SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
Schedule
TO
TENDER
OFFER STATEMENT UNDER SECTION 14(D)(1) OR 13(E)(1) OF
THE
SECURITIES EXCHANGE ACT OF 1934
CBRL
Group, Inc.
(Name
of Subject Company (Issuer))
CBRL
Group, Inc. (Issuer)
(Name
of Filing Person (Offeror and Issuer))
Liquid
Yield Option Notes due 2032 (Zero Coupon - Senior)
(Title
of Class of Securities)
12489
VAB2 and 12489 VAA4
(CUSIP
Number of Class of Securities)
Lawrence
E. White
Senior
Vice President - Finance and Chief Financial Officer
CBRL
Group, Inc.
305
Hartmann Drive,
P.O.
Box 787
Lebanon,
Tennessee 37088-0787
Telephone:
(615) 444-5533
(Name,
Address and Telephone Number of Person Authorized
to
Receive Notices and Communications on Behalf of Filing
Persons)
Copies
to:
Gary
M. Brown
Baker,
Donelson, Bearman, Caldwell & Berkowitz, PC
Commerce
Center, Suite 1000
211
Commerce Street
Nashville,
Tennessee 37201
Telephone:
(615) 726-5600
CALCULATION
OF FILING FEE
|
Transaction
Valuation*
|
Amount
of Filing Fee**
|
|
|
$200,479,971
|
$6,155
|
| * |
Estimated solely for purposes of determining the amount of the
filing
fee. The purchase price of the Liquid Yield Option Notes due 2032
(Zero
Coupon—Senior) (the
“Securities”),
as described herein, is $475.01 per $1,000 principal amount at maturity
outstanding. As of January 26, 2007 there was $422,050,000 in aggregate
principal amount at maturity of Securities outstanding, resulting
in an
aggregate maximum purchase price of $200,479,971.
|
| ** | The amount of the filing fee, calculated in accordance with Rule 0-11(b)(1) of the Securities Exchange Act of 1934, as amended, equals $30.70 per million of the value of the transaction. |
¨ Check
the
box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify
the filing with which the offsetting fee was previously paid. Identify the
previous filing by registration statement number, or the Form or Schedule and
the date of its filing.
Amount
Previously Paid: N/A Filing
Party: N/A
Form
or
Registration No.: N/A Date
Filed: N/A
¨ Check
the
box if the filing relates solely to preliminary communications made before
the
commencement of a tender offer.
Check
the
appropriate boxes below to designate any transactions to which the statement
relates:
¨
third-party
tender offer subject to Rule 14d-1.
ý
issuer
tender offer subject to Rule 13e-4.
¨
going-private
transaction subject to Rule 13e-3.
¨
amendment
to Schedule 13D under Rule 13d-2.
Check
the
following box if the filing is a final amendment reporting the results of the
tender offer: ¨
2
INTRODUCTORY
STATEMENT
This
Tender Offer Statement on Schedule TO (“Schedule
TO”)
relates to the notice by CBRL Group, Inc. a Tennessee corporation
(“CBRL”
or the “Company”),
pursuant to the terms and subject to the conditions set forth in the Indenture,
dated as of April 3, 2002, as amended (the “Indenture”),
among CBRL, the subsidiary guarantors party thereto, and U.S. Bank, National
Association, as successor to Wachovia Bank National Association, as trustee
(the
“Trustee”),
with respect to the right of each holder (the “Holder”)
of the Company’s Liquid Yield Option Notes due 2032 (Zero Coupon—Senior) (the
“Securities”)
to sell and the obligation of the Company to purchase the Securities, as set
forth in the Company Notice to Holders of Liquid Yield Option Notes due 2032,
dated March 6, 2007 (the “Company
Notice”),
and the related notice materials filed as exhibits to this Schedule TO-I (which
Company Notice and related notice materials, as amended or supplemented from
time to time, collectively constitute the “Put
Option”).
This
Schedule TO is intended to satisfy the reporting requirements of Rule
13e-4(c)(2) of the Securities Exchange Act of 1934, as amended. The information
contained in the Company Notice, a copy of which is attached to this Schedule
TO
as Exhibit (a)(1)(A), is incorporated herein by reference in response to all
of
the items of this Schedule TO as more particularly described below.
Item
1. Summary Term Sheet.
The
information set forth under "Summary Term Sheet” in the Company Notice is
incorporated herein by reference.
Item
2. Subject Company Information.
|
(a)
|
The
name of the issuer is CBRL Group, Inc. The address of CBRL’s principal
executive office is 305 Hartmann Drive, Lebanon, Tennessee 37088.
CBRL’s
telephone number is (615) 444-5533.
|
|
(b)
|
Securities.
The information set forth in the Section 2 of the Company Notice
(“Information Concerning the Securities”) is incorporated herein by
reference.
|
|
(c)
|
Trading
Market and Price. The information set forth in Section 2 of the Company
Notice (“Information Concerning the Securities”) is incorporated herein by
reference.
|
Item
3. Identity
and Background of Filing Person.
CBRL
is the filing person. CBRL's business address and business telephone number
are
set forth in Item 2(a) above. The information set forth in “Annex A” of the
Company Notice is incorporated herein by reference.
Items
4 through 9.
As
permitted by General Instruction F to Schedule TO, all of the information set
forth in the Put Option is incorporated by reference into this Schedule
TO-I.
3
Item
10. Financial Statements.
|
(a)
|
Financial
Information. Pursuant
to Instruction 2 to Item 10 of Schedule TO, the Company’s financial
condition is not material to a holder’s decision whether to require the
Company to purchase the Securities pursuant to the Put Option because
(1)
the consideration being paid to holders surrendering Securities consists
solely of cash, (2) the Put Option is not subject to any financing
conditions, (3) the Put Option applies to all outstanding Securities
and
(4) the Company is a public reporting company under Section 13 or
15(d) of
the Securities Exchange Act of 1934, as amended, that files reports
electronically on EDGAR.
|
| (b) |
Pro-Forma
Information.
Not applicable.
|
Item
11. Additional Information
| (a) | Not applicable. |
| (b) |
Other
Material Information. The information set forth
in the Company Notice, a copy of which is filed with this Schedule
TO as
Exhibit (a)(1)(A), as it may be amended or supplemented from time
to time,
is incorporated herein
by reference.
|
|
|
|
The
Company
undertakes to amend and disseminate as necessary a revised Schedule TO to
incorporate by reference future periodic reports made by the
Company.
Item
12. Exhibits
| (a)(1)(A) | Company Notice, dated March 6, 2007 |
| (a)(1)(B) | Form of Substitute Form W-9 |
| (a)(2)-(a)(4) | Not applicable |
| (a)(5)(A) |
Press
Release dated March 6, 2007 (incorporated by reference
to Exhibit 99.1 to the Company's Current Report on Form 8-K dated
March 6,
2007 and filed with the SEC on March 6, 2007)
|
| (b) |
Credit
Agreement dated as of April 27, 2006 among CBRL
Group, Inc., the Subsidiary Guarantors named therein, the Lenders
party
thereto and Wachovia Bank, National Association, as Administrative
Agent
and Collateral Agent (incorporated by reference to the Company’s Quarterly
Report on Form 10-Q for the quarterly period ended April 28,
2006)
|
| (d)(1) |
Indenture,
dated as of April 3, 2002 (the “LYONs
Indenture”), among the Company, the Guarantors (as defined therein) and
U.S. Bank, National Association, as trustee, successor to Wachovia
Bank,
National Association, as trustee, relating to the Company’s zero-coupon
convertible senior notes (the “Notes”) (incorporated by reference to the
Company’s Quarterly Report on Form 10-Q for the quarterly period ended May
3, 2002)
|
4
| (d)(2) |
Form
of Certificate for the Notes (included in the LYONS
Indenture incorporated by reference as Exhibit 4(d) hereof) (incorporated
by reference to the Company’s Quarterly Report on Form 10-Q for the
quarterly period ended May 3, 2002)
|
| (d)(3) |
Form
of Guarantee of the Notes (included in the LYONS
Indenture filed as Exhibit 4(d) hereof) (incorporated by reference
to the
Company’s Quarterly Report on Form 10-Q for the quarterly period ended May
3, 2002)
|
| (d)(4) |
First
amendment, dated as of June 19, 2002, to the LYONS
Indenture (incorporated by reference to Amendment No. 1 to the Company’s
Annual Report on Form 10-K/A for the fiscal year ended July 30,
2004)
|
| (d)(5) |
Second amendment, dated as of July 30, 2004, to the LYONS Indenture
(incorporated by reference to Amendment No. 1 to the Company’s Annual
Report on Form 10-K/A for the fiscal year ended July 30, 2004)
|
| (d)(6) |
Third
amendment, dated as of December 31, 2004, to the LYONS
Indenture (incorporated by reference to the Company’s Quarterly Report on
Form 10-Q the quarterly period ended January 28, 2005)
|
| (d)(7) |
Fourth
amendment, dated as of January 28, 2005, to the LYONS
Indenture (incorporated by reference to the Company’s Current Report on
Form 8-K under the Exchange Act filed on February 2, 2005)
|
| (e) | Not applicable |
| (g) | Not applicable |
| (h) | Not applicable |
Item
13.
Information Required by Schedule 13E-3.
Not
applicable.
