMATION REQUIRED IN CONSENT STATEMENT SCHEDULE 14A INFORMATION CONSENT STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. ) Filed by the Registrant | | Filed by a Party other than the Registrant|X| Check the appropriate box: | | Preliminary Consent Statement | | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | | Definitive Consent Statement |X| Definitive Additional Materials | | Soliciting Material Under Rule 14a-12 BAIRNCO CORPORATION - -------------------------------------------------------------------------------- (Name of Registrant as Specified in Its Charter) STEEL PARTNERS II, L.P. STEEL PARTNERS, L.L.C. BZ ACQUISITION CORP. WARREN G. LICHTENSTEIN HUGH F. CULVERHOUSE JOHN J. QUICKE ANTHONY BERGAMO HOWARD M. LEITNER - -------------------------------------------------------------------------------- (Name of Persons(s) Filing Consent Statement, if Other Than the Registrant) Payment of Filing Fee (Check the appropriate box): |X| No fee required.| | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. (1) Title of each class of securities to which transaction applies: - -------------------------------------------------------------------------------- (2) Aggregate number of securities to which transaction applies: - -------------------------------------------------------------------------------- (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): - -------------------------------------------------------------------------------- (4) Proposed maximum aggregate value of transaction: - -------------------------------------------------------------------------------- (5) Total fee paid: - -------------------------------------------------------------------------------- | | Fee paid previously with preliminary materials: - -------------------------------------------------------------------------------- | | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. (1) Amount previously paid - -------------------------------------------------------------------------------- (2) Form, Schedule or Registration Statement No: - -------------------------------------------------------------------------------- (3) Filing Party: - -------------------------------------------------------------------------------- (4) Date Filed: - -------------------------------------------------------------------------------- Steel Partners II, L.P., together with the other Participants (as defined below), is filing materials contained in this Schedule 14A with the Securities and Exchange Commission in connection with the solicitation of written consents from stockholders of Bairnco Corporation. On January 24, 2007, Steel Partners II, L.P. issued the following press release: FOR IMMEDIATE RELEASE STEEL PARTNERS II SENDS LETTER TO BAIRNCO STOCKHOLDERS QUESTIONING BOARD OF DIRECTORS' PAST RECORD NEW YORK, NY - JANUARY 24, 2007 -- Steel Partners II, L.P. ("Steel Partners II"), which has commenced a $12.00 per share cash tender offer for Bairnco Corporation (NYSE:BZ; "Bairnco"), announced today that it has sent the following letter to stockholders of Bairnco questioning the board of directors' past record and calling on stockholders to support Steel Partners II's consent solicitation to remove the current board members and replace them with Steel Partners II's nominees in order to allow the stockholders to decide their company's future for themselves: STEEL PARTNERS II, L.P. 590 MADISON AVENUE, 32ND FLOOR NEW YORK, NEW YORK 10022 January 24, 2007 Dear Fellow Stockholder: As you are aware, BZ Acquisition Corp., a wholly owned subsidiary of Steel Partners II, L.P., has commenced a tender offer to purchase all the issued and outstanding shares of common stock of Bairnco Corporation for $12.00 net per share in cash (the "Offer"). THE BOARD OF DIRECTORS OF BAIRNCO HAS REFUSED TO TAKE THE STEPS NECESSARY TO ALLOW US TO CONSUMMATE THE OFFER AND TO ALLOW YOU TO DETERMINE FOR YOURSELF WHETHER YOU WANT TO RECEIVE THE CONSIDERATION TO BE PAID PURSUANT TO THE OFFER. Because we believe that the current directors of Bairnco are not acting, and will not act, in your best interests with respect to the Offer, we are soliciting written consents from Bairnco stockholders to remove