September 12, 2005
Via Facsimile (713) 229-1522
Gene J. Oshman, Esq.
Baker Botts L.L.P.
3000 One Shell Plaza
910 Louisiana
Houston, Texas 77002
(713) 229-1234
RE: EGL, Inc.
Schedule TO-I filed August 30, 2005
File No. 005-49709
Dear Mr. Oshman:
We have the following comments on the above-referenced
filing:
Schedule TO-I
General
1. We note that your amendment to the Schedule TO-I, filing
Exhibit (a)(1)(vi), the Letter to Participants in EGL`s Employee
Stock Purchase Plan, was filed September 6, 2005. Please tell us
when the letter was provided to the employee stock purchase plan
holders. We note that the letter is dated August 31, 2005. If the
letter was not provided to holders on August 31, 2005, please tell
us how, given such circumstances, this tender offer shall remain
open until the expiration of at least twenty business days from
its commencement, as required by Rule 13e-4(f)(1)(i) given your
current expiration time and date of 5:00 pm on September 28, 2005.
Please see Rule 13e-4(a)(4).
Forward-Looking Statements, page 7
2. We reference your statement that except as required by law, you
"are not under any obligation and do not undertake to make
publicly available any update or other revision to any of these
forward-looking statements to reflect circumstances existing after
the date of this Offer to Purchase or to reflect the occurrence
of future events even if experience or future changes make it clear
that any projected results expressed or implied herein or in any
other document will not be realized." Under certain circumstances
you may incur an obligation to revise the offer materials to reflect
any material changes in the information disseminated to option
holders pursuant to Rule 13e-4(e)(3). Please tell us your plans
in this regard.
Determination of Validity. . . . page 21
3. We note your statement that your "interpretation of the terms
of the tender offer (including the instructions in the Letter of
Transmittal) will be final and binding on all parties." Please
revise this sentence to more precisely define its scope. It
appears that your interpretation of the terms of the tender offer
may not necessarily be final and binding on all parties. For
example, while you may assert an offer condition when it is
triggered, when parties contest asserted conditions, the judgments
of courts of law are generally considered final and binding in
such matters. Please make corresponding revisions throughout
your document, including, but not limited to, the last sentence
of your section entitled "Conditions of the Tender Offer."
Conditions of the Tender Offer, page 24
4. Please note that it is our position that a tender offer subject
to a financing condition must remain open for at least five
business days after the financing condition has been waived or
satisfied. Please tell us your plans in this regard.
5. In the first paragraph you state that you may terminate this
offer if one of the listed events occurs and you determine in
your reasonable judgment that the occurrence of the event makes it
inadvisable to proceed with the offer. You have the right to
decide whether to terminate or proceed with your offer if a listed
offer condition is "triggered." However, if you go forward with the
offer despite the occurrence of one of the listed events, you must
waive the applicable condition. Waiver of an offer condition may
require extension of the offer and dissemination of additional
offer materials. You may not use the language in the first
paragraph of this section to tacitly waive an offer condition by
failing to assert it. Please confirm your understanding in a
supplemental response.
6. We refer to the first sentence of the first paragraph of this
section. In our view, you may condition a tender offer on any
number of conditions, as long as they are described with reasonable
specificity, capable of objective verification, and outside of
your control. The phrase "regardless of the circumstances giving
rise to such event" implies that you may assert an offer condition
even when the condition is "triggered" by your own action or
inaction. Please revise the disclosure found here and in the last
paragraph. Please make corresponding revisions throughout your
document including, but not limited to, the first sentence of the
last paragraph of this section.
7. We note your second offer condition at the third bullet
regarding any event or events occurring that "in [your] reasonable
judgment, would or is reasonably likely to directly or indirectly
materially and adversely affect you or your subsidiaries` business,
condition (financial or otherwise,) income, operations or
prospects. . . ." Please revise to specify or generally describe
the prospects to which you refer and clarify what you mean by
conditions other than financial, so that security holders will
have the ability to objectively determine whether the condition
has been triggered.
8. We reference the first sentence of your sixth offer condition.
Please refer to the comment above and make the corresponding
revision to condition number six. Further, describe what you mean
by any change occurring or threatened in your "stock ownership"
that is contemplated. Finally, tell us why it is appropriate
that you may make such offer condition based on a "threatened"
change as contemplated by this condition. Please revise this
condition to specify or generally describe what you mean so
that security holders will have the ability to objectively
determine whether the condition has been triggered.
Source and Amount of Funds, page 26
9. We note that you expect to repay the $150 million of borrowing
under the bridge facility from $150 million of "alternative debt
financing." Such alternative debt financing appears to be
indirect borrowed funds for the purpose of the transaction, as
contemplated by Item 1007(d) of Regulation M-A. Please provide
the information required by this item.
Certain Information Concerning Us, page 29
10. We note that you incorporate the financial statements by
reference. Please clearly identify the information incorporated
by page, paragraph, caption or otherwise. Please see Instruction
3 to Item 10 of Schedule TO.
Fees and Expenses, page 38
11. Please tell us if you will pay a fee to the dealer manager
based on the number of shares tendered. We object to fees paid
to a dealer manager based on tenders of subject securities it
holds for its own account. See Rule 13e-4(f)(8)(ii). Please
indicate whether you intend to pay fees under those circumstances.
If you do not, indicate how you will ensure that. For example,
what mechanism will you use to determine who holds the tendered
securities when calculating the fee owed to Banc of America
Securities LLC?
Closing Comments
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be certain that they have provided all information investors
require.Since the Company and its management are in possession of
all facts relating to a Company`s disclosure, they are responsible
for the accuracy and adequacy of the disclosures they have made.
In connection with responding to our comments, please
provide, in writing, a statement from the Company acknowledging
that:
* the Company is responsible for the adequacy and accuracy of the
disclosure in the filings;
* staff comments or changes to disclosure in response to staff
comments in the filings reviewed by the staff do not foreclose the
Commission from taking any action with respect to the filing; and
* the Company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
As appropriate, please amend your filing in response to
these comments. You may wish to provide us with marked copies
of the amendment, if required, to expedite our review. Please
furnish a cover letter with your amendment that keys your
responses to our comments and provides any requested supplemental
information. Detailed cover letters greatly facilitate our review.
Please file your response letter on EDGAR. Please understand that
we may have additional comments after reviewing your amendment and
responses to our comments. If the information you provide in
response to our comments materially changes the information that
you have already provided to security holders, disseminate the
revised materials in a manner reasonably calculated to inform
them of the new information.
Direct any questions to me at (202) 551-3257. You may also
contact me via facsimile at (202) 772-9203. Please send all
correspondence to us at the following ZIP code: 20549-3628.
Very truly yours,
Celeste M. Murphy
Special Counsel
Office of Mergers & Acquisitions