Exhibit (a)(1)(A)
Offer to Purchase for Cash
All Outstanding Shares of Common Stock
(including the Associated Junior Participating Preferred Stock Purchase Rights)
of
HeadHunter.NET, Inc.
at
$9.25 Net Per Share In Cash
by
CB Merger Sub, Inc.,
a wholly owned subsidiary of
Career Holdings, Inc.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON FRIDAY, SEPTEMBER 28, 2001, UNLESS THE OFFER IS EXTENDED
THE OFFER IS BEING MADE PURSUANT TO AN AGREEMENT AND PLAN OF MERGER, DATED
AS OF AUGUST 24, 2001 (THE "MERGER AGREEMENT"), AMONG CAREER HOLDINGS, INC.
("CAREER HOLDINGS"), HEADHUNTER.NET, INC. ("HEADHUNTER") AND CB MERGER SUB,
INC. ("PURCHASER"), A WHOLLY OWNED SUBSIDIARY OF CAREER HOLDINGS. THE BOARD OF
DIRECTORS OF HEADHUNTER HAS DETERMINED THAT THE MERGER AGREEMENT, THE OFFER AND
THE MERGER ARE FAIR TO, AND IN THE BEST INTERESTS OF, HEADHUNTER'S
SHAREHOLDERS, HAS APPROVED THE OFFER AND THE MERGER AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED THEREBY AND RECOMMENDS THAT HEADHUNTER'S SHAREHOLDERS
ACCEPT THE OFFER AND TENDER THEIR SHARES (AS DEFINED HEREIN) PURSUANT TO THE
OFFER.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (I) THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER, SUCH NUMBER OF
SHARES THAT WOULD CONSTITUTE AT LEAST A MAJORITY OF THE SHARES THAT IN THE
AGGREGATE ARE OUTSTANDING DETERMINED ON A FULLY DILUTED BASIS AFTER GIVING
MAXIMUM EFFECT TO THE EXERCISE OF ALL OPTIONS, WARRANTS AND OTHER RIGHTS TO
PURCHASE, AND THE CONVERSION OR EXCHANGE OF ALL SECURITIES CONVERTIBLE OR
EXCHANGEABLE INTO, SHARES OUTSTANDING AT THE EXPIRATION DATE OF THE OFFER,
WHETHER OR NOT VESTED, EXERCISED OR CONVERTED AT THE TIME OF DETERMINATION,
(II) ANY WAITING PERIOD UNDER THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT
OF 1976, AS AMENDED, APPLICABLE TO THE PURCHASE OF SHARES PURSUANT TO THE OFFER
HAVING EXPIRED OR HAVING BEEN TERMINATED PRIOR TO THE EXPIRATION OF THE OFFER,
AND (III) THE SATISFACTION OF CERTAIN OTHER TERMS AND CONDITIONS. SEE
"INTRODUCTION" AND SECTIONS 12, 15, AND 16 OF THIS OFFER TO PURCHASE. THE OFFER
IS NOT CONDITIONED UPON CAREER HOLDINGS OR THE PURCHASER OBTAINING FINANCING.
-----------------
IMPORTANT
Any shareholder of Headhunter wishing to tender Shares in the Offer must (i)
complete and sign the Letter of Transmittal (or a manually signed facsimile
thereof) in accordance with the instructions in the Letter of Transmittal and
mail or deliver the Letter of Transmittal and all other required documents to
the Depositary (as defined herein) together with certificates representing the
Shares tendered or follow the procedure for book-entry transfer set forth in
Section 2--"Procedures for Accepting the Offer and Tendering Shares" or (ii)
request such shareholder's broker, dealer, commercial bank, trust company or
other nominee to effect the transaction for the shareholder. A shareholder
whose Shares are registered in the name of a broker, dealer, commercial bank,
trust company or other nominee must contact such person if such shareholder
wishes to tender such Shares.
Any shareholder of Headhunter who wishes to tender Shares and cannot deliver
certificates representing such Shares and all other required documents to the
Depositary on or prior to the Expiration Date (as defined herein) or who cannot
comply with the procedures for book-entry transfer on a timely basis may tender
such Shares pursuant to the guaranteed delivery procedure set forth in Section
2--"Procedures for Accepting the Offer and Tendering Shares."
Questions and requests for assistance may be directed to the Information
Agent at the address and telephone number set forth on the back cover of this
Offer to Purchase. Additional copies of this Offer to Purchase, the Letter of
Transmittal, the Notice of Guaranteed Delivery and other related materials may
be obtained from the Information Agent. Shareholders may also contact their
broker, dealer, commercial bank, trust company or other nominee for copies of
these documents.
-----------------
The Information Agent for the Offer is:
[LOGO] Georgeson Shareholder
August 31, 2001
TABLE OF CONTENTS
Page
----
SUMMARY TERM SHEET.......................................................................... ii
INTRODUCTION................................................................................ 1
1. Terms of the Offer...................................................................... 2
2. Procedures for Accepting the Offer and Tendering Shares................................. 5
3. Withdrawal Rights....................................................................... 7
4. Acceptance for Payment and Payment for Shares........................................... 8
5. Material Federal Income Tax Consequences................................................ 9
6. Price Range of the Shares............................................................... 9
7. Possible Effects of the Offer on the Market for the Shares; Nasdaq Listing; Exchange Act
Registration; Margin Regulations........................................................ 10
8. Certain Information Concerning Headhunter............................................... 11
9. Certain Information Concerning Career Holdings and CB Merger Sub, Inc................... 12
10. Source and Amount of Funds.............................................................. 13
11. Background of the Offer; Contacts with Headhunter....................................... 13
12. The Merger Agreement; The Stockholder Agreements........................................ 16
13. Purpose of Offer; Plans for Headhunter.................................................. 28
14. Dividends and Distributions............................................................. 29
15. Conditions of the Offer................................................................. 29
16. Legal Matters; Required Regulatory Approvals............................................ 31
17. Fees and Expenses....................................................................... 33
18. Miscellaneous........................................................................... 34
Schedule I Directors and Executive Officers of Career Holdings, Inc., CB
Merger Sub, Inc., Tribune Company and Knight Ridder Digital
i
SUMMARY TERM SHEET
Career Holdings, Inc., through its wholly owned subsidiary, CB Merger Sub,
Inc., is offering to purchase all of the outstanding common stock (including
the associated junior participating preferred stock purchase rights) of
HeadHunter.NET, Inc. for $9.25 per share in cash. The following summary term
sheet briefly outlines the material provisions of the offer. It is not intended
to be a substitute for the information contained in the remainder of this Offer
to Purchase. You are urged to read carefully the entire Offer to Purchase and
related Letter of Transmittal prior to making any decision regarding your
shares because this summary term sheet is not complete and may not include all
information that is important to you.
Principal Terms
. Career Holdings, Inc., through its wholly owned subsidiary, CB Merger
Sub, Inc., is offering to buy all of the outstanding shares of common
stock of HeadHunter.NET, Inc., including the associated junior
participating preferred stock purchase rights issued pursuant to
Headhunter's shareholder protection rights agreement, as amended. The
tender price is $9.25 per share in cash, without interest. If you are
the record owner of your shares and you tender your shares to us, you
will not have to pay broker fees or similar expenses. If you own your
shares through a broker or nominee and your broker or nominee tenders
your shares on your behalf, your broker or nominee may charge you a fee
for doing so. You should consult your broker or other nominee to
determine whether any charges will apply. See "Introduction" and Section
1--"Terms of the Offer" on pages 1 and 2.
. The offer is the first step in the planned acquisition of all of the
outstanding shares of Headhunter common stock, as provided in our merger
agreement with Headhunter. If the offer is successful, under the merger
agreement, provided certain conditions are met, CB Merger Sub will be
merged with and into Headhunter, and each remaining share of Headhunter
common stock (including the associated junior preferred stock purchase
rights) will be converted into the right to receive $9.25 per share in
cash. If the offer is consummated, provided certain conditions are met,
we will cause the merger to take place with the approval of shareholders
by voting the shares that we acquire in the offer (which will represent
at least a majority of the outstanding shares on a fully-diluted basis)
in favor of the merger. If at least 90% of the shares are tendered in
the offer, we will cause the merger to take place without action by any
other shareholder. See "Introduction" and Section 12-- "The Merger
Agreement; The Stockholder Agreements"on pages 1 and 16.
. You will not have dissenters' rights in the tender offer; however, to
the extent that you have not tendered your shares in the tender offer,
you will have dissenters' rights in the merger.
. The offer will expire at 12:00 midnight, New York City time, on Friday,
September 28, 2001, unless we extend the offer.
. If we decide to extend the offer, we will issue a press release giving
the new expiration date no later than 9:00 a.m., New York City time, on
the first business day after the previously scheduled expiration of the
offer.
Headhunter Board Recommendation
. The Headhunter board of directors has unanimously approved the merger
agreement, the offer and the merger and determined that each is fair and
in the best interests of Headhunter and its shareholders. The Headhunter
board recommends that shareholders of Headhunter accept the offer and
tender their shares pursuant to the offer.
Conditions
We are not required to complete the offer unless specified conditions are
met, including:
. the number of shares of Headhunter common stock validly tendered and not
withdrawn prior to the expiration of the offer equals at least a
majority of the outstanding shares of Headhunter common
ii
stock, after giving maximum effect to the exercise of all options,
warrants and other rights to purchase, and the conversion or exchange of
all securities convertible or exchangeable into, shares of Headhunter
common stock outstanding at the expiration date of the offer, whether or
not vested, exercised or converted at the time of determination, and
. U.S. federal antitrust clearance for the acquisition of shares of
Headhunter common stock is obtained.
SeeSection 15--"Conditions of the Offer" on page 29.
Financing
. The offer is not conditioned on our obtaining financing. We have entered
into an investment agreement with Tribune Company and Knight Ridder
Digital, two of our stockholders, under which they have agreed to
purchase shares of our preferred stock for an aggregate purchase price
of $201 million. The aggregate purchase price of the shares of preferred
stock will provide financing adequate to enable us to acquire all of the
outstanding shares of Headhunter common stock and satisfy our funding
obligations under the merger agreement. See Section 10--"Source and
Amount of Funds" on page 13.
Stockholder Agreements
. Certain shareholders of Headhunter have agreed to tender a total of
5,524,966 shares in the offer, constituting approximately 27.1% of the
total number of shares of Headhunter common stock issued and outstanding
as of August 28, 2001. These shareholders have also agreed that they
will not transfer those Headhunter shares subject to the stockholder
agreements prior to the expiration of such agreements and that, if
necessary, they will vote those shares in favor of the merger and
against any competing transactions. See Section 12--"The Merger
Agreement; The Stockholder Agreements" on page 16.
Procedures for Tendering
If you wish to accept the offer, this is what you must do:
. If you are a record holder of Headhunter shares, you must complete and
sign the enclosed Letter of Transmittal and send it with your stock
certificate to American Stock Transfer & Trust Company, the depositary
for the offer. These materials must reach the depositary before the
offer expires. Detailed instructions are contained in the Letter of
Transmittal and in Section 2--"Procedures for Accepting the Offer and
Tendering Shares" on page 5.
. If you are a record holder but your stock certificate is not available
or you cannot deliver it to the depositary before the offer expires, you
may be able to tender your shares using the enclosed notice of
guaranteed delivery. Please call our information agent, Georgeson
Shareholder Communications Inc., at (800) 223-2064 for assistance. See
Section 2--"Procedures for Accepting the Offer and Tendering Shares" on
page 5.
. If you hold your shares through a broker or nominee, you should contact
your broker or nominee to tender your shares.
Withdrawal Rights
. If, after tendering your shares in the offer, you decide that you do NOT
want to accept the offer, you can withdraw your shares by instructing
the depositary before the offer expires. If you tendered by giving
instructions to a broker or nominee, you must instruct the broker or
nominee to arrange for the withdrawal of your shares. See Section
3--"Withdrawal Rights" on page 7.
iii
Extension of Offering Period
. Without the consent of Headhunter, we may extend the offer beyond the
scheduled expiration date if required by applicable law or if, at that
date, any of the conditions to our offer have not been satisfied or
waived.
. If, on the expiration date of the offer, (1) any applicable waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act has not
expired or been terminated or (2) there is any pending proceeding by a
governmental entity or any statute, law or regulation is enacted or
promulgated, which has certain specified adverse effects on us or
Headhunter or our or its ability to consummate the transactions
contemplated by the merger agreement, and Headhunter is contesting that
event as required by the merger agreement, then we have agreed that we
will extend the offer from time to time until November 7, 2001.
. We may elect to provide a "subsequent offering period" for the offer.
Subsequent offering periods, if included, will be additional periods of
not less than three business days or more than twenty business days in
the aggregate beginning after we have purchased shares tendered during
the offer, during which period you may tender, but not withdraw, your
shares and receive the offer consideration. There can be no assurance
that we will elect to provide a subsequent offering period.
See Section 1--"Terms of the Offer" and Section 12--"The Merger Agreement;
The Stockholder Agreements" on pages 2 and 16.
Recent Headhunter Trading Prices
. The last sale price for Headhunter common stock was:
. $6.95 on August 23, 2001, the last trading day before we announced
the execution of the merger agreement with Headhunter, and
. $9.19 on August 30, 2001, the last trading day before the
commencement of the offer.
. Before deciding whether to tender, you should obtain a current market
quotation for the shares.
See Section 7--"Possible Effects on the Market for the Shares; Nasdaq
Listing; Exchange Act Registration; Margin Regulations" on page 10.
Consequences of Not Tendering Your Shares
. If the merger described above takes place, shareholders not tendering in
the offer will receive the same amount of cash per share that they would
have received had they tendered their shares in the offer, subject to
any dissenters' rights properly perfected under Georgia law. Therefore,
if the merger takes place, the only difference to you between tendering
your shares and not tendering your shares is that you will be paid
earlier if you tender your shares.
. If the merger does not take place, however, the number of shareholders
and the number of shares of Headhunter that are still in the hands of
the public may be so small that there no longer will be an active public
trading market (or, possibly, there may not be any public trading
market) for Headhunter common stock. Also, Headhunter may no longer be
required to make filings with the Securities and Exchange Commission or
otherwise comply with the SEC rules relating to publicly held companies.
See Section 7--"Possible Effects on the Market for the Shares; Nasdaq
Listing; Exchange Act Registration; Margin Regulations" and Section 12--"The
Merger Agreement; The Stockholder Agreements" on pages 10 and 16.
iv
Further Information
If you have questions about the offer, you can call our Information Agent:
Georgeson Shareholder Communications Inc.
17 State Street, 10th Floor
New York, New York 10004
Banks and Brokers Call Collect:
(212) 440-9800
All Others Call Toll Free:
(800) 223-2064
v
To the Holders of Shares of Common Stock of HeadHunter.NET, Inc.:
INTRODUCTION
CB Merger Sub, Inc., a Georgia corporation ("Purchaser") and a wholly owned
subsidiary of Career Holdings, Inc., a Delaware corporation ("Career
Holdings"), is offering to purchase all of the outstanding shares of common
stock, $.01 par value per share (the "Company Common Stock"), of
HeadHunter.NET, Inc., a Georgia corporation ("Headhunter"), including the
associated junior participating preferred stock purchase rights (the "Rights"
and, together with the Company Common Stock, the "Shares") issued pursuant to a
Shareholder Protection Rights Agreement, dated as of April 15, 2000, between
Headhunter and American Stock Transfer & Trust Company, as amended by Amendment
No. 1 to the Shareholder Protection Rights Agreement, dated as of February 27,
2001, and as further amended by Amendment No. 2 to the Shareholder Protection
Rights Agreement, dated as of August 24, 2001 (collectively, the "Rights
Agreement"), at a purchase price of $9.25 per share, net to the seller in cash,
without interest thereon (the "Offer Price"), on the terms and subject to the
conditions set forth in this Offer to Purchase and in the related Letter of
Transmittal (which, as amended or supplemented from time to time, collectively
constitute the "Offer"). As used herein, "we," "us" or "our" refers to Career
Holdings and Purchaser.
We are making the Offer under the Agreement and Plan of Merger (the "Merger
Agreement"), dated as of August 24, 2001, among Headhunter, Career Holdings and
Purchaser. Following the consummation of the Offer and the satisfaction or
waiver of certain conditions, Purchaser will merge with and into Headhunter
(the "Merger"), with Headhunter continuing as the surviving corporation (the
"Surviving Corporation"). In the Merger, each Share issued and outstanding
immediately prior to the Effective Time (as defined herein) (other than Shares
held in the treasury of Headhunter and any Shares owned by Career Holdings or
Purchaser and other than Shares held by shareholders who properly perfect
dissenters' rights under the Georgia Business Corporation Code (the "GBCC"))
will be automatically cancelled and extinguished and be converted into the
right to receive $9.25 in cash, without interest, or any higher price paid per
Share in the Offer (the "Merger Consideration"). Section 12 contains a more
detailed description of the Merger Agreement. Section 5 describes the material
federal income tax consequences of the sale or exchange of Shares in the Offer
and the Merger.
We are not required to purchase any Shares unless there shall have been
validly tendered and not withdrawn prior to the expiration of the Offer such
number of Shares that would constitute at least a majority of the Shares that
in the aggregate would be outstanding determined on a fully diluted basis
(after giving maximum effect to the exercise of all options, warrants and other
rights to purchase, and the conversion or exchange of all securities
convertible or exchangeable into, Shares outstanding at the expiration date of
the Offer, whether or not vested, exercised or converted at the time of
expiration of the Offer) (the "Minimum Condition"). Subject to the prior
written consent of Headhunter, we reserve the right (subject to the applicable
rules and regulations of the Securities and Exchange Commission (the "SEC")),
which we presently have no intention of exercising, to waive or reduce the
Minimum Condition and to elect to purchase a smaller number of Shares. The
Offer is also subject to certain other terms and conditions. See Sections 1,
15, and 16.
You will not be required to pay brokerage fees or commissions or, except as
described in Instruction 6 of the Letter of Transmittal, stock transfer taxes
on the purchase of Shares in the Offer. However, if you do not complete and
sign the Substitute Form W-9 that is included in the Letter of Transmittal, you
may be subject to a required backup federal income tax withholding of 30.5% of
the gross proceeds payable to you. See Section 2. We will pay all charges and
expenses of American Stock Transfer & Trust Company, as Depositary, and
Georgeson Shareholder Communications Inc., as Information Agent, incurred in
connection with the Offer. See Section 17.
The Board of Directors of Headhunter (the "Headhunter Board") has determined
that the Offer and the Merger are fair and in the best interests of Headhunter
and its shareholders, has approved the Offer, the Merger and the Merger
Agreement and recommends that shareholders of Headhunter accept the Offer and
tender their Shares pursuant to the Offer.
1
Credit Suisse First Boston Corporation ("CSFB"), Headhunter's financial
advisor, has delivered to the Headhunter Board a written opinion that, as of
August 24, 2001 and based upon and subject to certain assumptions and matters
set forth in the opinion, the per Share consideration of $9.25 in cash to be
received by the holders of Shares in the Offer and the Merger was fair from a
financial point of view to holders of Shares. A copy of the written opinion of
CSFB is contained in Headhunter's Solicitation/Recommendation Statement on
Schedule 14D-9 which has been filed with the SEC and is being mailed to you
with this document. You are urged to read this opinion carefully and in its
entirety for a description of the assumptions made, matters considered and
limitations of the review undertaken by CSFB. The CSFB opinion does not
constitute a recommendation to any shareholder as to whether or not such
shareholder should tender Shares pursuant to the Offer or as to how such
shareholder should vote or act on any matter relating to the Merger.