5
SIGNATURE
After
due
inquiry and to the best of my knowledge and belief, I certify that the
information set forth in this statement is true, complete and
correct.
| CBRL GROUP, INC. | |||
| By: /s/ N.B. Forrest Shoaf | |||
| Name: N.B. Forrest Shoaf | |||
| Title: Senior Vice President, Secretary | |||
| and General Counsel | |||
| Dated: March 6, 2007 | |||
6
EXHIBIT INDEX
| Exhibit Number Description | |
| (a)(1)(A) | Company Notice, dated March 6, 2007 |
| (a)(1)(B) | Form of Substitute Form W-9 |
| (a)(2)-(a)(4) | Not applicable |
| (a)(5)(A) |
Press
Release dated March 6, 2007 (incorporated by reference
to Exhibit 99.1 to the Company's Current Report on Form 8-K dated
March 6,
2007 and filed with the SEC on March 6, 2007)
|
| (b) |
Credit
Agreement dated as of April 27, 2006 among CBRL
Group, Inc., the Subsidiary Guarantors named therein, the Lenders
party
thereto and Wachovia Bank, National Association, as Administrative
Agent
and Collateral Agent (incorporated by reference to the Company’s Quarterly
Report on Form 10-Q for the quarterly period ended April 28,
2006)
|
| (d)(1) |
Indenture,
dated as of April 3, 2002 (the “LYONs
Indenture”), among the Company, the Guarantors (as defined therein) and
U.S. Bank, National Association, as trustee, successor to Wachovia
Bank,
National Association, as trustee, relating to the Company’s zero-coupon
convertible senior notes (the “Notes”) (incorporated by reference to the
Company’s Quarterly Report on Form 10-Q for the quarterly period ended May
3, 2002)
|
| (d)(2) |
Form
of Certificate for the Notes (included in the LYONS
Indenture incorporated by reference as Exhibit 4(d) hereof) (incorporated
by reference to the Company’s Quarterly Report on Form 10-Q for the
quarterly period ended May 3, 2002)
|
| (d)(3) |
Form
of Guarantee of the Notes (included in the LYONS
Indenture filed as Exhibit 4(d) hereof) (incorporated by reference
to the
Company’s Quarterly Report on Form 10-Q for the quarterly period ended May
3, 2002)
|
| (d)(4) |
First
amendment, dated as of June 19, 2002, to the LYONS
Indenture (incorporated by reference to Amendment No. 1 to the Company’s
Annual Report on Form 10-K/A for the fiscal year ended July 30,
2004)
|
| (d)(5) |
Second
amendment, dated as of July 30, 2004, to the LYONS
Indenture (incorporated by reference to Amendment No. 1 to the Company’s
Annual Report on Form 10-K/A for the fiscal year ended July 30,
2004)
|
|
|
|
| (d)(6) |
Third
amendment, dated as of December 31, 2004, to the LYONS
Indenture (incorporated by reference to the Company’s Quarterly Report on
Form 10-Q the quarterly period ended January 28,
2005)
|
| (d)(7) |
Fourth
amendment, dated as of January 28, 2005, to the LYONS
Indenture (incorporated by reference to the Company’s Current Report on
Form 8-K under the Exchange Act filed on February 2, 2005)
|
| (e) | Not applicable |
| (g) | Not applicable |
| (h) | Not applicable |
COMPANY
NOTICE
TO
HOLDERS OF
LIQUID
YIELD OPTION NOTES DUE 2032
(Zero
Coupon—Senior)
ISSUED
BY
CBRL
GROUP, INC.
CUSIP
Numbers: 12489 VAB2 and 12489 VAA4
NOTICE
IS
HEREBY GIVEN pursuant to the terms and conditions of the Indenture, dated
as of
April 3, 2002, as amended (the “Indenture”),
between CBRL Group, Inc., a Tennessee corporation (the
“Company”),
and U.S. Bank, National Association, as successor to Wachovia Bank National
Association, as trustee and paying agent (the “Paying
Agent”),
and the Liquid Yield OptionTM Notes
Due
2032 (Zero Coupon—Senior) (the “Securities”)
of the Company, that at the option of each holder (the
“Holder”)
of the Securities, the Securities will be purchased by the Company for $475.01
in cash per $1,000 principal amount at maturity of the Securities (the
“Purchase
Price”),
subject to the terms and conditions of the Indenture, the Securities and
this
Company Notice and related notice materials, as amended and supplemented
from
time to time (the “Put
Option”).
Holders may surrender their Securities from March 6, 2007 through 5:00 p.m.,
New
York City time, on Tuesday, April 3, 2007 (the “Purchase
Date”).
This Company Notice is being sent pursuant to the provisions of Section 3.08(e)
of the Indenture and paragraph 7 of the Securities. All capitalized terms
used
but not specifically defined in this Company Notice shall have the meanings
given to such terms in the Indenture and the Securities.
To
exercise your Put Option and require that the Company purchase your Securities
for a cash payment of $475.01 per $1,000 principal amount at maturity of
the
Securities, you must validly surrender the Securities prior to 5:00 p.m.,
New
York City time, on the Purchase Date. Securities surrendered for purchase
may be
withdrawn at any time prior to 5:00 p.m., New York City time, on the Purchase
Date. The right of Holders to surrender Securities for purchase in the Put
Option expires at 5:00 p.m., New York City time, on the Purchase Date.
This
Company Notice contains important information that may affect whether you
exercise your Put Option and we recommend that you read this information
carefully.
The
Trustee has informed the Company that, as of the date of this Company Notice,
all custodians and beneficial holders of the Securities hold the Securities
through Depository Trust Company (“DTC”) accounts and that there are no
certificated Securities in non-global form. Accordingly, all Securities
surrendered for purchase hereunder must be delivered through the transmittal
procedures of DTC.
The
Paying Agent is:
U.S.
Bank, National Association
|
By
Regular or Registered Mail
U.S.
Bank, National Association
P.O.
Box 64111
St.
Paul, MN 55164-0111
Attention:
Corporate Trust Services
|
|
For
Information:
(800)
937-6802
|
|
By
Hand Delivery or Overnight Mail
U.S.
Bank, National Association
60
Livingston Avenue
1st
Floor - Bond Drop Window
St.
Paul, MN 55107
Attention:
Corporate Trust Services
|
Additional
copies of this Company Notice may be obtained from the Paying Agent at its
addresses set forth above.
TM Trademark of Merrill Lynch & Co.
TABLE
OF CONTENTS
| Page | |||
|
SUMMARY
TERM SHEET
|
i
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||
|
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|||
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FORWARD
LOOKING STATEMENTS AND SPECIAL FACTORS
|
1
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||
|
IMPORTANT
INFORMATION CONCERNING THE PUT OPTION
|
3
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||
|
1. Information
Concerning The Company
|
3
|
||
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2. Information
Concerning The Securities
|
4
|
||
| 2.1. The Company’s Obligation to Purchase the Securities |
4
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||
| 2.2. Purchase Price |
5
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||
| 2.3. Conversion Rights of the Securities |
6
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||
| 2.4. Market for the Securities and the Company’s Common Stock |
6
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||
| 2.5. Redemption |
7
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||
| 2.6. Change in Control |
8
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||
| 2.7. Ranking |
8
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||
| 2.8. Dividends |
8
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||
|
3. Procedures
To Be Followed By Holders Electing To Surrender Securities For
Purchase
|
8
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||
| 3.1. Method of Delivery |
8
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||
| 3.2. Agreement to be Bound by the Terms of the Put Option |
9
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||
| 3.3. Delivery of Securities |
10
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||
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4. Right
Of Withdrawal
|
11
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5. Payment
For Surrendered Securities
|
11
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6. Securities
Acquired
|
13
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||
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7. Plans
Or Proposals Of The Company
|
13
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||
|
8. Interests
Of Directors, Executive Officers And Affiliates Of The Company
In The
Securities.
|
15
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||
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9. Purchases
Of Securities By The Company And Its Affiliates
|
15
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||
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10.
Material
United States Tax Considerations
|
16
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||
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11. Additional
Information
|
19
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||
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12.
No
Solicitations
|
20
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||
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13.
Definitions
|
20
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||
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14.
Conflicts
|
20
|
||
No
person has been authorized to give any information or to make any
representations other than those contained in the Put Option and, if given
or
made, such information or representations must not be relied upon as having
been
authorized. The Put Option does not constitute an offer to buy or the
solicitation of an offer to sell securities in any circumstances or jurisdiction
in which such offer or solicitation is unlawful. The delivery of the Put Option
shall not under any circumstances create any implication that the information
contained in the Put Option is current as of any time subsequent to the date
of
such information. None of the Company or its board of directors or employees
are
making any representation or recommendation to any Holder as to whether or
not
to surrender such Holder’s Securities. You should consult your own financial and
tax advisors and must make your own decision as to whether to surrender your
Securities for purchase and, if so, the amount of Securities to surrender.
SUMMARY
TERM SHEET
The
following are answers to some of the questions that you may have about the
Put
Option. To understand the Put Option fully and for a more complete description
of the terms of the Put Option, we urge you to read carefully the remainder
of
this Company Notice because the information in this summary is not complete.
We
have included page references to direct you to a more complete description
of
the topics in this summary.
Who
is offering to purchase my securities?
CBRL
Group, Inc., a Tennessee corporation (the “Company”),
is obligated, at your option, to purchase your validly surrendered Liquid Yield
Option Notes due 2032 (Zero Coupon—Senior) (the “Securities”).
(Page 3)
Why
is the Company offering to purchase my securities?
The
right
of each holder (the “Holder”)
of the Securities to sell and the Company’s obligation to purchase the
Securities pursuant to the Put Option is a term of the Securities and has been
a
right of Holders from the time the Securities were issued on April 3, 2002.
We
are required to repurchase the Securities of any Holder exercising the Put
Option pursuant to the terms of the Securities and the Indenture. (Page 4)
What
securities is the Company obligated to purchase?
We
are
obligated to purchase all of the Securities surrendered, at the option of the
Holder. As of January 26, 2007, the end of our most recent fiscal quarter,
there
was $422,050,000 aggregate principal amount at maturity of Securities
outstanding. The Securities were issued under an Indenture, dated as of April
3,
2002, as amended (the “Indenture”),
among the Company, the subsidiary guarantors named therein and U.S. Bank,
National Association, as successor to Wachovia Bank National Association, as
trustee and paying agent (the “Paying
Agent”).
(Page 4)
Does
the Company have other plans with respect to the
Securities?
Yes. We
intend
to propose an amendment to, or otherwise revise or replace, the Securities
to
provide, on conversion, a “net share settlement” feature. That feature would
allow us to pay a certain amount of cash instead of shares of our common stock,
par value $0.01 (the “Common
Stock”)
upon conversion, thus reducing the dilutive effect of the Securities upon
earnings per share. We would settle a conversion of the Securities with an
amount of cash up to the accreted principal amount of the Securities and the
excess, if any, of the conversion value of the Securities over the accreted
principal amount in shares of our Common Stock. We also propose reducing the
notice period for redemptions by the Company. We are studying the most efficient
method by which to implement these changes - among the possible courses of
action are either a consent solicitation with existing Securities holders or
an
exchange offer by which Securities holders would be offered a new security
that
contains the net share settlement feature. We expect to begin the process of
implementing these changes in the coming weeks. Following implementation of
these changes, and potentially prior to the end of our fiscal year,
i
August
3,
2007, we plan to redeem the Securities (and any new securities that might be
issued in an exchange offer). However, any decision to redeem the Securities
outstanding will depend upon many factors, including the market price of the
Securities, the market price of the Common Stock, the business and financial
position of the Company and general economic and market conditions. (Page
7)
How
much will the Company pay and what is the form of payment?
