Exhibit (a)(1)(A)
Offer to Purchase for Cash Up to
1,739,130 Shares of Delta and Pine Land Company Common Stock
at a Purchase Price Not Greater Than $28.75 Nor Less Than $25.00 Per Share by
Delta and Pine Land Company
THE TENDER OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, NEW YORK CITY TIME, ON TUESDAY, MAY 17, 2005, UNLESS THE COMPANY
EXTENDS THE TENDER OFFER.
Delta and Pine Land Company, a Delaware corporation (referred to herein as "we,"
"us," the "Company" or "D&PL"), is offering to purchase for cash up to 1,739,130
shares of its common stock, upon the terms and subject to the conditions set
forth in this document and the letter of transmittal (which together, as they
may be amended and supplemented from time to time, constitute the tender offer).
On the terms and subject to the conditions of the tender offer, we will
determine the single per share price, not greater than $28.75 nor less than
$25.00 per share, net to you in cash, without interest, that we will pay for
shares properly tendered and not properly withdrawn in the tender offer, taking
into account the total number of shares so tendered and the prices specified by
the tendering stockholders. We will select the lowest purchase price that will
allow us to purchase 1,739,130 shares, or such fewer number of shares as are
properly tendered and not properly withdrawn, at prices not greater than $28.75
nor less than $25.00 per share. We will purchase at the purchase price all
shares properly tendered at prices at or below the purchase price and not
properly withdrawn, on the terms and subject to the conditions of the tender
offer, including the odd lot, conditional tender and proration provisions. We
reserve the right, in our sole discretion, to purchase more than 1,739,130
shares in the tender offer, subject to applicable law. We will not purchase
shares tendered at prices greater than the purchase price nor shares that we do
not accept for purchase because of proration provisions or conditional tenders.
Shares not purchased in the tender offer will be returned to the tendering
stockholders at our expense promptly after the expiration of the tender offer.
See Section 1.
THE TENDER OFFER IS NOT CONDITIONED UPON THE RECEIPT OF FINANCING NOR ON ANY
MINIMUM NUMBER OF SHARES BEING TENDERED. THE TENDER OFFER IS, HOWEVER, SUBJECT
TO OTHER CONDITIONS. SEE SECTION 7.
___________________________
The dealer manager for the tender offer is:
UBS Investment Bank
___________________________
Offer to Purchase dated April 20, 2005.
IMPORTANT
If you wish to tender all or any part of your shares, you should either (1)
complete and sign a letter of transmittal according to the instructions in the
letter of transmittal and mail or deliver it, together with any required
signature guarantee and any other required documents, including the share
certificates, to Illinois Stock Transfer Company, the depositary for the tender
offer, or (2) tender the shares according to the procedure for book-entry
transfer described in Section 3, or (3) request a broker, dealer, commercial
bank, trust company or other nominee to effect the transaction for you. If your
shares are registered in the name of a broker, dealer, commercial bank, trust
company or other nominee, you should contact that person if you desire to tender
your shares. If you desire to tender your shares and (1) your share certificates
are not immediately available or cannot be delivered to the depositary, (2) you
cannot comply with the procedure for book-entry transfer, or (3) you cannot
deliver the other required documents to the depositary by the expiration of the
tender offer, you must tender your shares according to the guaranteed delivery
procedure described in Section 3.
_____________________________
OUR BOARD OF DIRECTORS HAS APPROVED THE TENDER OFFER. HOWEVER, NEITHER WE
NOR OUR BOARD OF DIRECTORS NOR THE DEALER MANAGER MAKES ANY RECOMMENDATION TO
YOU AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR SHARES OR AS
TO THE PRICE OR PRICES AT WHICH YOU MAY CHOOSE TO TENDER YOUR SHARES. YOU MUST
MAKE YOUR OWN DECISION AS TO WHETHER TO TENDER YOUR SHARES AND, IF SO, HOW MANY
SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH TO TENDER YOUR SHARES. IN SO
DOING, YOU SHOULD READ CAREFULLY THE INFORMATION IN THIS OFFER TO PURCHASE AND
IN THE LETTER OF TRANSMITTAL, INCLUDING OUR REASONS FOR MAKING THE TENDER OFFER.
OF OUR DIRECTORS AND EXECUTIVE OFFICERS, ONE EXECUTIVE OFFICER HAS ADVISED US
THAT HE INTENDS TO TENDER A PORTION OF HIS SHARES IN THE TENDER OFFER.
_____________________________
Our common stock is listed and traded on the New York Stock Exchange under
the trading symbol "DLP." We publicly announced the tender offer on April 20,
2005, before the open of trading on the NYSE on that date. On April 15, 2005,
the last trading day prior to printing this offer to purchase, the reported
closing price of our common stock on the NYSE was $25.68 per share. We urge
stockholders to obtain current market quotations for our common stock. See
Section 8.
_____________________________
You may direct questions and requests for assistance to Georgeson
Shareholder Communications Inc., the information agent for the tender offer, or
UBS Securities LLC, the dealer manager for the tender offer, at their respective
addresses and telephone numbers set forth on the back cover page of this
document. You may direct requests for additional copies of this document, the
letter of transmittal or the notice of guaranteed delivery to the information
agent or the dealer manager.
We have not authorized any person to make any recommendation on our behalf
as to whether you should tender or refrain from tendering your shares or as to
the purchase price at which you may choose to tender your shares in the tender
offer. We have not authorized any person to give any information or to make any
representation in connection with the tender offer other than those contained in
this document or in the letter of transmittal. If given or made, you must not
rely upon any such information or representation as having been authorized by us
or the dealer manager.
_____________________________
We are not making the tender offer to (nor will we accept any tender of
shares from or on behalf of) holders in any jurisdiction in which the making of
the tender offer or the acceptance of any tender of shares would not be in
compliance with the laws of such jurisdiction. However, we may, at our
discretion, take such action as we may deem necessary for us to make the tender
offer in any such jurisdiction and extend the tender offer to holders in such
jurisdiction.
TABLE OF CONTENTS
Page
----
SUMMARY TERM SHEET................................................................................................1
FORWARD-LOOKING STATEMENTS........................................................................................7
INTRODUCTION.....................................................................................................10
THE TENDER OFFER.................................................................................................12
1. Number of Shares; Proration....................................................................12
2. Purpose of the Tender Offer....................................................................15
3. Procedures for Tendering Shares................................................................17
4. Withdrawal Rights..............................................................................23
5. Purchase of Shares and Payment of Purchase Price...............................................23
6. Conditional Tender of Shares...................................................................25
7. Conditions of the Tender Offer.................................................................26
8. Price Range of Shares; Dividends...............................................................29
9. Source and Amount of Funds.....................................................................30
10. Certain Information Concerning D&PL............................................................30
11. Interests of Directors and Executive Officers; Transactions and
Arrangements Concerning Shares.................................................................31
12. Effects of the Tender Offer on the Market for Shares; Registration under
the Exchange Act...............................................................................36
13. Legal Matters; Regulatory Approvals............................................................37
14. U.S. Federal Income Tax Consequences...........................................................37
15. Extension of the Tender Offer; Termination; Amendment..........................................40
16. Fees and Expenses..............................................................................41
17. Miscellaneous..................................................................................42
SUMMARY TERM SHEET
We are providing this summary term sheet for your convenience. You should
realize that it does not describe all of the details of the tender offer to the
same extent described in this document. We urge you to read the entire document
and the letter of transmittal because they contain the full details of the
tender offer. We have included references to the sections of this document where
you will find a more complete discussion.
Who is offering to purchase my shares?
Delta and Pine Land Company, which we refer to as "our", "we", "us", the
"Company" or "D&PL", is offering to purchase shares of its common stock.
What will the purchase price for the shares be?
We will determine the purchase price that we will pay per share promptly after
the tender offer expires. The purchase price will be the lowest price at which,
based on the number of shares tendered and the prices specified by the tendering
stockholders, we can purchase 1,739,130 shares, or such fewer number of shares
as are properly tendered and not properly withdrawn prior to the expiration
date. The purchase price will not be greater than $28.75 nor less than $25.00
per share. We will pay this purchase price in cash, without interest, for all
the shares we purchase pursuant to the tender offer, including the shares
tendered at a price below the purchase price. We will not purchase shares
tendered at prices greater than the purchase price or shares that we do not
purchase because of proration provisions or conditional tenders. See Section 1.
How many shares will D&PL purchase?
We will purchase 1,739,130 shares properly tendered in the tender offer, or such
fewer number of shares as are properly tendered and not properly withdrawn prior
to the expiration date. The 1,739,130 shares that we are offering to purchase
pursuant to the tender offer represent approximately 4.5% of the shares of
common stock outstanding as of April 13, 2005 (or approximately 4.2% of the
shares on a diluted basis, assuming the exercise of all outstanding stock
options). Additionally, 1,066,667 shares of our Series M Convertible Non-Voting
Preferred Stock were outstanding as of April 13, 2005. The Series M Convertible
Non-Voting Preferred Stock is convertible to shares of common stock on a
one-for-one basis.
We expressly reserve the right, to purchase an additional number of shares not
to exceed 2% of the outstanding shares, and could decide to purchase more
shares, subject to applicable legal requirements. See Section 1. The tender
offer is not conditioned upon the receipt of financing nor on any minimum number
of shares being tendered. See Section 7.
1
What will happen if more than 1,739,130 shares are tendered at or below the
purchase price?
If more than 1,739,130 shares are tendered at or below the purchase price, we
will purchase all shares tendered, at or below the purchase price on a pro rata
basis, except for "odd lots" (lots held by owners of less than 100 shares),
which we will purchase on a priority basis as described in the immediately
following paragraph and except for shares that were conditionally tendered and
for which the condition was not satisfied. See Sections 5 and 6.
If I own fewer than 100 shares and I tender all of my shares, will I be subject
to proration?
If you own beneficially or of record fewer than 100 shares in the aggregate, you
properly tender all of these shares at or below the purchase price before the
tender offer expires and you complete the section entitled "Odd Lots" in the
letter of transmittal, we will purchase all of your shares without subjecting
them to the proration procedure. See Section 1.
How will D&PL pay for the shares?
We anticipate that we will fund the purchase of the shares tendered in the
tender offer through cash on hand. See Section 9.
How long do I have to tender my shares?
You may tender your shares until the tender offer expires. The tender offer will
expire on Tuesday, May 17, 2005, at 12:00 Midnight, New York City time, unless
we extend it. See Section 1. We may choose to extend the tender offer for any
reason, subject to applicable laws. We cannot assure you that we will extend the
tender offer or indicate the length of any extension that we may provide. See
Section 15. If a broker, dealer, commercial bank, trust company or other nominee
holds your shares, it is likely they have an earlier deadline for you to act to
instruct them to accept the tender offer on your behalf. We urge you to contact
the broker, dealer, commercial bank, trust company or other nominee to find out
their deadline.
Can the tender offer be extended, amended or terminated, and under what
circumstances?
We can extend or amend the tender offer in our sole discretion. If we extend the
tender offer, we will delay the acceptance of any shares that have been
tendered. We can terminate the tender offer under certain circumstances. See
Section 7 and Section 15.
2
How will I be notified if D&PL extends the tender offer or amends the term sof
the tender offer?
If we decide to extend the tender offer, we will issue a press release not later
than 9:00 a.m., New York City time, on the business day after the scheduled
expiration date. We will announce any amendment to the tender offer by making a
public announcement of the amendment and/or filing amended tender offer
documents with the Securities and Exchange Commission. We post our press
releases and filings with the Securities and Exchange Commission on our website
at www.deltaandpine.com. See Section 15.
What is the purpose of the tender offer?
We believe that the tender offer is a prudent use of our financial resources
given our strong cash position and expected future cash flows, business profile,
assets and the current market price of our common stock. The tender offer
represents an opportunity for us to return cash to stockholders who elect to
tender their shares, while at the same time increasing non-tendering
stockholders' proportionate interest in D&PL. See Section 2 and Section 10.
Are there any conditions to the tender offer?
Yes. The tender offer is subject to conditions, such as the absence of court and
governmental action prohibiting the tender offer and of changes in general
market conditions or our business that, in our judgment, are or may be
materially adverse to us. See Section 7.
Following the tender offer, will D&PL continue as a public company?
Yes. Following the completion of the tender offer in accordance with its terms
and conditions, D&PL's common stock will continue to be listed on the New York
Stock Exchange and D&PL will continue to be subject to the periodic reporting
requirements of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"). See Section 12.
How do I tender my shares?
The tender offer will expire at 12:00 Midnight, New York City time, on Tuesday,
May 17, 2005, unless we extend the tender offer. To tender your shares, prior to
the expiration of the tender offer:
- - you must deliver your share certificate(s) and a properly completed and
duly executed letter of transmittal to the depositary at the address
appearing on the back cover page of this document; or
- - the depositary must receive a confirmation of receipt of your shares by
book-entry transfer and a properly completed and duly executed letter of
transmittal or an agent's message in the case of a book-entry transfer; or
3
- - you must request a broker, dealer, commercial bank, trust company or other
nominee to effect the transaction for you; or
- - you must comply with the guaranteed delivery procedures described in
Section 3.
You should contact the information agent or the dealer manager for assistance at
their respective addresses and telephone numbers set forth on the back cover
page of this document. See Section 3 and the instructions to the letter of
transmittal. Please note that D&PL will not purchase your shares in the tender
offer unless the depositary receives the required documents prior to the
expiration of the tender offer. If a broker, dealer, commercial bank, trust
company or other nominee holds your shares, it is likely they have an earlier
deadline for you to act to instruct them to accept the tender offer on your
behalf. We urge you to contact your broker, dealer, commercial bank, trust
company or other nominee to find out their applicable deadline.