Headhunter has informed us that, as of August 28, 2001, there were (i)
20,407,872 Shares issued and outstanding, (ii) 2,912,565 outstanding stock
options, of which options to purchase 2,427,765 Shares have an exercise price
less than the Offer Price, and (iii) 827,226 Shares reserved for issuance upon
the exercise of outstanding warrants, all of which have an exercise price less
than the Offer Price. Based on Shares, options and warrants outstanding as of
August 28, 2001, if Purchaser acquires at least 11,831,432 Shares in the Offer,
ownership of such shares will give Purchaser control of a majority of the
outstanding Shares, assuming that options with exercise prices equal to or
greater than the Offer Price will not be exercised. Accordingly, Purchaser
would have sufficient voting power to approve the Merger without the
affirmative vote of any other shareholder.
Headhunter has advised us that each of its executive officers and directors
intends to tender all Shares that they own in the Offer. In addition, pursuant
to the Stockholder Agreements (as defined below), certain shareholders of
Headhunter have agreed to tender a total of 5,524,966 Shares pursuant to the
Offer, constituting approximately 27.1% of the total number of Shares
outstanding as of August 28, 2001.
The approval and adoption of the Merger Agreement by Headhunter requires the
affirmative vote of holders of a majority of the outstanding Shares. As a
result, if the Minimum Condition and the other conditions to the Offer are
satisfied and the Offer is completed, Purchaser will own a sufficient number of
Shares to ensure that the Merger Agreement will be approved by Headhunter's
shareholders. See Sections 12 and 15.
The Offer is conditioned upon the fulfillment of the conditions described in
Section 15. The Offer will expire at 12:00 midnight, New York City time, on
Friday, September 28, 2001, unless the Purchaser extends it.
This Offer to Purchase and the related Letter of Transmittal contain
important information which you should read carefully before you make any
decision with respect to the Offer.
1. Terms of the Offer.
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any extension or
amendment), we will accept for payment and pay for all Shares validly tendered
prior to the Expiration Date and not withdrawn in accordance with the
procedures set forth in Section 3 of this Offer to Purchase. The term
"Expiration Date" means 12:00 midnight, New York City time, on Friday,
September 28, 2001, unless the Purchaser, in accordance with the Merger
Agreement, extends the period during which the Offer is open, in which event
the term "Expiration Date" means the latest time and date on which the Offer,
as so extended (other than any extension with respect to the Subsequent
Offering Period described below), expires.
The Offer is conditioned upon the satisfaction of the Minimum Condition and
the other conditions set forth in Section 15. Subject to compliance with
applicable rules and regulations of the SEC and the provisions of the Merger
Agreement, the Purchaser may waive any or all of the conditions to its
obligation to purchase Shares
2
pursuant to the Offer (other than the Minimum Condition). If by the initial
Expiration Date or any subsequent Expiration Date any or all of the conditions
to the Offer have not been satisfied or waived, subject to the provisions of
the Merger Agreement as described below, the Purchaser may, without the consent
of Headhunter, elect to (i) terminate the Offer and return all tendered Shares
to Tendering Shareholders, (ii) waive all of the unsatisfied conditions (other
than the Minimum Condition or the HSR Condition) and, subject to any required
extension, purchase all Shares validly tendered by the Expiration Date and not
properly withdrawn, or (iii) extend the Offer and, subject to the right of
shareholders to withdraw Shares until the new Expiration Date, retain the
Shares that have been tendered until the expiration of the Offer as extended.
The Merger Agreement provides that if, at the scheduled Expiration Date of
the Offer, (i) the waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), pursuant to the Offer
shall not have expired or been terminated (the "HSR Condition") or (ii) any of
the events described in clause (a) or (b) of Section 15 shall have occurred and
be continuing and Headhunter is contesting such event to the extent required by
the Merger Agreement (unless such conditions are waived by the Purchaser),
Purchaser will extend the Offer from time to time until November 7, 2001.
We may also extend the Offer:
. for any period required by applicable rules, regulations, interpretations
or positions of the SEC or its staff applicable to the Offer;
. for one or more periods that each do not exceed 10 business days if any
condition of the Offer has not been satisfied or waived by us;
. for one or more periods not exceeding five business days in the aggregate
if the Minimum Condition is met but less than 90% of the Shares have been
validly tendered and not withdrawn;
. for a period or periods sufficient to comply with applicable law if we
increase the consideration to be paid in the Offer; and
. for one or more periods, not exceeding five business days in the
aggregate, in our sole discretion for any reason.
If, at the Expiration Date, the conditions to the Offer described in Section
15 have not been satisfied or earlier waived, then, subject to the provisions
of the Merger Agreement, we may extend the Expiration Date for an additional
period or periods of time by giving oral or written notice of the extension to
the Depositary. During any such extension, all Shares previously tendered and
not withdrawn will remain subject to the Offer and subject to your right to
withdraw Shares. See Sections 3 and 12.
We have also agreed in the Merger Agreement that, following our acceptance
for payment of Shares in the Offer, we may, in our sole discretion, in
compliance with applicable law, provide a subsequent offering period in
accordance with Rule 14d-11 of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") (a "Subsequent Offering Period").
A Subsequent Offering Period is an additional period of time from three to
20 business days in length, beginning after the Purchaser accepts for payment,
and pays for, Shares tendered in the Offer, during which time shareholders may
tender, but not withdraw, their Shares and receive the Offer Price. Rule 14d-11
provides that the Purchaser may include a Subsequent Offering Period so long
as, among other things, (i) the Offer remained open for a minimum of 20
business days and has expired, (ii) all conditions to the Offer are deemed
satisfied or waived by the Purchaser on or before the Expiration Date, (iii)
the Purchaser accepts and promptly pays for all Shares tendered during the
Offer prior to Expiration Date, (iv) the Purchaser announces the results of the
Offer, including the approximate number and percentage of Shares deposited in
the Offer, no later than 9:00 a.m. Eastern time on the next business day after
the Expiration Date and immediately begins the Subsequent Offering Period, and
(v) the Purchaser immediately accepts and promptly pays for Shares as they are
tendered during the Subsequent Offering Period. In the event that the Purchaser
elects to provide a Subsequent Offering Period, it will provide an announcement
to that effect by issuing a press release to a national news service on the
next
3
business day after the previously scheduled Expiration Date. There can be no
assurance that the Purchaser will provide a Subsequent Offering Period.
Subject to the applicable regulations of the SEC and the terms of the Merger
Agreement, we expressly reserve the right, in our sole discretion, at any time
or from time to time, to: (i) delay purchase of or, regardless of whether we
previously purchased any Shares, payment for any Shares pending receipt of any
regulatory or governmental approvals or expiration of the applicable regulatory
or governmental waiting period specified in Section 16; (ii) terminate the
Offer (whether or not any Shares have previously been accepted for payment) if
any condition referred to in Section 15 has not been satisfied; and (iii) waive
any condition (other than the Minimum Condition) of the Offer, in each case, by
giving oral or written notice of the delay, termination or waiver to the
Depositary and, other than in the case of any waiver, by making a public
announcement thereof.
In the Merger Agreement, we have agreed that, without the prior written
consent of Headhunter, we will not (i) reduce the number of Shares subject to
the Offer, (ii) reduce the Offer Price, (iii) impose conditions to the Offer
other than those set forth in Section 15 or amend any material term of the
Offer in any manner adverse to holders of Shares, (iv) except as provided in
the Merger Agreement, extend the expiration date of the Offer, (v) change the
form of consideration payable in the Offer or (vi) amend or waive the Minimum
Condition.
We acknowledge (i) that Rule 14e-1(c) under the Exchange Act requires us to
pay the consideration offered or return the Shares tendered promptly after the
termination or withdrawal of the Offer and (ii) that we may not delay purchase
of, or payment for (except as described above), any Shares upon the occurrence
of any event specified in Section 15 without extending the period of time
during which the Offer is open.
Our rights described above are in addition to our rights described in
Section 15. Any extension, delay, termination or amendment of the Offer will be
followed as promptly as practicable by a public announcement. An announcement
in the case of an extension will be made no later than 9:00 a.m., New York City
time, on the next business day after the previously scheduled Expiration Date
in accordance with the public announcement requirements of Rule 14e-1(d) under
the Exchange Act. Without limiting the manner in which we may choose to make
any public announcement, subject to applicable law (including Rules 14d-4(d)
and 14d-6(c) under the Exchange Act, which require that material changes be
promptly disseminated to holders of Shares in any manner reasonably designed to
inform them of such changes), we will have no obligation to publish, advertise
or otherwise communicate any such public announcement other than by issuing a
press release to a national news service.
If we make a material change in the terms of the Offer, or if we waive a
material condition to the Offer, we will extend the Offer and disseminate
additional tender offer materials to the extent required by Rules 14d-4(d),
14d-6(c) and 14e-1 under the Exchange Act. The minimum period during which a
tender offer must remain open following material changes in the terms of the
offer, other than a change in price or a change in percentage of securities
sought, depends upon the facts and circumstances, including the materiality of
the changes.
In the SEC's view, an offer should remain open for a minimum of five
business days from the date the material change is first published, sent or
given to shareholders, and, if material changes are made with respect to
information that approaches the significance of price and the percentage of
securities sought, a minimum of 10 business days may be required to allow for
adequate dissemination and investor response. With respect to a change in
price, a minimum 10 business-day period from the date of the change is
generally required to allow for adequate dissemination to shareholders.
Accordingly, if prior to the Expiration Date we decrease the number of Shares
being sought, or increase or decrease the consideration offered pursuant to the
Offer, and if the Offer is scheduled to expire at any time earlier than the
period ending on the 10th business day from the date that notice of the
increase or decrease is first published, sent or given to holders of Shares, we
will extend the Offer at least until the expiration of such period of 10
business days. For purposes of the Offer, a "business day" means any day other
than a Saturday, Sunday or a federal holiday and consists of the time period
from 12:01 a.m. through 12:00 midnight, New York City time.
4
Headhunter has provided us with its shareholder lists and security position
listings for the purpose of disseminating the Offer to holders of Shares. We
will mail this Offer to Purchase, the related Letter of Transmittal and other
relevant materials to record holders of Shares and we will furnish the
materials to brokers, dealers, commercial banks, trust companies and similar
persons whose names, or the names of whose nominees, appear on the
securityholder lists or, if applicable, who are listed as participants in a
clearing agency's security position listing, for forwarding to beneficial
owners of Shares.
2. Procedures for Accepting the Offer and Tendering Shares.
Valid Tender of Shares. Except as set forth below, in order for you to
tender Shares in the Offer, the Depositary must receive the Letter of
Transmittal (or a facsimile), properly completed and signed, together with any
required signature guarantees or an Agent's Message (as defined below) in
connection with a book-entry delivery of Shares and any other documents that
the Letter of Transmittal requires at one of its addresses set forth on the
back cover of this Offer to Purchase on or prior to the Expiration Date and
either (i) you must deliver certificates representing the Shares ("Share
Certificates") to the Depositary or you must cause your Shares to be tendered
pursuant to the procedure for book-entry transfer set forth below and the
Depositary must receive Book-Entry Confirmation, in each case on or prior to
the Expiration Date, or (ii) you must comply with the guaranteed delivery
procedures set forth below.
The term "Agent's Message" means a message transmitted by the Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of a
Book-Entry Confirmation, which states that the Book-Entry Transfer Facility has
received an express acknowledgment from the participant in the Book-Entry
Transfer Facility tendering the Shares which are the subject of the Book-Entry
Confirmation that the participant has received and agrees to be bound by the
terms of the Letter of Transmittal and that we may enforce that agreement
against the participant.
The method of delivery of Share Certificates, the Letter of Transmittal and
all other required documents, including delivery through the Book-Entry
Transfer Facility, is at your option and sole risk, and delivery will be
considered made only when the Depositary actually receives the Share
Certificates. If delivery is by mail, registered mail with return receipt
requested, properly insured, is recommended. In all cases, you should allow
sufficient time to ensure timely delivery.
Book-Entry Transfer. The Depositary will make a request to establish an
account with respect to the Shares at the Book-Entry Transfer Facility for
purposes of the Offer by August 31, 2001. Any financial institution that is a
participant in the system of the Book-Entry Transfer Facility may make
book-entry delivery of Shares by causing the Book-Entry Transfer Facility to
transfer the Shares into the Depositary's account at the Book-Entry Transfer
Facility in accordance with the Book-Entry Transfer Facility's procedures.
However, although Shares may be delivered through book-entry transfer into the
Depositary's account at the Book-Entry Transfer Facility, the Depositary must
receive the Letter of Transmittal (or facsimile), properly completed and
signed, with any required signature guarantees, or an Agent's Message in
connection with a book-entry transfer, and any other required documents, at one
of its addresses set forth on the back cover of this Offer to Purchase on or
before the Expiration Date, or you must comply with the guaranteed delivery
procedure set forth below.
Delivery of documents to the Book-Entry Transfer Facility in accordance with
the Book-Entry Transfer Facility's procedures does not constitute delivery to
the Depositary.
Signature Guarantees. A bank, broker, dealer, credit union, savings
association or other entity which is a member in good standing of the
Securities Transfer Agents Medallion Program (an "Eligible Institution") must
guarantee signatures on all Letters of Transmittal, unless the Shares tendered
are tendered (i) by a registered holder of Shares who has not completed either
the box labeled "Special Payment Instructions" or the box labeled "Special
Delivery Instructions" on the Letter of Transmittal or (ii) for the account of
an Eligible Institution. See Instruction 1 of the Letter of Transmittal.
5
If the Share Certificates are registered in the name of a person other than
the signer of the Letter of Transmittal, or if payment is to be made to, or
Share Certificates for unpurchased Shares are to be issued or returned to, a
person other than the registered holder, then the tendered certificates must be
endorsed or accompanied by appropriate stock powers, signed exactly as the name
or names of the registered holder or holders appear on the certificates, with
the signatures on the certificates or stock powers guaranteed by an Eligible
Institution as provided in the Letter of Transmittal. See Instructions 1 and 5
of the Letter of Transmittal.
If the Share Certificates are forwarded separately to the Depositary, a
properly completed and duly executed Letter of Transmittal (or facsimile) must
accompany each delivery of Share Certificates.
Guaranteed Delivery. If you want to tender Shares in the Offer and your
Share Certificates are not immediately available or time will not permit all
required documents to reach the Depositary on or before the Expiration Date or
the procedures for book-entry transfer cannot be completed on time, your Shares
may nevertheless be tendered if you comply with all of the following guaranteed
delivery procedures:
(a) your tender is made by or through an Eligible Institution;
(b) the Depositary receives, as described below, a properly completed and
signed Notice of Guaranteed Delivery, substantially in the form made
available by us, prior to the Expiration Date; and
(c) the Depositary receives the Share Certificates (or a Book-Entry
Confirmation) representing all tendered Shares, in proper form for transfer
together with a properly completed and duly executed Letter of Transmittal
(or facsimile), with any required signature guarantees (or, in the case of a
book-entry transfer, an Agent's Message) and any other documents required by
the Letter of Transmittal within three trading days after the date of
execution of the Notice of Guaranteed Delivery. A "trading day" is any day
on which the New York Stock Exchange is open for business.
You may deliver the Notice of Guaranteed Delivery by hand, mail or facsimile
transmission to the Depositary. The Notice of Guaranteed Delivery must include
a guarantee by an Eligible Institution in the form set forth in the Notice of
Guaranteed Delivery.
Notwithstanding any other provision of the Offer, we will pay for Shares
only after timely receipt by the Depositary of Share Certificates for, or of
Book-Entry Confirmation with respect to, the Shares, a properly completed and
duly executed Letter of Transmittal (or facsimile thereof), together with any
required signature guarantees (or, in the case of a book-entry transfer, an
Agent's Message) and any other documents required by the appropriate Letter of
Transmittal. Accordingly, payment might not be made to all tendering
shareholders at the same time, and will depend upon when the Depositary
receives Share Certificates or Book-Entry Confirmation that the Shares have
been transferred into the Depositary's account at the Book-Entry Transfer
Facility.
Backup Federal Income Tax Withholding. Under the backup federal income tax
withholding laws applicable to certain shareholders (other than certain exempt
shareholders, including, among others, all corporations and certain foreign
individuals), the Depositary may be required to withhold 30.5% of the amount of
any payments made to those shareholders pursuant to the Offer. To prevent
backup federal income tax withholding, you must provide the Depositary with
your correct taxpayer identification number and certify that you are not
subject to backup federal income tax withholding by completing the Substitute
Form W-9 included in the Letter of Transmittal or if you are an exempt foreign
individual, on Form W-8. See Instruction 8 of the Letter of Transmittal.
Appointment as Proxy. By executing the Letter of Transmittal, you
irrevocably appoint our designees, and each of them, as your agents,
attorneys-in-fact and proxies, with full power of substitution, in the manner
set forth in the Letter of Transmittal, to the full extent of your rights with
respect to the Shares that you tender and that we accept for payment and with
respect to any and all other Shares and other securities or rights issued or
issuable in respect of those Shares on or after the date of this Offer to
Purchase. All such powers of attorney and
6
proxies will be considered irrevocable and coupled with an interest in the
tendered Shares. This appointment will be effective when, and only to the
extent that, we accept your Shares for payment in accordance with the terms of
the Offer. Upon such acceptance for payment, all other powers of attorney and
proxies given by you with respect to your Shares and such other securities or
rights prior to such payment will be revoked, without further action, and no
subsequent powers of attorney and proxies may be given by you (and, if given,
will not be deemed effective). Our designees will, with respect to the Shares
and such other securities and rights for which the appointment is effective, be
empowered to exercise all your voting and other rights as they in their sole
discretion may deem proper at any annual or special meeting of Headhunter's
shareholders, or any adjournment or postponement thereof, or by written consent
in lieu of any such meeting or otherwise. In order for Shares to be deemed
validly tendered, immediately upon the acceptance for payment of such Shares,
we or our designee must be able to exercise full voting, consent and other
rights with respect to such Shares and other securities, including voting at
any meeting of shareholders.
Determination of Validity. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance for payment of
any tender of Shares will be determined by us, in our sole discretion, which
determination will be final and binding on all parties. We reserve the absolute
right to reject any or all tenders determined by us not to be in proper form or
the acceptance of or payment for which may, in the opinion of our counsel, 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 of Shares of any
particular shareholder whether or not similar defects or irregularities are
waived in the case of other shareholders.
Our interpretation of the terms and conditions of the Offer will be final
and binding. No tender of Shares will be deemed to have been validly made until
all defects and irregularities with respect to the tender have been cured or
waived by us. None of Career Holdings, Purchaser or any of their affiliates or
assigns, the Depositary, the Information Agent or any other person or entity
will be under any duty to give any notification of any defects or
irregularities in tenders or incur any liability for failure to give any such
notification.
The tender of your Shares pursuant to any of the procedures described above
will constitute your acceptance of the Offer, as well as your representation
and warranty that you have full power and authority to tender and assign the
tendered Shares as specified in the Letter of Transmittal. Our acceptance for
payment of Shares tendered pursuant to any of the procedures described above
will constitute a binding agreement between us and you upon the terms and
subject to the conditions of the Offer.
3. Withdrawal Rights.
Except as described in this Section 3, tenders of Shares made in the Offer
are irrevocable. You may withdraw Shares that you have previously tendered in
the Offer at any time on or before the Expiration Date and, unless theretofore
accepted for payment as provided herein, may also be withdrawn at any time
after October 29, 2001.
If, for any reason, acceptance for payment of any Shares tendered in the
Offer is delayed, or we are unable to accept for payment or pay for Shares
tendered in the Offer, then, without prejudice to our rights set forth in this
document, the Depositary may, nevertheless, on our behalf, retain Shares that
you have tendered, and you may not withdraw your Shares except to the extent
that you are entitled to and duly exercise withdrawal rights as described in
this Section 3. Any such delay will be by an extension of the Offer to the
extent required by law.