each current member of Bairnco's board of directors and replace them with five highly qualified individuals who, as dictated by their fiduciary duties, will take action to allow the stockholders, the true owners of Bairnco, to decide the Company's future for themselves. SHOULD YOU TRUST THE CURRENT BOARD OF DIRECTORS WITH YOUR COMPANY'S FUTURE? WE THINK THE ANSWER IS CLEARLY NO Bairnco's management has made some bold predictions regarding the future financial results of the Company for 2007. Do you believe that Bairnco, led by its current board of directors, will achieve these projections? If you look at the record, Bairnco's management is no stranger to making predictions of future success that come up woefully short. To find unfulfilled expectations of greener earnings pastures, you need look no further than the two most recent annual reports that Bairnco sent to its stockholders. Consider the following statements made by Luke E. Fichthorn, III, Bairnco's Chairman of the Board and CEO: FICTION: "We expect 2005 to be a year of improved results as compared to 2004." (2004 annual report) FACT: In 2005, operating profit and diluted earnings per share from continuing operations were each DOWN OVER 30%, as compared to 2004. THE EXCUSE: "[E]xternal events, COMBINED WITH OUR DECISIONS - SOME OF WHICH WERE GOOD, SOME BAD, AND SOME LATE - LED TO FINANCIAL RESULTS WELL BELOW OUR EXPECTATIONS." (2005 annual report, EMPHASIS ADDED) WHY WOULD YOU BELIEVE THE BOARD OF DIRECTORS NOW? In addition to making public statements about the Company's future financial performance that have not borne fruit, Mr. Fichthorn also conveniently neglects to tell the whole story about the Company's financial health. In the Company's press release announcing its 2006 results, Mr. Fichthorn fails to remind you of his statement from Bairnco's 2005 annual report that the level of growth represented by the Company's 2006 earnings "will still leave us below our long term financial objectives." He also doesn't tell you that, even with the repurchase of a significant number of shares during the past two years, the Company's diluted earnings per share for 2006 is STILL BELOW THE COMPANY'S 2004 DILUTED EARNINGS PER SHARE OF $0.68. Now, Mr. Fichthorn is predicting earnings per share growth in the range of approximately 69% to 85% in 2007 even though, in 2006, the Company did not return to 2004 levels and Arlon Coated Materials operating profit DECREASED 48.4% IN 2006, including an OPERATING LOSS IN THE FOURTH QUARTER OF 2006. Based on its track record, do you believe that Bairnco, led by its current board of directors, will achieve these lofty projections? THE NUMBERS DON'T LIE - Bairnco, led by its current board of directors, earned less and is in a worse financial position - with substantially higher debt - today than in 2004. HAS BAIRNCO BEEN ABLE TO DELIVER ON THE OPERATIONAL CHANGES IT PROMISED? AGAIN, WE THINK THE ANSWER IS CLEARLY NO FICTION: "[P]lans have been approved to open a China manufacturing plant which is expected to be in production by the end of 2005. . . . The plant is expected to be profitable in 2006." (2004 annual report) FACT: The new China plant "will not be operational until the third quarter 2006." (2005 annual report). In fact, the China facility began only LIMITED OPERATIONS in October 2006, and a significant increase in sales and production is needed to ramp-up this plant from its 2006 fourth quarter operating loss to the level of profitability projected by the Company for 2007. FICTION: "The start up inefficiencies and scrap at the San Antonio plant [into which Bairnco consolidated its Arlon industrial engineered coated products businesses] should be materially reduced." (2004 annual report) FACT: "Arlon Coated Materials' San Antonio facility remained substantially below expected performance levels during 2005 due to POOR PRODUCTION SCHEDULING, INCREASED SCRAP, INEFFICIENT LABOR AND INCREASED RAW MATERIAL COSTS." (2005 annual report, EMPHASIS ADDED) FICTION: Bairnco's goal was "to move the remaining manufacturing operations in St. Louis to Kasco's Mexican plant over the first six months of 2005." (2004 annual report) FACT: "The St. Louis plant