Pursuant
to the terms of the Indenture and the Securities, we will pay, in cash, a
purchase price of $475.01 per $1,000 principal amount at maturity of the
Securities (the “Purchase
Price”)
with respect to any and all Securities validly surrendered for purchase and
not
withdrawn. (Page 5)
How
can I determine the market value of the Securities?
There
is
no established reporting system or market for trading in the Securities. To
the
extent that the Securities are traded, prices of the Securities may fluctuate
widely depending on trading volume, the balance between buy and sell orders,
prevailing interest rates, the Company’s operating results, the trading price
and implied volatility of the our Common Stock and the market for similar
securities. To the extent available, we recommend that Holders obtain current
market quotations for the Securities prior to making any decision with respect
to the Put Option. The Common Stock of the Company into which the Securities
are
convertible is listed on the Nasdaq Global Market
(“NASDAQ”)
under the symbol “CBRL.” On March 5, 2007, the last reported sales price of the
Common Stock on the NASDAQ was $45.63 per share. (Pages 6-7)
What
does the board of directors of the Company think of the Put Option?
The
board
of directors of the Company has not made any recommendation as to whether you
should surrender your Securities for purchase. You must make your own decision
whether to surrender your Securities for purchase pursuant to the Put Option
and, if so, the amount of Securities to surrender. (Page 5)
When
does the Put Option expire?
The
Put
Option expires at 5:00 p.m., New York City time, on Tuesday, April 3, 2007
(the
“Purchase
Date”).
We will not extend the period Holders have to accept the Put Option unless
required to do so by United States federal securities laws. (Pages 4-5)
What
are the conditions to the purchase by the Company of the Securities?
The
purchase by us of validly surrendered Securities is not subject to any condition
other than such purchase being lawful and satisfaction of the procedural
requirements described in this Company Notice.
ii
How
do I surrender my Securities?
To
surrender your Securities for purchase pursuant to the Put Option, you must
surrender the Securities through the transmittal procedures of the Depository
Trust Company (“DTC”)
no later than 5:00 p.m., New York City time, on the Purchase Date.
|
|
•
|
|
Holders
whose Securities are held by a broker, dealer, commercial bank, trust
company or other nominee must contact such nominee if such Holder
desires
to surrender such Holder’s Securities and instruct such nominee to
surrender the Securities on the Holder’s behalf through the transmittal
procedures of DTC.
|
|
|
•
|
|
Holders
who are DTC participants should surrender their Securities electronically
through DTC’s Automated Tenders over the Participant Terminal System,
subject to the terms and procedures of that system on or before 5:00
p.m.,
New York City time, on the Purchase Date.
|
By
surrendering your Securities through the transmittal procedures of DTC, you
agree to be bound by the terms of the Put Option set forth in this Company
Notice (Pages 8-11)
If
I surrender my Securities, when will I receive payment for them?
We
will
accept for payment all validly surrendered Securities promptly upon expiration
of the Put Option. We will promptly forward to the Paying Agent, prior to 10:00
a.m., New York City time, on April 5, 2007, the appropriate amount of cash
required to pay the Purchase Price for the surrendered Securities, and the
Paying Agent will promptly distribute the cash to the DTC, the sole record
Holder. The DTC will thereafter distribute the cash to its participants in
accordance with its procedures. (Pages 11-12)
Until
what time can I withdraw previously surrendered
Securities?
You
can
withdraw Securities previously surrendered for purchase at any time until 5:00
p.m., New York City time, on the Purchase Date. (Page 11)
How
do I withdraw previously surrendered Securities?
To
withdraw previously surrendered Securities, you must comply with the withdrawal
procedures of the DTC prior to 5:00 p.m., New York City time, on the Purchase
Date. (Page 11)
Do
I need to do anything if I do not wish to surrender my Securities for purchase?
No.
If
you do not surrender your Securities before the expiration of the Put Option,
we
will not purchase your Securities and such Securities will remain outstanding
subject to their existing terms. (Page 8)
iii
If
I choose to surrender my Securities for purchase, do I have to surrender all
of
my Securities?
No.
You
may surrender all of your Securities, a portion of your Securities or none
of
your Securities for purchase. If you wish to surrender a portion of your
Securities for purchase, however, you must surrender your Securities in a
principal amount at maturity of $1,000 or an integral multiple thereof. (Page
8)
If
I do not surrender my Securities for purchase, will I continue to be able to
exercise my conversion rights?
Yes.
All
conditions for convertibility of the Securities have previously been met and,
accordingly, the Securities are convertible into our Common Stock at the rate
of
10.8584 shares per $1,000 in principal amount of Securities. If you do not
surrender your Securities for purchase, your conversion rights will not be
affected. You will continue to have the right to convert your Securities into
shares of Common Stock, subject to the terms, conditions and adjustments
specified in the Indenture and the Securities. (Page 6)
If
I am a U.S. resident for U.S. federal income tax purposes, will I have to pay
taxes if I surrender my Securities for purchase in the Put
Option?
The
receipt of cash in exchange for Securities pursuant to the Put Option will
be a
taxable transaction for U.S. federal income tax purposes and you may recognize
gain, income, loss or deduction. You should consult with your tax advisor
regarding the actual tax consequences to you. (Pages 16-17)
Who
is the Paying Agent?
U.S.
Bank, National Association, as the successor to Wachovia Bank National
Association, the trustee under the Indenture, is serving as Paying Agent in
connection with the Put Option. Its address and telephone number are set forth
on the front cover page of this Company Notice.
Who
can I talk to if I have questions about the Put Option?
Questions
and requests for assistance in connection with the surrender of Securities
for
purchase in the Put Option may be directed to the Paying Agent at the address
and telephone and facsimile numbers set forth on the cover of this Company
Notice.
iv
This
document contains or incorporates by reference not only historical information,
but also forward-looking statements relating to our operations that are based
on
our expectations, estimates and projections. Words such as “anticipates,”
“believes,” “continues,” “estimates,” “expects,” “goal,” “objectives,”
“expectations,” “intends,” “may,” “opportunity,” “future,” “plans,” “potential,”
“near-term,” “long-term,” “projections,” “assumptions,” “projects,” “guidance,”
“forecasts,” “outlook,” “target,” “trends,” “should,” “could,” “would,” “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.
In
deciding whether to participate in the Put Option, each holder of Securities
should consider carefully, in addition to the other information contained or
incorporated by reference herein, that our actual results may differ from the
forward-looking statements for many reasons, including:
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•
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Successful
implementation of the “net share settlement” feature with respect to the
Securities (and
any new securities that might be issued in an exchange offer);
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The
timing and ability of the Company to successfully complete its share
repurchase authorizations;
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•
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The
effects of incurring substantial indebtedness and associated restrictions
on our financial and operating flexibility and ability to execute
or
pursue our operating plans and objectives;
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The
effects of uncertain consumer confidence, higher costs for energy,
consumer debt payments, or general or regional economic weakness,
or
weather on sales and customer travel, discretionary income or personal
expenditure activity of our customers;
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Our
ability to identify, acquire and sell successful new lines of retail
merchandise and new menu items at our restaurants;
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Our
ability to sustain or the effects of plans intended to improve operational
execution and performance;
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Changes
in or implementation of additional governmental or regulatory rules,
regulations and interpretations affecting tax, wage and hour matters,
health and safety, pensions, insurance or other undeterminable areas;
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1
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The
effects of plans intended to promote or protect our brands and products;
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Commodity,
workers compensation, group health and utility price changes;
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Consumer
behavior based on negative publicity or concerns over nutritional
or
safety aspects of the Company’s products or restaurant food in general,
including concerns about E. coli bacteria, hepatitis A, “mad cow” disease,
“foot-and-mouth” disease, and bird flu, as well as the possible effects of
such events on the price or availability of ingredients used in our
restaurants;
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Changes
in interest rates or capital market conditions affecting our financing
costs or ability to obtain financing or execute initiatives;
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The
effects of business trends on the outlook for individual restaurant
locations and the effect on the carrying value of those locations;
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Our
ability to retain key personnel during and after the restructuring
process;
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Our
ability and cost to us to recruit, train, and retain qualified hourly
and
management employees;
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The
effects of increased competition at our locations on sales and on
labor
recruiting, cost, and retention;
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The
availability and cost of suitable sites for restaurant development
and our
ability to identify those sites;
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Changes
in building materials and construction costs;
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The
actual results of pending, future or threatened litigation or governmental
investigations and the costs and effects of negative publicity associated
with these activities;
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Practical
or psychological effects of natural disasters or terrorist acts or
war and
military or government responses;
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Disruptions
to our restaurant or retail supply chain;
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Changes
in foreign exchange rates affecting our future retail inventory purchases;
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Implementation
of new or changes in interpretation of existing accounting principles
generally accepted in the United States of America (“GAAP”); and
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Effectiveness
of internal controls over financial reporting and disclosure.
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2
In
addition, please refer to our Annual Report on Form 10-K for the fiscal year
ended July 28, 2006 (filed with the SEC on October 3, 2006) and our
Quarterly Reports on Form 10-Q for the quarterly periods ended October 27,
2006
(filed with the SEC on December 6, 2006) and January 26, 2007 (filed with
the SEC on March 2, 2007), for a more detailed discussion of these risks and
uncertainties and other factors. These reports are available at
www.cbrlgroup.com and www.sec.gov. See Section 11. You should not place undue
reliance on our forward-looking statements, which speak only as of the date
of
this Company Notice, or the date of the documents referred to if contained
therein. We undertake no obligation to make any revision to the forward-looking
statements contained in this Company Notice or in any document referred to
in
this Company Notice, or to update them to reflect events or circumstances
occurring after the date of this Company Notice, except as may be required
by
law. We confirm that we will comply with Rule 13e-4(d)(2) and
Rule 13e-4(e)(3) with respect to the information presented to security
holders.
IMPORTANT
INFORMATION CONCERNING THE PUT OPTION
1.
Information Concerning The Company.
CBRL Group, Inc., a Tennessee corporation (the “Company”),
is obligated to purchase all of its Liquid Yield Option Notes Due 2032 (Zero
Coupon—Senior) (the “Securities”).