In order for your withdrawal to be effective, you must deliver a written or
facsimile transmission notice of withdrawal to the Depositary at one of its
addresses set forth on the back cover of this Offer to Purchase. Any such
notice of withdrawal must specify your name, the number of Shares that you want
to withdraw, and (if Share Certificates have been tendered) the name of the
registered holder of the Shares as shown on the Share Certificate, if different
from your name. If Share Certificates have been delivered or otherwise
identified to the Depositary, then prior to the physical release of such
certificates, you must submit the serial numbers shown on
7
the particular certificates evidencing the Shares to be withdrawn and an
Eligible Institution must guarantee the signature on the notice of withdrawal,
except in the case of Shares tendered for the account of an Eligible
Institution. If Shares have been tendered pursuant to the procedures for
book-entry transfer set forth in Section 2, the notice of withdrawal must also
specify the name and number of the account at the appropriate Book-Entry
Transfer Facility to be credited with the withdrawn Shares, in which case a
notice of withdrawal will be effective if delivered to the Depositary by any
method of delivery described in the first sentence of this paragraph.
You may not rescind a withdrawal of Shares. Any Shares that you withdraw
will be considered not validly tendered for purposes of the Offer, but you may
tender your Shares again at any time before the Expiration Date by following
any of the procedures described in Section 2.
All questions as to the form and validity (including time of receipt) of
notices of withdrawal will be determined by us, in our sole discretion, which
determination will be final and binding. None of Career Holdings, Purchaser or
any of their affiliates or assigns, the Depositary, the Information Agent or
any other person or entity will be under any duty to give any notification of
any defects or irregularities in any notice of withdrawal or incur any
liability for failure to give any such notification.
4. Acceptance for Payment and Payment for Shares.
Upon the terms and subject to the conditions of the Offer (including, if we
extend or amend the Offer, the terms and conditions of the Offer as so extended
or amended), we will purchase, by accepting for payment, and will pay for, all
Shares validly tendered and not withdrawn (as permitted by Section 3) prior to
the Expiration Date promptly after the later of (i) the Expiration Date and
(ii) the satisfaction or waiver of the conditions to the Offer set forth in
Section 15. In addition, subject to applicable rules of the SEC and the terms
of the Merger Agreement, we reserve the right to delay acceptance for payment
of, or payment for, Shares pending receipt of any regulatory or governmental
approvals specified in Section 16.
In all cases, we will pay for Shares purchased in the Offer only after
timely receipt by the Depositary of (i) Share Certificates or timely
confirmation (a "Book-Entry Confirmation") of the book-entry transfer of the
Shares into the Depositary's account at The Depository Trust Company (the
"Book-Entry Transfer Facility") pursuant to the procedures set forth in Section
2; (ii) the appropriate Letter of Transmittal (or a facsimile), properly
completed and duly executed, with any required signature guarantees or an
Agent's Message in connection with a book-entry transfer; and (iii) any other
documents that the Letter of Transmittal requires.
For purposes of the Offer, we will be deemed to have accepted for payment,
and purchased, Shares validly tendered and not withdrawn if, as and when we
give oral or written notice to the Depositary of our acceptance of the Shares
for payment pursuant to the Offer. In all cases, upon the terms and subject to
the conditions of the Offer, payment for Shares purchased pursuant to the Offer
will be made by deposit of the purchase price for the Shares with the
Depositary, which will act as agent for tendering shareholders for the purpose
of receiving payment from us and transmitting payment to validly tendering
shareholders.
Under no circumstances will we pay interest on the purchase price for
Shares, regardless of any extension of the Offer or any delay in making such
payment.
If we do not purchase any tendered Shares pursuant to the Offer for any
reason, or if you submit Share Certificates representing more Shares than you
wish to tender, we will return Share Certificates representing unpurchased or
untendered Shares, without expense to you (or, in the case of Shares delivered
by book-entry transfer into the Depositary's account at the Book-Entry Transfer
Facility pursuant to the procedures set forth in Section 2, the Shares will be
credited to an account maintained within the Book-Entry Transfer Facility), as
promptly as practicable following the expiration, termination or withdrawal of
the Offer.
8
If, prior to the Expiration Date, we increase the price offered to holders
of Shares in the Offer, we will pay the increased price to all holders of
Shares that we purchase in the Offer, whether or not the Shares were tendered
before the increase in price.
We reserve the right, subject to the provisions of the Merger Agreement, to
transfer or assign, in whole or from time to time in part, to one or more of
our wholly owned subsidiaries the right to purchase all or any portion of the
Shares tendered in the Offer, but any such transfer or assignment will not
relieve us of our obligations under the Offer or prejudice your rights to
receive payment for Shares validly tendered and accepted for payment in the
Offer.
5. Material Federal Income Tax Consequences.
Your receipt of cash for Shares in the Offer or the Merger will be a taxable
transaction for federal income tax purposes and may also be a taxable
transaction under applicable state, local, foreign and other tax laws. For
federal income tax purposes, if you sell or exchange your Shares for cash in
the Offer or the Merger, you would generally recognize gain or loss equal to
the difference between the amount of cash received and your tax basis for the
Shares that you sold or exchanged. That gain or loss will be capital gain or
loss (assuming you hold your Shares as a capital asset) and any such capital
gain or loss will be long term if, as of the date of sale or exchange, you have
held the Shares for more than one year or will be short term if, as of such
date, you have held the Shares for one year or less.
The discussion above may not be applicable to certain types of shareholders,
including shareholders who acquired Shares through the exercise of employee
stock options or otherwise as compensation, individuals who are not citizens or
residents of the United States, foreign corporations, or entities that are
otherwise subject to special tax treatment under the Internal Revenue Code
(such as insurance companies, tax-exempt entities and regulated investment
companies).
The federal income tax discussion set forth above is included for general
information only. You are urged to consult your tax advisor with respect to the
specific tax consequences to you of the Offer and Merger, including federal,
state, local and foreign tax consequences.
6. Price Range of the Shares.
According to Headhunter's Annual Report on Form 10-K for the fiscal year
ended December 31, 2000, the Shares are principally traded on the Nasdaq
National Market ("Nasdaq") under the symbol "HHNT." The following table sets
forth, for the periods indicated, the reported high and low sale prices for the
Shares on Nasdaq, as reported on Headhunter's Form 10-K with respect to periods
occurring in fiscal 1999 and 2000 and published financial sources with respect
to periods occurring in the current fiscal year. During these periods,
Headhunter has paid no cash dividends on the Shares.
High Low
------ ------
Fiscal 1999
From August 19, 1999 through September 30, 1999 $19.19 $10.13
Quarter Ended December 31, 1999................ 15.50 10.63
Fiscal 2000
Quarter Ended March 31, 2000................... 26.13 10.75
Quarter Ended June 30, 2000.................... 18.13 7.75
Quarter Ended September 30, 2000............... 10.13 4.47
Quarter Ended December 31, 2000................ 11.25 4.75
Fiscal 2001
Quarter Ended March 31, 2001................... 9.38 4.69
Quarter Ended June 30, 2001.................... 5.50 3.30
From July 1, 2001 through August 30, 2001...... 9.19 4.19
9
Under the terms of the Merger Agreement, Headhunter is not permitted to
declare or pay dividends with respect to the Shares without the prior written
consent of Career Holdings.
On August 23, 2001, the last full day of trading prior to the announcement
of the execution of the Merger Agreement, the reported closing price per Share
on Nasdaq was $6.95. On August 30, 2001, the last full day of trading prior to
the commencement of the Offer, the reported closing price per Share on Nasdaq
was $9.19.
As of August 28, 2001, there were 173 holders of record of shares and
20,407,872 outstanding shares. We have been advised by Headhunter that it has
never declared or paid any cash dividends and does not anticipate that it will
pay any cash dividends in the foreseeable future.
We urge you to obtain current market quotations for the Shares.
7. Possible Effects of the Offer on the Market for the Shares; Nasdaq Listing;
Exchange Act Registration; Margin Regulations.
Possible Effects of the Offer on the Market for the Shares. The purchase of
Shares pursuant to the Offer will reduce the number of Shares that might
otherwise trade publicly and could adversely affect the liquidity and market
value of the remaining Shares held by the public. The purchase of Shares
pursuant to the Offer can also be expected to reduce the number of holders of
Shares. We cannot predict whether the reduction in the number of Shares that
might otherwise trade publicly would have an adverse or beneficial effect on
the market price for, or marketability of, the Shares or whether it would cause
future market prices to be greater or less than the Offer Price.
Nasdaq Quotation. Depending upon the number of Shares purchased pursuant to
the Offer, the Shares may no longer meet the standards for continued inclusion
on Nasdaq, which requires that an issuer either (i) have at least 750,000
publicly held shares, held by at least 400 round lot shareholders, with a
market value of at least $5,000,000, have at least two market makers, have a
minimum bid price of $1 and have either (A) net tangible assets of at least $4
million or (B) shareholders' equity of at least $10 million or (ii) have at
least 1,100,000 publicly held shares, held by at least 400 round lot
shareholders, with a market value of at least $15,000,000, have a minimum bid
price of $3, have at least 4 market makers and have either (X) a market
capitalization of at least $50,000,000 or (Y) total assets and revenues each of
at least $50,000,000.
If the Shares are no longer eligible for Nasdaq quotation, quotations might
still be available from other sources. The extent of the public market for the
Shares and the availability of such quotations would, however, depend upon the
number of holders of such Shares remaining at such time, the interest in
maintaining a market in such Shares on the part of securities firms, the
possible termination of registration of such Shares under the Exchange Act as
described below and other factors.
Exchange Act Registration. The Shares are currently registered under the
Exchange Act. The purchase of the Shares pursuant to the Offer may result in
the Shares becoming eligible for deregistration under the Exchange Act.
Registration of the Shares may be terminated upon application by Headhunter to
the SEC if the Shares are not listed on a "national securities exchange" and
there are fewer than 300 record holders of Shares. Termination of registration
of the Shares under the Exchange Act would substantially reduce the information
that Headhunter would be required to furnish to its shareholders and the SEC
and would make certain provisions of the Exchange Act, such as the short-swing
profit recovery provisions of Section 16(b) and the requirements of furnishing
a proxy statement in connection with shareholders' meetings pursuant to Section
14(a) or 14(c) and the related requirement of an annual report, no longer
applicable to Headhunter. If the Shares are no longer registered under the
Exchange Act, the requirements of Rule 13e-3 under the Exchange Act with
respect to "going private" transactions would no longer be applicable to
Headhunter. In addition, the ability of "affiliates" of Headhunter and persons
holding "restricted securities" of Headhunter to dispose of such securities
pursuant to Rule 144 promulgated under the Securities Act of 1933, as amended
(the "Securities Act"), may be impaired or, with respect to certain persons,
eliminated. If registration of the Shares under the Exchange Act were
terminated, the
10
Shares would no longer be eligible for stock exchange listing or Nasdaq
reporting. We believe that the purchase of the Shares pursuant to the Offer may
result in the Shares becoming eligible for deregistration under the Exchange
Act, and it would be our intention to cause Headhunter to make an application
for termination of registration of the Shares as soon as possible after
successful completion of the Offer if the Shares are then eligible for such
termination.
If registration of the Shares is not terminated prior to the Merger, then
the registration of the Shares under the Exchange Act and the listing of the
Shares on the Nasdaq will be terminated following the completion of the Merger.
Margin Regulations. The Shares are currently "margin securities" under the
regulations of the Board of Governors of the Federal Reserve System, which have
the effect, among other things, of allowing brokers to extend credit on the
collateral of the Shares for the purpose of buying, carrying or trading in
securities ("Purpose Loans"). Depending upon factors such as the number of
record holders of the Shares and the number and market value of publicly held
Shares, following the purchase of Shares pursuant to the Offer, the Shares
might no longer constitute "margin securities" for purposes of the Federal
Reserve Board's margin regulations and, therefore, could no longer be used as
collateral for Purpose Loans made by brokers. In addition, if registration of
the Shares under the Exchange Act were terminated, the Shares would no longer
constitute "margin securities."
8. Certain Information Concerning Headhunter.
Headhunter's principal executive offices are located at 333 Research Court,
Suite 200, Norcross, Georgia 30092. Its telephone number at such offices is
(770) 349-2400. Headhunter was incorporated in Georgia in 1998. The following
description of Headhunter and its business has been taken from Headhunter's
Annual Report on Form 10-K for the fiscal year ended December 31, 2000 and is
qualified in its entirety by reference to Headhunter's Form 10-K.
Headhunter provides comprehensive online recruitment offerings for employers
and job seekers. Headhunter brings employers and job seekers together by (1)
providing employers, recruiters and advertising agencies with the ability to
advertise job openings and review resumes online, and (2) providing job seekers
with the tools to find, research, explore, evaluate and apply to a broad range
of job opportunities online.
Headhunter generates revenue primarily from fees paid by employers,
recruiters and agencies to post job opportunities. Headhunter also generates
revenue from access fees paid by employers, recruiters and agencies for viewing
its resume database. To a lesser extent, Headhunter derives revenue from
selling web page sponsorships and banner advertising, cross-posting jobs to
partnered websites and hosting online career fairs. As of August 28, 2001,
Headhunter employed approximately 263 employees.
Financial Projections. Headhunter does not, as a matter of course, make
public any forecasts as to its future financial performance on an annual basis.
However, in connection with our review of the transactions contemplated by the
Merger Agreement, Headhunter provided us with projected financial information
for 2001 and 2002. Such information included, among other things, the following
projections of net revenues, gross profit and earnings before interest,
taxation, depreciation and amortization ("EBITDA") (in millions): $67.3, $66.5
and $2.9 for 2001; and $101.5, $100.2 and $25.4 for 2002. These projections
should be read together with the financial statements of Headhunter that can be
obtained from the SEC as described below.
11
It is our understanding that the projections were not prepared with a view
to public disclosure or compliance with published guidelines of the SEC or the
guidelines established by the American Institute of Certified Public
Accountants regarding projections or forecasts and are included herein only
because such information was provided to us in connection with our evaluation
of a business combination transaction. These projections are subject to various
risks and uncertainties that could cause actual results to differ materially
from the projections. Headhunter has advised us that its internal financial
forecasts (upon which the projections provided to us were based in part) are,
in general, prepared solely for internal use and capital budgeting and other
management decisions and are subjective in many respects and thus susceptible
to interpretations and periodic revision based on actual experience and
business developments. The projections also reflect numerous assumptions (not
all of which were provided to us), all made by management of Headhunter, with
respect to industry performance, general business, economic, market and
financial conditions and other matters, all of which are difficult to predict,
many of which are beyond Headhunter's control, and none of which were subject
to approval by us. Accordingly, there can be no assurance that the assumptions
made in preparing the projections will prove accurate.
It is expected that there will be differences between actual and projected
results, and actual results may be materially greater or less than those
contained in the projections. The inclusion of the projections herein should
not be regarded as an indication that we or Headhunter or any of our respective
affiliates or representatives considered or consider the projections to be a
reliable prediction of future events, and the projections should not be relied
upon as such. Neither we nor Headhunter, nor any of our respective affiliates
or representatives, have made or makes any representation to any person
regarding the ultimate performance of Headhunter compared to the information
contained in the projections, and none of us intends to update or otherwise
revise the projections to reflect circumstances existing after the date when
made or to reflect the occurrence of future events even in the event that any
or all of the assumptions underlying the projections are shown to be in error.
We acknowledge that the Private Securities Litigation Reform Act of 1995 does
not apply to the information set forth in this Offer to Purchase, including the
projections set forth in this Section 8.
Headhunter's common stock is registered under the Exchange Act. Accordingly,
Headhunter files annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any reports, statements
or other information filed at the SEC's public reference room at 450 Fifth
Street, N.W., Washington, D.C. 20549, or at the SEC's public reference rooms in
New York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330
for further information on the public reference rooms. Headhunter's SEC filings
are also available to the public from commercial document retrieval services
and at the Internet world wide web site maintained by the SEC at
http://www.sec.gov.
9. Certain Information Concerning Career Holdings and CB Merger Sub, Inc.
Career Holdings is a Delaware corporation formed by Tribune Company
("Tribune") and KnightRidder.com, Inc., later renamed Knight Ridder Digital, in
July 2000 in order to acquire CareerBuilder, Inc. ("CareerBuilder") and
CareerPath.com, Inc. ("CareerPath"). Career Holdings acquired the outstanding
capital stock of CareerPath and CareerBuilder in August 2000. Shortly
thereafter, the CareerPath operations were absorbed by CareerBuilder.
CareerBuilder is an online recruitment company and a wholly owned subsidiary of
Career Holdings. Knight Ridder Digital is a Delaware corporation in the
business of creating and maintaining a variety of online services, including
Real Cities, a national network of city and regional destination sites in 55
U.S. markets. Knight Ridder Digital is a wholly owned subsidiary of
Knight-Ridder, Inc. Tribune is a Delaware corporation and is one of the
country's premier media companies, operating businesses in broadcasting,
publishing and on the Internet. Each of Tribune and Knight-Ridder, Inc. files
annual, quarterly and special reports, proxy statements and other information
with the SEC. You may inspect or copy these reports and other information at
the SEC's public reference facilities and they are available for inspection in
the same manner as set forth with respect to Headhunter in Section 8.
Purchaser is a newly formed Georgia corporation organized in connection with
the Offer and the Merger, and is a wholly owned subsidiary of Career Holdings.
12
The principal offices of Career Holdings and Purchaser are located at 10780
Parkridge Blvd., Suite 200, Reston, Virginia 20191, and the telephone number
for both Career Holdings and Purchaser is (703) 259-5500.
Except for Career Holdings' ownership of the outstanding capital stock of
CareerPath and CareerBuilder, neither Career Holdings nor Purchaser has any
significant assets or liabilities, nor do they engage in activities, other than
those incident to their formation and capitalization, Career Holdings'
operation of CareerPath and CareerBuilder and the transactions contemplated by
the Offer and the Merger.
The name, citizenship, business address, business telephone number,
principal occupation or employment and five-year business history of each of
the directors and executive officers of Career Holdings, Purchaser, Tribune and
Knight Ridder Digital are described in Schedule I hereto.
10. Source and Amount of Funds.
Career Holdings estimates that the total amount of funds required to
purchase all of the Shares pursuant to the Offer and pay all amounts due with
respect to stock options and warrants to purchase Shares as a result of the
Offer and the Merger (excluding payment of related fees and expenses) will be
approximately $201 million. The Investment Agreement provides that on the date
that is two business days prior to the date that Shares are accepted for
payment by Purchaser pursuant to the Offer, each of Tribune and Knight Ridder
Digital will purchase 1,005,000 shares of preferred stock of Career Holdings at
a purchase price of $100 per share. The proceeds of such issuance of shares
will be sufficient to provide funds to purchase all of the Shares pursuant to
the Offer. The Investment Agreement does not contain any conditions to the
funding by the Career Holdings stockholders. See Section 12. The funds required
to purchase Shares accepted for payment pursuant to the Offer will be obtained
by Purchaser through a capital contribution from Career Holdings. The Offer is
not conditioned on obtaining financing.
11. Background of the Offer; Contacts with Headhunter.
In late June 2001, Robert M. Montgomery, Jr., the Chief Executive Officer of
Headhunter, had a telephone call with a senior executive of a party (the "Other
Party"), in which such senior executive indicated that the Other Party was
interested in discussing a business combination with Headhunter. Subsequent to
this telephone call, at
a meeting of the Headhunter Board, Mr. Montgomery described his telephone
conversation to the Headhunter Board and the Board authorized him to contact
CSFB, Headhunter's financial advisor. CSFB then sent to the Other Party a draft
confidentiality agreement. On July 4, 2001, the confidentiality agreement was
discussed and executed by the Other Party and preliminary meetings were held in
Chicago, Illinois on July 5 and 6, 2001.
On July 11 and 12, 2001, representatives of the Other Party met with
representatives of Headhunter in Atlanta, Georgia at the offices of Alston &
Bird LLP ("A&B"), counsel to Headhunter, to conduct business, financial and
legal due diligence reviews. Thereafter, between July 13 and 26, numerous
discussions were held between Headhunter and the Other Party and their
respective advisors in connection with due diligence matters.