Once I have tendered shares in the tender offer, can I withdraw my tendered
shares?
Yes. You may withdraw any shares you have tendered at any time before the
expiration of the tender offer which will occur at 12:00 Midnight, New York City
time, on Tuesday, May 17, 2005, unless we extend the tender offer, in which case
you can withdraw your shares until the expiration of the tender offer as
extended. In addition, after our offer expires, if we have not accepted for
payment the shares you have tendered to us, you may withdraw your shares at any
time after 12:00 Midnight, New York City time, on Wednesday, June 15, 2005. See
Section 4.
How do I withdraw shares I previously tendered?
You must deliver, on a timely basis, a written or facsimile notice of your
withdrawal to the depositary at the address appearing on the back cover page of
this document. Your notice of withdrawal must specify your name, the number of
shares to be withdrawn and the name of the registered holder of these shares.
Some additional requirements apply if the share certificates to be withdrawn
have been delivered to the depositary or if your shares have been tendered under
the procedure for book-entry transfer set forth in Section 3. See Section 4.
4
How do holders of vested stock options for shares participate in the tender
offer?
If you hold vested but unexercised options, you may exercise such options for
cash in accordance with the terms of the applicable stock option plans and
tender the shares received upon such exercise in accordance with this tender
offer. An exercise of an option cannot be revoked even if shares received upon
the exercise thereof and tendered in the offer are not purchased in the offer
for any reason. See Section 3.
Has D&PL or its Board of Directors adopted a position on the tender offer?
Our Board of Directors has approved the tender offer. However, neither we nor
our Board of Directors nor the dealer manager makes any recommendation to you as
to whether you should tender or refrain from tendering your shares or as to the
price or prices at which you may choose to tender your shares. You must make
your own decision as to whether to tender your shares and, if so, how many
shares to tender and the price or prices at which to tender your shares. In so
doing, you should read carefully the information in this offer to purchase and
in the letter of transmittal, including our reasons for making the tender offer.
Of our directors and executive officers, one executive officer has advised us
that he intends to tender a portion of his shares in the tender offer. See
Section 2 and Section 11.
If I decide not to tender, how will the tender offer affect my shares?
Stockholders who choose not to tender will own a greater percentage interest in
our outstanding common stock following the consummation of the tender offer.
What is the recent market price for the shares?
We publicly announced the tender offer on April 20, 2005, before the opening of
trading on the New York Stock Exchange on that date. On April 15, 2005, the last
trading day prior to printing this offer to purchase, the reported closing price
of our common stock on the NYSE was $25.68 per share. We urge you to obtain
current market quotations for our common stock. See Section 8.
When will D&PL pay for the shares I tender?
We will pay the purchase price, net to you in cash, without interest, for the
shares we purchase promptly after the expiration of the tender offer and the
acceptance of the shares for payment; provided, however, that we do not expect
to announce the results of the proration and begin paying for tendered shares
until at least five business days after the expiration of the tender offer. See
Section 5.
Will I have to pay brokerage commissions if I tender my shares?
If you are a registered stockholder and you tender your shares directly to the
depositary, you will not incur any brokerage commissions. If you hold shares
through a broker or bank, we urge you to consult your broker or bank to
determine whether transaction costs are applicable. See Section 3.
5
What are the U.S. federal income tax consequences if I tender my shares?
Generally, you will be subject to U.S. federal income taxation when you receive
cash from us in exchange for the shares you tender. The receipt of cash for your
tendered shares will be treated either as (1) a sale or exchange or (2) a
distribution from us in respect of our stock. Holders of shares, including
holders who are not U.S. holders, should consult their tax advisors as to the
particular consequences to them of participation in the tender offer. See
Section 14.
Will I have to pay any stock transfer tax if I tender my shares?
If you instruct the depositary in the letter of transmittal to make the payment
for the shares to the registered holder, you will not incur any stock transfer
tax. See Section 5.
Who can help answer my questions about the tender offer?
The information agent or the dealer manager can help answer your questions. The
information agent is Georgeson Shareholder Communications Inc. and the dealer
manager is UBS Securities LLC. Their contact information is set forth on the
back cover page of this document.
6
FORWARD-LOOKING STATEMENTS
This offer to purchase contains or incorporates by reference not only
historical information, but also forward-looking statements relating to our
operations that are based on our current expectations, estimates and
projections. Words such as "anticipates," "believes," "continues," "estimates,"
"expects," "goal," "intends," "may," "opportunity," "plans," "potential,"
"projects," "forecasts," "should," "will," and similar expressions are intended
to identify such forward-looking statements. These statements are not guarantees
of future performance and involve risks, uncertainties, and assumptions that are
difficult to predict. Forward-looking statements are based upon assumptions as
to future events that may not prove to be accurate. Actual outcomes and results
may differ materially from what is expressed or forecasted in these
forward-looking statements.
Our actual results may differ from the forward-looking statements for many
reasons, including:
- Demand for our seed will be affected by government programs and
policies and by weather. Demand for seed is also influenced by
commodity prices, the cost of other crop inputs, and the demand for a
crop's end-uses such as textiles, animal feed, cottonseed oil, food
and raw materials for industrial use. These factors, along with
weather, influence the cost and availability of seed for subsequent
seasons. Weather impacts crop yields, commodity prices and the
planting decisions that farmers make regarding both original planting
commitments and, when necessary, replanting levels.
- The planting seed market is highly competitive, and our products face
competition from a number of seed companies, diversified chemical
companies, agricultural biotechnology companies, governmental agencies
and academic and scientific institutions. A number of chemical and
biotechnology companies have seed production and/or distribution
capabilities to ensure market access for new seed products and new
technologies that may compete with the Bollgard(R) ("Bollgard") and
Roundup Ready(R) ("Roundup Ready") gene technologies of Monsanto
Company ("Monsanto"), our principal licensor of such technology. Our
seed products and technologies contained therein may encounter
substantial competition from technological advances by others or
products from new market entrants. Many of our competitors are, or are
affiliated with, large diversified companies that have substantially
greater resources than we have.
- We currently are engaged in a dispute resolution and arbitration
process with Monsanto, the principal licensor of our cotton
technology. In the arbitration, Monsanto is seeking a determination by
the arbitrators of its right to terminate certain agreements between
our companies, including the Bollgard and Roundup Ready licenses. In
addition, we are currently engaged in litigation with Monsanto
concerning the failed merger of the companies. The result of this
litigation (and the process of litigating) may materially affect the
results of our business.
- There is no assurance that new technologies, such as the DeltaMax
Cotton, LLC and Syngenta technologies, will result in commercially
7
viable products or that such technologies are developed in the time
frame or for the amounts estimated to complete. Also, there is no
assurance that regulatory approval will be obtained for the products.
- The production, distribution or sale of crop seed in or to foreign
markets may be subject to special risks, including fluctuations in
foreign currency, exchange rate controls, expropriation,
nationalization and other agricultural, economic, tax and regulatory
policies of foreign governments and shipping disruptions. Particular
policies which may affect our domestic and international operations
include the use of and the acceptance of products that were produced
from plants that have been genetically modified, the testing,
quarantine and other restrictions relating to the import and export of
plants and seed products and the availability (or lack thereof) of
proprietary protection for plant products. In addition, United States
government policies, particularly those affecting foreign trade and
investment, may impact our international operations.
- The publicity related to genetically modified organisms ("GMOs") or
products made from plants that contain GMOs may have an effect on our
sales in the future. In 2004, approximately 94% of our cottonseed that
was sold in the United States contained either or both of Monsanto's
Bollgard and Roundup Ready gene technologies, and 95% of our soybean
seed sales contained the Roundup Ready gene technology. Although many
farmers have rapidly adopted these technologies, the concern of some
customers and governmental entities over finished products that
contain GMOs could impact demand for crops (and ultimately seed)
raised from seed containing such traits.
- Due to the varying levels of agricultural and social development of
the international markets in which we operate and because of factors
within the particular international markets we target, international
profitability and growth may be less stable and predictable than
domestic profitability and growth. Furthermore, recent action taken by
the U.S. government, including that taken by the U.S. military in the
aftermath of the tragic events of September 11, 2001, the war in Iraq,
and conflicts between major cotton producing nations, may serve to
further complicate our ability to execute our long range ex-U.S.
business plans because those plans include future expansion into
Uzbekistan, Pakistan and India. World health concerns about infectious
diseases also affect the conduct of our international business.
- Our customers in many markets, including the U.S., benefit from
government subsidy programs. The Farm Security and Rural Investment
Act of 2002 expires on January 1, 2007 (although this act includes the
2007 cotton planting season), and future U.S. farm subsidy programs
are uncertain. Various other countries have challenged, and may
continue to challenge, the appropriateness of U.S. farm subsidies
through the World Trade Organization ("WTO") or other forums. The
outcome of these challenges has not yet been determined, but may
negatively impact U.S. farmers. U.S. farm programs and WTO rulings
impacting such programs may materially affect the results of our
business.
8
- Overall profitability will depend on the factors noted above as well
as weather conditions, government policies in all countries where we
sell products and operate, worldwide commodity prices, our ability to
successfully open new international markets, our ability to develop
the Texas High Plains market, the technology partners' ability to
obtain timely government approval (and maintain such approval) for
existing and for additional biotechnology products on which they and
D&PL are working, our technology partners' ability to successfully
defend challenges to proprietary technologies licensed to us and our
ability to produce sufficient commercial quantities of high quality
planting seed of these products. Any delay in or inability to
successfully complete these projects may affect future profitability.
In addition, earnings forecasts do not consider the impact of
potential transactions, their related accounting and other factors,
that may be under consideration by the Company, but have not yet been
completed or their effect determined at the date of a particular
filing.
For a more detailed discussion of these and other risks, see the
information under the heading "Risk and Uncertainties" in our Annual Report on
Form 10-K.
9
INTRODUCTION
To the Holders of our common stock:
We invite our stockholders to tender shares of our common stock, with a par
value of $0.10 per share, for purchase by us. Upon the terms and subject to the
conditions set forth in this offer to purchase and in the letter of transmittal,
we are offering to purchase up to 1,739,130 shares of our common stock, at a
price not greater than $28.75 nor less than $25.00 per share, net to the seller
in cash, without interest.
The tender offer will expire at 12:00 Midnight, New York City time, on
Tuesday, May 17, 2005, unless extended (such date and time, as the same may be
extended, the "expiration date"). We may, in our sole discretion, extend the
period of time in which the tender offer will remain open.
We will select the lowest purchase price that will allow us to buy
1,739,130 shares, or, if a lesser number of shares is properly tendered, all
shares that are properly tendered and not properly withdrawn. We will acquire
all shares that we purchase in the tender offer at the same purchase price
regardless of whether the stockholder tendered at a lower price. However,
because of the "odd lot" priority, proration and conditional tender provisions
described in this offer to purchase, we may not purchase all of the shares
tendered at or below the purchase price if more than the number of shares we
seek are properly tendered. We will not purchase shares tendered at prices
greater than the purchase price or shares that we do not accept for purchase
because of proration provisions or conditional tenders. We will return tendered
shares that we do not purchase to the tendering stockholders at our expense
promptly after the expiration of the tender offer. See Section 1.
We reserve the right, in our sole discretion, to purchase more than
1,739,130 shares pursuant to the tender offer, subject to certain limitations
and legal requirements. See Section 1.
Stockholders must complete the section of the letter of transmittal
relating to the price at which they are tendering shares in order to properly
tender shares.
We will pay the purchase price, net to the tendering stockholders in cash,
without interest, for all shares that we purchase. Tendering stockholders whose
shares are registered in their own names and who tender directly to Illinois
Stock Transfer Company, the depositary in the tender offer, will not be
obligated to pay brokerage fees or commissions or, except as set forth in
Instruction 9 to the letter of transmittal, stock transfer taxes on the purchase
of shares by us pursuant to the tender offer. If you own your shares through a
bank, broker, dealer, trust company or other nominee and that person tenders
your shares on your behalf, that person may charge you a fee for doing so. You
should consult your bank, broker, dealer, trust company or other nominee to
determine whether any charges will apply.
The tender offer is not conditioned upon the receipt of financing or on any
minimum number of shares being tendered. The tender offer is, however, subject
to certain other conditions. See Section 7.
10
OUR BOARD OF DIRECTORS HAS APPROVED THE TENDER OFFER. HOWEVER, NEITHER WE
NOR OUR BOARD OF DIRECTORS NOR THE DEALER MANAGER MAKES ANY RECOMMENDATION TO
YOU AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR SHARES OR AS
TO THE PRICE OR PRICES AT WHICH YOU MAY CHOOSE TO TENDER YOUR SHARES. YOU MUST
MAKE YOUR OWN DECISION AS TO WHETHER TO TENDER YOUR SHARES AND, IF SO, HOW MANY
SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH TO TENDER YOUR SHARES. IN SO
DOING, YOU SHOULD READ CAREFULLY THE INFORMATION IN THIS OFFER TO PURCHASE AND
IN THE LETTER OF TRANSMITTAL, INCLUDING OUR REASONS FOR MAKING THE TENDER OFFER.
OF OUR DIRECTORS AND EXECUTIVE OFFICERS, ONE EXECUTIVE OFFICER HAS ADVISED US
THAT HE INTENDS TO TENDER A PORTION OF HIS SHARES IN THE TENDER OFFER. SEE
SECTION 2 AND SECTION 11.