Each $1,000 in principal amount at maturity of the Securities are convertible
into 10.8584 shares of the Company’s common stock, $0.01 par value per share
(the “Common
Stock”),
of the Company, subject to the terms, conditions and adjustments specified
in
the Indenture and the Securities.
The
Company is a holding company that, through subsidiaries, is engaged in the
operation and development of the Cracker Barrel Old Country Store®
restaurant and retail concepts. The Company’s principal subsidiary, Cracker
Barrel Old Country Store, Inc. (“Cracker Barrel”), headquartered in Lebanon,
Tennessee, through its various affiliates, as of January 26, 2007, operated
552
full-service “country store” restaurants and gift shops, in 41 states.
Cracker Barrel stores are intended to appeal to both the traveler and the local
customer and consistently have been a consumer favorite.
During 2006, for the 16th consecutive year, Cracker Barrel was named the
“Best Family Dining Restaurant” in the Restaurants & Institutions
magazine “Choice in Chains” annual consumer survey. For the
13th consecutive year, Cracker Barrel was ranked as the “Best Restaurant
Chain” by Destinations magazine poll. In 2006, for the 5th consecutive
year, Cracker Barrel was named “The Most RV Friendly Sit-Down Restaurant in
America” by The Good Sam Club.
Except
for Christmas day, when they are closed, and Christmas Eve when they close
at
2:00 p.m., Cracker Barrel restaurants serve breakfast, lunch and dinner
daily between the hours of 6:00 a.m. and 10:00 p.m. (closing at
11:00 p.m. on Fridays and Saturdays) and feature home style country cooking
from Cracker Barrel’s own recipes using quality ingredients and emphasizing
authenticity. Menu items are moderately priced and include country ham, chicken,
fish, roast beef, beans, turnip greens, vegetable plates, salads, sandwiches,
pancakes, eggs, bacon, sausage and grits among other items. The
restaurants
3
Stores
are located primarily along interstate highways; however, as of January 26,
2007, 70 stores are located near “tourist destinations” or are considered
“off-interstate” stores. In fiscal 2007, Cracker Barrel intends to open
approximately 68% of its new stores along interstate highways as compared to
100% in fiscal 2006. The Company believes it should focus primarily in the
near
term on available interstate locations where Cracker Barrel generates the
greatest brand awareness. Off-interstate locations are expected to represent
a
meaningful part of Cracker Barrel’s efforts to expand the brand in future years.
The Company has identified over 500 trade areas for potential future development
with characteristics that appear to be consistent with those believed to be
necessary to support a successful Cracker Barrel unit.
On
December 6, 2006, we sold our interest in Logan’s Roadhouse, Inc. to LRI
Holdings, Inc., an affiliate of Bruckmann, Rosser, Sherrill & Co. Inc.,
Canyon Capital Advisors LLC and Black Canyon Capital LLC. Total consideration
in
the transaction was approximately $486 million, subject to customary
post-closing adjustments, if any, for working capital, indebtedness and capital
expenditures. Our expected net cash proceeds after payment of taxes and expenses
associated with the transaction were approximately $385 million. These
proceeds, together with other cash balances on hand, were used to fund
approximately $250 million in purchases of our
shares pursuant in a “Dutch Auction” tender offer and an open market stock
repurchase program, as well to reduce our outstanding debt under our existing
credit facility by $75 million.
2.
Information Concerning The Securities.
The Securities were issued under an Indenture, dated as of April 3, 2002, as
amended (the “Indenture”),
among
the Company, the subsidiary guarantors named therein and U.S. Bank, National
Association, as successor to Wachovia Bank National Association, as trustee
and
paying agent (the “Paying
Agent”).
The
Securities mature on April 3, 2032.
2.1.
The
Company’s Obligation to Purchase the Securities.
Pursuant to the terms of the Securities and the Indenture, the Company is
obligated to purchase all Securities validly surrendered for purchase and not
withdrawn, at the Holder’s option, on April 3, 2007. This Put Option will expire
at 5:00 p.m., New York City
4
2.2.
Purchase Price.
Pursuant to the Securities, the purchase price to be paid by the Company for
the
Securities on the Purchase Date is $475.01 per $1,000 principal amount at
maturity of the Securities (the “Purchase
Price”).
The Purchase Price will be paid in cash with respect to any and all Securities
validly surrendered for purchase and not withdrawn prior to 5:00 p.m., New
York
City time, on the Purchase Date. Securities surrendered for purchase will be
accepted only in principal amounts at maturity equal to $1,000 or integral
multiples thereof. The Original Issue Discount (as defined in the Securities)
will cease to accrue on the Purchase Date on Securities validly surrendered
for
purchase and not withdrawn unless the Company defaults in making payment on
these Securities.
The
Purchase Price is based solely on the requirements of the Indenture and the
Securities and bears no relationship to the market price of the Securities
or
the Common Stock. Thus, the Purchase Price may be significantly higher or lower
than the market price of the Securities on the Purchase Date, or the aggregate
market price of the shares of Common Stock into which the Securities are
convertible. Holders of Securities are urged to obtain the best available
information as to potential current market prices of the Securities, to the
extent available, and the Common Stock before making a decision whether to
surrender their Securities for purchase.
None
of
the Company or its board of directors or employees are making any recommendation
to Holders as to whether to surrender or refrain from surrendering Securities
for purchase pursuant to this Company Notice. Each Holder must make such
Holder’s own decision whether to surrender such Holder’s Securities for purchase
and, if so, the principal amount of Securities to surrender based on such
Holder’s assessment of current market value of the Securities and the Common
Stock and other relevant factors.
5
2.3.
Conversion
Rights of the Securities.
All conditions in the Indenture for convertibility of the Securities have
previously been met and, accordingly, the Securities are convertible into our
Common Stock at the rate of 10.8584 shares per $1,000 in principal amount of
Securities. Holders that do not surrender their Securities for purchase pursuant
to the Put Option will maintain the right to convert their Securities into
Common Stock, subject to the terms, conditions and adjustments specified in
the
Indenture and the Securities. Any Securities which are surrendered pursuant
to
the Put Option may be converted in accordance with the terms of the Indenture
and the Securities only if such surrender has been validly withdrawn prior
to
5:00 p.m., New York City time, on the Purchase Date, as described in
Section 4 below.
2.4.
Market
for the Securities and the Company’s Common Stock.
There is no established reporting system or trading market for trading in the
Securities. We believe, however, that from time-to-time, the Securities are
traded over the counter. We do not believe that there is any practical way
to
accurately determine the trading history of the Securities. To the extent that
the Securities are traded, prices of the Securities may fluctuate widely
depending on trading volume, the balance between buy and sell orders, prevailing
interest rates, the Company’s operating results, the market price and implied
volatility of the Common Stock and the market for similar securities. Following
the expiration of the Put Option, we expect that Securities not purchased in
the
Put Option will continue to be traded over the counter; however, the trading
market for the Securities may be even more limited. A debt security with a
smaller outstanding principal amount available for trading (a smaller “float”)
may command a lower price and trade with greater volatility than would a
comparable debt security with a larger float. Consequently, our purchase of
a
significant amount of the Securities pursuant to the Put Option will reduce
the
float and may negatively affect the liquidity, market value and price volatility
of the Securities that remain outstanding following the Put Option. We cannot
assure you that a market will exist for the Securities following the Put Option.
The extent of the public market for the Securities following consummation of
the
Put Option will depend upon, among other things, the remaining outstanding
principal amount at maturity of the Securities at such time, the number of
holders of Securities remaining at that time and the interest on the part of
securities firms in maintaining a market in the Securities. The Paying Agent
has
informed us that, as of the date of this Company Notice, all of the Securities
are held in global form through DTC. As of January 26, 2007, there was
$422,050,000 aggregate principal amount at maturity of Securities outstanding
and DTC was the sole record Holder of the Securities.
The
Common Stock into which the Securities are convertible is listed on the Nasdaq
Global Market (“NASDAQ”)
under the symbol “CBRL.” Each $1,000 in principal amount of Securities currently
is convertible into 10.8584 shares of our Common Stock. The following table
sets
forth, for the fiscal quarters indicated, the high and low sales prices of
the
Common Stock as reported on the NASDAQ and the dividends paid on those shares
during that quarter.
6
|
Fiscal
Year 2007 (ending August 3, 2007)
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High
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Low
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Divi-
dend
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Third
Quarter (through March 5, 2007)
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49.00
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45.62
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0.14
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Second
Quarter
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$
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47.61
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$
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42.03
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$
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0.14
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First
Quarter
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$
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43.93
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$
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32.04
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$
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0.13
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Fiscal
Year 2006 (ending July 28, 2006)
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Fourth
Quarter
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$
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41.12
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$
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32.27
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$
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0.13
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Third
Quarter
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$
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47.95
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$
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39.75
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$
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0.13
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Second
Quarter
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$
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45.00
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$
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33.95
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$
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0.13
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First
Quarter
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$
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41.45
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$
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33.11
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$
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0.12
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||||
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Fiscal
Year 2005 (ended July 29, 2005)
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||||||||||
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Fourth
Quarter
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$
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42.12
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$
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37.75
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$
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0.12
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||||
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Third
Quarter
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$
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44.60
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$
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38.38
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$
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0.12
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||||
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Second
Quarter
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$
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43.14
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$
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36.08
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$
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0.12
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||||
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First
Quarter
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$
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37.09
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$
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30.00
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$
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0.11
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Dividends. Our
dividend policy is determined at the discretion of our Board. 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 or not
be
reduced. Our ability to pay any cash dividends on our Common Stock is dependent
on our earnings and cash requirements.
Recent
Market Price. We
publicly announced this notice on March 6, 2007. On the day prior to that
announcement, the reported closing price of our Common Stock was $45.63
per
share. If a holder had converted his Securities on that date, the holder would
have received 10.8584 shares of Common Stock on that date with a value of
$495.47, which would have been greater than the Purchase Price being offered
pursuant to the Put Option. Accordingly,
we recommend that holders of Securities obtain current market quotations for
our
Common Stock before deciding whether to surrender their Securities.
2.5.
Redemption.