On July 27, 2001, the Other Party sent a preliminary, non-binding proposal
to Headhunter in which the Other Party proposed to acquire Headhunter in a cash
tender offer followed by a merger in which all Headhunter shareholders would be
paid $7.00 per share in cash. After consideration of the Other Party's proposal
on July 31, 2001, the Headhunter Board directed CSFB to call the Other Party's
financial advisor to discuss the proposal and indicate that $7.00 per share was
not adequate. After further guidance from the Headhunter Board and management
team, on August 1 and 2, 2001, CSFB initiated calls to other potentially
interested parties. CSFB contacted a total of seven additional parties on
behalf of Headhunter. Among the additional parties contacted during this
two-day period were Knight Ridder Digital and Tribune, the parent companies of
Career Holdings. The contact with Knight Ridder Digital and Tribune followed a
telephone call by Robert McGovern, the Chief Executive Officer of Career
Holdings, to Mr. Montgomery.
On August 3, 2001, Dan Finnigan of Knight Ridder Digital returned the
telephone call from CSFB and indicated that they were interested in discussing
a business combination with Headhunter and that Knight Ridder Digital would
coordinate with Tribune and Career Holdings. Following the telephone call on
August 3, 2001,
13
CSFB forwarded a confidentiality agreement to Mr. Finnigan, to be executed by
Career Holdings, and it was agreed that a due diligence review would begin on
August 7, 2001 at the offices of A&B in Atlanta. On August 3, 2001, CSFB also
had additional discussions with the Other Party's financial advisor in which
CSFB reiterated that the Other Party's initial $7.00 per share offer was
inadequate.
On August 4, 2001, CSFB had telephone discussions with Mr. McGovern and with
representatives of Updata Capital, Inc. ("Updata"), the financial advisor to
Career Holdings, to organize the scheduled due diligence review sessions. The
confidentiality agreement was executed by both parties on August 6, 2001,
whereupon Headhunter promptly forwarded certain confidential financial
information to Career Holdings, Knight Ridder Digital and Tribune. On August 7,
2001, as previously agreed, representatives of Career Holdings, Knight Ridder
Digital and Tribune began their due diligence review in A&B's offices in
Atlanta.
Meanwhile, on August 7, 2001, CSFB had additional discussions with the Other
Party's financial advisor in which CSFB was informed that the Other Party had
increased its offer to $8.00 in cash, but that it wanted Headhunter to
negotiate exclusively with the Other Party. Other potential terms were also
discussed, including that the Other Party wanted an option to purchase all
shares held by ITC Holding Company, Inc. ("ITC"), Headhunter's largest
shareholder, and all shares held by directors and executive officers of
Headhunter as part of any transaction. CSFB responded to the Other Party's
financial advisor that Headhunter was willing to consider a business
combination but that $8.00 in cash was still inadequate. On August 9, 2001, the
Other Party's financial advisor contacted CSFB and increased its offer to $8.25
per share, provided that Headhunter would agree to certain other terms of the
transaction.
On August 10, 2001, Career Holdings sent a written indication of its
interest to acquire Headhunter at $8.50 to $9.00 per share in cash, subject to
completion of a due diligence review. On August 13, 2001, after discussions
between Updata and CSFB, Career Holdings sent a letter in which it confirmed a
revised offer of $9.00 per share in cash. Also, on August 13, 2001, CSFB
contacted the financial advisor for the Other Party and told them that
Headhunter had now received another all-cash offer at a higher price, that
Headhunter was not in a position to agree to an exclusivity arrangement with
any party, and that Headhunter hoped the Other Party would remain interested
and consider increasing its offer. Later on August 13, 2001, Mr. Montgomery
spoke with a senior executive of the Other Party and it was agreed that the
Other Party would complete its remaining due diligence review in Atlanta
immediately. Finally, on August 13, 2001, as a result of Career Holdings'
revised offer, Headhunter gave the ten-day written notice to the Other Party as
required under one of Headhunter's contracts with the Other Party (the
"Contract") indicating that Headhunter may enter into a change of control
transaction. This notice was required under the Contract before Headhunter
could enter into a definitive merger or acquisition agreement with any other
party.
From August 14 to 17, 2001, business, financial and legal representatives of
both Career Holdings and the Other Party met separately in A&B's offices in
Atlanta to complete their due diligence reviews.
On August 16, 2001, at 8:30 a.m., the Headhunter Board held a meeting in
which CSFB updated the Headhunter Board once again on discussions to date with
Career Holdings and the Other Party. CSFB also discussed with the Headhunter
Board all of the other parties contacted by CSFB about a possible business
combination within the past month. A&B also went through a detailed review with
the Headhunter Board of its fiduciary duties in the context of the potential
transactions it was considering.
On August 17, 2001, the Headhunter Board met to discuss the draft of a
definitive agreement delivered by the Other Party. The Headhunter Board was
advised that a draft of a definitive agreement was expected from Career
Holdings later that day. The Headhunter Board then discussed the next steps in
the negotiations with each of Career Holdings and the Other Party.
On August 18, 2001, the Other Party sent a letter to Headhunter in which it
increased its offer to $8.50 per share in cash and stated that its offer would
expire at 11:59 p.m. on Monday, August 20, 2001. On August 19, 2001, at 12:30
p.m., the Headhunter Board again met to discuss the revised offer from the
Other Party and the deadline to accept or reject it. Because the Contract
included the ten-day notice provision, the Other Party was the only party with
whom Headhunter could enter into a definitive agreement for a business
combination prior to
14
the expiration of the ten-day notice period on August 24, 2001. As the offer
from the Other Party was scheduled to expire on August 20, Headhunter
determined to negotiate simultaneously with the Other Party and Career Holdings
but informed Career Holdings that it would need to obtain all necessary
corporate approvals, negotiate and execute a definitive agreement and deliver
such documents to Headhunter in the form of an offer that would remain open
until such time as Headhunter could accept it.
After much discussion among representatives for Headhunter and Career
Holdings, Career Holdings increased its offer to $9.25 per share in cash, but
indicated it would not be able to obtain the required board approvals by Career
Holdings, Knight Ridder Digital and Tribune until August 22, 2001.
On August 19, 2001, CSFB also contacted the financial advisor for the Other
Party and indicated that Headhunter was willing to work with the Other Party to
negotiate a definitive agreement, but advised that another party still had made
and not withdrawn a higher cash price per share. Finally, on August 19, 2001,
at 9:00 p.m., the Headhunter Board met again in order to be updated by its
legal and financial advisors on the status of all negotiations with the Other
Party and Career Holdings.
Between August 20 and 22, 2001, the Headhunter Board met repeatedly to
review the status of and direct the course of negotiations with the Other Party
and Career Holdings. During such time period, Headhunter and its
representatives also worked diligently with representatives of both the Other
Party and Career Holdings to identify all open issues and negotiate final
proposed definitive agreements even though, in the case of the Other Party, the
original deadline for the expiration of its offer had passed.
At 6:00 p.m. on Monday, August 20, 2001, the Headhunter Board met and was
updated by its legal and financial advisors on the status of negotiations. The
Headhunter Board requested CSFB to seek clarity from each of the bidders about
their respective approval processes and timing. In response to questions from
directors, A&B
once again reviewed with the Headhunter Board its fiduciary obligations under
these circumstances. Again at 11:00 p.m. on August 20, 2001, the Headhunter
Board met to be updated on the status of contract negotiations with Career
Holdings and the Other Party.
On Tuesday, August 21, 2001, senior executives of Knight Ridder Digital and
Tribune each telephoned William H. Scott III, the Chairman of the Board of
Directors, to provide assurances that their respective management teams fully
supported the transaction and that they believed their respective boards of
directors would approve the transaction, but that it was just not possible to
have an actual meeting before August 22. At 6:00 p.m. on Tuesday, August 21,
2001, the Headhunter Board met again. It was reported that the required board
approvals by Career Holdings, Knight Ridder Digital and Tribune were scheduled
for the next day, August 22. Once again, the Headhunter Board discussed with
counsel its fiduciary obligations.
By early evening on Wednesday, August 22, 2001, the proposed definitive
agreements between Headhunter and the Other Party and Headhunter and Career
Holdings had been substantially negotiated. Each party's proposed definitive
agreements provided for an all-cash tender offer and a follow-up merger at the
same cash consideration as to be paid in the tender offer. The Other Party's
offer stood at $8.50 per share in cash and Career Holdings' offer stood at
$9.25 in cash. The proposed definitive agreements of each bidder were
substantially the same in most material respects, except that the proposed
definitive agreement with the Other Party reflected several issues that had not
been finalized, the most important of which was that the Other Party insisted
on a stock option agreement from ITC and the Headhunter directors and executive
officers and Career Holdings had agreed not to require such an option. ITC,
which holds approximately 26.5% of the Headhunter Shares, had steadfastly
refused to execute such an option arrangement with either Career Holdings or
the Other Party.
On August 22, 2001, the boards of directors of Career Holdings, Knight
Ridder Digital and Tribune each unanimously approved a proposed definitive
agreement with Headhunter. Career Holdings executed the definitive agreement on
August 22, 2001 and delivered it to Headhunter along with assurances that the
offer represented by the executed definitive agreement would remain open for
acceptance by Headhunter until early Friday morning, August 24, 2001. At a
meeting on the evening of August 22, 2001, the Headhunter Board met again and
decided, in view of the offer made by Career Holdings for a deal at $9.25 per
share in cash, that it
15
could no longer proceed with the cash proposal of $8.50 from the Other Party.
Following its meeting on the evening of August 22, the Headhunter Board
instructed CSFB to communicate to the Other Party that Headhunter could not
proceed with an offer at $8.50 but would consider a higher offer together with
improved terms approved by the board of directors of the Other Party if such an
improved offer could be made prior to August 24, 2001.
CSFB spoke by telephone to the financial advisor for the Other Party on the
evening of August 22 and communicated this information. The financial advisor
for the Other Party indicated that the Other Party was likely to be unable to
reconvene its board of directors to consider a higher bid by August 24, 2001
and, in any event, may not wish to increase its offer under any circumstances.
On August 23, 2001, at 6:00 p.m., the Headhunter Board met again and
reviewed the status and received reports from CSFB and A&B. CSFB also
summarized its analysis that had been done in connection with an anticipated
request from the Headhunter Board for a fairness opinion about the
consideration to be received by the Headhunter shareholders from a financial
point of view. CSFB did not, however, deliver its fairness opinion at this
meeting.
At approximately 3:05 a.m. on August 24, 2001, the Headhunter Board convened
a meeting. The offer made by Career Holdings was scheduled to expire at 5:00
a.m., Eastern Time, on August 24, 2001. At this meeting CSFB reiterated its
fairness opinion analysis from the Headhunter Board meeting the preceding
evening and delivered its opinion that the consideration to be received in a
transaction with Career Holdings was fair to the Headhunter shareholders from a
financial point of view. After discussion and consideration of certain factors
and reasons, the Headhunter Board unanimously determined that the Merger
Agreement and the transactions contemplated thereby, including the Offer and
the Merger, are fair to and in the best interests of the Headhunter
shareholders, unanimously approved the Merger Agreement and the transactions
contemplated thereby, including the Offer and the Merger, and unanimously
recommended that the Headhunter shareholders accept the Offer and tender their
Shares pursuant to the Offer. In addition, the Headhunter Board unanimously
approved the terms of the Stockholder Agreements.
Following the meeting of the Headhunter Board, on August 24, 2001,
Headhunter, Career Holdings and Purchaser executed the Merger Agreement, and
ITC and each of the members of the Headhunter Board executed the Stockholder
Agreements.
On August 24, 2001, prior to the opening of the financial markets,
CareerBuilder, Knight Ridder Digital and Tribune issued a press release
announcing the execution of the Merger Agreement and the related documents.
On August 31, 2001, Career Holdings and Purchaser commenced the Offer.
12. The Merger Agreement; The Stockholder Agreements.
The Merger Agreement.
The following summary description of the Merger Agreement is qualified in
its entirety by reference to the agreement itself, which we have filed as an
exhibit to the Tender Offer Statement on Schedule TO that we filed with the
SEC. You may examine and copy the Tender Offer Statement as set forth in
Section 8.
The Offer. The Merger Agreement provides for the commencement of the Offer
by Purchaser. The obligation of Purchaser to accept for payment and pay for
Shares validly tendered pursuant to the Offer is subject to the Minimum
Condition, the HSR Condition and the prior satisfaction or waiver by us of the
conditions to the Offer set forth in Section 15 hereof. The Merger Agreement
provides that, without the prior written consent of Headhunter, we will not (i)
reduce the number of Shares subject to the Offer, (ii) reduce the Offer Price,
(iii) impose additional conditions to the Offer other than the conditions set
forth in Section 15 or amend any material term of the Offer in any manner
adverse to holders of Shares, (iv) except as described in the next two
paragraphs, extend the expiration date of the Offer, (v) change the form of
consideration payable in the Offer or (vi) amend or waive the Minimum
Condition.
16
We have agreed with Headhunter that we will not extend the Offer without the
consent of Headhunter; provided, however, that without the consent of
Headhunter, (i) we may extend the Offer as required by applicable law
(including for any period required by any rule, regulation, interpretation or
position of the SEC or the staff thereof), (ii) if, immediately prior to the
scheduled expiration date of the Offer (as it may be extended), any condition
to the Offer has not been satisfied or waived, we may, in our sole discretion,
extend the expiration date of the Offer for one or more periods (not in excess
of 10 business days each), (iii) if, immediately prior to the scheduled
expiration date of the Offer (as it may be extended), the Shares validly
tendered and not properly withdrawn pursuant to the Offer constitute at least
the Minimum Condition but less than 90% of the outstanding Shares, we may, in
our sole discretion, extend the Offer for one or more periods not to exceed an
aggregate of five business days, notwithstanding that all conditions to the
Offer are satisfied as of such expiration date of the Offer, (iv) we may extend
the Offer in connection with an increase in the consideration to be paid
pursuant to the Offer so as to comply with applicable rules and regulations of
the SEC, or (v) in our sole discretion, we may extend the Offer for any other
reason for one or more periods not to exceed an aggregate of five business
days.
We have also agreed with Headhunter that if, at any scheduled expiration
date of the Offer, the HSR Condition or any of the events set forth in
paragraphs (a) or (b) of Section 15 shall have occurred and be continuing and
Headhunter is contesting that event as required by the Merger Agreement, then
we will extend the Offer from time to time, provided that in no event shall we
be required to extend the Offer beyond November 7, 2001.
The Merger. If the Offer is consummated, the Merger Agreement provides that
Purchaser shall merge with and into Headhunter following the satisfaction or
waiver of the conditions to the Merger contained in the Merger Agreement. As a
result of the Merger, the separate corporate existence of Purchaser will cease
and Headhunter will continue as the Surviving Corporation.
At the effective time of the Merger (the "Effective Time"), (i) the Articles
of Incorporation, as amended, of Headhunter shall be the Articles of
Incorporation of the Surviving Corporation, (ii) the Bylaws of Purchaser shall
be the Bylaws of the Surviving Corporation, (iii) the directors of Purchaser
shall become the directors of the Surviving Corporation and (iv) the officers
of Purchaser shall become the officers of the Surviving Corporation.
Headhunter has agreed that it will, at our request, as soon as practicable
following the purchase of Shares pursuant to the Offer, (i) prepare and file
with the SEC a proxy statement relating to the Merger Agreement and to respond
to any comments of the SEC and its staff and to cause the proxy statement to be
mailed to its shareholders as promptly as practicable after responding to all
such comments to the satisfaction of the staff and (ii) convene a meeting of
its shareholders for the purpose of considering the approval of the Merger
Agreement and the Merger. If Purchaser or any other subsidiary of Career
Holdings owns at least 90% of the outstanding Shares, Career Holdings,
Purchaser and Headhunter shall take all necessary and appropriate action to
cause the Merger to become effective as soon as practicable after expiration of
the Offer without a meeting of the shareholders of Headhunter, in accordance
with Section 14-2-1104 of the GBCC.
Conversion of Securities. At the Effective Time, by virtue of the Merger and
without any action on the part of Purchaser, Headhunter or the holders of any
securities of Purchaser or Headhunter, each Share (other than Shares held in
the treasury of Headhunter, or owned by Career Holdings or Purchaser, and other
than Shares owned by shareholders, if any, who are entitled to and who properly
perfect dissenters' rights under the GBCC) shall be automatically cancelled and
extinguished and be converted into the right to receive from the Surviving
Corporation, in cash, the Merger Consideration. Each share of capital stock of
Purchaser issued and outstanding immediately prior to the Effective Time shall,
at the Effective Time, by virtue of the Merger and without any action on the
part of the holder of any shares of stock of Purchaser, be converted into and
become one fully paid and nonassessable share of common stock of the Surviving
Corporation.
The Merger Agreement provides that Career Holdings, the Surviving
Corporation or the designated paying agent will be entitled to deduct and
withhold from the consideration otherwise payable pursuant to the Merger
Agreement to any holder of Shares such amounts as Career Holdings or such
paying agent reasonably determines it is required to deduct and withhold with
respect to the making of such payment under the Internal Revenue Code or any
other applicable law.
17
Representations and Warranties. In the Merger Agreement, Headhunter has made
customary representations and warranties to Career Holdings and Purchaser. The
representations and warranties of Headhunter relate, among other things, to
organization, standing and power, and subsidiaries; capitalization; authority,
absence of conflicts, and required consents and filings; SEC filings, financial
statements and information provided; absence of undisclosed liabilities;
absence of certain changes or events; taxes; real properties; intellectual
property; agreements, contracts and commitments; litigation and product
liability; environmental matters; employee benefit plans; compliance with laws;
permits; labor matters; insurance; affiliate transactions; assets; warranty;
customers and suppliers; opinion of financial advisor; rights agreement; and
brokers.
Purchaser and Career Holdings have also made customary representations and
warranties to Headhunter. Representations and warranties of Purchaser and
Career Holdings relate, among other things, to their organization, good
standing and authority to enter into the Merger Agreement and to consummate the
transactions contemplated thereby; required filings and consents and absence of
conflicts; information provided; interim operations of Purchaser; and
financing.
