UNITED STATES
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
KENDLE
INTERNATIONAL INC.
(Name of Subject Companies (Issuer) and Filing Persons (Issuer))
3.375% Convertible Senior Notes due 2012
(Title of Class of Securities)
48880LAA5
(CUSIP Number of Class of Securities)
Copies of all communications to:
Jarrod B. Pontius, Esq.
Vice President, Chief Legal Officer and
Secretary
441 Vine Street, Suite 500
Cincinnati, Ohio 45202
(513) 763-4293
Facsimile: (513) 381-5870
(Name, address and telephone number of person authorized to receive notices and communications on behalf of filing persons)
With a Copy to:
F. Mark Reuter, Esq.
Keating Muething & Klekamp PLL
One East Fourth Street, Suite 1400
Cincinnati, Ohio 45202
(513) 579-6469
Facsimile: (513) 579-6457
CALCULATION OF FILING FEE
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Transaction valuation*
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Amount of filing fee
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$142,500,000
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$16,544.25
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*
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Calculated solely for purposes of determining the filing fee. The amount shown assumes that $142,500,000 aggregate principal amount of the 3.375% Convertible Senior
Notes due 2012 are purchased at the offer price of $1,000.00 per $1,000 principal amount plus accrued and unpaid interest up to but excluding July 11, 2011. The amount of the filing fee, calculated in accordance with the Securities Exchange Act
of 1934, as amended, and Fee Rate Advisory #5 for Fiscal Year 2011, equals $116.10 per million of the transaction valuation.
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Check 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.
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Amount Previously Paid:
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Not applicable.
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Filing party:
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Not applicable.
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Form or Registration No.:
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Not applicable.
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Date filed:
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Not applicable.
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Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer.
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Check the appropriate boxes below to designate any transactions to which the statement relates:
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third party tender offer subject to Rule 14d-1
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x
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issuer tender offer subject to Rule 13e-4
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going private transaction subject to Rule 13e-3
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amendment to Schedule 13D under Rule 13d-2
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Check the following box if the filing is a final amendment reporting the results of the tender
offer:
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INTRODUCTORY STATEMENT
This Tender Offer Statement on Schedule TO (this Schedule TO) is filed by Kendle International Inc., an Ohio corporation (the
Company or Offeror), and relates to the offer (the Offer) by the Offeror to purchase for cash any and all of the Companys 3.375% Convertible Senior Notes due 2012 (the Notes or the
Securities) upon the terms and subject to the conditions set forth in the attached Offer to Purchase and Consent Solicitation Statement dated as of June 6, 2011 (as it may be amended or supplemented from time to time, the
Offer to Purchase) and the related Letter of Transmittal and Consent. Copies of the Offer to Purchase and the related Letter of Transmittal and Consent are filed with this Schedule TO as Exhibits (a)(1)(i) and (a)(1)(ii), respectively.
The Offer will expire at 8:00 am, New York City time, on July 6, 2011, unless an Offer is extended or earlier terminated. This Schedule TO is intended to satisfy the disclosure requirements of Rule 13e-4(c)(2) under the Securities Exchange Act
of 1934.
All of the information set forth in the Offer to Purchase and the related Letter of Transmittal and Consent is
incorporated by reference herein as set forth below.
ITEM 1. SUMMARY TERM SHEET.
The information set forth in the Offer to Purchase under Summary is incorporated herein by reference.
ITEM 2. SUBJECT COMPANY INFORMATION.
(a)
Name and Address
. The name of the issuer and Offeror is Kendle International Inc. The address of the Offerors principal executive offices is 441 Vine Street, Suite 500, Cincinnati, Ohio
45202. The telephone number of its principal executive office is (513) 381-5550.
(b)
Securities
. This Schedule TO
relates to the offer by the Offeror to purchase any and all the outstanding Securities. As of June 6, 2011, there were $142.5 million in aggregate principal amount of the Notes outstanding.
(c)
Trading Market and Price
. The information set forth in the Offer to Purchase under Market and Trading Information
is incorporated herein by reference.
