UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13E-3
RULE 13E-3 TRANSACTION STATEMENT UNDER SECTION
13(e)
OF THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. ___)
THE COEUR D'ALENES COMPANY
(Name of the Issuer)
THE COEUR D'ALENES COMPANY
(Name of Persons Filing Statement)
COMMON STOCK, NO PAR VALUE
(Title of Class of Securities)
192119 10 9
(CUSIP Number of Class Securities)
Marilyn A Schroeder
Vice President/CFO
The Coeur d'Alenes Company
P O Box 2610
Spokane, WA 99220-2610
(509) 924-6363
(Name, Address and Telephone Numbers of Person Authorized to Receive
Notices and Communications on Behalf of the Persons Filing Statement)
COPY TO:
Lawrence Small
Paine, Hamblen, Coffin, Brooke & Miller, LLP
717 W Sprague Suite 1200
Spokane, WA 99201-3505
This statement is filed in connection with (check the appropriate box):
a. [ X ] The filing of solicitation materials or an information
statement subject to Regulation 14A (Section 240.14a-1 through 240.14b-2),
Regulation 14C (Section 240.14c-1 through 240.14c-101) or Rule 13e-3c
(Section240.13e-3c) under the Securities Exchange Act of 1934 ("the Act").
b. [ ] The filing of a registration statement under the Securities
Act of 1933.
c. [ ] 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: [ X ]
Check the following box if the filing is a final amendment reporting the
results of the transaction: [ ]
Calculation of Filing Fee
Transaction valuation* Amount of filing fee
$15,822 $3.16
*The transaction value is based on the assumption that only those holders of
record with less than 1,000 shares will be cashed out as a result of this
transaction.
There may be more shareholders that fall into this category who currently
have their stock with a depository. The total shares held by shareholders
of record with less than 1,000 shares are 63,287. The transaction value is
calculated by multiplying 63,287 shares by the purchase price of $0.25 per
share. The amount of the filing fee is calculated in accordance with Rule
0-11 of the Securities Exchange Act of 1934, as amended, and equals 1/50th
of one percent of the aggregate value of this transaction.
[ ] Check the box if any part of the fee is offset as provided by
Section 240.0-11(a)(2) and identify the filing 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: ___________________
Form or Registration No.: ___________________
Filing Party: ______________________________
Date Filed: _______________________________
Item 1. Summary Term Sheet:
The terms of the Transaction are summarized as follows:
The purpose of the transaction is to cash out Shareholders holding less
than one thousand (1,000) shares of common stock in a record or nominee
account at 6:01 p.m. on April 30, 2002 (the "Effective Time");
The ratio for the reverse split is one (1) share for every one thousand
(1,000) shares beneficially owned at the Effective Time;
Shareholders who are cashed out will receive $0.25 for each share
beneficially owned the moment before the Effective Time;
The transaction must be approved by a majority of the Shareholders
including Shareholders who are affiliated with the Company as officers,
directors or employees;
If the transaction is approved, then the Company intends to file a
certification of termination of registration of its common stock with the
Securities and Exchange Commission and the Company will cease to be a
reporting company;
The transaction, if approved, will not have any affect on Shareholders
beneficially owning one thousand (1,000) or more shares of the
Company's common stock, other than the termination of registration with
the Securities and Exchange Commission.
A complete description of the terms of the transaction can be found in
Proposal Number 3 beginning on Page 8 of the Proxy Statement.