Covenants Relating to the Conduct of Business. During the period from the
date of the Merger Agreement to the earlier of the termination of the Merger
Agreement in accordance with its terms or the Effective Time, Headhunter shall,
and shall cause each of its subsidiaries to, act in the ordinary course of
business, and use commercially reasonable efforts to maintain and preserve its
and each subsidiary's business organization, assets, and properties, keep
available the services of its present officers and employees and preserve its
advantageous business relationships with customers, strategic partners,
suppliers, distributors and others having business dealings with it to the end
that its goodwill and ongoing business shall be unimpaired at the Effective
Time. In addition, during that period, Headhunter shall not, and shall not
permit any of its subsidiaries to, without the prior written consent of Career
Holdings:
(a) (i) declare, set aside or pay any dividends on, or make any other
distributions (whether in cash, securities or other property) in respect of,
any of its capital stock (other than dividends and distributions by a direct
or indirect wholly owned subsidiary of Headhunter to its parent); (ii)
split, combine or reclassify any of its capital stock or issue or authorize
the issuance of any other securities in respect of, in lieu of or in
substitution for shares of its capital stock or any of its other securities;
or (iii) purchase, redeem or otherwise acquire any shares of its capital
stock or any other securities or any rights, warrants or options to acquire
any such shares or other securities;
(b) issue, deliver, sell, grant, pledge or otherwise dispose of or
encumber any shares of its capital stock, any other voting securities or any
securities convertible into or exchangeable for, or any rights, warrants or
options to acquire, any such shares, voting securities or convertible or
exchangeable securities (other than the issuance of Shares upon the exercise
of stock options or warrants outstanding on the date of the Merger Agreement
in accordance with their present terms);
(c) amend its articles of incorporation, by-laws or other comparable
charter or organizational documents, except as expressly provided by the
Merger Agreement;
(d) acquire (i) by merging or consolidating with, or by purchasing all or
a substantial portion of the assets or any stock of, or by any other manner,
any business or any corporation, partnership, joint venture, limited
liability company, association or other business organization or division
thereof or (ii) acquire any assets that are material, in the aggregate, to
Headhunter and its subsidiaries, taken as a whole, except purchases of
inventory and components in the ordinary course of business;
(e) except in the ordinary course of business, sell, lease, license,
pledge or otherwise dispose of or encumber any of properties or assets of
Headhunter or its subsidiaries;
(f) whether or not in the ordinary course of business, sell, dispose of,
or otherwise transfer any assets material to Headhunter and its
subsidiaries, taken as a whole (including any accounts, leases, contracts or
intellectual property or any assets or the stock of any subsidiaries, but
excluding the sale or non-exclusive license of products in the ordinary
course of business);
(g) adopt or implement any shareholder rights plan or, except as provided
in the Merger Agreement, alter or further amend the Rights Agreement or the
Rights;
18
(h) enter into an agreement with respect to any merger, consolidation,
liquidation or business combination, or any acquisition or disposition of
all or substantially all of the assets or securities of Headhunter or any of
its subsidiaries;
(i) (i) except as permitted under the Merger Agreement, incur or suffer
to exist any indebtedness for borrowed money other than such indebtedness
reflected on the balance sheet of Headhunter as of June 30, 2001 or
guarantee any such indebtedness of another person, (ii) issue, sell or amend
any debt securities or warrants or other rights to acquire any debt
securities of Headhunter or any of its subsidiaries, guarantee any debt
securities of another person, enter into any "keep well" or other agreement
to maintain any financial statement condition of another person or enter
into any arrangement having the economic effect of any of the foregoing,
(iii) make any loans, advances (other than routine advances to employees of
Headhunter in the ordinary course of business) or capital contributions to,
or investments in, any other person, other than Headhunter or any of its
direct or indirect wholly owned subsidiaries, or (iv) enter into any hedging
agreement or other financial agreement or arrangement fluctuations in
commodities prices or exchange rates;
(j) make any capital expenditures or other expenditures with respect to
property, plant or equipment in excess of $500,000 in the aggregate for
Headhunter and its subsidiaries, taken as a whole;
(k) make any change in accounting methods, principles or practices,
except insofar as may have been required by a change in generally accepted
accounting principles or, except as so required, change any assumption
underlying, or method of calculating, any bad debt, contingency or other
reserve;
(l) (i) pay, discharge, settle or satisfy any claims, liabilities or
obligations (whether absolute, accrued, asserted or unasserted, contingent
or otherwise), other than the payment, discharge or satisfaction, in the
ordinary course of business or in accordance with their terms as in effect
on the date of the Merger Agreement, of claims, liabilities or obligations
reflected or reserved against in, or contemplated by, the most recent
consolidated financial statements (or the notes thereto) of Headhunter
included in any reports, registration statements, forms and other documents
filed by Headhunter with the SEC prior to the date of the Merger Agreement
(to the extent so reflected or reserved against) or incurred since the date
of such financial statements in the ordinary course of business, or (ii)
waive any material benefits of, modify in any adverse respect, fail to
enforce, or consent to any matter with respect to which its consent is
required under, any confidentiality, standstill or similar agreements to
which Headhunter or any of its subsidiaries is a party;
(m) modify, amend or terminate any material contract or agreement to
which Headhunter or any of its subsidiaries is party, other than
modifications, terminations or amendments reflected on the disclosure
schedules provided by Headhunter to Career Holdings and Purchaser, or
knowingly waive, release or assign any material rights or claims (including
any write-off or other compromise of any accounts receivable of Headhunter
or any of its subsidiaries);
(n) (i) except in the ordinary course of business, enter into any
contract or agreement relating to the rendering of services or the
distribution, sale or marketing by third parties of the products of, or
products licensed by, Headhunter or any of its subsidiaries or (ii) license
any material intellectual property rights to or from any third party, other
than non-exclusive licenses which may not be canceled without penalty by
Headhunter or its subsidiaries upon written notice of 30 days or less;
(o) except as required to comply with applicable law or agreements, plans
or arrangements existing on the date of the Merger Agreement, (i) take any
action with respect to, adopt, enter into, terminate or amend any
employment, severance or similar agreement or benefit plan for the benefit
or welfare of any current or former director, officer, employee or
consultant or any collective bargaining agreement, (ii) increase in any
material respect the compensation or fringe benefits of, or pay any bonus
to, any director, officer, key employee or consultant, (iii) amend or
accelerate the payment, right to payment or vesting of any compensation or
benefits, including any outstanding options or any restricted stock awards
(with certain exceptions), (iv) pay any material benefit not currently
provided for under any benefit plan, (v) grant any awards under any bonus,
incentive, performance or other compensation plan or arrangement or benefit
plan,
19
including the grant of stock options, stock appreciation rights, stock based
or stock related awards, performance units or restricted stock, or the
removal of existing restrictions in any benefit plans or agreements or
awards made thereunder, or (vi) take any action other than in the ordinary
course of business to fund or in any other way secure the payment of
compensation or benefits under any employee plan, agreement, contract or
arrangement or benefit plan;
(p) make or rescind any tax election, settle or compromise any tax
liability or amend any tax return;
(q) commence any offering of Shares pursuant to the Headhunter's 2000
Employee Stock Purchase Plan;
(r) initiate, compromise or settle any material litigation or arbitration
proceeding;
(s) open or close any material facility or office;
(t) fail to maintain insurance at levels substantially comparable to
levels existing as of the date of the Merger Agreement;
(u) fail to pay accounts payable and other obligations in the ordinary
course of business; or
(v) authorize any of, or commit or agree, in writing or otherwise, to
take any of, the foregoing actions or any action which would cause any
representation or warranty of Headhunter set forth in the Merger Agreement
to be inaccurate under the applicable standard set forth in paragraph (e) of
Section 15 of this Offer to Purchase, or would materially impair or prevent
the satisfaction of any conditions set forth in Section 15 of this Offer to
Purchase or set forth below under "--Conditions Precedent".
No Solicitation. Under the Merger Agreement, neither Headhunter nor any of
its subsidiaries shall, and Headhunter shall cause its or their directors,
officers, employees, investment bankers, attorneys, accountants or other
agents, advisors or representatives not to, directly or indirectly (i) solicit,
initiate, participate in, or encourage or take any other action which
facilitate, any inquiries or the making of any proposal or offer that
constitutes, or may reasonably be expected to lead to, any Acquisition Proposal
(as defined below) or (ii) enter into, continue or otherwise participate in any
discussions or negotiations regarding, furnish to any person any information
with respect to, assist or participate in any effort or attempt by any person
with respect to, or otherwise cooperate in any way with, any Acquisition
Proposal. Notwithstanding the foregoing, prior to the acceptance for payment of
any Shares pursuant to the Offer, Headhunter may, to the extent required by the
fiduciary obligations of the Headhunter Board, as determined in good faith by
the Headhunter Board after consultation with outside counsel, in response to an
unsolicited Superior Proposal (as defined below) and subject to Headhunter's
compliance with its requirement to provide notice to Career Holdings of any
Acquisition Proposal, (x) furnish information with respect to Headhunter to the
person making such Superior Proposal pursuant to a customary confidentiality
agreement and (y) participate in discussions or negotiations with such person
regarding any Superior Proposal.
The Merger Agreement provides that the Headhunter Board shall recommend the
Offer and the Merger to the Headhunter shareholders, and neither the Headhunter
Board nor any committee thereof shall (i) except as otherwise permitted by the
Merger Agreement, withdraw or modify, or propose to withdraw or modify, in a
manner adverse to Career Holdings or Purchaser, the approval or recommendation
by the Headhunter Board or any such committee of the Merger Agreement, the
Offer or the Merger; (ii) cause or permit Headhunter to enter into any letter
of intent, memorandum of understanding, agreement in principle, acquisition
agreement, merger agreement or similar agreement (an "Acquisition Agreement")
constituting or relating to any Acquisition Proposal; or (iii) adopt, approve
or recommend, or propose to adopt, approve or recommend, any Acquisition
Proposal. Notwithstanding the foregoing, prior to the acceptance and payment of
Shares pursuant to the Offer and from the third business day following Career
Holdings' receipt of written notice advising Career Holdings that the
Headhunter Board has decided to accept a Superior Proposal, specifying the
material terms and conditions of such Superior Proposal and identifying the
person making such Superior Proposal, the Headhunter Board may, in response to
an unsolicited Superior Proposal, withdraw or modify the recommendation by the
20
Headhunter Board of the Merger Agreement, the Offer or the Merger or terminate
the Merger Agreement, if the Headhunter Board determines in good faith, after
consultation with outside counsel, that failure to do so would be inconsistent
with its fiduciary obligations (and concurrently therewith causes Headhunter to
enter into an Acquisition Agreement with respect to such Superior Proposal).
Nothing shall be deemed to permit Headhunter to take any action described in
clauses (ii) or (iii) of the first sentence of this paragraph unless it has
terminated the Merger Agreement and paid to Career Holdings the Termination Fee
(as defined below).
The Merger Agreement requires that Headhunter shall immediately advise
Career Holdings orally, with written confirmation to follow within 24 hours, of
any Acquisition Proposal or any request for nonpublic information in connection
with any Acquisition Proposal, or any inquiry with respect to, or that could
reasonably be expected to lead to any Acquisition Proposal, the material terms
and conditions of any such Acquisition Proposal or inquiry and the identity of
the person making any such Acquisition Proposal or inquiry. Headhunter shall
not provide any information to or participate in discussions or negotiations
with the person or entity making any Superior Proposal until two business days
after Headhunter has first notified Career Holdings of such Acquisition
Proposal as required by the preceding sentence. Headhunter shall (i) keep
Career Holdings informed of the status and details (including any change to the
terms) of any such Acquisition Proposal or inquiry, and (ii) if Career Holdings
shall make a counterproposal, consider and cause its financial and legal
advisors to negotiate on its behalf in good faith with respect to the terms of
such counterproposal. Contemporaneously with providing any information to a
third party in connection with any such Superior Proposal or inquiry,
Headhunter shall furnish a copy of such information to Career Holdings.
Nothing contained in the Merger Agreement shall be deemed to prohibit
Headhunter from taking and disclosing to its shareholders a position with
respect to a tender or exchange offer by a third party required pursuant to
Rule 14d-9 and 14e-2(a) promulgated under the Exchange Act; provided, however,
that, except as set forth above, in no event shall the Headhunter Board or any
committee thereof withdraw or modify, or propose to withdraw or modify, its
position with respect to the Merger Agreement, the Offer or the Merger or
adopt, approve or recommend, or propose to adopt, approve or recommend, any
Acquisition Proposal.
For purposes of the Merger Agreement, "Acquisition Proposal" means (i) any
inquiry, proposal or offer for a merger, consolidation, dissolution, sale of
substantial assets, tender offer, recapitalization, share exchange or other
business combination involving Headhunter or any of its subsidiaries, (ii) any
proposal for the issuance by Headhunter or any of its subsidiaries of over 15%
of its equity securities (provided that, so long as the Stockholder Agreements
are in full force and effect without material breach thereof solely for
purposes of paragraph (c) under "--Fees and Expenses" below, such percentage
shall be 40% of its equity securities) or (iii) any proposal or offer to
acquire in any manner, directly or indirectly, over 15% (provided that, so long
as the Stockholder Agreements are in full force and effect without material
breach there of solely for purposes of paragraph (c) under "--Fees and
Expenses" below, such percentage shall be 40%) of the equity securities or
consolidated total assets of Headhunter, in each case other than the
transactions contemplated by the Merger Agreement.
Also for purposes of the Merger Agreement, "Superior Proposal" means any
unsolicited, bona fide written proposal made by a third party to acquire
substantially all the equity securities or assets of Headhunter, pursuant to a
tender or exchange offer, a merger, or a sale of its assets, (i) on terms which
the Headhunter Board determines, at a duly constituted meeting of the
Headhunter Board or by unanimous written consent, in its reasonable good faith
judgment to be reasonably likely to be more favorable, both financially and
otherwise, to the holders of Shares than the transactions contemplated by the
Merger Agreement (after receiving the advice of Headhunter's independent
financial advisor that the value of the consideration provided for in such
proposal exceeds the value of the consideration provided for in the Merger),
taking into account all the terms and conditions of such proposal and the
Merger Agreement (including any proposal by Career Holdings to amend the terms
of the Merger Agreement) and (ii) that in the good faith judgment of the
Headhunter Board (after consultation with outside counsel) is reasonably
capable of being completed timely on the terms proposed, taking into account
all financial, regulatory, legal and other aspects of such proposal; and for
which financing, to the
21
extent required, is then committed or which, in the reasonable good faith
judgment of the Headhunter Board, as expressed in a resolution adopted at a
duly constituted meeting (based on the advice of Headhunter's independent
financial advisor), is reasonably capable of being obtained by such third
party.
Stock Options and Warrants. Pursuant to the Merger Agreement, Headhunter
shall adjust the terms of all outstanding stock options and warrants to provide
that each stock option and warrant outstanding shall be canceled in exchange
for a cash payment by Headhunter at the Effective Time of an amount equal to
(i) the excess, if any, of (x) the Merger Consideration per Share over (y) the
exercise price per Share subject to such stock option or warrant, multiplied by
(ii) the number of Shares subject to such stock option or warrant. Headhunter
shall use its best efforts to obtain all necessary consents of the holders of
the stock options and warrants necessary to effectuate this cancellation.
Headhunter's stock plans shall terminate as of the Effective Time, and the
provisions in any other of Headhunter's employee plans providing for the
issuance, transfer or grant of any Headhunter capital stock or any interest in
respect of any Headhunter capital stock shall terminate and be deleted as of
the Effective Time or (if permissible) at Purchaser's request, upon the initial
acceptance of the Shares pursuant to the Offer, and Headhunter shall ensure
that following the Effective Time no holder of a stock option or any
participant in any stock plan or other employee plan shall have any right
thereunder to acquire any capital stock of Headhunter.
Headhunter has agreed that, as soon as practicable following the date of the
Merger Agreement, the Headhunter Board or, if appropriate, any committee
administering Headhunter's 2000 Employee Stock Purchase Plan, shall, if
permitted by the terms of such plan, adopt such resolutions or take such
actions as are required to (i) cancel all options under such plan and (ii)
terminate such plan prior to the Effective Time and return all payroll
deductions credited to the participants in such plan entitled thereto.
Convertible Debt. The Merger Agreement provides that Headhunter shall take
all actions necessary to block the conversion into Shares of any unpaid
principal and interest outstanding under the Omnicom Credit Agreement.
Headhunter shall repay all unpaid amounts of principal and interest under the
Omnicom Credit Agreement in full prior to the Effective Time and Career
Holdings shall provide financing to Headhunter on commercially reasonable terms
in amounts sufficient to satisfy such obligation to Omnicom. See Section 13 for
more information on recent developments concerning the Omnicom Credit
Agreement.
Indemnification. Pursuant to the Merger Agreement, for a period of six years
from and after the Effective Time, in the event of any threatened or actual
claim, action, suit, proceeding, or investigation, whether civil, criminal, or
administrative, including, without limitation, any such claim, action, suit,
proceeding or investigation in which any person who is now, or has been at any
time prior to the date of the Merger Agreement, a director or officer of
Headhunter (the "Indemnified Parties") is, or is threatened to be, made a party
based in whole or in part on, or arising in whole or in part out of, or
pertaining to (i) the fact that he or she is or was a director, officer, or
employee of Headhunter, or (ii) the Merger Agreement or any of the transactions
contemplated hereby, whether in any case asserted or arising before or after
the Effective Time, the Surviving Corporation shall indemnify and hold
harmless, as and to the fullest extent permitted by law, each such Indemnified
Party against any liability (including reasonable attorneys' fees and expenses
in advance of the final disposition of any claim, suit, proceeding, or
investigation to each Indemnified Party to the fullest extent permitted by law
upon receipt of any undertaking required by applicable law in form and
substance which is reasonably satisfactory to the Surviving Corporation),
judgments, fines, and amounts paid in settlement in connection with any such
threatened or actual claim, action, suit, proceeding, or investigation, and in
the event of any such threatened or actual claim, action, suit, proceeding, or
investigation (whether asserted or arising before or after the Effective Time),
the Indemnified Parties may retain counsel reasonably satisfactory to them;
provided, however, that (a) the Surviving Corporation shall have the right to
assume the defense thereof and upon such assumption the Surviving Corporation
shall not be liable to any Indemnified Party for any legal expenses of other
counsel or any other expenses subsequently incurred by any Indemnified Party in
connection with the defense thereof, except that if the Surviving Corporation
elects not to assume such defense or counsel for the Indemnified Parties
reasonably advises the Indemnified Parties that there are issues which raise
conflicts of interest between the Surviving Corporation and the Indemnified
Parties, the Indemnified Parties may retain one (but only one) counsel
reasonably satisfactory to
22
them and the Surviving Corporation, and in such instance the Surviving
Corporation shall pay the reasonable fees and expenses of such counsel for the
Indemnified Parties, (b) the Surviving Corporation shall not be liable for any
settlement effected without its prior written consent, and (c) the Surviving
Corporation shall have no obligation hereunder to any Indemnified Party when
and if a court of competent jurisdiction shall ultimately determine, and such
determination shall have become final and nonappealable, that indemnification
of such Indemnified Party in the manner contemplated hereby is prohibited by
applicable law.
Under the Merger Agreement, the Surviving Corporation agrees that all rights
to indemnification and all limitations on liability existing in favor of the
directors, officers, and employees of Headhunter and its subsidiaries as
provided in their respective articles of incorporation, bylaws, or similar
governing instruments as in effect as of the date of the Merger Agreement with
respect to matters occurring prior to the Effective Time shall survive the
Merger and shall continue in full force and effect, and shall be honored by
such entities or their respective successors as if they were the indemnifying
party thereunder, without any amendment thereto, for a period of six years
after the Effective Time; provided, further, however, that nothing contained in
this section shall be deemed to preclude the liquidation, consolidation, or
merger of Headhunter or any subsidiary, in which case all of such rights to
indemnification and limitations on liability shall be deemed to so survive and
continue notwithstanding any such liquidation, consolidation, or merger.
Without limiting the foregoing, in any case in which approval by the Surviving
Corporation is required to effectuate any indemnification, Career Holdings
shall direct, at the election of the Indemnified Party, that the determination
of any such approval shall be made after consultation with independent counsel
mutually agreed upon between the Surviving Corporation and the Indemnified
Party.
Pursuant to the Merger Agreement, Career Holdings, from and after the
Effective Time, will directly or indirectly cause the persons who served as
directors or officers of Headhunter at or before the Effective Time to be
covered by Headhunter's existing directors' and officers' liability insurance
policy (provided that Career Holdings may substitute therefor policies of
substantially similar coverage and amounts containing terms and conditions
which are not less advantageous than such policy), provided that Career
Holdings shall not be required to pay an annual premium for such insurance in
excess of 200% of the last annual premiums paid prior to the date of the Merger
Agreement, but in such case shall purchase as much coverage as possible for
such amount. Such insurance coverage shall commence at the Effective Time and
will be provided for a period of no less than six years after the Effective
Time.