If, at the expiration date, more than 1,739,130 shares (or such greater
number of shares as we may elect to purchase, subject to applicable law) are
properly tendered at or below the purchase price and not properly withdrawn, we
will buy shares:
- first, from all holders of "odd lots" (holders of less than 100
shares) who properly tender all of their shares at or below the
purchase price selected by us and do not properly withdraw them before
the expiration date;
- second, on a pro rata basis from all other stockholders who properly
tender shares at or below the purchase price selected by us, other
than stockholders who tender conditionally and whose conditions are
not satisfied; and
- third, only if necessary to permit us to purchase 1,739,130 shares (or
such greater number of shares as we may elect to purchase, subject to
applicable law) from holders who have tendered shares at or below the
purchase price subject to the condition that a specified minimum
number of the holder's shares be purchased if any of the holder's
shares are purchased in the tender offer (for which the condition was
not initially satisfied) by random lot, to the extent feasible. To be
eligible for purchase by random lot, stockholders whose shares are
conditionally tendered must have tendered all of their shares.
We may not purchase all of the shares tendered pursuant to the tender offer
even if the shares are tendered at or below the purchase price. See Section 1,
Section 5 and Section 6, respectively, for additional information concerning
priority, proration and conditional tender procedures.
Section 14 of this offer to purchase describes various United States
federal income tax consequences of a sale of shares pursuant to the tender
offer.
Holders of vested but unexercised options to purchase shares may exercise
such options for cash and tender some or all of the shares issued upon such
exercise. An exercise of an option cannot be revoked even if shares received
upon the exercise thereof and tendered in the offer are not purchased in the
offer for any reason.
11
As of April 13, 2005, D&PL had 38,479,224 shares outstanding. The 1,739,130
shares that we are offering to purchase pursuant to the tender offer represent
approximately 4.5% of the shares of common stock outstanding as of that date.
Our common stock is listed and traded on the NYSE under the symbol "DLP". See
Section 8. On April 15, 2005, the last trading day prior to the printing of this
offer to purchase, the reported closing price of our common stock on the NYSE
was $25.68. We urge stockholders to obtain current market quotations for our
common stock.
THE TENDER OFFER
1. Number of Shares; Proration.
General. Upon the terms and subject to the conditions of the tender offer,
D&PL will purchase 1,739,130 shares of common stock, or such fewer number of
shares as are properly tendered and not properly withdrawn in accordance with
Section 4 before the scheduled expiration date of the tender offer, at a price
not greater than $28.75 nor less than $25.00 per share, net to the seller in
cash, without interest.
The term "expiration date" means 12:00 Midnight, New York City time, on
Tuesday, May 17, 2005, unless D&PL, in its sole discretion, extends the period
of time during which the tender offer will remain open, in which event the term
"expiration date" shall refer to the latest time and date at which the tender
offer, as so extended by D&PL, shall expire. See Section 15 for a description of
D&PL's right to extend, delay, terminate or amend the tender offer. In
accordance with the rules of the Securities and Exchange Commission, D&PL may,
and D&PL expressly reserves the right to purchase pursuant to the tender offer
an additional number of shares not to exceed 2% of the outstanding shares
without amending or extending the tender offer. See Section 15. In the event of
an over-subscription of the tender offer as described below, shares tendered at
or below the purchase price will be subject to proration, except for odd lots.
The proration period and, except as described herein, withdrawal rights, expire
on the expiration date.
If we:
- increase the price to be paid for shares above $28.75 per share or
decrease the price to be paid for shares below $25.00 per share, or
- increase the number of shares being sought in the tender offer and
this increase in the number of shares sought exceeds 2% of the
outstanding shares, or
- decrease the number of shares being sought, and
- the tender offer is scheduled to expire at any time earlier than the
expiration of a period ending on the tenth business day from, and
including, the date that we first publish, send or give notice, in the
manner specified in Section 15, of any increase or decrease,
then we will extend the tender offer until the expiration of ten business days
from the date that we first publish notice of any increase or decrease. For the
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purposes of the tender offer, a "business day" means any day other than a
Saturday, Sunday or U.S. federal holiday and consists of the time period from
12:01 a.m. through 12:00 Midnight, New York City time.
The tender offer is not conditioned upon the receipt of financing or on any
minimum number of shares being tendered. The tender offer is, however, subject
to other conditions. See Section 7.
In accordance with Instruction 5 of the letter of transmittal, stockholders
desiring to tender shares must specify the price or prices, not greater than
$28.75 nor less than $25.00 per share, at which they are willing to sell their
shares to D&PL pursuant to the tender offer. Alternatively, stockholders
desiring to tender shares can choose not to specify a price and, instead,
specify that they will sell their shares at the purchase price that D&PL
ultimately pays for shares properly tendered and not properly withdrawn in the
tender offer, which could result in the tendering stockholder receiving a price
per share as low as $25.00 or as high as $28.75. If tendering stockholders wish
to maximize the chance that D&PL will purchase their shares, they should check
the box in the section of the letter of transmittal captioned "Shares Tendered
at Price Determined Pursuant to the Tender Offer." Note that this election could
result in the tendered shares being purchased at the minimum price of $25.00 per
share. This election could also have the effect of decreasing the price at which
D&PL purchases tendered shares because shares tendered using this election will
be available for purchase at the minimum price of $25.00 per share.
To tender shares properly, stockholders must specify one, and only one,
price box in the appropriate section in each letter of transmittal. If you
specify more than one price or if you fail to check any price at all you will
not have validly tendered your shares. See Section 3.
Promptly following the expiration date, D&PL will, in its sole discretion,
determine the purchase price that it will pay for shares properly tendered and
not properly withdrawn in the tender offer, taking into account the number of
shares tendered and the prices specified by tendering stockholders. D&PL will
select the lowest purchase price, not greater than $28.75 nor less than $25.00
per share, net to the seller in cash, without interest, that will enable it to
purchase 1,739,130 shares, or such fewer number of shares as are properly
tendered and not properly withdrawn in the tender offer. D&PL will purchase all
shares properly tendered at or below the purchase price (and not properly
withdrawn), all at the same purchase price, upon the terms and subject to the
conditions of the tender offer, including the odd lot, proration and conditional
tender provisions.
D&PL will not purchase shares tendered at prices greater than the purchase
price and shares that it does not accept in the tender offer because of
proration provisions or conditional tenders. D&PL will return to the tendering
stockholders shares that it does not purchase in the tender offer at D&PL's
expense promptly after the expiration date. By following the instructions to the
letter of transmittal, stockholders can specify one minimum price for a
specified portion of their shares and a different minimum price for other
specified shares, but stockholders must submit a separate letter of transmittal
for shares tendered at each price. Stockholders also can specify the order in
13
which D&PL will purchase the specified portions of their shares in the event
that, as a result of the proration provisions or otherwise, D&PL purchases some
but not all of the tendered shares pursuant to the tender offer.
If the number of shares properly tendered at or below the purchase price
and not properly withdrawn prior to the expiration date is fewer than or equal
to 1,739,130 shares, or such greater number of shares as D&PL may elect to
purchase, subject to applicable law, D&PL will, upon the terms and subject to
the conditions of the tender offer, purchase all such shares.
Priority of Purchases. Upon the terms and subject to the conditions of the
tender offer, if greater than 1,739,130 shares, or such greater number of shares
as D&PL may elect to purchase, subject to applicable law, have been properly
tendered at prices at or below the purchase price, and not properly withdrawn
prior to the expiration date, D&PL will purchase properly tendered shares on the
basis set forth below:
- First, we will purchase all shares tendered by all holders of "odd
lots" who:
- tender all shares owned beneficially or of record at a price at
or below the purchase price selected by us (partial tenders will
not qualify for this preference); and
- complete the section entitled "Odd Lots" in the letter of
transmittal and, if applicable, in the notice of guaranteed
delivery.
- Second, subject to the conditional tender provisions described in
Section 6, we will purchase all other shares tendered at prices at or
below the purchase price selected by us on a pro rata basis, with
appropriate adjustments to avoid purchases of fractional shares, as
described below.
- Third, only if necessary to permit us to purchase 1,739,130 shares (or
such greater number of shares as we may elect to purchase, subject to
applicable law), shares conditionally tendered (for which the
condition was not initially satisfied) at or below the purchase price
selected by us, will, to the extent feasible, be selected for purchase
by random lot. To be eligible for purchase by random lot, stockholders
whose shares are conditionally tendered must have tendered all of
their shares.
D&PL may not purchase all of the shares that a stockholder tenders in the
tender offer even if they are tendered at prices at or below the purchase price.
It is also possible that D&PL will not purchase any of the shares conditionally
tendered even though those shares were tendered at prices at or below the
purchase price.
Odd Lots. For purposes of the tender offer, the term "odd lots" shall mean
all shares properly tendered prior to the expiration date at prices at or below
the purchase price and not properly withdrawn by any person, referred to as an
"odd lot" holder, who owns beneficially or of record an aggregate of fewer than
100 shares and so certifies in the appropriate place on the letter of
transmittal and, if applicable, on the notice of guaranteed delivery. To qualify
for this preference, an odd lot holder must tender all shares owned beneficially
or of record by the odd lot holder in accordance with the procedures described
in Section 3. As set forth above, D&PL will accept odd lots for payment before
14
proration, if any, of the purchase of other tendered shares. This preference is
not available to partial tenders or to beneficial or record holders of an
aggregate of 100 or more shares, even if these holders have share certificates
representing fewer than 100 shares. By accepting the tender offer, an odd lot
holder who holds shares in its name and tenders its shares directly to the
depositary would not only avoid the payment of brokerage commissions, but also
would avoid any applicable odd lot discounts in a sale of the odd lot holder's
shares on the NYSE. Any odd lot holder wishing to tender all of its shares
pursuant to the tender offer should complete the section entitled "Odd Lots" in
the letter of transmittal and, if applicable, in the notice of guaranteed
delivery.
Proration. If proration of tendered shares is required, D&PL will determine
the proration factor as soon as practicable following the expiration date.
Subject to adjustment to avoid the purchase of fractional shares and subject to
the provisions governing conditional tenders described in Section 6 of this
offer to purchase, proration for each stockholder that tenders shares will be
based on the ratio of the total number of shares that we accept for purchase
(excluding "odd lots") to the total number of shares properly tendered (and not
properly withdrawn) at or below the purchase price by all stockholders (other
than "odd lot" holders).
Because of the difficulty in determining the number of shares properly
tendered, including shares tendered by guaranteed delivery procedures, as
described in Section 3, and not properly withdrawn, and because of the odd lot
procedure and conditional tender provisions, D&PL does not expect that it will
be able to announce the final proration factor or commence payment for any
shares purchased pursuant to the tender offer until at least five business days
after the expiration date. The preliminary results of any proration will be
announced by press release promptly after the expiration date. Stockholders may
obtain preliminary proration information from the information agent or the
dealer manager and may be able to obtain this information from their brokers.
As described in Section 14, the number of shares that D&PL will purchase
from a stockholder under the tender offer may affect the U.S. federal income tax
consequences to that stockholder and, therefore, may be relevant to that
stockholder's decision whether or not to tender shares.
We will mail this offer to purchase and the letter of transmittal to record
holders of shares and we will furnish this offer to purchase to brokers,
dealers, commercial banks and trust companies whose names, or the names of whose
nominees, appear on D&PL's stockholder list or, if applicable, that are listed
as participants in a clearing agency's security position listing for subsequent
transmittal to beneficial owners of shares.
2. Purpose of the Tender Offer.
D&PL believes that the tender offer is a prudent use of its financial
resources given its strong cash position and expected future cash flows,
business profile, assets and the current market price of its common stock. The
tender offer represents an opportunity for D&PL to return cash to stockholders
who elect to tender their shares. Where shares are tendered by the registered
owner of those shares directly to the depositary, the sale of those shares in
the tender offer will permit the seller to avoid the usual transaction costs
15
associated with open market sales. Furthermore, odd lot holders who hold shares
registered in their names and tender their shares directly to the depositary and
whose shares are purchased pursuant to the tender offer will avoid not only the
payment of brokerage commissions but also any applicable odd lot discounts that
might be payable on sales of their shares in NYSE transactions.
Stockholders who do not tender their shares pursuant to the tender offer
and stockholders who otherwise retain an equity interest in D&PL as a result of
a partial tender of shares, proration or a conditional tender for which the
condition is not satisfied will continue to be owners of D&PL and will realize a
proportionate increase in their relative equity interest in D&PL and will bear
the risks and rewards associated with owning the equity securities of D&PL,
including risks resulting from D&PL's purchase of shares.
Our offer also presents some potential risks and disadvantages to us and
our continuing stockholders. Our offer will reduce our "public float"; that is,
the number of shares owned by outside stockholders and available for trading in
the securities markets. This may result in lower stock prices or reduced
liquidity in the trading market for our shares in the future. See Section 12.
After the completion of the tender offer, D&PL expects to have sufficient
cash flow and access to funding to meet its cash needs for normal operations and
anticipated capital expenditures.
Neither D&PL nor the D&PL Board of Directors nor the dealer manager makes
any recommendation to any stockholder as to whether to tender or refrain from
tendering any shares or as to the price or prices at which stockholders may
choose to tender their shares. D&PL has not authorized any person to make any
recommendation. Stockholders should carefully evaluate all information in the
tender offer, should consult their own investment and tax advisors, and should
make their own decisions about whether to tender shares, and, if so, how many
shares to tender and the price or prices at which to tender. D&PL has been
advised that of its directors and executive officers, one executive officer
intends to tender a portion of his shares in the tender offer.