Item 2. Subject Company Information
This Transaction is being conducted by the issuer:
THE COEUR D'ALENES COMPANY
3900 E Broadway
Spokane, WA 99220-2610
(509) 924-6363
Item 3. Identify and Background of Filing Person
The filing person is the subject company:
THE COEUR D'ALENES COMPANY
3900 E Broadway
Spokane, WA 99220-2610
(509) 924-6363
Directors: Jimmie T G Coulson, Director, President/CEO
P O Box 2610
Spokane, WA 99220-2610
(509) 924-6363
Wendell J Satre, Director
2822 E Snowberry Lane
Spokane, WA 99223
(509) 536-5627
Marilyn Schroeder, Director, Vice President/CFO
P O Box 2610
Spokane, WA 99220-2610
(509) 924-6363
Robert P Shanewise, Director
921 W Comstock Court
Spokane, WA 99203
(509) 443-1944
Lawrence A Stanley, Director
Empire Bolt and Screw
1501 E Trent
Spokane, WA 99202
(509) 534-0636
Officers: Jimmie T G Coulson, Director, President/CEO
P O Box 2610
Spokane, WA 99220-2610
(509) 924-6363
Lawrence A Coulson, Vice President/GM Stock Steel
P O Box 2610
Spokane, WA 99220-2610
Marilyn Schroeder, Director, Vice President/CFO
P O Box 2610
Spokane, WA 99220-2610
(509) 924-6363
Item 4. Terms of the Transaction.
The Transaction includes both a reverse stock split and a forward split
of the Company's common stock. If this Transaction is approved and occurs,
the reverse split will occur at 6:00 P.M. Pacific time on April 30, 2002
(the Effective Time). All shareholders on April 30, 2002 will receive
one share of the Company's common stock for every 1,000 shares of the
Company's common stock held in their record or nominee accounts at that
time. Any Shareholder who has the beneficial interest in fewer than 1,000
shares of the Company's common stock at the Effective Time (referred to
herein as a "Cashed Out Shareholder") will receive a cash payment instead
of fractional shares. This cash payment will be $0.25 per share as
determined by the Board of Directors at a regularly scheduled meeting of
the Board held on November 29, 2001 and reaffirmed at a subsequent
regularly scheduled meeting of the Board held on January 28, 2002.
The Directors considered an independent valuation report prepared by
Cronkite and Kissell that established the value of the shares at $0.08
per share as of August 31, 2001. The Directors, however, did not accept
the conclusions and recommendations of that report; consequently, it will
not be provided to the Shareholders as part of the proxy statement. The
Directors determined that $0.25 was a more appropriate value. Immediately
following the Effective Time for the reverse split, all Shareholders who
are not Cashed Out Shareholders will receive 1,000 shares of the Company's
common stock for every one share of stock they received as a result of the
reverse stock split. If a Shareholder holds 1,000 or more shares in a
record or nominee account prior to the Transaction, any fractional share
in those accounts will not be cashed out after the reverse split and the
total number of shares held in those accounts will not change as a result
of the Transaction.
In accordance with Section 30-1302 of the Idaho Code, Cashed Out
Shareholders have the right to dissent from the Transaction and to
receive payment in cash for the "fair value" of those shares voted
against the Transaction. Instructions regarding the assertion of
dissenter rights are contained in the section entitled Dissenters
Appraisal Rights at page 19; this section is incorporated herein by
reference. See also Appendix A to the Proxy Statement.
No provisions have been made by the Company to grant unaffiliated security
holders access to the corporate files of the Company or to obtain counsel or
appraisal services at the expense of the Company.
Item 1004(f) of Regulation M-A is not applicable.
Item 5. Past Contacts, Transactions, Negotiations and Agreements.
There have been no sales or acquisitions of the Company's common stock by
any of the executive officers or directors of the Company where the
aggregate value of the transactions exceeded $60,000 during the past
two years.
The Company has been conducting tender offers to holders of 200 and fewer
shares continuously over the past two years. Total shares purchased and
the price paid for the Common Stock is detailed in the following table:
Avg
Cost
Date # of shares Total Cost Per Share
October 2001 5,274 $ 2,260 $0.43
May 2001 776 $ 400 $0.52
February 2001 584 $ 320 $0.55
September 2000 1,055 $ 540 $0.51
June 2000 1,014 $ 590 $0.58
There were no negotiations, transactions or material contacts between the
Company and any of its executive officers, directors or affiliates that
would qualify as significant corporate events, as that term is defined by
Item 1005(b) and (c) of Regulation M-A..
