UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
UNDER SECTION 14(d)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
VERSAR, INC.
(Name
of Subject Company)
VERSAR, INC.
(Names
of Persons Filing Statement)
Common Stock, $.01 par value
(Title
of Class of Securities)
925297103
(CUSIP
Number of Class of Securities)
James D. Villa
Senior Vice President, General Counsel, Secretary and Chief
Compliance Officer
6850 Versar Center
Springfield, VA 22151
(703) 750-3000
(Name,
address and telephone number of person authorized to
receive
notices
and communications on behalf of the persons filing
statement)
with
copies to:
Elizabeth Noe
Paul Hastings LLP
1170 Peachtree Street N.E., Suite 100
Atlanta, Georgia 30309-9998
☒Check the
box if the filing relates solely to preliminary communications made
before the commencement of a tender offer.
This
Schedule 14D-9 filing consists of the following communications
related to the proposed acquisition of Versar, Inc. (the
“
Company
” or
“
Versar
”), by Kingswood
Genesis Fund I, LLC, a Delaware limited liability company
(“
Parent
” or
“
Kingswood
”), and KW
Genesis Merger Sub, Inc., a Delaware corporation and a wholly owned
subsidiary of Parent (“
Merger Sub
”). Parent and
Merger Sub are affiliates of Kingswood Capital Management, LLC.
Capitalized terms used but not defined herein have the meanings
ascribed to them in the Merger Agreement.
The
information set forth under Items 1.01, 8.01 and 9.01 of the
Current Report on Form 8-K filed by the Company on September 25,
2017 (including all exhibits attached thereto) is incorporated
herein by reference.
Attached are: (1)
slides used for a presentation to Versar employees on September 25,
2017 and (2) a list of frequently asked questions circulated to
Versar employees on September 25, 2017.
Additional Information and Where to Find It
The
tender offer described in this communication (the
“Offer”) has not yet commenced, and this communication
is neither an offer to purchase nor a solicitation of an offer to
sell any shares of the capital stock of Versar or any other
securities. On the commencement date of the Offer, a tender offer
statement on Schedule TO, including an offer to purchase, a letter
of transmittal and related documents, will be filed with the United
States Securities and Exchange Commission (the “SEC”).
The offer to purchase shares of Versar stock will only be made
pursuant to the offer to purchase, the letter of transmittal and
related documents filed with such Schedule TO. The tender offer
statement will be filed with the SEC by an affiliate of Kingswood
and Versar is obligated to file a solicitation/recommendation
statement with the SEC. INVESTORS AND SECURITY HOLDERS ARE URGED TO
READ THE TENDER OFFER STATEMENT AND THE SOLICITATION/RECOMMENDATION
STATEMENT, AS THEY MAY BE AMENDED FROM TIME TO TIME, WHEN THEY
BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT THE PROPOSED TRANSACTION AND THE PARTIES TO THE TRANSACTION.
Investors and security holders may obtain a free copy of these
statements (when available) and other documents filed with the SEC
at the website maintained by the SEC at www.sec.gov or by directing
such requests to the information agent for the tender offer, which
will be named in the tender offer statement.
Cautionary Note Regarding Forward-Looking Statements
This
filing contains forward-looking information. Forward-looking
statements may be significantly impacted by certain risks and
uncertainties described herein and in Versar’s Annual Report
on Form 10-K filed with the Securities and Exchange Commission for
the fiscal year ended June 30, 2017, as updated from time to time
in the Company’s periodic filings. The forward-looking
statements are made as of the date hereof and Versar does not
undertake to update its forward-looking
statements.
Versar and
Kingswood
Agreement and Plan of
Merger
Frequently Asked Questions
September 25, 2017
What
is VERSAR announcing today?
VERSAR and KINGSWOOD signed an
agreement to commence a Tender Offer (TO) to purchase all existing
VERSAR shares. Page Hoeper, Chairman of the Board of VERSAR, signed
the agreement on September 22, 2017, and both VERSAR’s Board
and management support this proposed transaction.
This transaction culminates a lengthy
and multi-stage process undertaken by VERSAR and its investment
bankers, initially B. Riley and then Canaccord Genuity, to identify
and act upon strategic initiatives to maximize our shareholder
value and improve our liquidity. This transaction represents the
best available outcome for both VERSAR and its
shareholders.
Please refer to today’s 8-K and
press release announcing this transaction for more details, both of
which were filed with the Securities and Exchange Commission (SEC)
on September 25, 2017.
Why
is this the best available outcome for VERSAR?
A lengthy process -- which included
outreach to nearly 150 prospective acquirers, investors, lenders
and other financial and strategic partners -- resulted in this
transaction. VERSAR’s Board believes that it is in the best
interests of our Company and its shareholders.