Beginning April 3, 2007, the Securities are redeemable for cash at any time
at
the option of the Company, in whole or in part, at a redemption price equal
to
the Issue Price (as defined in the Indenture) plus accrued Original Issue
Discount (as defined in the Indenture). We have announced that we intend to
implement a “net share settlement” feature with respect to the Securities. That
feature will allow us to pay a certain amount of cash instead of shares of
our
Common Stock upon conversion, thus reducing the dilutive effect of the
Securities upon earnings per share. Following the implementation of the net
settlement feature, we would settle a conversion of the Securities with an
amount of cash up to the accreted principal amount of the Securities and the
excess, if any, of the conversion value of the Securities over the accreted
principal amount in shares of Common Stock. We also intend to shorten the notice
period by which we have to give notice of redemption from 30 to 15 days. After
implementation of those
7
2.6.
Change
in Control.
A Holder may require the Company to redeem for cash such Holder’s securities if
there is a Change in Control (as defined in the Securities) on or prior to
April
3, 2007 at a redemption price equal to the Issue Price (as defined in the
Securities) plus accrued Original Issue Discount (as defined in the Securities)
on the purchase date.
2.7.
Ranking.
The Securities are unsecured and unsubordinated obligations of the
Company and rank equal in right of payment to all of the Company’s existing and
future unsecured and unsubordinated indebtedness. However, the Securities are
effectively subordinated to all existing and future obligations of the Company’s
subsidiaries and to the Company’s obligations that are secured to the extent of
the security.
Although
our subsidiaries do not currently have any material indebtedness, we currently
conduct a significant portion of our operations through our subsidiaries and
our
subsidiaries have significant operating liabilities. In addition, we may, and
in
some cases we have plans to, conduct additional operations through our
subsidiaries in the future and, accordingly, our subsidiaries’ liabilities will
increase. The Securities do not restrict the ability of our subsidiaries to
incur additional liabilities. Similarly, we do not currently have any secured
indebtedness. However, the Securities do not restrict us from incurring secured
indebtedness.
2.8.
Dividends.
The Holders of Securities are not entitled to dividends. Upon conversion into
Common Stock, the Holders will be entitled to dividends, if any, made to holders
of Common Stock.
3.
Procedures To Be Followed By Holders Electing To Surrender Securities For
Purchase.
Holders will not be entitled to receive the Purchase Price for their Securities
unless they validly surrender and do not withdraw the Securities on or before
5:00 p.m., New York City time, on the Purchase Date. Only registered Holders
are
authorized to surrender their Securities for purchase. Holders may surrender
some or all of their Securities; however, any Securities surrendered must be
in
$1,000 principal amount at maturity or an integral multiple thereof. If Holders
do not validly surrender their Securities on or before 5:00 p.m., New York
City
time, on the Purchase Date, their Securities will remain outstanding subject
to
the existing terms of the Securities.
3.1.
Method
of Delivery.
The Trustee has informed the Company that, as of the date of this Company
Notice, all custodians and beneficial holders of the Securities hold the
Securities through DTC accounts and that there are no certificated Securities
in
non-global form. Accordingly, all Securities surrendered for purchase hereunder
must be delivered through DTC’s Automatic Tenders over the Participant Terminal
System (“PTS”).
This Company Notice constitutes the Company Notice (as defined in the Indenture)
and delivery of Securities via PTS will satisfy the notice requirements of
the
Indenture. Delivery of Securities and all other required documents, including
delivery and acceptance through PTS, is at the election and risk of the person
surrendering such Securities.
8
3.2.
Agreement
to be Bound by the Terms of the Put Option.
By surrendering your Securities through the transmittal procedures of DTC,
a
Holder acknowledges and agrees as follows:
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•
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such
Securities shall be purchased as of the Purchase Date pursuant to
the
terms and conditions set forth in this Company Notice;
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•
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such
Holder agrees to all of the terms of this Company Notice;
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•
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such
Holder has received this Company Notice and acknowledges that this
Company
Notice provides the notice required pursuant to the Indenture;
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•
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upon
the terms and subject to the conditions set forth in this Company
Notice,
the Indenture and the Securities, and effective upon the acceptance
for
payment thereof, such Holder (i) irrevocably sells, assigns and
transfers to the Company, all right, title and interest in and to
all the
Securities surrendered, (ii) releases and discharges the Company and
its directors, officers, employees and affiliates from any and all
claims
such Holder may have now, or may have in the future arising out of,
or
related to, the Securities, including, without limitation, any claims
that
such Holder is entitled to receive additional principal or interest
payments with respect to the Securities or to participate in any
redemption or defeasance of the Securities and (iii) irrevocably
constitutes and appoints the Paying Agent as the true and lawful
agent and
attorney-in-fact of such Holder with respect to any such surrendered
Securities, with full power of substitution and resubstitution (such
power
of attorney being deemed to be an irrevocable power coupled with
an
interest) to (a) deliver certificates representing such Securities,
or transfer ownership of such Securities, on the account books maintained
by DTC, together, in any such case, with all accompanying evidences
of
transfer and authenticity, to the Company, (b) present such
Securities for transfer on the relevant security register and
(c) receive all benefits or otherwise exercise all rights of
beneficial ownership of such Securities (except that the Paying Agent
will
have no rights to, or control over, funds from the Company, except
as
agent for the Company, for the Purchase Price of any surrendered
Securities that are purchased by the Company), all in accordance
with the
terms set forth in this Company Notice;
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•
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such
Holder represents and warrants that such Holder (i) owns the
Securities surrendered and is entitled to surrender such Securities
and
(ii) has full power and authority to surrender, sell, assign and
transfer the Securities surrendered hereby and that when such Securities
are accepted for purchase and payment by the Company, the Company
will
acquire good title thereto, free and clear of all liens, restrictions,
charges and encumbrances and not subject to any adverse claim or
right;
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•
|
|
such
Holder agrees, upon request from the Company, to execute and deliver
any
additional documents deemed by the Paying Agent or the Company to
be
|
9
|
|
necessary or desirable to complete the sale, assignment and transfer
of the Securities surrendered;
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|
|
|
•
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such
Holder understands that all Securities properly surrendered for purchase
and not withdrawn prior to 5:00 p.m., New York City time, on the
Purchase
Date will be purchased at the Purchase Price, in cash, pursuant to
the
terms and conditions of the Indenture, the Securities, the Company
Notice
and related notice materials, as amended and supplemented from time
to
time;
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•
|
|
payment
for Securities purchased pursuant to the Company Notice will be made
by
deposit of the Purchase Price for such Securities with the Paying
Agent,
which will act as agent for surrendering Holders for the purpose
of
receiving payments from the Company and transmitting such payments
to such
Holders;
|
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•
|
|
surrenders
of Securities may be withdrawn by written notice of withdrawal delivered
pursuant to the procedures set forth in this Company Notice at any
time
prior to 5:00 p.m., New York City time, on the Purchase Date;
|
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|
•
|
|
all
authority conferred or agreed to be conferred pursuant to the terms
of the
Put Option hereby shall survive the death or incapacity of the undersigned
and every obligation of the Holder and shall be binding upon the
Holder’s
heirs, personal representatives, executors, administrators, successors,
assigns, trustees in bankruptcy and other legal representatives;
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•
|
|
the
delivery and surrender of the Securities is not effective, and the
risk of
loss of the Securities does not pass to the Paying Agent, until receipt
by
the Paying Agent of any and all evidences of authority and any other
required documents in form satisfactory to the Company; and
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•
|
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all
questions as to the validity, form, eligibility (including time of
receipt) and acceptance for payment of any surrender of Securities
pursuant to the procedures described in this Company Notice and the
form
and validity (including time of receipt of notices of withdrawal)
of all
documents will be determined by the Company, in its sole direction,
which
determination shall be final and binding on all parties.
|
3.3.
Delivery
of Securities.
Securities
Held Through a Custodian.
A
Holder whose Securities are held by a broker, dealer, commercial bank, trust
company or other nominee must contact such nominee if such Holder desires to
surrender such Holder’s Securities and instruct such nominee to surrender the
Securities for purchase on the Holder’s behalf through the transmittal
procedures of DTC as set forth below in “Securities in Global Form” on or prior
to 5:00 p.m., New York City time, on the Purchase Date.
Securities
in Global Form.
A
Holder who is a DTC participant may elect to surrender to the Company such
Holder’s beneficial interest in the Securities by:
10
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•
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delivering
to the Paying Agent’s account at DTC through DTC’s book-entry system such
Holder’s beneficial interest in the Securities on or prior to 5:00 p.m.,
New York City time, on the Purchase Date; and
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•
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|
electronically
transmitting such Holder’s acceptance through DTC’s PTS, subject to the
terms and procedures of that system on or prior to 5:00 p.m., New
York
City time, on the Purchase Date.
|
In
surrendering through PTS, the electronic instructions sent to DTC by the Holder
or by a broker, dealer, commercial bank, trust company or other nominee on
such
Holder’s behalf, and transmitted by DTC to the Paying Agent, will acknowledge,
on behalf of DTC and the Holder, receipt by the Holder of and agreement to
be
bound by the terms of the Put Option, including those set forth above under
“-
Agreement to be Bound by the Terms of the Put Option.”
4.
Right Of Withdrawal.
Securities surrendered for purchase may be withdrawn at any time prior to 5:00
p.m., New York City time, on the Purchase Date. In order to withdraw Securities,
Holders must comply with the withdrawal procedures of the DTC prior to 5:00
p.m., New York City time, on the Purchase Date. Securities withdrawn from the
Put Option may be resurrendered by following the surrender procedures described
in Section 3 above. In addition, Securities that are not accepted by us
pursuant to the Put Option by April 30, 2007 may be withdrawn.
This
means a Holder must deliver, or cause to be delivered, a valid withdrawal
request through the Automated Tender Offer Program system from the tendering
DTC
participant before 5:00 p.m., New York City time, on the Purchase Date. The
withdrawal notice must:
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•
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specify
the DTC Voluntary Offer Instruction Number, the name of the participant
for whose account such Securities were tendered and such participant’s
account number at DTC to be credited with the withdrawn Securities;
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•
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contain
a description of the Securities to be withdrawn (including the principal
amount to be withdrawn); and
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•
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be
submitted through the DTC PTS system by such participant under the
same
name as the participant’s name is listed in the original tender, or be
accompanied by evidence satisfactory to the Company that the person
withdrawing the tender has succeeded to the beneficial ownership
of the
Securities.
|
We
will
determine all questions as to the validity, form and eligibility, including
time
of receipt, of notices of withdrawal.
5.
Payment For Surrendered Securities.