There are no agreements between the Company, its executive officers,
directors or any affiliates and any other party with respect to the
Company's common stock which would be subject to Item 1005(e) of
Regulation M-A.
Item 6. Purposes of the Transaction and Plans or Proposals.
The securities acquired in the Transaction will be held in treasury of the
Company; Idaho law allows its domestic corporations to hold their shares of
common stock in treasury for limited purposes.
Effective January 28, 2002, the Company merged its wholly-owned subsidiary,
Union Iron Works, Inc. of Spokane back into the parent company. This merger
is intended to eliminate the expense of maintaining two separate businesses.
It is unrelated to the reverse split contemplated at this time. There are
no other plans, proposals or negotiations regarding any extraordinary
transactions such as a merger, reorganization or liquidation involving
the Company.
There are no plans, proposals or negotiations that might result in any
purchase, sale or transfer of a material amount of assets of the Company.
There are no plans, proposals or negotiations that might result in a
material change in the present dividend rate or policy or any indebtedness
or capitalization of the Company.
There are no plans, proposals or negotiations that might result in any
change in the present board of directors or management of the Company
except in the normal course of board member retirement and replacement.
There are no plans, proposals or negotiations that might result in any
change in the Company's corporate structure.
The Company has only one class of securities and, if the Transaction is
approved, the Transaction will result in the securities becoming eligible
for termination of registration under Section 12(g)(4) of the Act
(15 U.S.C. 781). The Company's listing of common stock on the NASDAQ
Bulletin Board will be discontinued.
Item 7. Purposes, Alternative, Reasons and Effects.
The information required by this Item 7 and Item 1013 of Regulation M-A
is set forth in the proxy statement in the section entitled "Background
and Purpose of the Transaction" at page 13 and "Affect of the Transaction
on the Company" at page 13. These sections are incorporated herein by
reference.
Item 8. Fairness of the Transaction.
The Directors and Management of the Company believe this transaction is
fair to all unaffiliated shareholders of the Company. The small
shareholders currently have no way to liquidate their investment in
the Company without incurring costs that are disproportionate to the
overall value of the stock. This transaction provides a method to cash
out these shareholders. The Company commissioned a going concern valuation
study and report from an independent appraiser in an effort to arrive at a
fair purchase price for the fractional shares. Since the conclusion of
$0.08 per share was based on financial information of comparable companies
much larger than the Company, the Board determined to set the price at
$0.25. Over the last two years, the range of high and low bids has been
$0.31 to $0.05. Market price is not a relevant measure of fairness, as
there is not an active trading market. Over the last five years, after
tax earnings per share have averaged $0.02 and $0.01 over the last three
years. At $0.25 per share, the purchase price represents twelve and one
half times average after tax net income per share based on the last five
years and twenty five times average after tax net income per share based
on the last three years. The purchase price represents roughly 50% of
book value.
This transaction will not have a material affect on shareholders holding
1,000 or more shares of the Company's stock. The Company will no longer
be a registered, reporting Company, but without an active trading market
over the last ten years, the registration does not provide a material
benefit to the unaffiliated shareholders.
No Director dissented or abstained from voting on the Transaction.
The Transaction does not require the approval of a majority of the
unaffiliated shareholders voting as a separate class.
A majority of the directors who are not employees of the Company has not
retained an unaffiliated representative to act solely on behalf of
unaffiliated shareholders for purposes of negotiating the terms of
this transaction nor to prepare a report concerning the fairness of
the transaction.
This transaction was approved by all the Directors who are not employees
of the Company.
There have been no firm offers made by an unaffiliated person during the
last two years to acquire the Company or a significant part of the
Company's assets.
Item 9. Reports, Opinions, Appraisals and Negotiations.
The information required by this Item is set forth in the proxy statement
in the section entitled "Structure of the Transaction" at page 11; this
section is incorporated herein by reference.