Were
any additional offers to purchase the company
received?
VERSAR had constructive conversations
with numerous parties during this process. VERSAR is focused on
finalizing the deal with KINGSWOOD, which the Board agrees is the
best opportunity for shareholders to maximize the value of their
investment in VERSAR. At this time, we are not disclosing details
of any parties that may or may not have been in discussions with
us. We will subsequently be making a public filing that fully
addresses this issue.
How
long has VERSAR been trying to sell the
Company?
We have filed information related to
VERSAR’s liquidity issues with the SEC for some time. The
management team and Board have always been open to strategic
partnerships and any initiatives that serve to increase customer
and shareholder value and best position VERSAR in ways that
maximize its long–term opportunities.
What
is a Tender Offer?
A Tender Offer (TO) is a public offer
by a prospective acquirer directly to shareholders to tender (make
a formal offer giving a stated fixed price) their shares for sale
at a specified price during a specified time, subject to the
tendering of a minimum number of shares. This TO is for $.15 per
share and will initially be open for 25 business days once the TO
is commenced by KINGSWOOD, subject to extension in certain
circumstances, but no later than October 6, 2017. In a TO, the
prospective acquirer contacts shareholders directly, so VERSAR
shareholders will be contacted by KINGSWOOD or its agent. Under the
relevant portions of Delaware law, shareholder approval of the TO
through a vote is not necessary.
What
is the schedule associated with the Tender
Offer
By October 6, 2017, KINGSWOOD will
file documents with the SEC formally asking shareholders to tender
all of their VERSAR shares to KINGWOOD, according to the
instructions and requirements included in such documents. At the
same time, VERSAR will file documents with the SEC stating why the
Board and management believe that this is the best course for our
company and shareholders. In the interim, VERSAR will conduct
business as usual while KINGSWOOD prepares for the consummation of
the deal and subsequent ownership of VERSAR. Upon the successful
tendering of a majority of VERSAR’s shares, the transaction
is expected to close in November.
Why
is KINGSWOOD the optimal financial partner and owner for
VERSAR?
KINGSWOOD is a recognized private
equity investor with proven experience and history of sound
financial investments in a variety of different business sectors.
KINGSWOOD brings expertise in turning under performing companies
into successful growth platforms. KINGSWOOD’s reputation will
elevate industry awareness of VERSAR and lend credibility to our
renewal.
What
are KINGSWOOD’s intentions?
KINGSWOOD is interested in helping
VERSAR maximize its value to its diverse client base. Following the
acquisition, KINGSWOOD will work with VERSAR’s management
team to assess where and how it can best help us by applying its
considerable expertise, business contacts, and financial resources.
KINGSWOOD is expected to help re-position VERSAR to a growth
trajectory in the near term.
What
does this mean for Versar?
If this transaction closes, VERSAR
will operate as a privately held company. VERSAR’s Board will
likely be reconstituted by KINGSWOOD, and together they will work
with management to formulate a new strategy going forward. VERSAR
will continue to operate as an independent company providing expert
and high quality services to our customers. KINGSWOOD, as
VERSAR’s financial partner and owner, will provide financial
liquidity to enable the company to grow, financial oversight to
ensure efficient and effective operations, and seasoned industry
executives.
Will
KINGSWOOD change the management team?
At this point, VERSAR and KINGSWOOD
are focused on closing this transaction. Additional details about
this transaction and the future operations of VERSAR will be
outlined in our forthcoming communications and public
filings.
Will
VERSAR sell any existing business or any other assets of the
company?
VERSAR and KINGSWOOD are focused on
closing this transaction, which involves the tender of all of the
outstanding shares of common stock of VERSAR.
What
does this mean for VERSAR’s Shareholders?
Once the transaction is consummated,
Versar will become a privately-held company no longer traded on the
New York Stock Exchange, and will be a wholly-owned subsidiary of
Kingswood. During the TO specified offer period (expected to run
for 25 business days once the TO commences) shareholders can tender
their shares to KINGSWOOD in exchange for $.15 per share.
Shareholders should be aware that the price per share is without
interest and subject to applicable withholding taxes. When a
majority of outstanding shares of VERSAR common stock is tendered
to Kingswood, the TO will be consummated (subject to certain other
conditions that will be set out in KINGSWOOD’S offer to
purchase). Any shares not tendered into the TO will be exchanged
for the same consideration of $.15 per share. Once consummated,
VERSAR’S shareholders will no longer have an interest in
VERSAR, having received cash for their shares.
Are
any shareholders expected to oppose this deal?
The transaction does not require
shareholder approval, but a majority of VERSAR shareholders must
tender into the TO for the transaction to be
consummated.