D&PL may make stock repurchases from time to time on the open market and/or
in private transactions. In February 2000, D&PL announced that its Board of
Directors had authorized the Company to repurchase up to $50 million of its
common stock. The repurchased shares are to be used to provide for option
exercises and for other general corporate purposes. D&PL has repurchased
approximately $47.5 million of its common stock under this repurchase
authorization. Whether or not D&PL makes additional repurchases will depend on
many factors, including, without limitation, the number of shares, if any, that
D&PL purchases in this tender offer, D&PL's business and financial performance
and situation, the business and market conditions at the time, including the
price of the shares, and such other factors as D&PL may consider relevant. Any
of these repurchases may be on the same terms or on terms that are more or less
favorable to the selling stockholders than the terms of the tender offer. Rule
13e-4 of the Exchange Act prohibits D&PL and its affiliates from purchasing any
shares, other than pursuant to the tender offer, until at least ten business
days after the expiration date of the tender offer, except pursuant to certain
limited exceptions provided in Rule 14e-5 of the Exchange Act.
16
D&PL intends to treat as treasury stock the shares that it acquires
pursuant to the tender offer. These shares will be available for D&PL to reissue
without further stockholder action (except as required by applicable law or the
rules of the NYSE or any other securities exchange on which the shares may then
be listed) for various purposes including, without limitation, acquisitions,
raising additional capital and the satisfaction of obligations under existing or
future employee benefit or compensation programs or stock plans or compensation
programs for directors.
3. Procedures for Tendering Shares.
Proper Tender of Shares. For stockholders to properly tender shares
pursuant to the tender offer:
- the depositary must receive, at the depositary's address set forth on
the back cover page of this offer to purchase, share certificates (or
confirmation of receipt of such shares under the procedure for
book-entry transfer set forth below), together with a properly
completed and duly executed letter of transmittal, including any
required signature guarantees, or an "agent's message" in the case of
a book-entry transfer and any other documents required by the letter
of transmittal, before the tender offer expires; or
- the tendering stockholder must comply with the guaranteed delivery
procedure set forth below.
If a broker, dealer, commercial bank, trust company or other nominee holds
your shares, it is likely they have an earlier deadline for you to act to
instruct them to accept the tender offer on your behalf. We urge you to contact
your broker, dealer, commercial bank, trust company or other nominee to find out
their applicable deadline.
In accordance with Instruction 5 of the letter of transmittal, stockholders
desiring to tender shares in the tender offer must properly indicate the
purchase price they will accept for their tendered shares by either (i) checking
the box in the section captioned "Shares Tendered at Price Determined Pursuant
to the Tender Offer" in the letter of transmittal, which means the stockholder
is willing to accept the purchase price determined by D&PL pursuant to the
tender offer, or (ii) checking one, and only one, of the boxes in the section
captioned "Shares Tendered at Price Determined by Stockholder" in the letter of
transmittal indicating the price per share at which such stockholder's shares
are being tendered.
If tendering stockholders wish to maximize the chance that D&PL will
purchase their shares, they should check the box in the section of the letter of
transmittal captioned "Shares Tendered at Price Determined Pursuant to the
Tender Offer." Note that this election could have the effect of decreasing the
price at which D&PL purchases tendered shares because shares tendered using this
election will be available for purchase at the minimum price of $25.00 per share
and, as a result, it is possible that this election could result in D&PL
purchasing tendered shares at the minimum price of $25.00 per share.
17
A stockholder who desires to tender shares at more than one price must
complete a separate letter of transmittal for each price at which such
stockholder tenders shares, provided that a stockholder may not tender the same
shares (unless properly withdrawn previously in accordance with Section 4) at
more than one price. To tender shares properly, stockholders must check one and
only one price box in the appropriate section of each letter of transmittal. If
you check more than one box or if you fail to check any box at all you will not
have validly tendered your shares.
Odd lot holders who tender all of their shares must complete the section
captioned "Odd Lots" in the letter of transmittal and, if applicable, in the
notice of guaranteed delivery, to qualify for the preferential treatment
available to odd lot holders as set forth in Section 1.
We urge stockholders who hold shares through brokers or banks to consult
the brokers or banks to determine whether transaction costs are applicable if
they tender shares through the brokers or banks and not directly to the
depositary.
Signature Guarantees. Except as otherwise provided below, all signatures on
a letter of transmittal must be guaranteed by a financial institution (including
most banks, savings and loans associations and brokerage houses) which is a
participant in an acceptable medallion guarantee program. Signatures on a letter
of transmittal need not be guaranteed if:
- the letter of transmittal is signed by the registered holder of the
shares (which term, for purposes of this Section 3, shall include any
participant in The Depository Trust Company, referred to as the
"book-entry transfer facility," whose name appears on a security
position listing as the owner of the shares) tendered therewith and
the holder has not completed either the box captioned "Special
Delivery Instructions" or the box captioned "Special Payment
Instructions" in the letter of transmittal; or
- shares are tendered for the account of a bank, broker, dealer, credit
union, savings association or other entity which is a member in good
standing of an acceptable medallion guarantee program or a bank,
broker, dealer, credit union, savings association or other entity
which is an "eligible guarantor institution," as such term is defined
in Rule 17Ad-15 under the Exchange Act. See Instruction 1 of the
letter of transmittal.
If a share certificate is registered in the name of a person other than the
person executing a letter of transmittal, or if payment is to be made to a
person other than the registered holder, then the certificate must be endorsed
or accompanied by an appropriate stock power, in either case signed exactly as
the name of the registered holder appears on the certificate, with the signature
guaranteed by an eligible guarantor institution.
D&PL will make payment for shares tendered and accepted for payment under
the tender offer only after the depositary timely receives share certificates or
a timely confirmation of the book-entry transfer of the shares into the
depositary's account at the book-entry transfer facility as described above, a
properly completed and duly executed letter of transmittal, or an agent's
message in the case of a book-entry transfer, and any other documents required
by the letter of transmittal.
18
Method of Delivery. The method of delivery of all documents, including
share certificates, the letter of transmittal and any other required documents,
is at the election and risk of the tendering stockholder. If you choose to
deliver required documents by mail, we recommend that you use registered mail
with return receipt requested, properly insured. In all cases, sufficient time
should be allowed to ensure timely delivery.
Book-Entry Delivery. The depositary will establish an account with respect
to the shares for purposes of the tender offer at the book-entry transfer
facility within two business days after the date of this offer to purchase, and
any financial institution that is a participant in the book-entry transfer
facility's system may make book-entry delivery of the shares by causing the
book-entry transfer facility to transfer shares into the depositary's account in
accordance with the book-entry transfer facility's procedures for transfer.
Although participants in the book-entry transfer facility may effect delivery of
shares through a book-entry transfer into the depositary's account at the
book-entry transfer facility, either:
- a properly completed and duly executed letter of transmittal,
including any required signature guarantees, or an agent's message in
the case of a book-entry transfer, and any other required documents
must, in any case, be transmitted to and received by the depositary at
its address set forth on the back cover page of this offer to purchase
before the expiration date; or
- the guaranteed delivery procedure described below must be followed.
Delivery of the letter of transmittal and any other required documents to
the book-entry transfer facility does not constitute delivery to the depositary.
The term "agent's message" means a message transmitted by the book-entry
transfer facility to, and received by, the depositary, 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 that the
participant has received and agrees to be bound by the terms of the letter of
transmittal and that D&PL may enforce the agreement against the participant.
Company Stock Option Plans. D&PL is not offering, as part of the offer, to
purchase any of the options outstanding under the Company's stock option plans
and tenders of such options will not be accepted. In no event are any options to
be delivered to the depositary in connection with a tender of shares hereunder.
An exercise of an option cannot be revoked even if shares received upon the
exercise thereof and tendered in the offer are not purchased in the offer for
any reason.
Federal Backup Withholding Tax. Under the federal income tax backup
withholding rules, 28% of the gross proceeds payable to a stockholder or other
payee pursuant to the tender offer must be withheld and remitted to the United
States Treasury, unless the stockholder or other payee provides his or her
taxpayer identification number (employer identification number or social
security number) to the depositary and certifies that such number is correct or
an exemption otherwise applies under applicable regulations. Therefore, unless
such an exemption exists and is proven in a manner satisfactory to the
depositary, each tendering stockholder should complete and sign the Substitute
19
Form W-9 included with the letter of transmittal so as to provide the
information and certification necessary to avoid backup withholding. Certain
stockholders (including, among others, all corporations and certain foreign
individuals) are not subject to these backup withholding and reporting
requirements. In order for a foreign individual to qualify as an exempt
recipient, that stockholder must submit a statement, signed under penalties of
perjury, attesting to that individual's exempt status. Tendering stockholders
can obtain such statements from the depositary. See Instruction 13 of the letter
of transmittal.
Any tendering stockholder or other payee who fails to complete fully and
sign the Substitute Form W-9 included with the letter of transmittal may be
subject to required federal income tax backup withholding of 28% of the gross
proceeds paid to such stockholder or other payee pursuant to the tender offer.
Gross proceeds payable pursuant to the tender offer to a foreign
stockholder or his or her agent will be subject to withholding of federal income
tax at a rate of 30%, unless we determine that a reduced rate of withholding is
applicable pursuant to a tax treaty or that an exemption from withholding is
applicable because such gross proceeds are effectively connected with the
conduct of a trade or business within the United States. For this purpose, a
foreign stockholder is any stockholder that is not:
- a citizen or resident of the United States,
- a corporation, partnership or other entity created or organized in or
under the laws of the United States, any State or any political
subdivision thereof,
- a trust whose administration is subject to the primary supervision of
a U.S. court and which has one or more U.S. persons who have the
authority to make all substantial decisions, or
- an estate the income of which is subject to United States federal
income taxation regardless of its source.
A foreign stockholder may be eligible to file for a refund of such tax or a
portion of such tax if such stockholder meets the "complete termination,"
"substantially disproportionate" or "not essentially equivalent to a dividend"
tests described in Section 14 or if such stockholder is entitled to a reduced
rate of withholding pursuant to a tax treaty and D&PL withheld at a higher rate.
In order to obtain a reduced rate of withholding under a tax treaty, a foreign
stockholder must deliver to the depositary before the payment a properly
completed and executed statement claiming such an exemption or reduction.
Tendering stockholders can obtain such statements from the depositary. In order
to claim an exemption from withholding on the grounds that gross proceeds paid
pursuant to the tender offer are effectively connected with the conduct of a
trade or business within the United States, a foreign stockholder must deliver
to the depositary a properly executed statement claiming such exemption.
Tendering stockholders can obtain such statements from the depositary. See
Instruction 13 of the letter of transmittal. We urge foreign stockholders to
consult their own tax advisors regarding the application of federal income tax
withholding, including eligibility for a withholding tax reduction or exemption
and the refund procedure.
For a discussion of United States federal income tax consequences to
tendering stockholders, see Section 14.
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Guaranteed Delivery. If a stockholder desires to tender shares under the
tender offer and the stockholder's share certificates are not immediately
available or the stockholder cannot deliver the share certificates to the
depositary before the expiration date, or the stockholder cannot complete the
procedure for book-entry transfer on a timely basis, or if time will not permit
all required documents to reach the depositary before the expiration date, the
stockholder may nevertheless tender the shares, provided that the stockholder
satisfies all of the following conditions:
- the stockholder makes the tender by or through an eligible guarantor
institution;
- the depositary receives by hand, mail, overnight courier or facsimile
transmission, before the expiration date, a properly completed and
duly executed notice of guaranteed delivery in the form D&PL has
provided, specifying the price at which the stockholder is tendering
shares, including (where required) a guarantee by an eligible
guarantor institution in the form set forth in such notice of
guaranteed delivery; and
- the depositary receives the share certificates, in proper form for
transfer, or confirmation of book-entry transfer of the shares into
the depositary's account at the book-entry transfer facility, together
with a properly completed and duly executed letter of transmittal, or
a manually signed facsimile thereof, and including any required
signature guarantees, or an agent's message, and any other documents
required by the letter of transmittal, within three NYSE trading days
after the date of receipt by the depositary of the notice of
guaranteed delivery.
Return of Unpurchased Shares. The depositary will return certificates for
unpurchased shares promptly after the expiration or termination of the tender
offer or the proper withdrawal of the shares, as applicable, or, in the case of
shares tendered by book-entry transfer at the book-entry transfer facility, the
depositary will credit the shares to the appropriate account maintained by the
tendering stockholder at the book-entry transfer facility, in each case without
expense to the stockholder.
Determination of Validity; Rejection of Shares; Waiver of Defects; No
Obligation to Give Notice of Defects. D&PL will determine, in its sole
discretion, all questions as to the number of shares that we will accept, the
price that we will pay for shares that we accept and the validity, form,
eligibility (including time of receipt) and acceptance for payment of any tender
of shares, and our determination will be final and binding on all parties. D&PL
reserves the absolute right to reject any or all tenders of any shares that it
determines are not in proper form or the acceptance for payment of or payment
for which D&PL determines may be unlawful. D&PL also reserves the absolute right
to waive any defect or irregularity in any tender with respect to any particular
shares or any particular stockholder, and D&PL's interpretation of the terms of
the tender offer will be final and binding on all parties. No tender of shares
will be deemed to have been properly made until the stockholder cures, or D&PL
waives, all defects or irregularities. None of D&PL, the depositary, the
information agent, the dealer manager or any other person will be under any duty
to give notification of any defects or irregularities in any tender or incur any
liability for failure to give this notification.
21
Tendering Stockholder's Representation and Warranty; D&PL's Acceptance
Constitutes an Agreement. A tender of shares under any of the procedures
described above will constitute the tendering stockholder's acceptance of the
terms and conditions of the tender offer, as well as the tendering stockholder's
representation and warranty to D&PL that:
- the stockholder has a net long position in the shares or equivalent
securities at least equal to the shares tendered within the meaning of
Rule 14e-4 of the Exchange Act; and
- the tender of shares complies with Rule 14e-4.