move to Mexico was DELAYED [it was not in full operation until the end of the third quarter of 2005] and OVER BUDGET [by nearly double the expected cost]." (2005 annual report, EMPHASIS ADDED) WHEN IT COMES TO ITS OPERATIONAL OBJECTIVES, BAIRNCO HAS CLEARLY OVER-PROMISED AND UNDER-DELIVERED. WHY WOULD YOU BELIEVE THE BOARD OF DIRECTORS NOW? Other sophisticated, potential purchasers of Bairnco don't appear to believe the board of directors. Although Bairnco, with the assistance of its financial advisor, conducted a nearly three-month process to explore a variety of possible strategic alternatives, including the possible sale of the Company, IT DID NOT RECEIVE A SINGLE OFFER FOR THE ACQUISITION OF THE ENTIRE COMPANY. It also seems as though Bairnco's management doesn't have the confidence to stand behind its own financial projections. When we put forth a proposal providing that a portion of the total transaction consideration would depend on Bairnco's future financial performance, it was summarily rejected. In a January 16, 2007 letter to stockholders, Mr. Fichthorn claimed that the board of directors has successfully enhanced shareholder value "over the last six months." For a board with over 50 years of combined experience serving as directors of the Company, we find it curious that Mr. Fichthorn focused only on the board's questionable accomplishments during the past six months, which happens to coincide with the period of time during which our Offer has remained open and the directors' continued service with Bairnco has been threatened, while completely overlooking the past missteps we have recounted above. ASK YOURSELF WHETHER THE PRICE IMPACT ON BAIRNCO'S STOCK IS THE RESULT OF THE COMPANY'S PERFORMANCE OR THE PUBLICLY ANNOUNCED INTEREST OF STEEL PARTNERS II IN PURCHASING THE COMPANY. YOU SHOULD BE ABLE TO DECIDE THE FUTURE OF YOUR COMPANY We believe that our Offer is fair to all stockholders and affords stockholders an attractive and certain means of monetizing their investment, as opposed to the uncertainty offered by the current board of directors, with its financial crystal ball and selective memory. The $12.00 per share cash price proposed to be paid in the Offer represents a premium of 21% to the last reported sales price per share on June 15, 2006, the day we informed Bairnco of our Offer. Unfortunately, the current board of directors has decided to reject and impose roadblocks on our Offer. As a result, we have been forced to undertake our consent solicitation as a last resort. WE URGE ALL STOCKHOLDERS TO CONSENT TO ALL FOUR OF OUR PROPOSALS, WHICH WILL RESULT IN THE REMOVAL OF THE CURRENT MEMBERS OF BAIRNCO'S BOARD OF DIRECTORS AND THEIR REPLACEMENT WITH FIVE HIGHLY QUALIFIED INDIVIDUALS WHO WILL ACT TO ENSURE THAT YOU, THE TRUE OWNERS OF THE COMPANY, WILL HAVE A VOICE IN THE FUTURE OF YOUR INVESTMENT. DEMAND VALUE FOR YOUR INVESTMENT - VOTE THE GOLD CONSENT CARD TODAY! As a significant and long-term stockholder of the Company, we are counting on your support to maximize value for all stockholders. We encourage all stockholders to vote promptly and to discard any consent revocation materials you may receive from management. If you return management's white consent card, you can change your vote by executing the enclosed GOLD consent card. If you have any questions, or need assistance in voting your GOLD consent card, please call our consent solicitor, MacKenzie Partners, Inc., toll-free at (800) 322-2885 or (212) 929-5500 (call collect). Thank you in advance for your support. Sincerely, /s/ Warren G. Lichtenstein Warren G. Lichtenstein Steel Partners II, L.P. - -------------------------------------------------------------------------------- IF YOU HAVE ANY QUESTIONS, REQUIRE ASSISTANCE IN VOTING YOUR GOLD CONSENT CARD, OR NEED ADDITIONAL COPIES OF STEEL PARTNERS II'S CONSENT MATERIALS, PLEASE CALL MACKENZIE PARTNERS, INC. AT THE PHONE NUMBERS LISTED BELOW. MACKENZIE PARTNERS, INC. 105 Madison Avenue New York, NY 10016 bairnco@mackenziepartners.com (212) 929-5500 (Call Collect) or TOLL-FREE (800) 322-2885 - -------------------------------------------------------------------------------- IMPORTANT INFORMATION REGARDING THE