Item 10. Source and Amounts of Funds or Other Consideration.
The source of funds for the transaction will be the Company's working
capital. The total number of fractional shares that will be purchased
and the total cash to be paid by the Company are unknown. However, if
the Transaction had been completed as of January 1, 2002, the cash
payment that would have been issued to cashed out shareholders would
have been at least $15,822 based on 63,287 shares held by 599
registered shareholders. The actual amounts will depend on the
number of cashed out shareholders at the Effective Time of the
transaction, which may vary from the number identified on January 1,
2002. The Company is not able to determine at this time the number of
shareholder accounts with fewer than 1,000 shares are held in depositories.
The cost of the transaction is expected to be around $10,000 not including
the payment to cashed out shareholders. Legal fees, solicitation materials
and mailing are the only significant costs the Company anticipates at this
time.
Item 11. Interest in Securities of Subject Company.
The information required by Item 1008(a) of Regulation M-A is set forth in
the Annual Report in the section entitled "Security Ownership of
Management" at page 15; this section is incorporated by reference.
Joel E. Simpson is still an employee of the Company but he is not
considered part of Management for disclosure purposes.
The only transaction during the last sixty days involving the Company's
common stock and executive officers or directors was a single transaction
on December 21, 2001. The transaction was an unsolicited offer to sell
to Company employees the shares of common stock held by Eliot Investments
Limited Partners. This Partnership offered to sell the shares quoted at
the market price, which at that time was $0.05. The total shares involved
were 4,205. Of those 4,205, Jimmie Coulson acquired 189 shares, Marilyn
Schroeder acquired 2,516 shares and other employees who are not executive
officers or directors acquired the remaining 1,500 shares.
Item 12. The Solicitation or Recommendation.
Three of the Company's Directors, listed below, will be cashed out unless
they acquire additional shares or if Dr. Robert Shanewise combines his
accounts, to bring their total holdings of record to more than 1,000.
Robert P. Shanewise
Wendell J. Satre
Lawrence A. Stanley
As all of the Directors believe this transaction is in the best interest
of the Company and all of the unaffiliated shareholders, all five intend
to vote their shares in favor of this transaction.
No Director or executive officer has made a recommendation separate from the
unanimous resolutions adopted by the directors either in support of or
opposed to this transaction to any other party.
Item 13. Financial Statements.
Audited financial statements for the two previous fiscal years required to
be filed with the Company's most recent annual report under Sections 13 and
15(d) of the Exchange Act (15 U.S.C. 78m; 15 U.S.C. 78o), have been filed
with the Company's most recent annual report on Form 10-KSB for the fiscal
year ended in September 2001. The Annual Report was filed on December 27,
2001. The Form 10-KSB for the year ending September 29, 2001 is included
with the mailing of the proxy statement to shareholders as the Company's
annual report.
The financial statements begin on Page F1, immediately following page 17
of the Form 10-KSB and are incorporated herein by reference.
The financial statements required to be included with the Company's most
recent quarterly report are contained in the most recent Form 10-QSB,
filed on February ___ for the quarter ended December 25, 2001 and are
incorporated herein by reference.
Book Value per share of the Company's Common stock as of December 25, 2001
is $0.56.
The Transaction will have no material effect on the Company's balance sheet,
income statement or earnings per share for the current fiscal year. The
Transaction will not have a material effect on the Company's book value per
share for the current fiscal year.
Item 14. Persons/Assets, Retained, Employed, Compensated or Used.
No person or class of persons are directly or indirectly employed,
retained, or are to be compensated to make solicitations or recommendations
in connection with this transaction.
No Officer, employee or corporate assets of the Company has or will be
employed or used by the Company in connection with this transaction.
Item 15. Additional Information.
No additional material is required under this item.
Item 16. Exhibits.
None
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.
/S/ Marilyn A. Schroeder
Vice President/CFO
February 1, 2002