It is a violation of Rule 14e-4 for a person, directly or indirectly, to
tender shares for that person's own account unless, at the time of tender and at
the end of the proration period or period during which shares are accepted by
lot (including any extensions thereof), the person so tendering has a net long
position equal to or greater than the amount tendered in:
- the shares; or
- securities immediately convertible into, or exchangeable or
exercisable for, the shares; and
- will deliver or cause to be delivered the shares in accordance with
the terms of the tender offer.
Rule 14e-4 provides a similar restriction applicable to the tender or
guarantee of a tender on behalf of another person. D&PL's acceptance for payment
of shares tendered under the tender offer will constitute a binding agreement
between the tendering stockholder and D&PL upon the terms and conditions of the
tender offer.
Lost or Destroyed Certificates. Stockholders whose share certificate for
part or all of their shares has been lost, stolen, misplaced or destroyed must
contact Illinois Stock Transfer Company, the depositary for this offer, at (800)
757-5755 or (312) 427-2953, for instructions as to obtaining a replacement share
certificate. That share certificate will then be required to be submitted
together with the letter of transmittal in order to receive payment for shares
that are tendered and accepted for payment. The stockholder may have to post a
bond to secure against the risk that the share certificate may subsequently
emerge. We urge stockholders to contact Illinois Stock Transfer Company
immediately in order to permit timely processing of this documentation.
Stockholders must deliver share certificates, together with a properly
completed and duly executed letter of transmittal, including any signature
guarantees, or an agent's message, and any other required documents to the
depositary and not to D&PL, the information agent or the dealer manager. Neither
D&PL, the information agent nor the dealer manager will forward any such
documents to the depositary and delivery to D&PL, the information agent or the
dealer manager will not constitute a proper tender of shares.
22
4. Withdrawal Rights.
Stockholders may withdraw shares tendered under the tender offer at any
time prior to the expiration date and, unless accepted by D&PL for payment after
the expiration date, may also be withdrawn at any time after 12:00 Midnight, New
York City time, on Wednesday, June 15, 2005.
For a withdrawal to be effective, the depositary must timely receive a
written or facsimile transmission notice of withdrawal at the depositary's
address set forth on the back cover page of this offer to purchase. Any such
notice of withdrawal must specify the name of the tendering stockholder, the
number of shares that the stockholder wishes to withdraw and the name of the
registered holder of the shares. If the share certificates to be withdrawn have
been delivered or otherwise identified to the depositary, then, before the
release of the share certificates, the serial numbers shown on the share
certificates must be submitted to the depositary and the signature(s) on the
notice of withdrawal must be guaranteed by an eligible guarantor institution,
unless the shares have been tendered for the account of an eligible guarantor
institution.
If a stockholder has tendered shares under the procedure for book-entry
transfer set forth in Section 3, any notice of withdrawal also must specify the
name and the number of the account at the book-entry transfer facility to be
credited with the withdrawn shares and must otherwise comply with the book-entry
transfer facility's procedures. D&PL will determine all questions as to the form
and validity (including the time of receipt) of any notice of withdrawal, in its
sole discretion, and such determination will be final and binding. None of D&PL,
the depositary, the information agent, the dealer manager or any other person
will be under any duty to give notification of any defects or irregularities in
any notice of withdrawal or incur any liability for failure to give this
notification.
A stockholder may not rescind a withdrawal and D&PL will deem any shares
that a stockholder properly withdraws not properly tendered for purposes of the
tender offer, unless the stockholder properly re-tenders the withdrawn shares
before the expiration date by following one of the procedures described in
Section 3.
If D&PL extends the tender offer, is delayed in its purchase of shares or
is unable to purchase shares under the tender offer for any reason, then,
without prejudice to D&PL's rights under the tender offer, the depositary may,
subject to applicable law, retain tendered shares on behalf of D&PL, and
stockholders may not withdraw these shares except to the extent tendering
stockholders are entitled to withdrawal rights pursuant to applicable law and as
described in this Section 4.
5. Purchase of Shares and Payment of Purchase Price.
Upon the terms and subject to the conditions of the tender offer, promptly
following the expiration date, D&PL:
- will determine the purchase price it will pay for shares properly
tendered and not properly withdrawn before the expiration date, taking
into account the number of shares so tendered and the prices specified
by tendering stockholders; and
23
- will accept for payment and pay for, and thereby purchase, up to
1,739,130 shares (or such greater number of shares as we may elect to
purchase, subject to applicable law) properly tendered at prices at or
below the purchase price and not properly withdrawn prior to the
expiration date.
For purposes of the tender offer, D&PL will be deemed to have accepted for
payment, and therefore purchased, shares that are properly tendered at or below
the purchase price determined by D&PL and not properly withdrawn, subject to the
"odd lot," proration and conditional tender provisions of the tender offer, only
when, as and if it gives oral or written notice to the depositary of its
acceptance of the shares for payment pursuant to the tender offer.
Upon the terms and subject to the conditions of the tender offer, promptly
after the expiration date, D&PL will accept for payment and pay a single per
share purchase price not greater than $28.75 nor less than $25.00 per share for
1,739,130 shares, subject to increase or decrease as provided in Section 15, if
properly tendered and not properly withdrawn, or such fewer number of shares as
are properly tendered and not properly withdrawn.
D&PL will pay for shares that it purchases pursuant to the tender offer by
depositing the aggregate purchase price for these shares with the depositary,
which will act as agent for tendering stockholders for the purpose of receiving
payment from D&PL and transmitting payment to the tendering stockholders.
In the event of proration, D&PL will determine the proration factor and pay
for those tendered shares accepted for payment as soon as practicable after the
expiration date; however, D&PL does not expect to be able to announce the final
results of any proration and commence payment for shares purchased until at
least five business days after the expiration date. Under no circumstances will
D&PL pay interest on the purchase price regardless of any delay in making the
payment. Shares tendered and not purchased, including all shares tendered at
prices greater than the purchase price and shares that D&PL does not accept for
purchase due to proration or conditional tenders, will be returned to the
tendering stockholder, or, in the case of shares tendered by book-entry
transfer, will be credited to the account maintained with the book-entry
transfer facility by the participant therein who so delivered the shares, at
D&PL's expense, promptly after the expiration date or termination of the tender
offer without expense to the tendering stockholders. If certain events occur,
D&PL may not be obligated to purchase shares pursuant to the tender offer. See
Section 7. D&PL will issue a press release announcing the price it will pay for
shares tendered in the offer promptly following the expiration date.
D&PL will pay all stock transfer taxes, if any, payable on the transfer to
it of shares purchased under the tender offer. If, however,
- payment of the purchase price is to be made to any person other than
the registered holder;
- certificate(s) for shares not tendered or tendered but not purchased
are to be returned in the name of and to any person other than the
registered holder(s) of such shares; or
- if tendered certificates are registered in the name of any person
other than the person signing the letter of transmittal;
24
the amount of all stock transfer taxes, if any (whether imposed on the
registered holder or the other person), payable on account of the transfer to
the person will be deducted from the purchase price unless satisfactory evidence
of the payment of the stock transfer taxes, or exemption therefrom, is
submitted. See Instruction 10 of the letter of transmittal.
Any tendering stockholder or other payee who fails to complete fully, sign
and return to the depositary the Substitute Form W-9 included with the letter of
transmittal may be subject to U.S. federal income tax backup withholding on the
gross proceeds paid to the stockholder or other payee under the tender offer.
See Section 3.
6. Conditional Tender of Shares.
Subject to the exception for holders of odd lots, in the event of an
over-subscription of the tender offer, shares tendered at or below the purchase
price prior to the expiration date will be subject to proration. See Section 1.
As discussed in Section 14, the number of shares to be purchased from a
particular stockholder may affect the tax treatment of the purchase to the
stockholder and the stockholder's decision whether to tender. Accordingly, a
stockholder may tender shares subject to the condition that D&PL must purchase a
specified minimum number of the stockholder's shares tendered pursuant to a
letter of transmittal if D&PL purchases any shares tendered. Any stockholder
desiring to make a conditional tender must so indicate in the box entitled
"Conditional Tender" in the letter of transmittal and, if applicable, in the
notice of guaranteed delivery, and indicate the minimum number of shares that
D&PL must purchase if D&PL purchases any shares. We urge each stockholder to
consult with his or her own financial or tax advisors.
After the expiration date, if more than 1,739,130 shares (or such greater
number of shares as we may elect to purchase, subject to applicable law) are
properly tendered and not properly withdrawn, so that we must prorate our
acceptance of and payment for tendered shares, we will calculate a preliminary
proration percentage based upon all shares properly tendered, conditionally or
unconditionally. If the effect of this preliminary proration would be to reduce
the number of shares that we purchase from any stockholder below the minimum
number specified, the shares conditionally tendered will automatically be
regarded as withdrawn (except as provided in the next paragraph). All shares
tendered by a stockholder subject to a conditional tender that are withdrawn as
a result of proration will be returned at our expense to the tendering
stockholder.
After giving effect to these withdrawals, we will accept the remaining
shares properly tendered, conditionally or unconditionally, on a pro rata basis,
if necessary. If conditional tenders that would otherwise be regarded as
withdrawn would cause the total number of shares that we purchase to fall below
1,739,130 (or such greater number of shares as we may elect to purchase, subject
to applicable law) then, to the extent feasible, we will select enough of the
shares conditionally tendered that would otherwise have been withdrawn to permit
us to purchase such number of shares. In selecting among the conditional
tenders, we will select by random lot, treating all tenders by a particular
taxpayer as a single lot, and will limit our purchase in each case to the
designated minimum number of shares to be purchased. To be eligible for purchase
by random lot, stockholders whose shares are conditionally tendered must have
tendered all of their shares.
25
7. Conditions of the Tender Offer.
Notwithstanding any other provision of the tender offer, we will not be
required to accept for payment, purchase or pay for any shares tendered, and may
terminate or amend the tender offer or may postpone the acceptance for payment
of, or the purchase of and the payment for shares tendered, subject to Rule
13e-4(f) under the Exchange Act, if, at any time on or after April 20, 2005 and
before the expiration of the offer, any of the following events shall have
occurred (or shall have been reasonably determined by us to have occurred) that,
in our reasonable judgment and regardless of the circumstances giving rise to
the event or events, make it inadvisable to proceed with the tender offer or
with acceptance for payment:
- there shall have been instituted or be pending or the Company shall
have received notice of any action or proceeding by any government or
governmental, regulatory or administrative agency, authority or
tribunal or any other person, domestic or foreign, before any court,
authority, agency or tribunal that:
- challenges the making of the tender offer, the acquisition of
some or all of the shares under the tender offer or otherwise
relates in any manner to the tender offer; or
- in our reasonable judgment, could materially and adversely affect
the business, condition (financial or otherwise), assets, income,
operations or prospects of us or any of our subsidiaries, taken
as a whole, or otherwise materially impair in any way the conduct
of the business of us or any of our subsidiaries or materially
impair our ability to achieve the purposes of the tender offer;
- there shall have been any action pending or taken or of which the
Company shall have received notice, or approval withheld, or any
statute, rule, regulation, judgment, order or injunction proposed,
sought, promulgated, enacted, entered, amended, enforced or deemed to
be applicable to the tender offer or us or any of our subsidiaries, by
any court or any authority, agency or tribunal that, in our reasonable
judgment, would:
- make the acceptance for payment of, or payment for, some or all
of the shares illegal or otherwise restrict or prohibit
completion of the tender offer;
- delay or restrict the ability of us, or render us unable, to
accept for payment or pay for some or all of the shares;
- materially impair our ability to achieve the purposes of the
tender offer; or
- materially and adversely affect the business, condition
(financial or otherwise), assets, income, operations or prospects
of us or our subsidiaries, taken as a whole, or otherwise
materially impair the conduct of the business of us or any of our
subsidiaries;
26
- there shall have occurred:
- any general suspension of trading in, or limitation on prices
for, securities on any national securities exchange or in the
over-the-counter market in the United States or the European
Union;
- the declaration of a banking moratorium or any suspension of
payments in respect of banks in the United States or the European
Union;
- a material change in United States or any other currency exchange
rates or a suspension of or limitation on the markets therefor;
- the commencement or escalation of a war, armed hostilities or
other international or national calamity directly or indirectly
involving the United States or any of its territories, including
but not limited to an act of terrorism;
- any limitation (whether or not mandatory) by any governmental,
regulatory or administrative agency or authority on, or any
event, or any disruption or adverse change in the financial or
capital markets generally or the market for loan syndications in
particular, that, in our reasonable judgment, would affect the
extension of credit by banks or other lending institutions in the
United States;
- any change in the general political, market, economic or
financial conditions in the United States or abroad that could,
in our reasonable judgment, have a material adverse effect on the
business, condition (financial or otherwise), assets, income,
operations or prospects of us or our subsidiaries, taken as a
whole, or otherwise materially impair in any way the conduct of
the business of us or any of our subsidiaries;
- in the case of any of the foregoing existing at the time of the
commencement of the tender offer, a material acceleration or
worsening thereof; or
- any decline in the market price of the shares or the Dow Jones
Industrial Average or the Standard and Poor's Index of 500
Industrial Companies or the New York Stock Exchange or the Nasdaq
Composite Index by a material amount (including, without
limitation, an amount greater than 10%) from the close of
business on April 20, 2005;
- a tender offer or exchange offer for any or all of the shares (other
than this tender offer), or any merger, business combination or other
similar transaction with or involving us or any of our subsidiaries or
affiliates, shall have been proposed, announced or made by any person;
- any of the following shall have occurred:
- any "group" (as that term is used in Section 13(d)(3) of the
Exchange Act) shall have been formed that shall own or have
acquired or proposed to acquire, or any entity or individual
shall have acquired or proposed to acquire, beneficial ownership
of more than 5% of the outstanding shares;
27
- any entity, group or person who has filed a Schedule 13D or
Schedule 13G with the Securities and Exchange Commission on or
before the commencement of this tender offer shall have acquired
or proposed to acquire beneficial ownership of an additional 2%
or more of the outstanding shares; or
- any person, entity or group shall have filed a Notification and
Report Form under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, or made a public announcement reflecting
an intent to acquire us or any of our subsidiaries or any of our
or their respective assets or securities;
- any change or combination of changes shall have occurred, or as to
which we have received notice, in the business, condition (financial
or otherwise), assets, income, operations, prospects or stock
ownership of us or any of our subsidiaries, taken as a whole, that in
our judgment is reasonably likely to be material and adverse to us or
any of our subsidiaries or that otherwise materially impairs the
conduct of the business of us or any of our subsidiaries;
- any approval, permit, authorization, favorable review or consent of
any governmental entity required to be obtained in connection with the
tender offer shall not have been obtained on terms satisfactory to us
in our reasonable judgment; or
- we reasonably determine that the completion of the tender offer and
the purchase of the shares may:
- cause the shares to be held of record by fewer than 300 persons;
or
- cause the shares to be delisted from the NYSE or to be eligible
for deregistration under the Exchange Act.