Board Representation. The Merger Agreement provides that promptly after such
time as Purchaser purchases Shares pursuant to the Offer, Purchaser will be
entitled to designate at its option up to that number of directors of the
Headhunter Board, subject to compliance with Section 14(f) of the Exchange Act,
as will make the percentage of Headhunter's directors designated by Purchaser
equal to the percentage of the aggregate voting power of the Shares held by
Career Holdings or any of its subsidiaries; provided, however, that in the
event that Purchaser's designees are elected to the Headhunter Board, until the
Effective Time the Headhunter Board shall have at least two directors who were
directors of Headhunter on the date of the Merger Agreement and who are not
officers of Headhunter (the "Independent Directors"). If the number of
Independent Directors shall be reduced below two for any reason, the
Independent Director shall designate an Independent Director for purposes of
the Merger Agreement or, if no Independent Directors then remain, the other
directors of Headhunter shall designate two persons to fill such vacancies who
shall not be directors, officers, employees or affiliates of Career Holdings or
any of its subsidiaries, and such persons shall be deemed to be Independent
Directors for purposes of the Merger Agreement. Following the time that
Purchaser's designees to the Headhunter Board constitute a majority of the
Headhunter Board and prior to the Effective Time, any amendment or modification
of the Merger Agreement, any termination of the Merger Agreement by Headhunter,
any extension by Headhunter of the time for the performance of any of the
obligations or other acts of Career Holdings or Purchaser or any waiver of any
condition to Headhunter's obligations under the Merger Agreement or any of
Headhunter's rights under the Merger Agreement will require the concurrence of
at least one of the Independent Directors. Headhunter shall take all action
requested by Career Holdings to effect any such election, including mailing to
its shareholders the information required by Section 14(f) of the Exchange Act
and Rule 14f-1 promulgated thereunder, and
23
Headhunter agrees to make such mailing with the mailing of the Schedule 14D-9
(provided that Purchaser shall have provided to Headhunter on a timely basis
all information required to be included in the Information Statement with
respect to Purchaser's designees). In connection with the foregoing, Headhunter
will promptly, at the option of Career Holdings, either increase the size of
the Headhunter Board and/or obtain the resignation of such number of its
current directors as is necessary to enable Purchaser's designees to be elected
or appointed to the Headhunter Board as provided above.
Beneficiary of the Investment Agreement. Pursuant to the Merger Agreement,
Career Holdings has agreed that Headhunter is an express third party
beneficiary of the Investment Agreement dated as of August 24, 2001 (the
"Investment Agreement") between Career Holdings, Tribune and Knight Ridder
Digital for purposes of enforcing its rights against Career Holdings pursuant
to the Merger Agreement. See " -- The Investment Agreement."
Rights Agreement. As required by the Merger Agreement, Headhunter has
amended the Rights Agreement and has agreed to take all other action necessary
or appropriate so that the execution, delivery and performance of the Merger
Agreement and/or the Stockholder Agreements do not and will not result in the
ability of any person to exercise any of the Rights under the Rights Agreement
or enable or require the Rights issued thereunder to separate from the shares
of Company Common Stock to which they are attached or to be triggered or become
exercisable or cease to be redeemable.
Conditions Precedent. The respective obligations of each party to effect the
Merger are subject to the satisfaction (or waiver by each party) prior to the
Effective Time of the following conditions: (i) the Merger Agreement shall have
been approved and adopted by the requisite vote of the shareholders of
Headhunter (unless the vote of shareholders is not required under the GBCC) as
required by the GBCC and Headhunter's Articles of Incorporation; (ii) any
waiting period (and any extension thereof) applicable to the consummation of
the Merger under the HSR Act shall have expired or been terminated; (iii)
Purchaser shall have previously accepted for payment and paid for Shares
pursuant to the Offer; and (iv) no temporary restraining order, preliminary or
permanent injunction or other order, decree or ruling issued by a court or by
any governmental entity nor any statute, rule, regulation or executive order
promulgated or enacted by any governmental entity shall be in effect, which
would make the acquisition or holding by Career Holdings or its subsidiaries of
the Shares illegal or otherwise prevent the consummation of the Merger.
Termination. The Merger Agreement provides that it may be terminated at any
time prior to the Effective Time, whether before or after adoption of the
Merger Agreement by the shareholders of Headhunter, as follows:
(a) by mutual written consent of Career Holdings and Headhunter;
(b) by either Career Holdings or Headhunter: (i) if (x) as a result of
the failure of any of the conditions to the Offer as set forth in Section 15
of this Offer to Purchase, the Offer shall have terminated or expired in
accordance with its terms without Purchaser having accepted for payment any
Shares pursuant to the Offer or (y) Purchaser shall not have accepted for
payment any Shares pursuant to the Offer prior to November 20, 2001,
provided that if on such date each of the conditions to the Offer as set
forth in Section 15 of this Offer to Purchase other than the HSR Condition
(as defined below) has been fulfilled or is capable of being fulfilled, then
such date shall be extended to January 20, 2002 (provided that the right to
terminate the Merger Agreement pursuant to this clause (b)(i) shall not be
available to any party whose failure to fulfill any obligations under the
Merger Agreement results in the failure of the Offer to be consummated), or
(ii) if any Governmental Entity shall have issued an order, decree or ruling
or taken any other action permanently enjoining, restraining or otherwise
prohibiting the acceptance for payment of, or payment for, Shares pursuant
to the Offer and such order, decree or ruling or other action shall have
become final and nonappealable;
(c) by Career Holdings prior to the purchase of Shares pursuant to the
Offer (i) in the event of a breach by Headhunter of any representation,
warranty, covenant or other agreement contained in the Merger Agreement
which would give rise to the failure of the Offer conditions described in
paragraph (e) or (f) of
24
Section 15 and cannot be or has not been cured within 20 days after the
giving of written notice to Headhunter or (ii) if Career Holdings is
entitled to terminate the Offer as a result of the occurrence of any event
set forth in paragraph (g) of Section 15 or if Headhunter breaches its
obligations set forth above under "--No Solicitation";
(d) by Headhunter in connection with entering into a definitive agreement
for a Superior Proposal as set forth above under "--No Solicitation",
provided that Headhunter has complied with all provisions of that section of
the Merger Agreement, including the notice section, and makes simultaneous
payment of Expenses (as defined below) and the Termination Fee as provided
below under "--Fees and Expenses"; or
(e) by Headhunter prior to the purchase of Shares pursuant to the Offer
if Career Holdings or Purchaser breaches or fails to perform in any material
respect any of their respective representations, warranties or covenants
contained in the Merger Agreement, which breach or failure to perform
materially impairs Career Holding's and Purchaser's ability to consummate
the Offer or the Merger and which breach or failure to perform cannot be or
has not been cured within 20 days after the giving of written notice to
Career Holdings of such breach.
In the event of a termination of the Merger Agreement by either Headhunter
or Career Holdings, there shall be no liability or obligation on the part of
Career Holdings, Purchaser or Headhunter (except for certain provisions
pertaining to the payment of certain expenses and fees and except for certain
confidentiality obligations of the parties) other than for liability for any
willful or intentional breach of the Merger Agreement or for fraud.
Fees and Expenses. Except as provided in the Merger Agreement, all fees and
expenses incurred in connection with the Offer, the Merger and the Merger
Agreement shall be paid by the party incurring such fees and expenses.
The Merger Agreement provides that Headhunter will pay in same day funds to
Career Holdings the following amounts under the circumstances and at the times
set forth as follows:
(a) if Career Holdings terminates the Merger Agreement in accordance with
the provisions described in clause (c)(ii) under "--Termination" above,
Headhunter shall pay a $8,000,000 termination fee, less the aggregate amount
of Expenses paid to Career Holdings pursuant to the Merger Agreement (the
"Termination Fee") within one business day following such termination;
(b) if Headhunter terminates the Merger Agreement in accordance with the
provision described in clause (d) under "--Termination" above, Headhunter
shall pay the Termination Fee within one business day following such
termination; or
(c) if Career Holdings terminates the Merger Agreement in accordance with
the provisions described in clause (c)(i) under "--Termination" above, and
after the date of the Merger Agreement and prior to such termination an
Acquisition Proposal shall have been made (x) Headhunter shall pay the
Expenses (as defined below) of Career Holdings upon demand, and (y) if
concurrently therewith or within nine months thereafter, Headhunter enters
into a merger agreement, acquisition agreement or similar agreement
(including a letter of intent) with respect to an Acquisition Proposal, or
an Acquisition Proposal is consummated, Headhunter shall pay the Termination
Fee upon the earlier of the execution of such agreement or upon consummation
of such Acquisition Proposal.
For purposes of the Merger Agreement, "Expenses" means documented
out-of-pocket fees and expenses incurred or paid by or on behalf of Career
Holdings and/or Purchaser in connection with the Offer, the Merger or the
consummation of any of the transactions contemplated by the Merger Agreement,
including all fees and expenses of law firms, investment banking firms,
accountants, experts and consultants to Career Holdings and/or Purchaser.
25
The Confidentiality Agreement.
The following summary description of the Confidentiality Agreement is
qualified in its entirety by reference to the Confidentiality Agreement itself,
which we have filed as an exhibit to the Tender Offer Statement on Schedule TO
that we filed with the SEC, which you may examine and copy as set forth in
Section 8.
Headhunter and CareerBuilder entered into a Confidentiality Agreement dated
August 6, 2001 (the "Confidentiality Agreement"). The Confidentiality Agreement
applies to confidential information (as that term is defined in the
Confidentiality Agreement) exchanged for the purpose of evaluating a possible
transaction such as the Merger. The Confidentiality Agreement provides that
none of the parties shall disclose confidential information provided to it by
another party and that each party shall use confidential information provided
to it by another party only for the purpose of evaluating the possible
transaction. Each party agrees that, without the consent of the other party, it
shall not (i) communicate with any employee of the other party concerning the
possible transaction, (ii) discuss with or offer to any third party an equity
participation in the possible transaction and (iii) solicit any person who is
employed by the other party in an executive or management level position or
otherwise considered to be a key employee for a period of one year. In
addition, each party agrees for one year not to act or seek to control or
influence the management of the other party. The parties are bound by the
provisions of the Confidentiality Agreement until August 6, 2002.
The Stockholder Agreements.
The following summary description of the Stockholder Agreements is qualified
in its entirety by reference to the Stockholder Agreements themselves, which we
have filed as exhibits to the Tender Offer Statement on Schedule TO that we
filed with the SEC, which you may examine and copy as set forth in Section 8.
Career Holdings and Purchaser entered into Stockholder Agreements dated
August 24, 2001 (the "Stockholder Agreements") with each of the following
shareholders of Headhunter: William H. Scott, III, Burton B. Goldstein, Jr.,
Robert M. Montgomery, Michael G. Misikoff, J. Douglas Cox, Kimberly E. Thompson
and ITC Holding Company, Inc. (the "Tendering Shareholders"). The Tendering
Shareholders have agreed to tender 5,524,966 Shares in the Offer, consisting of
approximately 27.1% of the total number of Shares issued and outstanding as of
August 28, 2001.
Pursuant to the Stockholder Agreements, each Tendering Shareholder has
agreed that, (a) if necessary, such Tendering Shareholder shall vote the
Subject Shares (as defined in the Stockholder Agreements) held by such
Tendering Shareholder in favor of the Merger and the Merger Agreement, provided
that the terms of the Merger Agreement shall not have been amended to adversely
affect such Tendering Shareholder; (b) if necessary, such Tendering Shareholder
shall vote the Subject Shares held by such Tendering Shareholder against: (i)
any other merger agreement or merger, consolidation, combination, sale of
substantial assets, reorganization, recapitalization, dissolution, liquidation
or winding up of or by Headhunter or any other Acquisition Proposal or (ii) any
amendment of Headhunter's articles of incorporation or by-laws or other
proposal or transaction involving Headhunter or any of its subsidiaries, which
amendment or other proposal or transaction would in any manner impede,
frustrate, prevent or nullify the Merger, the Merger Agreement or any of the
other transactions contemplated by the Merger Agreement; (c) such Tendering
Shareholder shall not (i) sell, transfer, pledge, assign or otherwise dispose
of or enter into any contract, option or other arrangement (including any
profit sharing arrangement) with respect to the sale, transfer, pledge,
assignment or other disposition of any or all of the Subject Shares or any
interest therein or (ii) grant any other proxy, power-of-attorney or other
authorization in or with respect to the Subject Shares; (d) such Tendering
Shareholder shall not, and shall not permit any investment banker, attorney or
other adviser or representative of the Tendering Shareholder to (i) directly or
indirectly solicit, initiate or encourage the submission of any Acquisition
Proposal or (ii) directly or indirectly participate in any discussions or
negotiations regarding, or furnish to any person any information with respect
to, or take any other action to facilitate any inquires or the making of any
proposal that constitutes, or may reasonably be expected to lead to, any
Acquisition Proposal in any manner inconsistent with the provisions of the
Merger Agreement, except as permitted by the Merger Agreement; and (e) the
Tendering Shareholder shall tender and not withdraw the Subject Shares. The
Stockholder Agreements terminate upon the earlier of (i) the Effective Time and
(ii) a termination of the Merger Agreement in accordance with its terms.
26
The Investment Agreement.
On August 24, 2001, the stockholders of Career Holdings (Knight Ridder
Digital, Tribune, Robert J. McGovern and James Winchester) and Career Holdings
entered into the Investment Agreement pursuant to which each of Tribune and
Knight Ridder Digital agreed to purchase 1,005,000 shares of preferred stock of
Career Holdings at a purchase price of $100 per share. The proceeds of such
issuance will be sufficient to provide funds to purchase all of the Shares
pursuant to the Offer. The Investment Agreement does not contain any conditions
to the purchase of shares by the Knight Ridder Digital and Tribune. The
Investment Agreement provides that it may not be terminated while the Merger
Agreement is in effect and that Headhunter is an express beneficiary of the
obligations of the parties under the Investment Agreement.
Statutory Requirements.
In general, under the GBCC, a merger of two Georgia corporations requires
that the board of directors of each of the corporations adopt a plan of merger
containing certain specified provisions and that the board, unless there exists
a conflict of interest or other special circumstances, recommend the plan to
the shareholders. The plan of merger must then be approved by the shareholders
of each corporation by the affirmative vote of the holders of a majority of all
the outstanding shares of stock entitled to vote on the merger. The Shares are
the only securities of Headhunter which entitle the holders thereof to voting
rights.
The GBCC also provides that if a parent corporation owns at least 90% of
each class of stock of a subsidiary that is outstanding and entitled to vote on
a merger, the parent corporation can effect a short-form merger (a "Short-Form
Merger") with that subsidiary without the action of the other shareholders of
the subsidiary. Accordingly, if as a result of the Offer or otherwise Purchaser
acquires or controls the voting power of at least 90% of the Shares, Purchaser
could, and intends (subject to the conditions to its obligations to effect the
Merger contained in the Merger Agreement), to effect the Merger without prior
notice to, or any action by, any other shareholder of Headhunter. Pursuant to
the Merger Agreement, under certain circumstances, we could extend the Offer
for a limited period of time in order to receive tenders of at least 90% of the
issued and outstanding Shares to enable us to effect a Short-Form Merger. See
"--The Merger Agreement--The Offer."
Dissenters' Rights.
No dissenters' rights are available in connection with the Offer. However,
if the Merger is submitted to the shareholders for approval or is consummated
by the Headhunter Board without shareholder approval being required,
shareholders will have certain rights under Article 13 of the GBCC, including
the right to dissent, and the right to demand and receive payment in cash of
the fair value of their Shares. Such dissenters' rights, if the statutory
procedures are met, could lead to a judicial determination of the fair value of
the Shares immediately before the effectuation of the Merger (excluding any
change in value arising in anticipation of the Merger) and a judgment requiring
payment of the fair value in cash to such dissenting holders for their Shares.
In addition, such dissenting shareholders would be entitled to receive payment
of a fair rate of interest from the date of consummation of the Merger on the
amount determined to be the fair value of their Shares. Any determination of
the fair value of Shares in a court proceeding could be based upon
considerations other than, or in addition to, the Offer Price and the market
value of the Shares, including, among other things, asset values and earning
capacity. Therefore, the value so determined in any court proceeding could be
the same as, or more or less than, the Offer Price or the Merger Consideration.
Transactions and Arrangements Concerning the Shares.
Except as set forth elsewhere in this Offer to Purchase or in Schedule I
hereto: (i) neither Career Holdings, Purchaser nor, to Career Holdings' or
Purchaser's knowledge, any of the persons listed in Schedule I hereto or any
associate or majority owned subsidiary of Career Holdings' or Purchaser's or of
any of the persons so listed, beneficially owns or has a right to acquire any
Shares or any other equity securities of Headhunter, (ii) neither Career
Holdings, Purchaser nor, to Career Holdings' or Purchaser's knowledge, any of
the persons or entities referred to in clause (i) above or any of their
executive officers, directors or subsidiaries has effected any transaction in
the Shares or any other equity securities of Headhunter during the past 60
days, and (iii) neither
27
Career Holdings, Purchaser nor, to Career Holdings' or Purchaser's knowledge,
any of the persons listed in Schedule I hereto, has any contract, arrangement,
understanding or relationship with any other person with respect to any
securities of Headhunter (including, but not limited to, any contract,
arrangement, understanding or relationship concerning the transfer or the
voting of any such securities, joint ventures, loan or option arrangements,
puts or calls, guaranties of loans, guaranties against loss, or the giving or
withholding of proxies, consents or authorizations).
13. Purpose of the Offer; Plans for Headhunter.
The purpose of the Offer and the Merger is for Career Holdings and its
subsidiaries to acquire all of the outstanding Shares. Upon the consummation of
the Merger, Headhunter will become a wholly owned subsidiary of Career
Holdings. The acquisition of Shares has been structured as a cash tender offer
followed by a cash merger in order to effect a prompt and orderly transfer of
ownership of Headhunter from the public shareholders to Career Holdings and
provide Headhunter's shareholders with cash for all of their Shares.
Pursuant to the Merger Agreement, upon completion of the Offer, we intend to
effect the Merger in accordance with the Merger Agreement. See Section 12.
Except as otherwise described below in this Section or elsewhere in this
Offer to Purchase, we have no current plans or proposals or negotiations which
relate to or would result in: (i) other than the Merger, an extraordinary
corporate transaction, such as a merger, reorganization or liquidation
involving Headhunter; (ii) any purchase, sale or transfer of a material amount
of assets of Headhunter; (iii) any material change in the present dividend
policy or indebtedness of Headhunter; (iv) any change in the management of
Headhunter or any change in any material term of the employment contract of any
executive officer of Headhunter; (v) any other material change in Headhunter's
corporate structure or business; (vi) the Shares ceasing to be authorized for
quotation on Nasdaq; or (vii) the Shares becoming eligible to termination of
registration under Section 12(c)(4) of the Exchange Act.
Currently, Headhunter has $10.0 million in convertible subordinated debt
outstanding under its Amended and Restated Credit Agreement, dated February 27,
2001, between Headhunter and Omnicom Finance, Inc. ("OFI"), as amended by the
Amendment to Amended and Restated Credit Agreement dated May 10, 2001 (the
"Omnicom Credit Agreement"). Pursuant to the Merger Agreement, Headhunter is
required to repay all unpaid amounts of principal and interest under the
Omnicom Credit Agreement in full prior to the Effective Time.
Further, but subject to certain restrictions based on the trading price of
Headhunter's common stock, OFI has the right to convert outstanding principal
and unpaid interest into shares of Headhunter's common stock at the "Applicable
Conversion Price" (as defined in the Omnicom Credit Agreement). Headhunter has
the right to block such conversion rights of OFI by delivering a blockage
notice to OFI within 5 business days of receipt of the OFI conversion notice
and repaying the amount OFI desires to be converted no later than 10 business
days after delivery of the blockage notice to OFI. The Merger Agreement
provides that Headhunter shall take all actions necessary to block any
attempted conversion by OFI.
On August 28, 2001, OFI delivered notice to Headhunter that it was
exercising its conversion rights in connection with all amounts outstanding
under the Omnicom Credit Agreement as of such date. On August 31, 2001,
Headhunter delivered a notice to OFI that it was exercising its right to block
OFI's conversion rights. Under the Merger Agreement, Career Holdings has agreed
to provide financing to Headhunter on commercially reasonable terms in light of
the nature of the transactions proposed under the Merger Agreement in an amount
necessary to enable Headhunter to repay the Omnicom Credit Agreement prior to
the Effective Time or to effect a conversion blockage. As a result of
Headhunter's delivery of the conversion blockage notice to OFI, Career Holdings
intends to extend the necessary financing to Headhunter to repay the Omnicom
Credit Agreement in full no later than September 17, 2001.