We will promptly forward to the Paying Agent, prior to 10:00 a.m., New York
City
time, on April 5, 2007 the appropriate amount of cash required to pay the
Purchase Price for the surrendered Securities, and the Paying Agent will
promptly thereafter cause the cash to be distributed to each record Holder
that
11
The
total
amount of funds required by us to purchase all of the Securities is
approximately $200.5 million (assuming all of the Securities are validly
surrendered for purchase and accepted for payment). In the event any Securities
are surrendered and accepted for payment, we intend to use cash on hand and
from
our revolving credit facility to purchase the Securities.
Our
revolving credit facility is a part of our credit agreement, effective as of
that April 27, 2006 (the “Credit Agreement”), among the Company, the Subsidiary
Guarantors named therein, the Lenders, the Issuing Bank and Swing Line Bank
named therein, SunTrust Bank, as syndication agent, Bank of America, N.A. and
Keybank National Association as co-documentation agents and Wachovia Bank,
National Association as Administrative Agent and Collateral Agent (the
“Administrative Agent”) that provides for senior secured facilities in an
aggregate principal amount of up to $1.25 billion (the “Credit Facilities”). The
Credit Facilities are comprised of (a) a revolving credit facility in an
aggregate principal amount of up to $250 million (the “Revolving Credit
Facility”), and (b) a term loan facility in an aggregate principal amount of up
to $1 billion , including up to $800 million used to finance a 16,750,000 share
repurchase under a modified "Dutch" auction tender offer (the “Initial Term
Loan”), and up to $200 million, which is available to be drawn in either a
single drawing or two drawings of equal principal amounts, in each case until
October 27, 2007 (the “Delayed Draw Term Loan”, together with the Initial Term
Loan, the “Term Facility”). The Delayed Draw Term Loan was intended to be used
to refinance the Securities; however, we do not know at this time whether we
will use that facility or some other financing if we implement our plan to
redeem the Securities (and any new securities that might be issued if we
implement planned changes to the Securities through an exchange offer).
The
Revolving Credit Facility may be used to provide ongoing working capital and
for
other general corporate purposes of the Company and its subsidiaries. The final
maturity of the Revolving Credit Facility is April 27, 2011 and will be payable
in full at that time. The final maturity of the Term Facility is April 27,
2013.
The Term Facility will amortize in 27 equal quarterly installments of 0.25%
of
the original principal amount of the Term Facility (subject to adjustment for
prepayments), with the remaining balance due upon maturity.
The
interest rate in connection with the Credit Facilities shall be based on the
Base Rate plus the Applicable Percentage (the “Base Rate Advance”), or
Eurodollar Rate plus the Applicable Percentage (the “Eurodollar Rate Advance”).
“Base Rate” means the higher of (a) the prime rate of interest established by
the Administrative Agent and (b) the federal funds rate plus 0.50% per annum.
The “Applicable Percentage” means 0.50% per annum for Base Rate Advances and
1.50% per annum for Eurodollar Rate Advances, subject to adjustment between
0% to 1.75%, depending upon certain financial ratios of the Company. “Eurodollar
Rate” means the rate per annum as the London interbank offered rate for deposits
in US dollars two business days before the first day of any interest period,
as
adjusted for maximum statutory reserves. Generally, a Base Rate
12
The
Credit Agreement also contains customary covenants, including, but not limited
to, restrictions on:
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·
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incurrence
of liens;
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·
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incurrence
of additional debt;
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·
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sales
of assets;
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·
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investments;
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·
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declarations
of dividends; and
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·
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capital
expenditures.
|
In
addition, the Credit Agreement requires maintenance of two financial covenants
that are based upon a ratio of the Company’s debt to EBITDA, both as
defined, and a ratio of EBITDA to net cash interest expense, all as defined
in the Credit Agreement. These covenants, which are described more fully in
the
Credit Agreement, which is incorporated by reference as an exhibit to the
Schedule TO to which this Company Notice is an exhibit. Please refer to the
Credit Agreement for a complete description of these and other covenants.
The
Credit Facilities are secured by all (whether now owned or hereafter owned)
present and future stock or other membership interests in the present and future
subsidiaries of the Company, subject to certain exceptions.
6.
Securities Acquired.
Any Securities purchased by us pursuant to the Put Option will be cancelled
by
the Trustee, pursuant to the terms of the Indenture.
7.
Plans Or Proposals Of The Company.
Except as described in the question“Does
the Company have other plans to retire or purchase the
Securities?”in
the
Summary Term Sheet and further in this section 7, the Company does not currently
have any plans which would be material to a Holder’s decision to surrender
Securities for purchase in the Put Option, which relate to or which would result
in:
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•
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any
extraordinary transaction, such as a merger, reorganization or
liquidation, involving the Company or any of its subsidiaries;
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•
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|
any
purchase, sale or transfer of a material amount of assets of the
Company
or any of its subsidiaries;
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•
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any
material change in the present dividend rate or policy, or indebtedness
or
capitalization of the Company;
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•
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|
any
change in the present board of directors or management of the Company,
including, but not limited to, any plans or proposals to change the
number
or the term of directors or to fill any existing vacancies on the
board or
to change any material term of the employment contract of any executive
officer;
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13
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•
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any
other material change in the corporate structure or business of the
Company;
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•
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any
class of equity securities of the Company to be delisted from a national
securities exchange or cease to be authorized to be quoted in an
automated
quotation system operated by a national securities association;
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•
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any
class of equity securities of the Company becoming eligible for
termination of registration under Section 12(g)(4) of the Securities
Exchange Act of 1934, as amended (the “Exchange
Act”);
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•
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the
suspension of the obligation of the Company to file reports under
Section 15(d) of the Exchange Act;
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•
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the
acquisition by any person of additional securities of the Company
or the
disposition of securities of the Company; or
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•
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|
any
changes in the charter, bylaws or other governing instruments of
the
Company or other actions that could impede the acquisition of control
of
the Company.
|
As
indicated above, we intend to propose an amendment to, or otherwise revise
or
replace, the Securities to provide, on conversion, a “net share settlement”
feature. This feature would require us, upon conversion by holders of the
Securities, to settle the conversion with an amount of cash up to the accreted
principal amount of the Securities. The excess, if any, of the conversion value
of the Securities over the accreted principal amount would be settled in shares
of our Common Stock. As a result, the share dilution associated with the
conversion of the Securities would be significantly reduced. We are studying
the
most efficient method by which to implement this change - courses of action
include, among other things, either a consent solicitation with existing
Securities holders or an exchange offer by which Securities holders would be
offered a new security that contains the net share settlement feature. We also
are going to propose that the Securities (and any new securities that might
be
issued in an exchange offer) have a shorter (reducing from 30 to 15 days) prior
notice period for redemptions by the Company. We then plan, following
implementation of these changes but prior to the end of our fiscal year, August
3, 2007, to redeem the Securities (and any new securities that might be issued
in an exchange offer).
This
Company Notice is neither an offer to sell nor a solicitation of an offer to
buy
any securities. There shall not be any sale of any securities to be issued
in an
exchange (if we choose that method by which to implement the changes described
above) in any state in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the laws of such state.
We
may be
required to and will file with the SEC certain documents relative the changes
described above that we intend to propose with respect to the Securities. Any
documents that we file with the SEC may contain important information that
we
recommend holders of Securities read carefully before any decision is made
with
respect to exercising your Put Option. These documents will be made available
to
all Securities holders at no expense to them. Holders of the Securities and
other interested parties may
14
8.
Interests Of Directors, Executive Officers And Affiliates Of The Company In
The
Securities.
Except as otherwise disclosed below, based on a reasonable inquiry by the
Company:
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•
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|
none
of the Company or its executive officers, directors, subsidiaries
or other
affiliates has any beneficial interest in the Securities;
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•
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|
the
Company will not purchase any Securities from such persons; and
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•
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|
during
the 60 days preceding the date of this Company Notice, none of such
officers, directors or affiliates has engaged in any transactions
in the
Securities.
|
A
list of
the directors and executive officers of the Company is attached to this Company
Notice as Annex A.
9.
Purchases Of Securities By The Company And Its Affiliates.
The Company and its affiliates may, subject to restrictions under applicable
United States federal securities laws, purchase Securities in the open market,
in private transactions, through a subsequent tender or exchange offer, or
otherwise, any of which may be consummated at purchase prices higher than the
Purchase Price. In particular, the Company may, subject to restrictions under
applicable United States federal securities laws, offer to exchange Securities
for a new class of senior convertible notes due 2032, with terms substantially
identical to the Securities with the exception of the "net share settlement"
feature described earlier. A decision to purchase Securities, if any, will
depend upon many factors, including the market price of the Securities, the
amount of Securities surrendered for purchase pursuant to the Put Option, the
market price of the Common Stock, the business and financial position of the
Company and general economic and market conditions.
15
10.
Material United States Tax Considerations.
The following discussion summarizes the material United States federal income
tax considerations that may be relevant to a Holder if you exercise the Put
Option. This summary is based on the Internal Revenue Code of 1986, as amended
(the “Code”),
and the regulations, rulings and decisions thereunder, all of which are subject
to change, possibly with retroactive effect.
This
summary does not describe all of the tax considerations that may be relevant
to
you. All Holders are strongly encouraged to consult with their tax advisor
about
the United States federal, state, local and other tax consequences of exercising
the Put Option.
U.S.
Holders
This
discussion deals only with U.S. Holders who are beneficial owners of the
Securities holding the Securities as capital assets, and does not apply if
you
are a member of a class of Holders subject to special rules, such as:
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•
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a
dealer in securities or currencies;
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•
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a
trader in securities that elects to use a mark-to-market method of
accounting for your securities holdings;
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•
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a
bank;
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•
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an
insurance company;
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•
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a
tax-exempt organization;
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•
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a
person that owns Securities that are a hedge or that are hedged against
interest rate risks;
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•
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a
partnership, or other pass-through entity or person holding the Securities
through a partnership or other pass-through entity;
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•
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a
person that owns Securities as part of a straddle or conversion
transaction for tax purposes; or
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•
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a
United States person whose functional currency for tax purposes is
not the
U.S. dollar.
|
You
will
be a U.S. Holder if you are a beneficial owner of the Securities for U.S.
federal income tax purposes and you are:
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•
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|
a
citizen or resident of the United States;
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•
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a
domestic corporation;
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•
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an
estate whose income is subject to United States federal income taxation
|
16
| regardless of its source; or | |||
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•
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a
trust if a United States court is able to exercise primary supervision
over the trust’s administration and one or more United States persons are
authorized to control all substantial decisions of the trust.
|
If
you are not a U.S. Holder, this discussion does not apply to you.