The foregoing conditions are for our the sole benefit and may be asserted
by us regardless of the circumstances giving rise to any of these conditions,
and may be waived by us, in whole or in part, at any time and from time to time,
before the expiration of the offer, in our sole discretion. Our failure at any
time to exercise any of the foregoing rights shall not be deemed a waiver of any
of these rights, and each of these rights shall be deemed an ongoing right that
may be asserted at any time and from time to time before the expiration of the
offer. Any determination or judgment by us concerning the events described above
will be final and binding on all parties.
28
8. Price Range of Shares; Dividends.
Our common stock is listed and traded on the NYSE under the trading symbol
"DLP." The following table sets forth the high and low closing selling prices
for our common stock for, and the cash dividends declared on our common stock
during, each of the quarterly periods presented.
Dividend
High Low Declared
-------------- ------------- --------------
Fiscal Year 2005 (ending August 31, 2005)
Third Quarter (through April 15, 2005) $28.82 $25.62 $0.12
Second Quarter $30.49 $26.16 $0.12
First Quarter $27.48 $25.22 $0.12
Fiscal Year 2004 (ending August 31, 2004)
Fourth Quarter $25.80 $20.90 $0.12
Third Quarter $25.82 $22.80 $0.12
Second Quarter $26.63 $24.28 $0.12
First Quarter $25.40 $22.62 $0.10
Fiscal Year 2003 (ending August 31, 2003)
Fourth Quarter $25.30 $21.78 $0.10
Third Quarter $24.02 $18.70 $0.06
Second Quarter $20.96 $19.18 $0.06
First Quarter $20.79 $17.96 $0.05
Stockholders of Record. As of April 14, 2005, there were 272 stockholders
of record of our common stock, as furnished by our stock transfer agent and
registrar, Illinois Stock Transfer Company. Several brokerage firms, banks and
other institutions ("nominees") are listed once on the stockholders of record
listing. However, in most cases, the nominees' holdings represent blocks of our
stock held in brokerage accounts for a number of stockholders. As such, our
actual number of stockholders is difficult to estimate with precision, but we
estimate we have approximately 20,000 stockholders.
Dividends. Our dividend policy is determined at the discretion of our Board
of Directors. While we currently anticipate that quarterly cash dividends will
continue to be paid in the future, there can be no assurance that payment of the
dividend will continue. Our ability to pay any cash dividends on our stock is
dependent on our earnings and cash requirements.
Recent Market Price. We publicly announced the tender offer on April 20,
2005, before the open of trading on the NYSE on that date. On April 15, 2005,
the last trading day prior to printing of the tender offer, the reported closing
price per share of our common stock on the NYSE was $25.68. We urge stockholders
to obtain current market quotations for the common stock.
29
9. Source and Amount of Funds.
Assuming that 1,739,130 shares of our common stock are purchased in the
tender offer, at a price between $25.00 and $28.75 per share, the aggregate
purchase price will be between approximately $43.5 million and $50.0 million. We
anticipate that we will fund the purchase of the shares tendered in the offer
through cash on hand.
10. Certain Information Concerning D&PL.
General. D&PL is primarily engaged in the breeding, production,
conditioning and marketing of proprietary varieties of cotton planting seed in
the United States and other cotton producing nations. We also breed, produce,
condition and market soybean planting seed in the United States.
Since 1915, we have bred, produced and/or marketed upland picker varieties
of cotton planting seed for cotton varieties that are grown primarily east of
Texas and in Arizona. We have used our extensive classical plant breeding
programs to develop a gene pool necessary for producing cotton varieties with
improved agronomic traits important to farmers (such as crop yield) and to
textile manufacturers (such as enhanced fiber characteristics).
In 1980, we added soybean seed to our product line. In 1996, we commenced
commercial sales in the United States of cotton planting seed containing
Bollgard gene technology licensed from Monsanto which expresses a protein toxic
to certain lepidopteran pests. Since 1997, we have marketed in the U.S. cotton
planting seed that contains a gene that provides tolerance to glyphosate-based
herbicides, commonly referred to as Roundup Ready cotton. In 1997, we commenced
commercial sales in the U.S. of soybean planting seed that contains a gene that
provides tolerance to glyphosate-based herbicides ("Roundup Ready Soybeans"). In
1998, we commenced sales of cotton planting seed of varieties containing both
the Bollgard and Roundup Ready genes.
During the 1980's, as a component of our long-term growth strategy, we
began to market our products, primarily cottonseed, internationally. Over a
period of years, we have strengthened and expanded our international staff in
order to support our expanding international business. In foreign countries,
cotton acreage is often planted with farmer-saved seed which has not been
delinted or treated and is of low overall quality. We believe that we have an
attractive opportunity to penetrate foreign markets because of our widely
adaptable, superior cotton varieties, technological know-how in producing and
conditioning high-quality seed and our brand name recognition. Furthermore,
Monsanto's Bollgard and Roundup Ready gene technologies (that we either have
licensed or have options to license) are effective in many countries and could
bring value to farmers.
We sell our products in foreign countries through (i) export sales to
distributors and (ii) direct in-country operations through either joint ventures
or wholly-owned subsidiaries. The method varies and evolves, depending on our
assessment of the potential size and profitability of the market, governmental
policies, currency and credit risks, sophistication of the target country's
agricultural economy, and costs (as compared to risks) of commencing physical
30
operations in a particular country. In 2004, the majority of international sales
came from direct in-country operations (primarily Argentina, Australia, Brazil,
China, South Africa and Turkey).
Where You Can Find More Information. D&PL is subject to the information
requirements of the Exchange Act, and, in accordance therewith, files periodic
reports, proxy statements and other information relating to its business,
financial condition and other matters. D&PL is required to disclose in these
proxy statements certain information, as of particular dates, concerning its
directors and executive officers, their compensation, stock options granted to
them, the principal holders of the securities of D&PL and any material interest
of such persons in transactions with D&PL. Pursuant to Rule 13e-4(c)(2) under
the Exchange Act, D&PL has filed electronically with the Securities and Exchange
Commission an Issuer Tender Offer Statement on Schedule TO that includes
additional information with respect to the tender offer. The Securities and
Exchange Commission also maintains a web site on the Internet at
http://www.sec.gov that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Securities and Exchange Commission. This material and other information may be
inspected at the public reference facilities maintained by the Securities and
Exchange Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C.
20549. Copies of this material can also be obtained by mail, upon payment of the
Securities and Exchange Commission's customary charges, by writing to the Public
Reference Section at 450 Fifth Street, N.W., Washington, D.C. 20549. These
reports, statements and other information concerning D&PL also can be inspected
at the offices of the NYSE, 20 Broad Street, New York, New York 10005.
Incorporation by Reference. The rules of the Securities and Exchange
Commission allow us to "incorporate by reference" information into this
document, which means that we can disclose important information to you by
referring you to another document filed separately with the Securities and
Exchange Commission. These documents contain important information about us.
SEC Filings (File No. 001-14136) Period or Date Filed
-------------------------------- ------------------------------
Annual Report on Form 10-K Year Ended August 31, 2004
Quarterly Report on Form 10-Q Quarter Ended February 28, 2005
Proxy Statement Filed on December 1, 2004
We incorporate by reference the documents listed above. These documents can
be accessed free of charge at the website of the Securities and Exchange
Commission cited above. You also may request a copy of these filings, at no
cost, by writing or telephoning us at our principal executive offices at the
following address: R.D. Greene, Delta and Pine Land Company, One Cotton Row,
Scott, Mississippi, 38772. Please be sure to include your complete name and
address in the request.
11. Interests of Directors and Executive Officers; Transactions and
Arrangements Concerning Shares.
As of April 13, 2005, D&PL had 38,479,224 shares outstanding (not including
2,344,166 shares held in treasury and 8,307,403 shares reserved for issuance
under various equity compensation plans). The 1,739,130 shares that we are
offering to purchase pursuant to the tender offer represent approximately 4.5%
of the shares of common stock outstanding as of that date (or approximately 4.2%
of the shares on a diluted basis, assuming the exercise of all outstanding stock
31
options). Of the reserved shares, 2,689,270 shares are issuable upon exercise of
outstanding stock options. Additionally, 1,066,667 shares of our Series M
Convertible Non-Voting Preferred Stock were outstanding as of April 13, 2005.
The Series M Convertible Non-Voting Preferred Stock is convertible to shares of
common stock on a one-for-one basis.
To the best of our knowledge, the following table sets forth certain
information regarding the beneficial ownership of common stock as of April 13,
2005 for all persons who beneficially owned at least 5% of our common stock as
of such date, as well as each of our named executive officers, directors and all
directors and executive officers as a group.
Shares
Beneficially
Name of Beneficial Owner Owned (13) Percent of Class
- -------------------------------------------------------------------------------------------------------
Sterling Capital Management, LLC(1) 4,243,410 11.0%
Westfield Capital Management Co. LLC(2) 2,260,675 5.86%
Stephens Group, Inc.(3) 1,070,004 2.8%
Jon E. M. Jacoby(4) 58,731 *
F. Murray Robinson(5) 96,446 *
W. Thomas Jagodinski(6) (11) 76,211 *
Rudi E. Scheidt(7) 62,445 *
Stanley P. Roth(8) 50,833 *
Nam-Hai Chua(9) 10,666 *
Joseph M. Murphy(10) 698 *
Charles R. Dismuke, Jr.(6) (12) 102,000 *
Ricky D. Greene(6) 500 *
William V. Hugie(6) 490 *
Thomas A. Kerby(6) 0 *
All directors and executive officers of
D&PL as a group (19 persons) (13) 646,782 1.7%
_________________________________
* Less than one percent
(1) This information is as of December 31, 2004 and is derived from the Form
13G/A filed with the SEC on January 4, 2005. The mailing address for
Sterling Capital Management is 4064 Colony Road, Suite 300, Charlotte,
North Carolina 28211.
(2) This information is as of December 31, 2004 and is derived from the Form
13G filed with the SEC on February 14, 2005. The mailing address for
Westfield Capital Management is One Financial Center, Boston, Massachusetts
02111.
(3) Mr. Jacoby, a director of Stephens Group, Inc. ("SGI") and an employee of
its subsidiary, Stephens, Inc., owns 58,731 shares which are not included.
(See Note 4 below). The mailing address for Stephens Group, Inc. and
affiliates is 111 Center Street, Little Rock, Arkansas 72201.
32
(4) Includes the following shares: 5,437 shares owned by Jacoby Enterprises,
Inc., as to which Mr. Jacoby has sole power to vote and sole power of
disposition, 20,094 shares held in an IRA account, 8,200 shares held by an
LLC as to which Mr. Jacoby disclaims beneficial ownership and 25,000 shares
owned beneficially by Mr. Jacoby. Does not include shares owned by SGI, or
other of its affiliates, except Jacoby Enterprises, Inc. (See Note 3
above). The mailing address for Jacoby Enterprises, Inc., and Mr. Jacoby is
111 Center Street, Little Rock, Arkansas 72201.
(5) Includes 38,000 shares owned by a Charitable Remainder Unit Trust ("CRUT").
Mr. Robinson disclaims beneficial ownership of shares owned by the CRUT.
The mailing address for Mr. Robinson is 1520 Woodruff Lane, Bloomington,
Indiana 47401.
(6) The mailing address for Messrs. Jagodinski, Dismuke, Greene, Hugie, and
Kerby is One Cotton Row, Scott, Mississippi 38772.
(7) Includes 17,000 shares owned by the Scheidt Family Foundation and 45,445
shares owned beneficially by Mr. Scheidt. The mailing address for Mr.
Scheidt is 54 South White Station Road, Memphis, Tennessee 38117.
(8) Includes 27,500 shares owned by North American Capital Corporation, as to
which Mr. Roth has sole power to vote and sole power of disposition and
23,333 shares owned beneficially by Mr. Roth. The mailing address for Mr.
Roth is 510 Broad Hollow Road, Suite 206, Melville, New York 11747.