ITEM 3. IDENTITY AND BACKGROUND OF FILING PERSON.
(a)
Name and Address
. This is an issuer tender offer. The information set forth under Item 2(a) above and in the Offer to
Purchase under Certain Information Concerning the Offeror is incorporated herein by reference. The Company is the filing person.
ITEM 4. TERMS OF THE TRANSACTION.
(a)
Material Terms.
The information set forth in (i) the Offer to Purchase under The Merger, Summary, Terms of the Offer and the Consent Solicitation,
Certain Significant Considerations, Proposed Amendment and Certain United States Federal Income Tax Consequences and (ii) the definitive Proxy Statement on Schedule 14A with respect to the Merger filed with
the Securities and Exchange Commission (the SEC) on June 3, 2011, as the same may be amended and supplemented, under SummaryVote Required and The MergerReasons for the Merger; Recommendation of the
Board of Directors is incorporated herein by reference.
(b)
Purchases.
To the best of our knowledge, we will not
purchase any Securities from any of our officers, directors or affiliates. The information set forth in the definitive Proxy Statement on Schedule 14A with respect to the Merger filed with the SEC on June 3, 2011, as the same may be
amended and supplemented, under The MergerInterests of Certain Persons in the Merger is incorporated herein by reference.
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ITEM 5. PAST CONTACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS.
(a)
Agreements Involving the Subject Companys Securities.
In connection with the issuance of the Notes, we entered into
convertible note hedge transactions with UBS Securities LLC and JP Morgan Chase Bank, N.A. (collectively, the counterparties). The convertible note hedge transactions are comprised of purchased call options and sold warrants. The purchased call
options were expected to reduce exposure to potential dilution upon the conversion of the Notes. We also entered into warrant transactions with such counterparties. The warrants are hedges sold by the Company to the sellers of the call options. The
effect of the call options and the warrants, taken together, was to increase the strike price of conversion from the companys perspective.
The continued existence of the warrants until their scheduled termination dates in 2013 means that, in the event company shares on the scheduled termination dates are trading above $61.217, the company
may be obligated to issue shares to the holders of the warrants at such strike price.
The information set forth in the
definitive Proxy Statement on Schedule 14A with respect to the Merger filed with the SEC on June 3, 2011, as the same may be amended and supplemented, under Summary, The Special Meeting, The MergerReasons for
the Merger; Recommendation of the Board of Directors, and The MergerInterests of Certain Persons in the Merger is incorporated herein by reference.
ITEM 6. PURPOSES OF THE TRANSACTION AND PLANS OR PROPOSALS.
(a)
Purposes.
The information set forth in the Offer to Purchase under Purpose of the Offer and Consent Solicitation is incorporated herein by reference.
(b)
Use of Securities Acquired.
Any Securities submitted for purchase will be cancelled and retired.
(c)
Plans.
The information set forth in the definitive Proxy Statement on Schedule 14A with respect to the Merger filed with the SEC on June 3, 2011, as the same may be amended and
supplemented, under Summary, The Special Meeting, Questions and Answers About the Special Meeting and the Merger, The MergerReasons for the Merger; Recommendations of the Board of Directors,
The MergerInterests of Certain Persons in the Merger and The Merger Agreement is incorporated by reference.
ITEM 7. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)
Source of Funds.
The information set forth in (i) the Offer to Purchase under Source and Amount of Funds and (ii) the definitive Proxy Statement on Schedule 14A with
respect to the Merger filed with the SEC on June 3, 2011, as the same may be amended and supplemented, under The MergerFinancing of the Merger is incorporated herein by reference.
(b)
Conditions.
The information set forth in (i) the Offer to Purchase under Sources and Amount of Funds and
(ii) the definitive Proxy Statement on Schedule 14A with respect to the Merger filed with the SEC on June 3, 2011, as the same may be amended and supplemented, under The MergerFinancing of the Merger is incorporated
herein by reference.