How
will shareholders be kept informed of continuing
developments?
VERSAR’s announcements and SEC
filings related to this transaction will provide updates as
appropriate.
What
should shareholders do that can’t find their certificates of
stock ownership?
Shareholders who can’t find
their certificates of stock ownership should contact VERSAR’s
transfer agent, Computershare at 1.800.368.5948. Mailing and
website information can be found on Versar’s Investor
Relations webpage. If shareholders have any trouble, please contact
Versar’s investor relations at
InvestorRelations@versar.com
or 703.642.6706.
What
does this mean for VERSAR’s Employees?
Versar will continue to operate as a
stand-alone company, providing a comprehensive services portfolio
to our customers. As a services company, VERSAR’S employees
are its greatest asset. KINGSWOOD will support Versar to ensure
that employees are properly trained, rewarded, and challenged to
provide the best service to its customers.
What
does this mean for VERSAR’s Customers?
Versar’s overall financial
health will improve, providing confidence to our customers that
VERSAR will continue to be a long-term partner. VERSAR will remain
focused on delivering high quality services to our
customers.
What
steps will VERSAR take to maintain commitments to customers during
this process?
VERSAR’s daily operations and
customer engagement will not change as this transaction progresses
towards closing. VERSAR is committed to providing our customers
with optimal service, as are our employees. VERSAR expects
customers to benefit from the substantial resources and industry
expertise that KINGSWOOD brings.
How
might customers react to this news?
We hope our customers will see this
news in a positive light. Kingswood’s investment in our
people and our future means that we will continue to provide
exceptional customer support to our customers, as we have for the
last five decades.
What
happens if I get called by the press or a
shareholder?
If you get a call from a shareholder
or anyone representing themselves as the media, please forward them
to Karin Weber (67060) or Jim Villa (63980). If you receive a
question from a customer you are not sure how to answer, also
please contact Karin or Jim.
Please be mindful that as a Company
employee, anything you say may be seen as a statement of Versar.
Refer to Company Policy 1.12 on Social Media for guidelines on such
external communications.
Forward Looking
Information
This document contains
forward-looking information. Forward-looking statements may be
significantly impacted by certain risks and uncertainties described
herein and in Versar’s Annual Report on Form 10-K filed with
the Securities and Exchange Commission for the fiscal year ended
July 1, 2016, as updated from time to time in the Company’s
periodic filings. The forward-looking statements are made as of the
date hereof and Versar does not undertake to update its
forward-looking statements.
Important Additional
Information
THE TENDER OFFER
DESCRIBED IN THIS COMMUNICATION (THE “OFFER”) HAS NOT
YET COMMENCED, AND THIS COMMUNICATION IS NEITHER AN OFFER TO
PURCHASE NOR A SOLICITATION OF AN OFFER TO SELL ANY SHARES OF THE
CAPITAL STOCK OF VERSAR OR ANY OTHER SECURITIES. ON THE
COMMENCEMENT DATE OF THE OFFER, A TENDER OFFER STATEMENT ON
SCHEDULE TO, INCLUDING AN OFFER TO PURCHASE, A LETTER OF
TRANSMITTAL AND RELATED DOCUMENTS, WILL BE FILED WITH THE UNITED
STATES SECURITIES AND EXCHANGE COMMISSION (THE “SEC”).
THE OFFER TO PURCHASE SHARES OF VERSAR STOCK WILL ONLY BE MADE
PURSUANT TO THE OFFER TO PURCHASE, THE LETTER OF TRANSMITTAL AND
RELATED DOCUMENTS FILED WITH SUCH SCHEDULE TO. THE TENDER OFFER
STATEMENT WILL BE FILED WITH THE SEC BY AN AFFILIATE OF KINGSWOOD
AND VERSAR IS OBLIGATED TO FILE A SOLICITATION/RECOMMENDATION
STATEMENT WITH THE SEC. INVESTORS AND SECURITY HOLDERS ARE URGED TO
READ THE TENDER OFFER STATEMENT, AS IT MAY BE AMENDED FROM TIME TO
TIME, WHEN IT BECOMES AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT
INFORMATION. INVESTORS AND SECURITY HOLDERS MAY OBTAIN A FREE COPY
OF THESE STATEMENTS (WHEN AVAILABLE) AND OTHER DOCUMENTS FILED WITH
THE SEC AT THE WEBSITE MAINTAINED BY THE SEC AT WWW.SEC.GOV OR BY
DIRECTING REQUESTS FOR SUCH MATERIALS TO THE INFORMATION AGENT FOR
THE TENDER OFFER, WHICH WILL BE NAMED IN THE TENDER OFFER
STATEMENT.
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