(9) The shares indicated are owned by Dr. Chua's wife. Dr. Chua disclaims
beneficial ownership of these shares. The mailing address for Dr. Chua is
c/o Laboratory of Plant Molecular Biology, Rockefeller University, 1230
York Avenue, New York, New York 10021-6399.
(10) The shares indicated are owned by Mr. Murphy's wife. Mr. Murphy disclaims
beneficial ownership of these shares. The mailing address for Mr. Murphy is
200 East 42nd Street, 9th Floor, New York, New York 10017.
(11) Includes 3,555 shares owned by Mr. Jagodinski's wife. Mr. Jagodinski
disclaims beneficial ownership of shares owned by his wife.
(12) Includes 30,000 shares owned by Mr. Dismuke's wife. Mr. Dismuke disclaims
beneficial ownership of shares owned by his wife.
(13) As a group, the 646,782 shares shown exclude vested and unvested options
for 46,778 shares pursuant to the 1993 Delta and Pine Land Company Stock
Option Plan and options for 1,673,144 shares pursuant to the 1995 Long-Term
Incentive Plan for a total of 1,719,922. These option amounts in the
preceding sentence include vested options of 1,300,328 for each individual
listed in the table (which amounts are excluded from the table) as follows:
Jon E. M. Jacoby, 100,085; F. Murray Robinson, 132,084; W. Thomas
Jagodinski, 323,820; Rudi E. Scheidt, 100,085; Stanley P. Roth, 100,085;
Nam-Hai Chua, 100,085; Joseph M. Murphy, 98,307; Charles R. Dismuke, Jr.,
80,000; Ricky D. Greene, 67,000; William V. Hugie, 115,000; Thomas A.
Kerby, 83,777.
The directors and executive officers of D&PL are entitled to participate in
the tender offer on the same basis as all other stockholders. Of our officers
and directors, we have been advised that Mr. Dismuke, one of our executive
officers, intends to tender 35,000 shares at a purchase price selected by him.
He has advised us that he is tendering the shares for the purpose of
diversifying his investments.
All of the other directors and executive officers have advised D&PL that
they do not intend to tender any shares in the tender offer. To D&PL's
knowledge, except as set forth above, none of D&PL's affiliates intends to
tender any shares in the tender offer.
33
Based on D&PL's records and information provided to D&PL by its directors,
executive officers, associates and subsidiaries, neither D&PL, nor, to the best
of D&PL's knowledge, any directors or executive officers of D&PL or any
associates or subsidiaries of D&PL, has effected any transactions in shares
during the 60-day period prior to the date of this offer to purchase, except as
set forth below.
The following is a list of the shares of common stock that D&PL purchased
under its previously announced share repurchase program during the 60-day period
prior to the date of this offer to purchase.
Shares Average Price
Date Purchased Per Share
---- --------- -------------
03/08/05 30,000 $ 27.22
03/09/05 49,500 $ 26.59
03/10/05 49,500 $ 26.99
03/11/05 49,500 $ 26.49
03/14/05 43,000 $ 26.80
03/15/05 50,000 $ 26.58
03/16/05 40,000 $ 26.26
03/17/05 40,000 $ 26.21
03/18/05 50,000 $ 26.06
03/21/05 32,000 $ 25.24
03/22/05 29,200 $ 25.84
03/23/05 40,000 $ 25.98
03/24/05 23,800 $ 25.95
03/28/05 40,000 $ 26.59
03/29/05 30,000 $ 26.71
03/30/05 40,000 $ 26.48
03/31/05 36,100 $ 26.78
04/01/05 4,100 $ 27.74
Based upon our records and upon information provided to us by our
directors, executive officers, associates and subsidiaries, none of any of our
associates or subsidiaries or persons controlling us or, to the best of our
knowledge, any of our directors or executive directors or any of our
subsidiaries, or any associates or subsidiaries of any of the foregoing, has
effected any transactions in our shares on the date of this offer to purchase or
during the 60 days prior to the date of this offer to purchase, except as
described below.
Date of Nature of Number of Price Per
Name Transaction Transaction Shares Share
- ---- ----------- ----------- ------ -----
Charles R. Dismuke 02/28/05 Gift* 12,334 n/a
James Willeke 04/06/05 Stock Option 25,000 $15.71
Exercise
James Willeke 04/06/05 Sale 25,000 $27.5398
______________________
*Mr. Dismuke gifted these 12,334 shares to his wife and he disclaims beneficial
ownership of the shares.
34
We currently have three plans pursuant to which equity awards are granted
and issued: the 1993 Stock Option Plan (the "1993 Plan"), the 1995 Long-Term
Incentive Plan (the "1995 Plan") and the 2005 Omnibus Stock Plan (the "2005
Plan").
In 1993, the Company adopted the 1993 Plan, but no more options were
granted under this plan effective with the adoption of the 1995 Plan. In 1995,
the Company's Board of Directors adopted the 1995 Plan that was ratified by the
stockholders at the 1996 Annual Meeting. In 2000, the 1995 Plan was amended and
restated eliminating the ability of our Board of Directors to award stock
appreciation rights, restricted shares of common stock and performance unit
credits. Pursuant to the amended and restated 1995 Plan, the Board of Directors
may award stock options to officers, key employees and directors. Under the
amended and restated 1995 Plan, 5,120,000 shares are authorized for grant, which
is an increase from the original 2,560,000 shares. As of April 13, 2005, options
for 5,310,359 shares have been granted under the 1995 Plan, of which 1,308,492
have been forfeited, leaving available for grant 1,118,133 shares.
Under the 1993 Plan, all stock options granted vested at a rate of 20% per
annum commencing on the first day of the second and each succeeding year
following each grant and expire ten years from the date of the grant. The number
of shares available for grant under the 1993 Plan and upon forfeitures of
options outstanding thereunder has been reduced to zero, and no further option
grants are being made under this plan.
Stock options granted under the 1995 Plan vest in accordance with an option
agreement that contains the terms and conditions applicable to each option
grant. No option shall be exercisable after ten years from the date of the
grant. Shares subject to options and awards under the 1995 Plan which expire
unexercised are available for new option grants and awards.
The 2005 Plan was approved at our Annual Meeting of Stockholders in January
2005. The 2005 Plan provides for the grant of incentive stock options,
non-qualified stock options, restricted stock and restricted stock units to D&PL
employees, independent contractors and members of the Board of Directors at the
discretion of the Compensation Committee of the Board. Such a grant, subject to
the terms and provisions of the 2005 Plan, is in such number and upon such terms
as determined by the Compensation Committee.
Up to 4,500,000 shares are available for grants under the 2005 Plan. No
shares under the 2005 Plan have yet been issued. Also, the shares available
under the 2005 Plan are in addition to the shares available under the 1995 Plan.
The maximum number of shares which may be issued for awards of restricted stock
and restricted stock units is 2,100,000 shares. The maximum number of shares
with respect to which shares or restricted stock, restricted stock units,
options or a combination thereof may be granted during any year to any person is
250,000 shares.
Except as otherwise described in this Offer to Purchase, none of D&PL or
any person controlling us or, to our knowledge, any of our directors or
executive officers, is a party to any contract, arrangement, understanding or
relationship with any other person relating, directly or indirectly, to our
offer or with respect to any of our securities, including, but not limited to,
any contract, arrangement, understanding or relationship concerning the transfer
35
or the voting of any such securities, joint ventures, loan or option
arrangements, puts or calls, guarantees of loans, guarantees against loss or the
giving or withholding of proxies, consents or authorizations.
12. Effects of the Tender Offer on the Market for Shares; Registration under
the Exchange Act.
The purchase by D&PL of shares pursuant to the tender offer may reduce the
number of shares of common stock that might otherwise be traded publicly and may
reduce the number of D&PL stockholders. These reductions may reduce the volume
of trading in our shares of common stock and may result in lower stock prices
and reduced liquidity in the trading of our shares of common stock following
completion of the tender offer. Stockholders may be able to sell non-tendered
shares of common stock in the future on the NYSE or otherwise, at a net price
higher or lower than the purchase price in the tender offer. We can give no
assurance, however, as to the price at which a stockholder may be able to sell
such shares in the future.
As of April 13, 2005, D&PL had 38,479,224 shares outstanding (not including
2,344,166 shares held in treasury and 8,307,403 shares reserved for issuance
under various equity compensation plans). The 1,739,130 shares that we are
offering to purchase pursuant to the tender offer represent approximately 4.5%
of the shares of common stock outstanding as of that date (or approximately 4.2%
of the shares on a diluted basis, assuming the exercise of all outstanding stock
options). Of the reserved shares, 2,689,270 shares are issuable upon exercise of
outstanding stock options. Additionally, 1,066,667 shares of our Series M
Convertible Non-Voting Preferred Stock are outstanding as of April 13, 2005. The
Series M Convertible Non-Voting Preferred Stock is convertible to shares of
common stock on a one-for-one basis.
D&PL anticipates that there will be a sufficient number of shares of common
stock outstanding and publicly traded following completion of the tender offer
to ensure a continued trading market for such shares. Based upon published
guidelines of the NYSE, D&PL does not believe that its purchase of shares
pursuant to the tender offer will cause the remaining outstanding shares of D&PL
common stock to be delisted from the NYSE.
Our shares are "margin securities" under the rules of the Board of
Governors of the Federal Reserve System. This classification has the effect,
among other things, of allowing brokers to extend credit to their customers
using the shares as collateral. D&PL believes that, following the purchase of
shares pursuant to the tender offer, the shares of common stock remaining
outstanding will continue to be margin securities for purposes of the Federal
Reserve Board's margin rules and regulations.
Our common stock is registered under the Exchange Act, which requires,
among other things, that D&PL furnish certain information to its stockholders
and the Securities and Exchange Commission and comply with the Securities and
Exchange Commission's proxy rules in connection with meetings of the D&PL
stockholders. D&PL believes that its purchase of shares pursuant to the tender
offer will not result in the common stock becoming eligible for deregistration
under the Exchange Act.
36
13. Legal Matters; Regulatory Approvals.
D&PL is not aware of any license or regulatory permit material to its
business that might be adversely affected by its acquisition of shares as
contemplated by the tender offer or of any approval or other action by any
government or governmental, administrative or regulatory authority or agency,
domestic, foreign or supranational, that would be required for the acquisition
of shares by D&PL as contemplated by the tender offer. Should any approval or
other action be required, D&PL presently contemplates that it will seek that
approval or other action. D&PL is unable to predict whether it will be required
to delay the acceptance for payment of or payment for shares tendered under the
tender offer pending the outcome of any such matter. There can be no assurance
that any approval or other action, if needed, would be obtained or would be
obtained without substantial cost or conditions or that the failure to obtain
the approval or other action might not result in adverse consequences to its
business and financial condition. The obligations of D&PL under the tender offer
to accept for payment and pay for shares is subject to conditions. See Section
7.
14. U.S. Federal Income Tax Consequences.
The following describes the material United States federal income tax
consequences relevant to the tender offer. This discussion is based upon the
Internal Revenue Code of 1986, as amended to the date hereof (the "Code"),
existing and proposed Treasury Regulations, administrative pronouncements and
judicial decisions, changes to which could materially affect the tax
consequences described herein and could be made on a retroactive basis.
This discussion deals only with shares held as capital assets and does not
deal with all tax consequences that may be relevant to all categories of holders
(such as financial institutions, dealers in securities or commodities, traders
in securities who elect to apply a mark-to-market method of accounting,
insurance companies, tax-exempt organizations, former citizens or residents of
the United States or persons who hold shares as part of a hedge, straddle,
constructive sale or conversion transaction). In particular, different rules may
apply to shares received through the exercise of employee stock options or
otherwise as compensation. This discussion does not address the state, local or
foreign tax consequences of participating in the tender offer. Holders of shares
should consult their tax advisors as to the particular consequences to them of
participation in the tender offer.
As used herein, a "Holder" means a beneficial holder of shares that is a
citizen or resident of the United States, a corporation or entity taxable as a
corporation created or organized in or under the laws of the United States or
any State thereof, a trust whose administration is subject to the primary
supervision of a U.S. court and which has one or more U.S. persons who have the
authority to make all substantial decisions, or an estate the income of which is
subject to United States federal income taxation regardless of its source.
Holders of shares who are not United States holders ("foreign
stockholders") should consult their tax advisors regarding the United States
federal income tax consequences and any applicable foreign tax consequences of
the tender offer and should also see Section 3 for a discussion of the
applicable United States withholding rules and the potential for obtaining a
refund of all or a portion of any tax withheld.
37
If a partnership holds shares, the tax treatment of a partner will
generally depend upon the status of the partner and the activities of the
partnership. Partners of partnerships holding shares should consult their tax
advisors.
We urge stockholders to consult their tax advisors to determine the
particular tax consequences to them of participating in the tender offer.
Non-Participation in the Tender Offer. Holders of shares who do not
participate in the tender offer will not incur any tax liability as a result of
the consummation of the tender offer.
Exchange of Shares Pursuant to the Tender Offer. An exchange of shares for
cash pursuant to the tender offer will be a taxable transaction for United
States federal income tax purposes. A Holder who participates in the tender
offer will, depending on such Holder's particular circumstances, be treated
either as recognizing gain or loss from the disposition of the shares or as
receiving a distribution from us with respect to our stock.
Under Section 302 of the Code, a Holder will recognize gain or loss on an
exchange of shares for cash if the exchange:
- results in a "complete termination" of all such Holder's equity
interest in us;
- results in a "substantially disproportionate" redemption with respect
to such Holder; or
- is "not essentially equivalent to a dividend" with respect to such
Holder.