28
Headhunter also has $5.0 million of indebtedness outstanding under a Loan
and Security Agreement with Wachovia Capital Investments, Inc. ("Wachovia")
dated May 10, 2001 (the "Wachovia Credit Agreement"). Under the Wachovia Credit
Agreement, the purchase by a third party of 30% or more of Headhunter's capital
stock constitutes a "Change in Control" and an event of default which would
permit Wachovia to accelerate the indebtedness of Headhunter thereunder. The
consummation of the transactions contemplated by the Merger Agreement would
constitute a "Change in Control" requiring that Headhunter must repay all
indebtedness under the Wachovia Credit Agreement at the time of the closing of
the Offer.
The Wachovia Credit Agreement constitutes senior debt of Headhunter and the
Omnicom Credit Agreement is subordinated to the Wachovia Credit Agreement
pursuant to customary subordination provisions. Upon the occurrence of an event
of default under the Wachovia Credit Agreement, Wachovia may block payments
under the Omnicom Credit Agreement, subject to the conversion rights of OFI
described above. In addition, Headhunter's repayment of amounts outstanding
under the Omnicom Credit Agreement would also constitute an event of default
under the Wachovia Credit Agreement, unless Wachovia consents to such
repayment.
In addition, we may initiate a review of Headhunter and its assets,
corporate structure, capitalization, operations, properties, policies,
management and personnel to determine what changes, if any, would be desirable
following the Merger in order best to organize and integrate the activities of
Headhunter and Career Holdings.
14. Dividends and Distributions.
The Merger Agreement provides that Headhunter shall not, without the prior
written consent of Career Holdings, (i) declare, set aside or pay any dividends
on, or make any other distributions (whether in cash, securities or other
property) in respect of, any of its capital stock (other than dividends and
distributions by a direct or indirect wholly owned subsidiary of Headhunter to
its parent); (ii) split, combine or reclassify any of its capital stock or
issue or authorize the issuance of any other securities in respect of, in lieu
of or in substitution for shares of its capital stock or any of its other
securities; or (iii) purchase, redeem or otherwise acquire any shares of its
capital stock or any other securities or any rights, warrants or options to
acquire any such shares or other securities.
15. Conditions of the Offer.
Notwithstanding any other provisions of the Offer or the Merger Agreement,
and in addition to (and not in limitation of) Purchaser's rights to extend and
amend the Offer at any time in its sole discretion (subject to the provisions
of the Merger Agreement), Purchaser shall not be required to accept for payment
or, subject to any applicable rules and regulations of the SEC, including Rule
14e-1(c) under the Exchange Act (relating to Purchaser's obligation to pay for
or return tendered Shares promptly after termination or withdrawal of the
Offer), pay for, and may delay the acceptance for payment of or, subject to the
restriction referred to above, the payment for, any tendered Shares, and may
terminate or amend the Offer as to any Shares not then paid for, if (i) prior
to the expiration date of the Offer, (x) the Minimum Condition shall not have
been satisfied or (y) the HSR Condition shall not have been satisfied or (ii)
at any time on or after the date of the Merger Agreement and prior to the
expiration date of the Offer, any of the following conditions shall exist and
be continuing:
(a) there shall be threatened in writing, instituted or pending any suit,
action or proceeding by any Governmental Entity (as defined in the Merger
Agreement) (i) seeking to challenge, or which could reasonably be expected
to make illegal or otherwise restrain, prohibit or make materially more
costly, the transactions contemplated by the Merger Agreement or the
Stockholder Agreements, including the Offer and the Merger, or seeking to
obtain from Headhunter or (to the extent it relates to the transactions
contemplated by the Merger Agreement or the Stockholder Agreements,
including the Offer or the Merger) Career Holdings or any of its affiliates,
any material damages, (ii) seeking to prohibit or limit the ownership or
operation by Headhunter, Career Holdings or Purchaser of all or any material
portion of the business or assets of Headhunter and its subsidiaries taken
as a whole or (to the extent it relates to the transactions
29
contemplated by the Merger Agreement or the Stockholder Agreements,
including the Offer or the Merger) of Career Holdings and its affiliates,
(iii) seeking to compel Headhunter, Career Holdings or Purchaser to dispose
of or to hold separate all or any material portion of the business or assets
of Headhunter or any of its subsidiaries taken as a whole or (to the extent
it relates to the transactions contemplated by the Merger Agreement or the
Stockholder Agreements, including the Offer or the Merger) of Career
Holdings or any of its affiliates, (iv) seeking to impose any material
limitation on the ability of Headhunter, Career Holdings or Purchaser to
conduct the business or own a material portion of the assets of Headhunter
and its subsidiaries taken as a whole, or (to the extent it relates to the
transactions contemplated by the Merger Agreement or Stockholder Agreements,
including the Offer or the Merger) of Career Holdings or any of its
affiliates, (v) seeking to impose limitations on the ability of Career
Holdings or Purchaser to acquire or hold, or to exercise full rights of
ownership of any Shares, including the right to vote such Shares on all
matters properly presented to Headhunter's shareholders, (vi) seeking to
require divestiture by Career Holdings or Purchaser of all or any of the
Shares, (vii) seeking to impose material limitations on the ability of
Purchaser, or rendering Purchaser unable, to accept for payment, pay for or
purchase all of the Shares pursuant to the Offer and the Merger, or (viii)
that otherwise has resulted in, or could reasonably be expected to result
in, a Material Adverse Effect (as defined below);
(b) there shall be any action taken, or any statute, rule, regulation,
legislation, interpretation, judgment, order or injunction enacted,
promulgated, entered, enforced, amended or issued, by any Governmental
Entity, which is applicable to or deemed applicable to (i) Career Holdings,
Purchaser, Headhunter or any subsidiary of Headhunter or (ii) the Offer, the
Merger, the Merger Agreement or the Stockholder Agreements, other than the
routine application to the Offer, the Merger or the transactions
contemplated by the Stockholder Agreements of the waiting period provisions
under the HSR Act, that result in, or could reasonably be expected to result
in, directly or indirectly, any of the consequences referred to in paragraph
(a) above;
(c) any change or event shall have occurred which has had, or could
reasonably be expected to result in, a Material Adverse Effect;
(d) there shall have occurred (i) any general suspension of trading in,
or limitation on prices for, securities on any U.S. securities exchange or
in the Nasdaq National Market for a period in excess of five hours
(excluding any coordinated trading halt triggered solely as a result of a
specified decrease in a market index and any suspensions or limitations
resulting solely from physical damage or interference with such markets not
related to market conditions), (ii) any decline in any of the Dow Jones
Industrial Average or the Nasdaq National Market in excess of 40% measured
from the close of business on the trading day immediately preceding the date
of the Merger Agreement, (iii) a declaration of a banking moratorium or any
suspension of payments in respect of banks in the United States, (iv) any
material limitation (whether or not mandatory) by any Governmental Entity on
the extension of credit by banks or other financial institutions, (v) a
commencement or escalation of a war or armed hostilities or other national
or international calamity directly or indirectly involving the United
States, or (vi) in the case of any of the foregoing existing at the date of
the Merger Agreement, an acceleration or worsening thereof;
(e) (i) the representations and warranties of Headhunter concerning its
capitalization set forth in the Merger Agreement shall be inaccurate in any
respect except for de minimis amounts as of the date of the Merger Agreement
or the scheduled or extended expiration date of the Offer, (ii) the
representations and warranties of Headhunter concerning authority, no
conflicts and required filings and consents set forth in the Merger
Agreement shall be inaccurate in any material respect as of the date of the
Merger Agreement or the scheduled or extended expiration date of the Offer
or (iii) the representations and warranties of Headhunter set forth in the
Merger Agreement (other than those described in clauses (i) and (ii) above)
shall be inaccurate as of the date of the Merger Agreement or the scheduled
or extended expiration date of the Offer (except to the extent that any such
representation or warranty refers specifically to a particular date, in
which case such representation or warranty shall be true and correct as of
such date) unless the inaccuracies (without giving effect to any materiality
or Material Adverse Effect qualification or expectations contained therein)
under such representations and warranties, taking all the inaccuracies under
all such representations and warranties together in their entirety, do not
result in a Material Adverse Effect;
30
(f) Headhunter shall have failed to perform in any material respect any
obligation or to comply in any material respect with any agreement or
covenant of Headhunter to be performed or complied with by it under the
Merger Agreement;
(g) (i) the Headhunter Board or any committee thereof shall have (A)
withdrawn or modified, or proposed to withdraw or modify, in a manner
adverse to Career Holdings or Purchaser its approval or recommendation of
the Offer, the Merger, the Merger Agreement or the Stockholder Agreements,
or (B) approved or recommended, or proposed to approve or recommend, or
announced a neutral position with respect to, any Acquisition Proposal, (ii)
Headhunter shall have entered into, or publicly announced its intention to
enter into, any agreement with respect to any Acquisition Proposal or (iii)
the Headhunter Board or any committee thereof shall have resolved to do any
of the foregoing;
(h) beneficial ownership (as defined in Rule 13d-3 promulgated under the
Exchange Act) of 25% or more of the Shares has been acquired by any person
or group (as defined in Section 13(d)(3) of the Exchange Act), provided,
that in the case of ITC such beneficial ownership shall not have been
increased above 28%;
(i) the Merger Agreement shall have been terminated in accordance with
its terms; or
(j) all consents necessary to the consummation of the Offer or the Merger
including, without limitation, consents from parties to loans, contracts,
leases or other agreements shall not have been obtained, other than consents
the failure to obtain which would not have a Material Adverse Effect.
"Material Adverse Effect" means, with respect to Headhunter, any change,
event, circumstance, development or effect that is or is reasonably likely to
have a materially adverse effect on (i) the business, assets, liabilities,
condition (financial or other), or results of operations of Headhunter and its
subsidiaries, taken as a whole or (ii) the ability of Headhunter to consummate
the transactions contemplated by the Merger Agreement; provided, however, that
in no event shall any of the following be taken into account (alone or in
combination with any other event identified in this proviso) in determining
whether there has been such a Material Adverse Effect: (i) any change, event,
circumstance, development or effect that results from or arises out of the
public announcement or pendency of the Offer, the Merger or of the other
transactions contemplated by the Merger Agreement; (ii) any change, event,
circumstance, development or effect attributable to conditions generally
affecting the industry as a whole in which Headhunter participates; (iii)
changes in United States generally accepted accounting principles for companies
operating in the industry in which Headhunter participates; or (iv) actions or
omissions of Headhunter taken with the prior written consent of Career Holdings
or Purchaser.
The foregoing conditions are for the sole benefit of Career Holdings and
Purchaser and may be asserted by Career Holdings and Purchaser regardless of
the circumstances giving rise to any such condition and may be waived by Career
Holdings or Purchaser (except for the Minimum Condition), in whole or in part,
at any time and from time to time, in their respective sole discretion. The
failure by Career Holdings or Purchaser at any time to exercise any of the
foregoing rights will not be deemed a waiver of any such right, the waiver of
any such right with respect to any particular facts and circumstances shall not
be deemed a waiver with respect to any other facts and circumstances and each
such right will be deemed an ongoing right that may be asserted at any time and
from time to time.
16. Legal Matters; Required Regulatory Approvals.
Except as set forth in this Offer to Purchase, based on our review of
publicly available filings by Headhunter with the SEC and other information
regarding Headhunter, we are not aware of any licenses or regulatory permits
that appear to be material to the business of Headhunter, and that might be
adversely affected by our acquisition of Shares in the Offer. In addition,
except as described in this Offer to Purchase, we are not aware of any filings,
approvals or other actions by or with any governmental authority or
administrative or regulatory agency that would be required for our acquisition
or ownership of the Shares. Should any such approval or other action be
required, we expect to seek such approval or action, except as described below
under "State Takeover Laws."
31
Should any such approval or other action be required, we cannot be certain that
we would be able to obtain any such approval or action without substantial
conditions or that adverse consequences might not result to Headhunter's
business, or that certain parts of Headhunter's, Career Holdings', or any of
their respective subsidiaries' businesses might not have to be disposed of or
held separate in order to obtain such approval or action. In that event, we may
not be required to purchase any Shares in the Offer. See Introduction and
Section 15 for a description of the conditions to the Offer.
State Takeover Laws. Headhunter is incorporated under the laws of the State
of Georgia. Headhunter has elected in its bylaws to be subject to Sections 1131
through 1133 (the "Business Combination Provisions") and Sections 1110 through
1113 (the "Fair Price Provisions") of the GBCC. In general, the Business
Combination Provisions prevent an "interested shareholder" (including a person
who is the beneficial owner of 10% or more of the voting power of the
outstanding voting shares of a corporation) from engaging in a "business
combination" (defined to include mergers and certain other actions) with a
Georgia corporation for a period of five years following the date such person
became an interested shareholder. However, this prohibition does not apply if
prior to the time that such person became an interested shareholder, the
"business combination" or the transaction which resulted in such person
becoming an interested shareholder is approved by the Board of Directors of the
corporation. In addition, the Fair Price Provisions provide that a business
combination with an interested shareholder must meet specified fair pricing
criteria and certain other tests unless the business combination is approved by
all the directors of the corporation that are not affiliated or otherwise
associated with the interested shareholder, provided that there are at least
three such directors. The Headhunter Board has unanimously approved the Offer
and the Merger, including the Merger Agreements and the Stockholder Agreements.
Accordingly, the substantive restrictions of the Business Combination
Provisions and the Fair Price Provisions will not apply to the Offer and the
Merger.
A number of other states have adopted laws and regulations applicable to
attempts to acquire securities of corporations which are incorporated, or have
substantial assets, shareholders, principal executive offices or principal
places of business or whose business operations otherwise have substantial
economic effects in such states. In 1982, the Supreme Court of the United
States, in Edgar v. Mite Corp., invalidated on constitutional grounds the
Illinois Business Takeovers Statute, which as a matter of state securities law
made takeovers of corporations meeting certain requirements more difficult. The
reasoning in that decision is likely to apply to certain other state takeover
statutes. In 1987, however, in CTS Corp. v. Dynamics Corp. of America, the
Supreme Court of the United States held that the State of Indiana could as a
matter of corporate law and, in particular, those aspects of corporate law
concerning corporate governance, constitutionally disqualify a potential
acquirer from voting on the affairs of a target corporation without the prior
approval of the remaining shareholders, as long as those laws were applicable
only under certain conditions. Subsequently, in TLX Acquisition Corp. v. Telex
Corp., a federal district court in Oklahoma ruled that the Oklahoma statutes
were unconstitutional insofar as they apply to corporations incorporated
outside Oklahoma, because they would subject those corporations to inconsistent
regulations. Similarly, in Tyson Foods, Inc. v. McReynolds, a federal district
court in Tennessee ruled that four Tennessee takeover statutes were
unconstitutional as applied to corporations incorporated outside Tennessee.
This decision was affirmed by the United States Court of Appeals for the Sixth
Circuit.
We have not attempted to comply with any state takeover statutes in
connection with the Offer or the Merger other than the Business Combination
Provisions and the Fair Price Provisions. We reserve the right to challenge the
validity or applicability of any state law allegedly applicable to the Offer or
the Merger, and nothing in this Offer to Purchase nor any action that we take
in connection with the Offer is intended as a waiver of that right. In the
event that it is asserted that one or more takeover statutes apply to the Offer
or the Merger, and it is not determined by an appropriate court that the
statutes in question do not apply or are invalid as applied to the Offer or the
Merger, as applicable, we may be required to file certain documents with, or
receive approvals from, the relevant state authorities, and we might be unable
to accept for payment or purchase Shares tendered in the Offer or be delayed in
continuing or consummating the Offer. In that case, we may not be obligated to
accept for purchase, or pay for, any Shares tendered. See Section 15.
32
Antitrust. Under the HSR Act and the related rules and regulations that have
been issued by the Federal Trade Commission (the "FTC"), certain acquisition
transactions may not be consummated until certain information and documentary
material has been furnished for review by the FTC and the Antitrust Division of
the Department of Justice (the "Antitrust Division") and certain waiting period
requirements have been satisfied. These requirements apply to our acquisition
of Shares in the Offer and the Merger.
Under the HSR Act, the purchase of Shares in the Offer may not be completed
until the expiration of a 15-calendar-day waiting period following the filing
of certain required information and documentary material concerning the Offer
with the FTC and the Antitrust Division, unless the waiting period is earlier
terminated by the FTC and the Antitrust Division. We expect to file a Premerger
Notification and Report Form under the HSR Act with the FTC and the Antitrust
Division in connection with the purchase of Shares in the Offer and the Merger
on August 31, 2001, and, in that event, the required waiting period with
respect to the Offer and the Merger will expire at 11:59 p.m., New York City
time, on or about September 17, 2001, unless earlier terminated by the FTC or
the Antitrust Division or we receive a request for additional information or
documentary material prior to that time. If within the 15-calendar-day waiting
period either the FTC or the Antitrust Division requests additional information
or documentary material from us, the waiting period with respect to the Offer
and the Merger would be extended for an additional period of 10 calendar days
following the date of our substantial compliance with that request. Only one
extension of the waiting period pursuant to a request for additional
information is authorized by the HSR Act rules. After that time, the waiting
period could be extended only by court order or with our consent. The FTC or
the Antitrust Division may terminate the additional 10-calendar-day waiting
period before its expiration. In practice, complying with a request for
additional information or documentary material can take a significant period of
time. Although Headhunter is required to file certain information and
documentary material with the FTC and the Antitrust Division in connection with
the Offer, neither Headhunter's failure to make those filings nor a request
made to Headhunter from the FTC or the Antitrust Division for additional
information or documentary material will extend the waiting period with respect
to the purchase of Shares in the Offer and the Merger.
The FTC and the Antitrust Division frequently scrutinize the legality under
the antitrust laws of transactions such as our acquisition of Shares in the
Offer and the Merger. At any time before or after our purchase of Shares, the
FTC or the Antitrust Division could take any action under the antitrust laws
that either considers necessary or desirable in the public interest, including
seeking to enjoin the purchase of Shares in the Offer and the Merger, the
divestiture of Shares purchased in the Offer or the divestiture of substantial
assets of Career Holdings, Headhunter or any of their respective subsidiaries
or affiliates. Private parties as well as state attorneys general may also
bring legal actions under the antitrust laws under certain circumstances.
Based upon an examination of publicly available information relating to the
businesses in which Headhunter is engaged, we believe that the acquisition of
Shares in the Offer and the Merger should not violate the applicable antitrust
laws. Nevertheless, we cannot be certain that a challenge to the Offer and the
Merger on antitrust grounds will not be made, or, if such challenge is made,
what the result will be.
17. Fees and Expenses.
We have retained Georgeson Shareholder Communications Inc. as Information
Agent in connection with the Offer. The Information Agent may contact holders
of Shares by mail, telephone, telex, telegraph and personal interview and may
request brokers, dealers and other nominee shareholders to forward material
relating to the Offer to beneficial owners of Shares. We will pay the
Information Agent reasonable and customary compensation for these services in
addition to reimbursing the Information Agent for its reasonable out-of-pocket
expenses. We have agreed to indemnify the Information Agent against certain
liabilities and expenses in connection with the Offer.
In addition, we have retained American Stock Transfer & Trust Company as the
Depositary. We will pay the Depositary reasonable and customary compensation
for its services in connection with the Offer, will
33
reimburse the Depositary for its reasonable out-of-pocket expenses and will
indemnify the Depositary against certain liabilities and expenses.
Except as described in Section 12 under "--Fees and Expenses," Headhunter
will not pay any of the fees and expenses to be incurred by us in connection
with the Offer.