Generally, your exercise of the Put Option will result in taxable gain or loss
to you equal to the difference between (i) the amount of cash received and
(ii) your adjusted tax basis in the Securities surrendered. Because you
agreed when you purchased your Securities to treat the Securities as subject
to
the special rules regarding contingent payment debt instruments, your adjusted
tax basis in the Securities will generally be equal to your original purchase
price for the Securities, increased by any interest income previously accrued
by
you (determined without regard to any adjustments to interest accruals that
arise because projected payments differ from the actual amounts paid), decreased
by the amount of any noncontingent payments and any projected payments that
have
been previously scheduled to be made (without regard to the contingent actual
amounts paid) on the Securities, and increased or decreased by the amount of
any
positive or negative adjustment, respectively, that you are required to make
because of differences between your tax basis and the adjusted issue price
of
the Securities. This gain will generally be treated as ordinary interest income;
any loss would generally be ordinary loss to the extent of interest previously
included in income, and thereafter, capital loss (which will be long-term if
you
held your Securities for more than one year). The deductibility of net capital
losses by individuals and corporations is subject to limitations.
The
contingent payment debt instrument regulations are complex. You should consult
your tax advisor regarding the accrual of interest, any positive and negative
adjustments, and the calculation of adjusted tax basis with respect to your
Securities.
Non-U.S.
Holders
This
discussion describes the tax consequences to a non-U.S. Holder. You are a
non-U.S. Holder if you are the beneficial owner of Securities that is neither
a
U.S. Holder (as defined above) nor a partnership for U.S. federal income tax
purposes.
If
you
are a U.S. Holder, this section does not apply to you.
If
you
are a non-U.S. Holder, we and other U.S. payers generally will not be required
to deduct United States withholding tax from cash received upon exercising
the
Put Option if:
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•
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you
do not actually or constructively own 10% or more of the total combined
voting power of all classes of our stock entitled to vote;
|
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•
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|
you
are not a controlled foreign corporation that is related to us through
stock ownership; and
|
17
|
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•
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|
either
(i) you provide your name and address, and certify, under penalties
of perjury, that you are not a United States person (which certification
may be made on Internal Revenue Service (“IRS”)
Form W-8BEN (or successor form)), or (ii) you hold your Securities
through certain intermediaries, and you and the intermediaries satisfy
the
certification requirements of applicable U.S. Treasury regulations.
|
Special
certification rules apply to non-U.S. Holders that are pass-through entities
rather than corporations or individuals. Non-U.S. Holders should consult their
tax advisors regarding the certification requirements for such non-U.S. Holders.
If
you
cannot satisfy the requirements above, but you are eligible for the benefits
of
an applicable U.S. income tax treaty that would reduce or eliminate such
withholding taxes, you should provide an IRS Form W-8BEN (or successor form)
claiming either a partial reduction or complete exemption from such withholding
taxes under such treaty. If interest with respect to the Securities is
effectively connected with the conduct of a U.S. trade or business by you,
you
should instead furnish IRS Form W-8ECI.
Backup
Withholding
To
prevent backup withholding on payments made to each surrendering U.S. Holder,
each such U.S. Holder should either (x) provide such Holder’s correct
taxpayer identification number (“TIN”)
by completing a copy of the substitute IRS Form W-9 enclosed with this Company
Notice, certifying that (1) such Holder is a “United States person” (as
defined in section 7701(a)(30) of the Code, (2) the TIN provided is correct
(or that such U.S. Holder is awaiting a TIN) and (3) that such U.S. Holder
is not subject to backup withholding because: (a) such Holder is exempt
from backup withholding, (b) such Holder has not been notified by the IRS
that such Holder is subject to backup withholding as a result of a failure
to
report all interest or dividends, or (c) the IRS has notified such U.S.
Holder that he, she or it is no longer subject to backup withholding, and
provide such completed Form W-9 or (y) otherwise establish an exemption.
Otherwise, backup withholding may apply until such Holder furnishes such
Holder’s TIN (and, if such Holder has not already done so, the completed
substitute IRS Form W-9 described above). If a tendering U.S. Holder does not
provide the correct TIN or an adequate basis for exemption, such Holder may
be
subject to a $50 penalty imposed by the IRS, and payments made with respect
to
the tendered Securities may be subject to backup withholding. If withholding
results in an overpayment of taxes, a refund may be obtained.
To
prevent backup withholding, non-U.S. Holders should (i) submit a properly
completed IRS Form W-8BEN, certifying under penalties of perjury to the holder’s
foreign status or (ii) otherwise establish an exemption. IRS Forms W-8BEN
may be obtained from the Paying Agent.
Certain
Holders (including, among others, corporations and certain foreign individuals)
are exempt recipients not subject to backup withholding requirements. See the
enclosed copy of the IRS Substitute Form W-9, Request for Taxpayer
Identification Number and Certification, and the Guidelines for Certification
of
taxpayer Identification Number on Substitute Form W-9. To avoid possible
erroneous backup withholding,
18
See
the
enclosed Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9 for additional information and instructions.
11.
Additional Information.
The Company is subject to the reporting and other informational requirements
of
the Exchange Act and, in accordance therewith, files reports, proxy statements
and other information with the SEC. Such reports, proxy statements and other
information can be inspected and copied at the Public Reference Section of
the
SEC located at Station Place, 100 F Street, N.E., Washington D.C. 20549. Copies
of such material can be obtained from the Public Reference Section of the SEC
at
prescribed rates. Such material may also be accessed electronically by means
of
the SEC’s home page on the Internet at www.sec.gov. Such reports and other
information concerning the Company may also be inspected at the offices of
the
NASDAQ located at One Liberty Plaza, 50th Floor, New York, New York 10006.
The
Company has filed with the SEC a Tender Offer Statement on Schedule TO-I,
pursuant to Section 13(e) of the Exchange Act and Rule 13e-4 promulgated
thereunder, furnishing certain information with respect to the Put Option.
The
Tender Offer Statement on Schedule TO-I, together with any exhibits and any
amendments thereto, may be examined and copies may be obtained at the same
places and in the same manner as set forth above.
The
documents listed below (as such documents may be amended from time to time)
contain important information about the Company and its financial condition.
| · |
Our
Annual Report on Form 10-K for the year ended July 28, 2006 filed
with the
SEC on October 3, 2006;
|
| · |
Our
Quarterly Report on Form 10-Q for the quarter ended October 27, 2006
filed
with the SEC on December 6, 2006;
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| · |
Our
Quarterly Report on Form 10-Q for the quarter ended January 26, 2007
filed
with the SEC on March 2, 2007; and
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| · |
Our
Current Reports on Form 8-K filed with the SEC on August 1, 2006,
August
15, 2006, August 29, 2006, September 13, 2006, September 19, 2006,
September 21, 2006, September 26, 2006, October 18, 2006, November
3,
2006, November 16, 2006, November 21, 2006, November 29, 2006, December
6,
2006, January 3, 2007, January 30, 2007, February 14, 2007, February
20,
2007, February 21, 2007, February 26, 2007, February 27, 2007 and
March 2,
2007.
|
We
may,
at our discretion, refer to or incorporate by reference into this Company Notice
documents we subsequently file with the SEC pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the Company
Notice by filing an amendment to the Schedule TO for such purpose. Nothing
in
this Company Notice
19
12.
No Solicitations.
The Company has not employed any persons to make solicitations or
recommendations in connection with the Put Option.
13.
Definitions.
All capitalized terms used but not specifically defined this Company Notice
shall have the meanings given to such terms in the Indenture and the Securities.
14.
Conflicts.
In the event of any conflict between this Company Notice on the one hand and
the
terms of the Indenture or the Securities or any applicable laws on the other
hand, the terms of the Indenture or the Securities or applicable laws, as the
case may be, will control.
None
of the Company or its board of directors or employees are making any
recommendation to any Holder as to whether to surrender or refrain from
surrendering Securities for purchase pursuant to this Company Notice. Each
Holder must make such Holder’s own decision whether to surrender such Holder’s
Securities for purchase and, if so, the principal amount of Securities to
surrender based on their own assessment of current market value and other
relevant factors.
CBRL
GROUP, INC.
20
ANNEX
A
The
following persons are the executive officers and/or directors of
CBRL:
|
Name
|
Position
|
|
Michael
A. Woodhouse
|
Chairman,
President and Chief Executive Officer
|
|
Lawrence
E. White
|
Senior
Vice President, Finance and Chief Financial Officer
|
|
N.
B. Forrest Shoaf
|
Senior
Vice President, General Counsel and Corporate Secretary
|
|
Edward
A. Greene
|
Senior
Vice President, Strategic Initiatives
|
|
Simon
Turner
|
Senior
Vice President, Marketing and Innovation and Chief Marketing
Officer
|
|
Diana
S. Wynne
|
Senior
Vice President, Corporate Affairs
|
|
Patrick
A. Scruggs
|
Vice
President, Accounting and Tax and Chief Accounting
Officer
|
|
James
D. Carreker
|
Director
|
|
Robert
V. Dale
|
Director
|
|
Richard
J. Dobkin
|
Director
|
|
Robert
C. Hilton
|
Director
|
|
Charles
E. Jones, Jr.
|
Director
|
|
B.
F. “Jack” Lowery
|
Director
|
|
Martha
M. Mitchell
|
Director
|
|
Erik
Vonk
|
Director
|
|
Andrea
M. Weiss
|
Director
|
|
Jimmie
D. White
|
Director
|
The
business address and telephone number of each of the above executive officers
and directors is c/o CBRL Group, Inc., 305 Hartmann Drive, P. O. Box 787,
Lebanon, TN 37088-0787 and (615) 444-5533.