TENDER OFFER BZ Acquisition Corp., a wholly-owned subsidiary of Steel Partners II, has commenced a tender offer to purchase all of the outstanding shares of common stock (and associated preferred stock purchase rights) of Bairnco at $12.00 per share, net to the seller in cash, without interest. The offer is currently scheduled to expire at 5:00 P.M., New York City time, on Monday, January 29, 2007, unless the offer is extended. MacKenzie Partners, Inc. is the Information Agent for the tender offer and any questions or requests for the Offer to Purchase and related materials with respect to the tender offer may be directed to MacKenzie Partners, Inc. THIS PRESS RELEASE IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT AN OFFER TO BUY OR THE SOLICITATION OF AN OFFER TO SELL ANY SHARES. THE SOLICITATION AND THE OFFER TO BUY BAIRNCO'S COMMON STOCK IS ONLY BEING MADE PURSUANT TO AN OFFER TO PURCHASE AND RELATED MATERIALS THAT STEEL PARTNERS II HAS FILED (AND WILL FILE) WITH THE SECURITIES AND EXCHANGE COMMISSION. STOCKHOLDERS SHOULD READ THESE MATERIALS CAREFULLY BECAUSE THEY CONTAIN IMPORTANT INFORMATION, INCLUDING THE TERMS AND CONDITIONS OF THE OFFER. STOCKHOLDERS MAY OBTAIN THE OFFER TO PURCHASE AND RELATED MATERIALS WITH RESPECT TO THE TENDER OFFER FREE AT THE SEC'S WEBSITE AT HTTP://WWW.SEC.GOV OR FROM STEEL PARTNERS II BY CONTACTING MACKENZIE PARTNERS, INC. TOLL-FREE AT (800) 322-2885 OR COLLECT AT (212) 929-5500 OR VIA EMAIL AT BAIRNCO@MACKENZIEPARTNERS.COM. IMPORTANT INFORMATION REGARDING THE CONSENT SOLICITATION Steel Partners II, together with the other Participants (as defined below), has filed a definitive consent solicitation statement (as it may be amended or supplemented, the "Consent Solicitation Statement") with the Securities and Exchange Commission (the "SEC") relating to the solicitation of written consents from Bairnco stockholders. STEEL PARTNERS II STRONGLY ADVISES ALL STOCKHOLDERS OF BAIRNCO TO READ THE CONSENT SOLICITATION STATEMENT BECAUSE IT CONTAINS IMPORTANT INFORMATION. SUCH CONSENT SOLICITATION STATEMENT IS AVAILABLE AT NO CHARGE ON THE SEC'S WEB SITE AT HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN THE SOLICITATION WILL PROVIDE COPIES OF THE CONSENT SOLICITATION STATEMENT WITHOUT CHARGE UPON REQUEST. REQUESTS FOR COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS' CONSENT SOLICITOR, MACKENZIE PARTNERS, INC., TOLL-FREE AT (800) 322-2885 OR COLLECT AT (212) 929-5500 OR VIA EMAIL AT BAIRNCO@MACKENZIEPARTNERS.COM. THE PARTICIPANTS IN THE CONSENT SOLICITATION ARE STEEL PARTNERS II, STEEL PARTNERS, L.L.C., BZ ACQUISITION CORP., WARREN G. LICHTENSTEIN, HUGH F. CULVERHOUSE, JOHN J. QUICKE, ANTHONY BERGAMO AND HOWARD M. LEITNER (COLLECTIVELY, THE "PARTICIPANTS"). STOCKHOLDERS OF BAIRNCO MAY OBTAIN INFORMATION REGARDING THE PARTICIPANTS' DIRECT OR INDIRECT INTERESTS, BY SECURITY HOLDINGS OR OTHERWISE, IN BAIRNCO BY REFERRING TO THE CONSENT SOLICITATION STATEMENT. Any forward-looking statements contained in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently subject to a variety of risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, among others: the willingness of Bairnco stockholders to tender their shares in the tender offer and the number and timing of shares tendered; the willingness of Bairnco stockholders to deliver written consents in connection with the consent solicitation; the receipt of third party consents to the extent required for the acquisition; and satisfaction of the various closing conditions. Other important factors that could cause actual results to differ materially are included but are not limited to those listed in Bairnco's periodic reports and registration statements filed with the Securities and Exchange Commission. Steel Partners II undertakes no obligation to update information contained in this release. For additional information: Media Jason Booth and Terry Fahn Sitrick And Company, Inc. (310) 788-2850 Investors and Analysts Daniel Sullivan and Bob Sandhu Mackenzie Partners, Inc. (212) 929-5500
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DFAN14A Filing
Bairnco Inactive DFAN14AAdditional proxy materials by non-management
Filed: 24 Jan 07, 12:00am