(c)
Borrowed Funds.
The information set forth in (i) the Offer to Purchase under
Sources and Amount of Funds and (ii) the definitive Proxy Statement on Schedule 14A with respect to the Merger filed with the SEC on June 3, 2011, as the same may be amended and supplemented, under The
MergerFinancing of the Merger is incorporated herein by reference.
ITEM 8. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a)
Securities Ownership.
To the best of our knowledge, no Securities are beneficially owned by any person whose
ownership would be required to be disclosed in this Item.
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(b)
Securities Transactions.
To the best of our knowledge, none of the persons
referenced in this Item have engaged in any transactions in the Securities during the 60 days preceding the date of this Schedule TO.
ITEM
9. PERSON/ASSETS, RETAINED, EMPLOYED, COMPENSATED OR USED.
(a)
Solicitations or Recommendations.
The information
set forth in the Offer to Purchase under Dealer Manager, Information Agent and Depositary and Fees and Expenses is incorporated by reference herein.
ITEM 10. FINANCIAL STATEMENTS.
(a)
Financial Information.
The
information set forth in: (i) Item 8 of the Companys Annual Report on Form 10-K for the year ended December 31, 2010, together with the attachments thereto, (ii) Item 1 of the Companys Quarterly Report on Form
10-Q for the period ended March 31, 2011 and (iii) Exhibit 12.1 to the Companys Annual Report on Form 10-K are incorporated herein by reference. The Companys ratio of earnings to fixed charges for the three months ended
March 31, 2011 was (0.20x).
(b)
Pro Forma Information.
Not applicable.
ITEM 11. ADDITIONAL INFORMATION.
(a)
Agreements, Regulatory Requirements and Legal Proceedings
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(1) None.
(2) The Company is required to comply with federal and state securities laws and tender offer rules.
(3) The information set forth in the definitive Proxy Statement on Schedule 14A with respect to the Merger filed with the SEC on
June 3, 2011, as the same may be amended and supplemented, under The MergerRegulatory Approvals and Notices is incorporated herein by reference.
(4) Not applicable.
(5) Not applicable.
(b)
Other Material Information.
The information set forth in (i) the Offer to Purchase and the Letter of Transmittal and
Consent and (ii) the definitive Proxy Statement on Schedule 14A with respect to the Merger filed with the SEC on June 3, 2011, as the same may be amended and supplemented, is incorporated herein by reference.
ITEM 12. EXHIBITS.
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Exhibit Number
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Description
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(a)(1)(i)
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Offer to Purchase and Consent Solicitation Statement dated June 6, 2011.
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(a)(1)(ii)
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Letter of Transmittal and Consent.
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(a)(1)(iii)
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Press Release issued by the Company on June 6, 2011.
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(b)
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None.
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(d)(1)
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Definitive Proxy Statement on Schedule 14A with respect to the Merger filed with the SEC on June 3, 2011, as the same may be amended and supplemented (incorporated herein by
reference).
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(g)
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None.
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(h)
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None.
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ITEM 13. INFORMATION REQUIRED BY SCHEDULE 13E-3.
Not applicable.
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this Schedule TO is true, complete and correct.
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KENDLE INTERNATIONAL INC.
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By:
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/s/ Jarrod B. Pontius
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Name:
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Jarrod B. Pontius
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Title:
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Vice President, Chief Legal Officer and Secretary
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Date: June 6, 2011
EXHIBIT INDEX
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Exhibit Number
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Description
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(a)(1)(i)
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Offer to Purchase and Consent Solicitation Statement dated June 6, 2011.
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(a)(1)(ii)
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Letter of Transmittal and Consent.
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(a)(1)(iii)
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Press Release issued by the Company on June 6, 2011.
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(b)
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None.
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(d)(1)
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Definitive Proxy Statement on Schedule 14A with respect to the Merger filed with the SEC on June 3, 2011, as the same may be amended and supplemented (incorporated herein by
reference).
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(g)
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None.
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(h)
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None.
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