In applying the Section 302 tests, a Holder must take account of shares
that such Holder constructively owns under attribution rules, pursuant to which
the Holder will be treated as owning shares owned by certain family members
(except that in the case of a "complete termination" a Holder may, under certain
circumstances, waive attribution from family members) and related entities and
shares that the Holder has the right to acquire by exercise of an option.
An exchange of shares for cash will be a substantially disproportionate
redemption with respect to a Holder if (A) the percentage of our outstanding
voting stock that the Holder actually and constructively owns after the
redemption (treating as not outstanding all stock purchased by us pursuant to
the tender offer) is less than 80% of the percentage of our outstanding voting
stock that the Holder owned immediately before the exchange (treating as
outstanding all stock purchased by us pursuant to the tender offer), (B) the
percentage of our outstanding common stock that the Holder actually and
constructively owns after the redemption (treating as not outstanding all stock
purchased by us pursuant to the tender offer) is less than 80% of the percentage
of our outstanding common stock that the Holder owned immediately before the
exchange (treating as outstanding all stock purchased by us pursuant to the
tender offer), and (C) the Holder owns after the redemption less than fifty
percent of the total voting power of all classes of our stock entitled to vote.
Holders should consult their tax advisors regarding the application of the rules
of Section 302 in their particular circumstances.
38
If an exchange of shares for cash fails to satisfy the "substantially
disproportionate" test, the Holder may nonetheless satisfy the "not essentially
equivalent to a dividend" test. An exchange of shares for cash will satisfy the
"not essentially equivalent to a dividend" test if it results in a "meaningful
reduction" of the Holder's equity interest in us. The Internal Revenue Service
has indicated in a published ruling that even a small reduction in the
proportionate interest of a small minority stockholder in a publicly held
corporation who exercises no control over corporate affairs may constitute such
a "meaningful reduction." Under this ruling, it is likely that a small minority
stockholder who exercises no control over D&PL, and all of whose actually and
constructively owned shares are tendered at or below the purchase price, would
satisfy the "not essentially equivalent to a dividend" test notwithstanding
proration in the tender offer. If you expect to rely on the "not essentially
equivalent to a dividend" test, you should consult your own tax advisor as to
its application in your particular situation.
Holders should be aware that it is possible that an acquisition or
disposition of shares by a Holder substantially contemporaneously with the offer
will be taken into account in determining whether any of the three tests
described above is satisfied. Holders should consult their tax advisors as to
any effect of such an event on the application of these tests.
If a Holder is treated as recognizing gain or loss from the disposition of
the shares for cash, such gain or loss will be equal to the difference between
the amount of cash received and such Holder's tax basis in the shares exchanged
therefor. Any such gain or loss will be capital gain or loss and will be
long-term capital gain or loss if the holding period of the shares exceeds one
year as of the date of the exchange. Calculation of gain or loss must be made
separately for each block of shares owned by a Holder. Under the tax laws, a
Holder may be able to designate which blocks and the order of such blocks to be
tendered pursuant to the tender offer. If no designation is made, the shares
earliest acquired by the Holder will be considered redeemed for purposes of
determining basis and holding period.
If a Holder is not treated under the Section 302 tests as recognizing gain
or loss on an exchange of shares for cash, the entire amount of cash received by
such Holder pursuant to the exchange will be treated as a dividend to the extent
of the Holder's allocable portion of our current and accumulated earnings and
profits and then as a return of capital to the extent of the Holder's basis in
the shares exchanged and thereafter as capital gain. Provided certain holding
period requirements are satisfied, non-corporate Holders generally will be
subject to U.S. federal income tax at a maximum rate of 15% on amounts treated
as dividends. Such a dividend will be taxed at a maximum rate of 15% in its
entirety, without reduction for the tax basis of the shares exchanged. To the
extent that a purchase of a non-corporate Holder's shares by us in the tender
offer is treated as the receipt by the Holder of a dividend, the non-corporate
Holder's remaining adjusted basis (reduced by the amount, if any, treated as a
return of capital) in the purchased shares will be added to any shares retained
by the Holder. To the extent that cash received in exchange for shares is
treated as a dividend to a corporate Holder, (i) it will be eligible for a
dividends-received deduction (subject to applicable limitations) and (ii) it may
be subject to the "extraordinary dividend" provisions of the Code. If the
extraordinary dividend provisions are applicable, the corporate Holder's basis
in the purchased shares may be reduced (but not below zero) by the non-taxed
39
portion of the dividend before adding such basis to the basis of the shares
retained by the Holder, and if the non-taxed portion of the dividend exceeds the
basis, the corporate Holder may recognize gain in the amount of such excess.
Corporate Holders should consult their tax advisors concerning the availability
of the dividends-received deduction and the application of the "extraordinary
dividend" provisions of the Code in their particular circumstances.
We cannot predict whether or the extent to which the tender offer will be
oversubscribed. If the tender offer is oversubscribed, proration of tenders
pursuant to the tender offer will cause us to accept fewer shares than are
tendered. Therefore, a Holder can be given no assurance that a sufficient number
of such Holder's shares will be purchased pursuant to the tender offer to ensure
that such purchase will be treated as a sale or exchange, rather than as a
dividend, for federal income tax purposes pursuant to the rules discussed above.
However, see Section 6 regarding a Holder's right to tender shares subject to
the condition that D&PL must purchase a specified minimum number of such
Holder's shares (if any are to be purchased).
See Section 3 with respect to the application of federal income tax
withholding and backup withholding.
We urge stockholders to consult their tax advisor to determine the
particular tax consequences to them of the tender offer, including the
applicability and effect of state, local and foreign tax laws.
15. Extension of the Tender Offer; Termination; Amendment.
D&PL expressly reserves the right, in its sole discretion, at any time and
from time to time, and regardless of whether or not any of the events set forth
in Section 7 shall have occurred or shall be deemed by D&PL to have occurred, to
extend the period of time during which the tender offer is open and thereby
delay acceptance for payment of, and payment for, any shares by giving oral or
written notice of the extension to the depositary and making a public
announcement of the extension. D&PL also expressly reserves the right, in its
sole discretion, to terminate the tender offer and not accept for payment or pay
for any shares not theretofore accepted for payment or paid for or, subject to
applicable law, to postpone payment for shares upon the occurrence of any of the
conditions specified in Section 7 by giving oral or written notice of
termination or postponement to the depositary and making a public announcement
of the termination or postponement. D&PL's reservation of the right to delay
payment for shares that it has accepted for payment is limited by Rule
13e-4(f)(5) promulgated under the Exchange Act, which requires that D&PL must
pay the consideration offered or return the shares tendered promptly after
termination or withdrawal of a tender offer. Subject to compliance with
applicable law, D&PL further reserves the right, in its sole discretion, and
regardless of whether any of the events set forth in Section 7 shall have
occurred or shall be deemed by D&PL to have occurred, to amend the tender offer
in any respect, including, without limitation, by decreasing or increasing the
consideration offered in the tender offer to holders of shares or by decreasing
or increasing the number of shares being sought in the tender offer. Amendments
to the tender offer may be made at any time and from time to time effected by
public announcement, the announcement, in the case of an extension, to be issued
no later than 9:00 a.m., New York City time, on the next business day after the
40
last previously scheduled or announced expiration date. Any public announcement
made under the tender offer will be disseminated promptly to stockholders in a
manner reasonably designed to inform stockholders of the change. Without
limiting the manner in which D&PL may choose to make a public announcement,
except as required by applicable law, D&PL shall have no obligation to publish,
advertise or otherwise communicate any public announcement other than by making
a release through PR Newswire.
If D&PL materially changes the terms of the tender offer or the information
concerning the tender offer, D&PL will extend the tender offer to the extent
required by Rules 13e-4(d)(2), 13e-4(e)(3) and 13e-4(f)(1) promulgated under the
Exchange Act. These rules and certain related releases and interpretations of
the Securities and Exchange Commission provide that the minimum period during
which a tender offer must remain open following material changes in the terms of
the tender offer or information concerning the tender offer (other than a change
in price or a change in percentage of securities sought) will depend on the
facts and circumstances, including the relative materiality of the terms or
information.
If D&PL (1) increases or decreases the price to be paid for shares or
increases or decreases the number of shares being sought in the tender offer
and, if an increase in the number of shares being sought, such increase exceeds
2% of the outstanding shares, and (2) the tender offer is scheduled to expire at
any time earlier than the expiration of a period ending on the tenth business
day from, and including, the date that the notice of an increase or decrease is
first published, sent or given to security holders in the manner specified in
this Section 15, then the tender offer will be extended until the expiration of
such ten business day period. For the purposes of the tender offer, a "business
day" means any day other than a Saturday, Sunday or U.S. federal holiday and
consists of the time period from 12:01 a.m. through 12:00 Midnight, New York
City time.
16. Fees and Expenses.
D&PL has retained Georgeson Shareholder Communications Inc. to act as
information agent and Illinois Stock Transfer Company to act as depositary in
connection with the tender offer. The information agent may contact holders of
shares by mail, telephone, telegraph and in person, and may request brokers,
dealers, commercial banks, trust companies and other nominee stockholders to
forward materials relating to the tender offer to beneficial owners. The
information agent and the depositary each will receive reasonable and customary
compensation for their respective services, will be reimbursed by D&PL for
specified reasonable out-of-pocket expenses, and will be indemnified against
certain liabilities in connection with the tender offer, including certain
liabilities under the U.S. federal securities laws.
D&PL has retained UBS Securities LLC to act as the dealer manager in
connection with the tender offer. UBS Securities LLC will receive reasonable and
customary compensation. D&PL also has agreed to indemnify UBS Securities LLC
against certain liabilities in connection with the tender offer, including
liabilities under the U.S. federal securities laws. In the ordinary course of
its trading and brokerage activities, UBS Securities LLC and its affiliates may
hold positions, for their own accounts or for those of their customers, in
securities of D&PL.
No fees or commissions will be payable by D&PL to brokers, dealers,
commercial banks or trust companies (other than fees to the dealer manager, the
information agent and the depositary, as described above) for soliciting tenders
of shares under the tender offer. We urge stockholders holding shares through
brokers or banks to consult the brokers or banks to determine whether
transaction costs are applicable if stockholders tender shares through such
41
brokers or banks and not directly to the depositary. D&PL, however, upon
request, will reimburse brokers, dealers, commercial banks and trust companies
for customary mailing and handling expenses incurred by them in forwarding the
tender offer and related materials to the beneficial owners of shares held by
them as a nominee or in a fiduciary capacity. No broker, dealer, commercial bank
or trust company has been authorized to act as the agent of D&PL, the dealer
manager, the information agent, the depositary or the trustee for D&PL's
employee plans for purposes of the tender offer. D&PL will pay or cause to be
paid all stock transfer taxes, if any, on its purchase of shares, except as
otherwise provided in this document and Instruction 10 in the letter of
transmittal.
17. Miscellaneous.
D&PL is not aware of any jurisdiction where the making of the tender offer
is not in compliance with applicable law. If D&PL becomes aware of any
jurisdiction where the making of the tender offer or the acceptance of shares
pursuant thereto is not in compliance with applicable law, D&PL will make a good
faith effort to comply with the applicable law. If, after such good faith
effort, D&PL cannot comply with the applicable law, D&PL will not make the
tender offer to (nor will tenders be accepted from or on behalf of) the holders
of shares in that jurisdiction.
Pursuant to Rule 13e-4(c)(2) under the Exchange Act, D&PL has filed with
the Securities and Exchange Commission an Issuer Tender Offer Statement on
Schedule TO, which contains additional information with respect to the tender
offer. The Schedule TO, including the exhibits and any amendments and
supplements thereto, may be examined, and copies may be obtained at the same
places and in the same manner as is set forth in Section 10 with respect to
information concerning D&PL.
D&PL has not authorized any person to make any recommendation on behalf of
D&PL as to whether you should tender or refrain from tendering your shares in
the tender offer. D&PL has not authorized any person to give any information or
to make any representation in connection with the tender offer other than those
contained in this offer to purchase or in the letter of transmittal. If anyone
makes any recommendation or representation to you or gives you any information,
you must not rely upon that recommendation, representation or information as
having been authorized by D&PL or the dealer manager.
April 20, 2005
42
The letter of transmittal and share certificates and any other required
documents should be sent or delivered by each stockholder or that stockholder's
broker, dealer, commercial bank, trust company or nominee to the depositary at
one of its addresses set forth below.
The Depositary for the Offer is:
Illinois Stock Transfer Company
Telephone: (800) 757-5755 or
(312) 427-2953
Facsimile: (312) 427-2879
Hours: 7:30 a.m. - 4:00 p.m. Central Time
By First Class Mail: By Express Mail or Overnight By Hand:
Courier:
209 West Jackson Boulevard, 209 West Jackson Boulevard, 209 West Jackson Boulevard,
Suite 903 Suite 903 Suite 903
Chicago, IL 60606 Chicago, IL 60606 Chicago, IL 60606
Please direct any questions or requests for assistance to the information
agent or the dealer manager at their respective telephone numbers and addresses
set forth below. Please direct requests for additional copies of this offer to
purchase, the letter of transmittal or the notice of guaranteed delivery to the
information agent at its telephone number and address set forth below.
Stockholders also may contact their broker, dealer, commercial bank, trust
company or nominee for assistance concerning the tender offer. Please contact
the depositary to confirm delivery of shares.
The Information Agent for the Offer is:
Georgeson Shareholder
17 State Street, 10th Floor
New York, NY 10004
(800) 561-4184 (Toll Free)
Banks and Brokerage Firms please call:
(212) 440-9800
The Dealer Manager for the Offer is:
UBS Securities LLC
299 Park Avenue
New York, NY 10171
Attn: Equity Capital Markets
Call: (212) 821-2100