Except as set forth above, we will not pay any fees or commissions to any
broker, dealer or other person for soliciting tenders of Shares pursuant to the
Offer. We will reimburse brokers, dealers, commercial banks and trust companies
and other nominees, upon request, for customary clerical and mailing expenses
incurred by them in forwarding offering materials to their customers.
18. Miscellaneous.
We are not aware of any jurisdiction where the making of the Offer is
prohibited by any administrative or judicial action pursuant to any valid state
statute. If we become aware of any valid state statute prohibiting the making
of the Offer or the acceptance of the Shares, we will make a good faith effort
to comply with that state statute. If, after a good faith effort, we cannot
comply with the state statute, we will not make the Offer to, nor will we
accept tenders from or on behalf of, the holders of Shares in that state. In
any jurisdiction where the securities, blue sky or other laws require the Offer
to be made by a licensed broker or dealer, the Offer shall be deemed to be made
on behalf of Purchaser by one or more registered brokers or dealers licensed
under the laws of such jurisdiction.
We have filed with the SEC a Tender Offer Statement on Schedule TO, together
with exhibits, furnishing certain additional information with respect to the
Offer, and may file amendments to our Schedule TO. Our Schedule TO and any
exhibits or amendments may be examined and copies may be obtained from the SEC
in the same manner as described in Section 8 with respect to information
concerning Headhunter.
We have not authorized any person to give any information or to make any
representation on our behalf not contained in this Offer to Purchase or in the
Letter of Transmittal and, if given or made, you should not rely on any such
information or representation as having been authorized.
Neither the delivery of the Offer to Purchase nor any purchase pursuant to
the Offer will under any circumstances create any implication that there has
been no change in the affairs of Career Holdings, Purchaser, Headhunter or any
of their respective subsidiaries since the date as of which information is
furnished or the date of this Offer to Purchase.
CB MERGER SUB, INC.
August 31, 2001
34
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF CAREER HOLDINGS, INC.,
CB MERGER SUB, INC., TRIBUNE COMPANY AND KNIGHT RIDDER DIGITAL
Directors and Executive Officers of Career Holdings, Inc.
The name, age, present principal occupation or employment and business
address and material occupations or employment for the past five years of each
of the directors and executive officers of Career Holdings is set forth below.
Unless otherwise indicated below, each occupation set forth opposite each
person refers to employment with Career Holdings, a provider for online
recruiting services and solutions. The business address of each such person is,
unless otherwise indicated below, 10790 Parkridge Blvd., Suite 200, Reston,
Virginia 20191. Each individual listed below is a citizen of the United States.
Directors/Executive Officers Principal Occupation and Business Address
- ---------------------------- -----------------------------------------
Daniel J. Finnigan (38).... Vice President and Director; President of Knight Ridder Digital and Vice
c/o Knight-Ridder, Inc. President of Knight-Ridder, Inc. since July 1999; President and CEO of SBC
50 W. San Fernando St. Interactive from 1998 to July 1999; various positions with SBC
Suite 1500 Communications, Inc., until 1998.
San Jose, CA 95113
Mark W. Hianik (41)........ Secretary; Vice President, Assistant General Counsel and Assistant Secretary of
c/o Tribune Company Tribune since July 2000; Senior Counsel/Mergers and Acquisitions and Assistant
435 North Michigan Avenue Secretary of Tribune from February 1999 until July 2000; Counsel/Mergers and
Chicago, IL 60611 Acquisitions of Tribune from December 1997 until February 1999; Partner, at
the law firm of Wildman, Harrold, Allen & Dixon until November 1997.
David D. Hiller (48)....... Vice President, Assistant Secretary and Director; President of Tribune
c/o Tribune Company Interactive, Inc. a subsidiary of Tribune, since May 2000; Senior Vice President/
435 North Michigan Avenue Development of Tribune until May 2000.
Chicago, IL 60611
Adrienne Lilly (31)........ Assistant Secretary; Assistant Vice President/Assistant General Counsel of
c/o Knight-Ridder, Inc. Knight-Ridder, Inc. since February 2001, Assistant General Counsel of Knight-
50 W. San Fernando St. Ridder, Inc. from 1999 until February 2001; Associate, Fredrikson & Byron,
Suite 1500 P.A. from 1995 to December 1999.
San Jose, CA 95113
Robert J. McGovern (40).... Chief Executive Officer and Chairman; Founder of CareerBuilder, Inc. and
Chairman of the Board of Directors, President and Chief Executive Officer of
CareerBuilder, Inc. since its founding in November 1995.
James A. Tholen (42)....... Vice President, Treasurer and Director; Senior Vice President and Chief
Financial Officer of CareerBuilder, Inc. since September 1998; Chief Operating
Officer and Chief Financial Officer of FTP Software, Inc., a software
communications company, from April 1997 until September 1998; Chief
Financial Officer of the Compucare Company, a healthcare information systems
provider, until April 1997.
James E. Winchester (51)... Vice President; Founder of CareerBuilder, Inc. and has served as Senior Vice
President of Engineering and Chief Technology Officer of CareerBuilder, Inc.
since its founding in November 1995.
I-1
Directors and Executive Officers of CB Merger Sub, Inc.
The name, age, present principal occupation or employment and business
address and material occupations or employment for the past five years of each
of the directors and executive officers of Purchaser is set forth below. Unless
otherwise indicated below, each occupation set forth opposite each person
refers to employment with CB Merger Sub, Inc. The business address of each such
person is, unless otherwise indicated below, 10790 Parkridge Blvd., Suite 200,
Reston, Virginia 20191. Each individual listed below is a citizen of the United
States.
Directors/Executive Officers Principal Occupation and Business Address
- ---------------------------- -----------------------------------------
Daniel J. Finnigan (38).... Director; Vice President and Director of Career Holdings, Inc. since July 2001;
c/o Knight-Ridder, Inc. President of Knight Ridder Digital and Vice President of Knight-Ridder, Inc.
50 W. San Fernando St. since July 1999; President and CEO of SBC Interactive from 1998 to July 1999;
Suite 1500 various positions with SBC Communications, Inc., until 1998.
San Jose, CA 95113
David D. Hiller (48)....... Director; Vice President and Director of Career Holdings, Inc. since July 2001;
c/o Tribune Company President of Tribune Interactive, Inc. a subsidiary of Tribune, since May 2000;
435 North Michigan Avenue Senior Vice President/Development of Tribune until May 2000.
Chicago, IL 60611
Robert J. McGovern (40).... Director; Chief Executive Officer and Chairman of Career Holdings, Inc. since
July 2001; Founder of CareerBuilder, Inc. and Chairman of the Board of
Directors, President and Chief Executive Officer of CareerBuilder, Inc. since its
founding in November 1995.
James A. Tholen (42)....... President, Treasurer, Secretary and Director; Vice President, Treasurer and
Director of Career Holdings, Inc. since July 2001; Senior Vice President and
Chief Financial Officer of CareerBuilder, Inc. since September 1998; Chief
Operating Officer and Chief Financial Officer of FTP Software, Inc., a software
communications company, from April 1997 until September 1998; Chief
Financial Officer of the Compucare Company, a healthcare information systems
provider, until April 1997.
Directors and Executive Officers of Tribune Company.
The following table sets forth the name and present principal occupation or
employment, and material occupations, positions, offices or employment for the
past five years of each director and executive officer of Tribune, a media
company with interests in broadcasting, publishing and on the Internet. Unless
otherwise indicated below, each occupation set forth opposite each person
refers to employment with Tribune. The business address of each such person is
c/o Tribune Company, 435 North Michigan Avenue, Chicago, Illinois 60611, and
each such person is a citizen of the United States of America.
Directors Principal Occupation and Business Address
--------- -----------------------------------------
Jeffrey Chandler.... Director. President and Chief Executive Officer, Chandler Ranch Co., one of the
largest avocado growers in California.
Dennis J. FitzSimons Director. President and Chief Operating Officer of Tribune since May 2001;
Executive Vice President of Tribune from January 2000 to May 2001; President,
Tribune Broadcasting Company, a subsidiary of Tribune, from May 1997 until
December 1999; and Executive Vice President, Tribune Broadcasting Company,
a subsidiary of Tribune, until May 1997.
Jack W. Fuller...... Director. President of Tribune Publishing, a subsidiary of Tribune, since May
1997; President and Publisher of Chicago Tribune Company, a subsidiary of
Tribune, until May 1997.
I-2
Directors Principal Occupation and Business Address
--------- -----------------------------------------
Roger Goodan............ Director. Vice President, Schlumberger Information Solutions, a supplier of
integrated solutions, since December 2000; various positions with Schlumberger
since 1973; Director of The Times Mirror Company from December 1988
through the merger into Tribune on June 12, 2000.
Enrique Hernandez, Jr... Director. Chairman and Chief Executive Officer of Inter-Con Security Systems,
Inc., an international provider of high-end security and facility support services
to government, utilities and industrial customers; Director, McDonald's
Corporation, Nordstrom, Inc. and Washington Mutual, Inc.
John W. Madigan......... Director. Chairman and Chief Executive Officer of Tribune; President of
Tribune until May 2001; President of Tribune Publishing Company, a subsidiary
of Tribune, until May 1994; Publisher, Chicago Tribune until May 1994.
Director of Morgan Stanley Dean Witter & Co. and AT&T Wireless Services,
Inc.
Nancy Hicks Maynard..... Director. President, Maynard Partners Incorporated, consultants in news media
economics; Chair, The Freedom Forum Media Studies Center from March 1996
to September 1997; Director, Economics of News Project, since September
1997; Member, Global Business Network.
Andrew J. McKenna....... Director. Chairman and Chief Executive Officer, Schwarz WorldWide, an
international distributor of paper packaging and related products and a printer,
producer and converter. Director of Aon Corporation, McDonald's Corporation
and Skyline Corporation.
James J. O'Connor....... Director. Retired Chairman and Chief Executive Officer of Unicom Corporation,
a holding company, where he served from June 1994 until March 1998, and of
Commonwealth Edison Company, an electric utility, where he served from 1980
to March 1998. Director of Corning Incorporated, Smurfit-Stone Container
Corporation and UAL Corporation.
Patrick G. Ryan......... Director. Chairman, Chief Executive Officer and Director of Aon Corporation, a
broad-based insurance holding company.
William Stinehart, Jr... Director. Partner, law firm of Gibson, Dunn & Crutcher LLP, the law firm where
he has practiced since 1969; Director, The Times Mirror Company from
December 1991 through the merger into Tribune on June 12, 2000.
Dudley S. Taft.......... Director. President and Director, Taft Broadcasting Company, an investor in
media and entertainment companies. Director of CINergy Corp.; Fifth Third
Bancorp; Southern Star Group; The Union Central Life Insurance Company.
Arnold R. Weber......... Director. President-Emertius, Northwestern University since January 1999.
President, Civic Committee of the Commercial Club of Chicago until July 1999.
Chancellor, Northwestern University until December 1998. Director of Aon
Corporation; Burlington Northern Santa Fe Corporation; Deere & Company;
Diamond Technology Partners, Inc.
I-3
Executive Officers Principal Occupation
------------------ --------------------
Dennis J. FitzSimons President and Chief Operating Officer of Tribune since May 2001; Executive
Vice President of Tribune from January 2000 to May 2001; President and Chief
Executive Officer, Tribune Broadcasting Company, a subsidiary of Tribune,
from May 1997 until December 1999; and Executive Vice President, Tribune
Broadcasting Company until May 1997.
Jack W. Fuller...... President of Tribune Publishing, a subsidiary of Tribune, since May 1997;
President and Publisher of Chicago Tribune Company, a subsidiary of Tribune,
until May 1997.
Donald C. Grenesko.. Senior Vice President/Finance and Administration of Tribune since August 1996;
Senior Vice President of Tribune until August 1996.
David D. Hiller..... President of Tribune Interactive, Inc. a subsidiary of Tribune, since May 2000;
Senior Vice President/Development of Tribune until May 2000.
Crane H. Kenney..... Senior Vice President, General Counsel and Secretary of Tribune since May 2000;
Vice President, General Counsel and Secretary of Tribune from August 1996 until
May 2000; Vice President/Chief Legal Officer until August 1996.
Luis E. Lewin....... Senior Vice President/Human Resources of Tribune since May 2000; Vice
President/Human Resources of Tribune from October 1996 until May 2000;
Director/Human Resources of Tribune until October 1996; Acting Publisher of
Exito! in Chicago from December 1995 to September 1996.
John W. Madigan..... Chairman and Chief Executive Officer of Tribune; President of Tribune until
May 2001; President of Tribune Publishing Company, a subsidiary of Tribune
until May 1994; Publisher, Chicago Tribune until May 1994. Director of Morgan
Stanley Dean Witter & Co. and AT&T Wireless Services, Inc.
Patrick J. Mullen... President of Tribune Television since March 2001; Regional Vice President of
Tribune Television from June 1998 to March 2001; Vice President/General
Manager of WXMI-TV (Grand Rapids), a Tribune Broadcasting station, until June
1998.
Ruthellyn Musil..... Vice President/Corporate Relations of Tribune since March 1995.
Andrew J. Oleszczuk. Senior Vice President/Development since May 2000; President of Tribune
Ventures, a division of Tribune, from August 1998 until May 2000; Vice President/
Development of Tribune until August 1998.
Jeff R. Scherb...... Senior Vice President and Chief Techology Officer of Tribune since May 2000;
President of Tribune Interactive, Inc., a subsidiary of Tribune, from May 1999
until May 2000; Senior Vice President and Chief Technology Officer of Tribune
from August 1996 until May 1999; Chief Technology Officer and Senior Vice
President for Research and Development at Dun & Bradstreet Software until
August 1996.
I-4
Directors and Executive Officers of Knight Ridder Digital
The following table sets forth the name and present principal occupation or
employment, and material occupations, positions, offices or employment for the
past five years of each director and executive officer of Knight Ridder
Digital, a creator and manager of online services and a wholly owned subsidiary
of Knight-Ridder, Inc. The business address of each such person is c/o
Knight-Ridder, Inc., 50 West San Fernando Street, Suite 1500, San Jose,
California 95113, and each such person is a citizen of the United States of
America.
Directors Principal Occupation
--------- --------------------
Jerome Ceppos...... Director. Vice President/News of Knight-Ridder, Inc. since May 1999; Vice
President and Executive Editor, San Jose Mercury News from 1995 to 1999;
Managing Editor of San Jose Mercury News from 1983 to 1995; Various editing
positions at the San Jose Mercury News from 1981 to 1983.
Mary Jean Connors.. Director. Senior Vice President/Human Resources of Knight-Ridder, Inc. since
1996; Vice President/Human Resources of Knight-Ridder, Inc. from 1989 to 1996;
Vice President/Human Resources, Philadelphia Newspapers, Inc., a subsidiary of
Knight-Ridder, Inc., 1988 to 1989; Assistant to the Senior Vice President/News,
Knight-Ridder, Inc. 1988; Assistant Managing Editor/Personnel, The Miami Herald
from 1985 to 1988 and in various editing positions there from 1980 to 1985.
Frank McComas....... Director. Senior Vice President/Operations of Knight-Ridder, Inc. since 1996
and Vice President/Operations of Knight-Ridder, Inc. from 1995 to 1996;
Publisher, The (Columbia) State from 1988 to 1995; Publisher, Bradenton
Herald 1980 to 1988; Various positions at The Miami Herald and The Charlotte
Observer from 1970 to 1980.
P. Anthony Ridder... Director. Chairman and CEO of Knight-Ridder, Inc. since 1995; President of
Knight-Ridder, Inc. from 1989 to 1995; President of the Newspaper Division of
Knight-Ridder, Inc. from 1986 to 1995.
Steven B. Rossi..... Director. President/Newspaper Division of Knight-Ridder, Inc. since February 2001;
Senior Vice President/Operations of Knight-Ridder, Inc. from 1998 to February
2001; Executive Vice President and General Manager, Philadelphia Newspapers,
Inc. from 1992 to 1998; Executive Vice President 1991 to 1992; Senior Vice
President 1988 to 1991; Vice President/Finance and CFO 1987 to 1988; Vice
President and Divisional General Manager of Amerigas, Inc., 1981 to 1987.
Gordon Yamate....... Director. Vice President and General Counsel of Knight-Ridder, Inc. since
September 2000; Vice President, General Counsel and Corporate Secretary at
Liberate Technologies from March 1999 to September 2000; Partner in the law
firm of McCutchen, Doyle, Brown & Enersen, LLP, in Palo Alto and San Jose
from 1988 to March 1999.
Executive Officers Principal Occupation
- ------------------ --------------------
Elizabeth Drewry.... Vice President/Human Resources of Knight Ridder Digital since September
2000; Senior Vice President/Human Resources of the Los Angeles Times from
1997 until 2000; Vice President/Employee, Labor & Public Affairs and other
various positions with Newsday from 1984 to 1997.
Daniel J. Finnigan.. President of Knight Ridder Digital and Vice President of Knight-Ridder, Inc. since
July 1999; President and CEO of SBC Interactive from 1998 to July 1999; Various
positions with SBC Communications, Inc., until 1998.
I-5
Executive Officers Principal Occupation
- ------------------ --------------------
Timothy Lambert.. Vice President/Sales of Knight Ridder Digital since September 1999; Vice
President/Sales SBC Interactive, Inc. from 1998 to 1999; General Manager,
Pacific Bell Directory, from 1996 to 1998; Various positions with Pacific Bell
Directory from 1990 to 1996.
Tally Liu........ Senior Vice President/Finance and Operations of Knight Ridder Digital since
March 2000; Vice President/Finance and Advanced Technology of Knight-
Ridder, Inc. from 1998 to March 2000; Vice President/Finance and
Administration of Knight-Ridder, Inc. from 1994 to 1998; Vice President and
Controller of Knight-Ridder, Inc. from 1990 to 1993; Vice President and CFO of
the San Jose Mercury News 1987 to 1990.
Rohn Jay Miller.. Senior Vice President/Product and Technology of Knight Ridder Digital since
August 2000; Managing Director and Partner in Collaborate Advertising &
Strategy from 1999 to 2000; Executive Vice President and Chief Operating
Officer and member of the board of directors of Ikonic, Inc. from 1993 to 1998;
Executive Producer and Executive Vice President of Synapse Technologies from
1991 to 1993.
Robert Ryan...... Vice President & General Manager/Site Operations of Knight Ridder Digital
since 2000; Director of the Mercury Center and member of the Executive
Committee of the San Jose Mercury News from 1995 to 1999; Deputy Managing
Editor of the San Jose Mercury News from 1993 to 1995, and in various other
positions at the San JoseMercury News from 1982 to 1993.
I-6
Facsimile copies of Letters of Transmittal, properly completed and duly
executed, will be accepted. The appropriate Letter of Transmittal, certificates
for Shares and any other required documents should be sent or delivered by each
shareholder of HeadHunter or his broker, dealer, commercial bank, trust company
or other nominee to the Depositary at its address set forth below:
The Depositary for the Offer is:
AMERICAN STOCK TRANSFER & TRUST COMPANY
-----------------
By Mail, Hand or Overnight Delivery:
59 Maiden Lane
New York, New York 10038
By Facsimile Transmission:
(For Eligible Institutions Only)
(718) 234-5001
Confirm Receipt of Facsimile by Telephone:
(718) 921-8200
You may direct questions and requests for assistance to the Information
Agent at its telephone number and address set forth below. You may obtain
additional copies of this Offer to Purchase, the Letter of Transmittal, the
Notice of Guaranteed Delivery and other tender offer materials from the
Information Agent as set forth below and they will be furnished promptly at our
expense. You may also contact your broker, dealer, commercial bank, trust or
other nominee for assistance concerning the Offer.
The Information Agent for the Offer is:
[LOGO] Georgeson Shareholder
Communications Inc.
17 State Street, 10th Floor
New York, New York 10004
Banks and Brokers Call Collect:
(212) 440-9800
All Others Call Toll-Free:
(800) 223-2064