FORM
OF SUBSTITUTE FORM W-9
PAYER’S
NAME: ______________________________
|
SUBSTITUTE
FORM W-9
Department
of the Treasury Internal Revenue Service
|
|
Part 1—TAXPAYER
IDENTIFICATION NUMBER—PLEASE PROVIDE YOUR TIN IN THE BOX AT RIGHT AND
CERTIFY BY SIGNING AND DATING BELOW. IF AWAITING TIN, WRITE “APPLIED
FOR.”
|
|
Social security number or
Employer identification number
|
|
Payer’s
Request for Taxpayer Identification Number (“TIN”)
and Certification
|
|
Part
2—For
Payees Exempt from Backup Withholding—Check the box if you are NOT subject
to backup withholding. ¨
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||
|
________________________
________________________
________________________
Name
|
|
Part
3—Certification—Under
penalties of perjury, I certify that: (1) the number shown on this
form is
my correct taxpayer identification number (or I am waiting for a
number to
be issued to me), (2) I am not subject to backup withholding because:
(a)
I am exempt from backup withholding, or (b) I have not been notified
by
the Internal Revenue Service (IRS) that I am subject to backup withholding
as a result of a failure to report all interest or dividends, or
(c) the
IRS has notified me that I am no longer subject to backup withholding
and
(3) I am a U.S. person (including a U.S. resident
alien).
|
||
|
Business
name if different from above Check appropriate box:
¨
individual/sole
¨
proprietor
¨
corporation
¨
partnership
¨
other __________
____________________
Address
________________________
________________________
________________________
|
|
Certificate
Instructions—You
must cross out item (2) in Part 3 above if you have been notified
by IRS
that you are currently subject to backup withholding because you
have
failed to report all interest and dividends on your tax return. However,
if, after being notified by the IRS that you were subject to backup
withholding, you received another notification from the IRS that
you are
no longer subject to backup withholding, do not cross out item
2.
|
||
Signature of U.S. person
_________________________________________________ Dated,
__________________________, 2007
|
NOTE:
|
FAILURE
TO COMPLETE THIS SUBSTITUTE FORM W-9 MAY RESULT IN BACKUP WITHHOLDING
OF
28% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OPTION. IN ADDITION,
FAILURE TO PROVIDE SUCH INFORMATION MAY RESULT IN A PENALTY IMPOSED
BY THE
INTERNAL REVENUE SERVICE. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR
CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM
W-9 FOR
ADDITIONAL DETAILS.
|
YOU
MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU WROTE “APPLIED FOR” INSTEAD OF A
TIN IN THE SUBSTITUTE FORM W-9
CERTIFICATE
OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I
certify
under penalties of perjury that a taxpayer identification number has not been
issued to me, and either (a) I have mailed or delivered an application to
receive a taxpayer identification number to the appropriate Internal Revenue
Service Center or Social Security Administration Office or (b) I intend to
mail or deliver an application in the near future. I understand that if I do
not
provide a taxpayer identification number by the time of payment, 28% of all
reportable payments made to me may be withheld until I provide a taxpayer
identification number to the Paying Agent.
Signature of U.S. person
__________________________________________________ Dated,
________________________, 2007
2
GUIDELINES
FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER
ON SUBSTITUTE FORM W-9
Guidelines
for Determining the Proper Identification Number to Give the
Payer—Social
Security numbers have nine digits separated by two hyphens: i.e., 000-00-0000.
Employer Identification numbers have nine digits separated by only one hyphen:
i.e., 00-0000000. The table below will help determine the number to give the
payer.
|
For
this type of account
|
|
Give
the SOCIAL SECURITY
number
of:
|
|
For
this type of account:
|
|
Give
the EMPLOYER
IDENTIFICATION
number of:
|
|
1.
Individual
|
|
The
individual
|
|
6.
Sole proprietorship or single-owner LLC
|
|
The
owner(3)
|
|
2.
Two or more individuals (joint account)
|
|
The
actual owner of the account or, if combined funds, the first individual
on
the account(1)
|
|
7.
A valid trust, estate, or pension trust
|
|
Legal
entity (Do not furnish the identifying number of the personal
representative or trustee unless the legal entity itself is not designated
in the account title.)(4)
|
|
3.
Custodian account of a minor (Uniform Gift to Minors Act)
|
|
The
minor(2)
|
|
8.
Corporate or LLC electing corporate status on Form 8832
|
|
The
corporation
|
|
4.a.
The usual revocable savings trust account (grantor is also
trustee)
|
|
The
grantor-trustee(1)
|
|
9.
Association, club, religious, charitable, or educational organization
or
other tax exempt organization
|
|
The
organization
|
|
b.
So-called trust account that is not a legal or valid trust under
State
law
|
|
The
actual owner(1)
|
|
10.
Partnership or multi-member LLC
|
|
The
partnership
|
|
5.
Sole proprietor or single-owner LLC
|
|
The
owner(3)
|
|
11.
A broker or registered nominee
|
|
The
broker or nominee
|
|
|
|
12.
Account with the Department of Agriculture in the name of a public
entity
(such as a State or local government, school district or prison)
that
receives agricultural program payments.
|
|
The
public entity
|
||
|
(1)
|
List
first and circle the name of the person whose number you furnish.
If only
one person on a joint account has a social security number, that
person’s
social security number must be furnished.
|
|
(2)
|
Circle
the minor’s name and furnish the minor’s social security number.
|
|
(3)
|
You
must show your individual name, but you may also enter your business
or
“doing business as” name. You may use either your social security number
or your employer identification number (if you have one).
|
|
(4)
|
List
first and circle the name of the legal trust, estate or pension trust.
|
|
NOTE:
|
If
no name is circled when there is more than one name listed, the number
will be considered to be that of the first name listed.
|
GUIDELINES
FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER
ON SUBSTITUTE FORM W-9
Obtaining
a Number
If
you
don’t have a taxpayer identification number, obtain Form SS-5, Application for
a
Social Security Number Card, or Form SS-4, Application for Employer
Identification Number, at the local office of the Social Security Administration
or the Internal Revenue Service and apply for a number.
Payees
Exempt from Backup Withholding
Payees
specifically exempted from backup withholding on ALL payments include the
following:
|
|
•
|
|
An
organization exempt from tax under section 501(a), an individual
retirement plan or a custodial account under Section 403(b)(7) if the
account satisfies the requirements of Section 401(f)(2).
|
|
|
•
|
|
The
United States or any agency or instrumentality thereof.
|
|
|
•
|
|
A
State, The District of Columbia, a possession of the United States,
or any
subdivision or instrumentality thereof.
|
|
|
•
|
|
A
foreign government, a political subdivision of a foreign government,
or
any agency or instrumentality thereof.
|
|
|
•
|
|
An
international organization or any agency or instrumentality thereof.
|
Other
payees that may be exempt from back-up withholding include the following:
|
|
•
|
|
A
corporation
|
|
|
•
|
|
A
financial institution
|
|
|
•
|
|
A
registered dealer in securities or commodities registered in the
U.S., the
District of Columbia or a possession of the U.S.
|
|
|
•
|
|
A
real estate investment trust.
|
|
|
•
|
|
A
common trust fund operated by a bank under section 584(a).
|
|
|
•
|
|
A
trust exempt from tax under section 664 or described in section 4947.
|
|
|
•
|
|
An
entity registered at all times under the Investment Company Act of
1940.
|
|
|
•
|
|
A
foreign central bank of issue.
|
|
|
•
|
|
A
futures commission merchant registered with the Commodity Futures
Trading
Commission.
|
|
|
•
|
|
A
middleman known in the investment community as a nominee or custodian.
|
Payments
of dividends and patronage dividends not generally subject to backup withholding
include the following:
|
|
•
|
|
Payments
to nonresident aliens subject to withholding under section 1441.
|
|
|
•
|
|
Payments
to partnerships not engaged in a trade or business in the U.S. and
which
have at least one nonresident partner.
|
|
|
•
|
|
Payments
of patronage dividends where the amount renewed is not paid in money.
|
|
|
•
|
|
Payments
made by certain foreign organizations.
|
Payments
of interest not generally subject to backup withholding include the following:
|
|
•
|
|
Payments
of interest on obligations issued by individuals. Note: You may be
subject
to backup withholding if this interest is $600 or more and is paid
in the
course of the payer’s trade or business and you have not provided your
correct taxpayer identification number to the payer.
|
|
|
•
|
|
Payments
of tax-exempt interest (including exempt-interest dividends under
section
852).
|
|
|
•
|
|
Payments
described in section 6049(b)(5) to non-resident aliens.
|
|
|
•
|
|
Payments
on tax-free covenant bonds under section 1451.
|
|
|
•
|
|
Payments
made by certain foreign organizations.
|
Exempt
payees described above should file Form W-9 to avoid possible erroneous backup
withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER IDENTIFICATION
NUMBER, WRITE “EXEMPT” ON THE FACE OF THE FORM, SIGN AND DATE THE FORM AND
RETURN IT TO THE PAYER.
Certain
payments other than interest, dividends, and patronage dividends that are not
subject to information reporting are also not subject to backup withholding.
For
details, see Code sections 6041, 6041A(a), 6042, 6044, 6045, 6049, 6050A and
6050N, and their regulations.
Privacy
Act Notice—Section
6109 requires most recipients of dividend, interest, or other payments to give
their correct taxpayer identification numbers to payers who must report the
payments to IRS. The IRS uses the numbers for identification purposes and to
help verify the accuracy of tax returns. The IRS may also provide this
information to the Department of Justice for civil and criminal litigation
and
to cities, states and the District of Columbia to carry out their tax laws.
We
may also disclose this information to other countries under a tax treaty, or
to
Federal or state agencies to enforce Federal non-tax criminal laws and to combat
terrorism. Payers must be given the numbers whether or not recipients are
required to file tax returns. Payers must generally withhold 28% of taxable
interest, dividend, and certain other payments to a payee who does not furnish
a
taxpayer identification number to a payer. Certain penalties may also apply.
Unless
otherwise indicated, all section references are to the Internal Revenue Code
of
1986, as amended.
Penalties
|
(1)
|
Penalty
for Failure to Furnish Taxpayer Identification
Number.—If
you fail to furnish your correct taxpayer identification number to
a
payer, you are subject to a penalty of $50 for each such failure
unless
your failure is due to reasonable cause and not to willful neglect.
|
|
(2)
|
Civil
Penalty for False Information With Respect to
Withholding.—If
you make a false statement with no reasonable basis which results
in no
imposition of backup withholding, you are subject to a penalty of
$500.
|
|
(3)
|
Criminal
Penalty for Falsifying Information.—Willfully
falsifying certifications or affirmations may subject you to criminal
penalties including fines and/or imprisonment.
|
|
(4)
|
Misuse
of Taxpayer Identification Numbers.—If
the requester discloses or uses taxpayer identification numbers in
violation of federal law, the requester may be subject to civil and
criminal penalties.
|
FOR
ADDITIONAL INFORMATION
CONTACT
YOUR TAX CONSULTANT OR
THE
INTERNAL REVENUE SERVICE.