SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule TO-T/A
Amendment No. 1
TENDER OFFER STATEMENT UNDER SECTION 14(d)(1)
OR SECTION 13(e)(1) OF THE SECURITIES EXCHANGE ACT OF 1934
Quadra Realty Trust, Inc.
(Name of Subject Company(Issuer))
HRECC Sub Inc.
Hypo Real Estate Capital Corporation
Hypo Real Estate Bank International AG
Hypo Real Estate Holding AG
(Name of Filing Persons(Offeror))
Common Stock, Par Value $0.001 Per Share
(Title of Class of Securities)
746945104
(CUSIP Number of Class of Securities)
Thomas Glynn
Hypo Real Estate Capital Corporation
622 Third Avenue
New York, NY 10017
(212) 671-6300
(Name, address and telephone number of person authorized to
receive notices and communications on behalf of filing persons)
with a copy to:
Larry Medvinsky, Esq.
Karl Roessner, Esq.
Clifford Chance US LLP
31 West 52nd Street
New York, NY 10019
(212) 878-8000
CALCULATION OF FILING FEE
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Transaction Valuation
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Amount of Filing Fee
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$178,879,309
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$7,030
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*
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Calculated solely for purposes of determining the filing fee. The calculation assumes the
purchase of 16,795,233 shares of common stock, par value $0.001 per
share of Quadra Realty Trust, Inc. that are not already owned by Hypo
Real Estate Capital Corporation, at $10.6506 per
share.
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**
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The filing fee, calculated in accordance with Exchange Act Rule 0-11, was calculated by
multiplying the transaction valuation by 0.00003930.
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þ
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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.
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Amount previously paid:
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$7,030
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Filing Parties:
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HRECC Sub Inc., Hypo Real Estate Capital Corporation, Hypo Real Estate Bank
International AG and Hypo Real Estate Holding AG
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Form or registration No.:
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Schedule TO-T
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Date Filed:
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February 13, 2008
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Note:
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o
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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:
þ
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third-party tender offer subject to Rule 14d-1.
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o
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issuer tender offer subject to Rule 13e-4.
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þ
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going-private transaction subject to Rule 13e-3.
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o
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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:
o
TABLE OF CONTENTS
This Amendment No. 1 amends and supplements the Tender Offer Statement and Rule 13e-3
Transaction Statement filed under the cover of Schedule TO with the Securities and Exchange
Commission on February 13, 2008 (as amended, the Schedule TO) by HRECC Sub Inc. (Purchaser),
Hypo Real Estate Capital Corporation (Parent), Hypo Real Estate Bank International AG (Hypo
International) and Hypo Real Estate Holding AG (Hypo Holding). The Schedule TO relates to the
offer by Purchaser to purchase any and all of the issued and outstanding shares of common stock,
par value $0.001 per share (the Shares), of Quadra Realty Trust, Inc. (Quadra or the
Company), not already owned by Parent and its affiliates, at a price of $10.6506 per share in
cash (without interest and less applicable withholding taxes), less the amount of any dividends
declared and paid (other than the $0.3494 dividend to be paid by the Company pursuant to the terms
of the Agreement and Plan of Merger dated as of January 28, 2008, by and among Parent, Purchaser
and Quadra) with respect to the Shares on or between the date of the
Offer and the Acceptance Date
(as defined in The Tender Offer
Section 1. Terms of the Offer; Expiration Date in the Offer to Purchase), upon the terms and subject to the conditions
set forth in the offer to purchase dated February 13, 2008 (the Offer to Purchase) and in the
related letter of transmittal (the Letter of Transmittal) (which Letter of Transmittal, together
with the Offer to Purchase, each as amended or supplemented from time to time, constitute the
Offer). Items not amended remain unchanged, and capitalized terms used herein and not otherwise
defined have the respective meanings ascribed thereto in the Offer to Purchase.
As permitted by General Instruction F to Schedule TO, the information set forth in the
Schedule TO, as amended by this Amendment No. 1, including all appendices, schedules, exhibits and
annexes hereto and thereto, is hereby expressly incorporated by reference herein in response to
Items 1 through 13 of the Schedule TO. You should read this Amendment No. 1 to Schedule TO together
with the Schedule TO filed on February 13, 2008.
Item 1.
Summary Term Sheet
.
The section captioned SUMMARY TERM SHEET beginning on page 2 of the Offer to Purchase is
hereby amended and restated in its entirety as follows:
SUMMARY TERM SHEET
HRECC Sub Inc., a Maryland corporation (which we refer to herein as Purchaser) and a wholly-owned
subsidiary of Hypo Real Estate Capital Corporation, a Delaware Corporation (which we refer to
herein as Parent), is offering to purchase any and all of the outstanding shares of the Companys
common stock that are not already owned by Parent and its affiliates at a price of $10.6506 per
share in cash (without interest and less applicable withholding taxes), less the amount of any
dividends declared and paid with respect to the shares on or between the date of this Offer and the
Acceptance Date (as defined below under The Tender Offer Section 1. Terms of the Offer;
Expiration Date) (other than the $0.3494 dividend described below). The Company expects to declare
and pay a dividend immediately prior to the Acceptance Date to the extent of the Companys taxable
income for the period beginning January 1, 2008 and ending on the date immediately preceding the
Acceptance Date. Such dividend will reduce the Offer price as described above. In connection with
the Offer, the Company has declared a $0.3494 per share dividend payable to stockholders of the
Company who hold shares of the Companys common stock at the close of business on the last trading
day immediately preceding the Acceptance Date. Such dividend will not be paid if the Offer is not
closed.
The following are some of the questions that you, as a stockholder of the Company, may have and
answers to those questions. We urge you to carefully read the remainder of this Offer to Purchase
and the related Letter of Transmittal because the information in this summary is not complete and
additional important information is contained in the remainder of this Offer to Purchase and the
related Letter of Transmittal.
Who Is Offering to Buy My Securities?
(See The Tender Offer Section 8. Certain Information
Concerning Parent, Purchaser, Hypo International and Hypo Holding.)
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The Offer to purchase any and all of the outstanding shares of the Companys common
stock not already owned by Parent and its affiliates is being made by Purchaser, a
wholly-owned subsidiary of Parent.
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Purchaser was formed on January 18, 2008 solely for the purposes of effecting
the Offer and the Merger and the transactions related thereto. Purchaser has not
engaged in any business except in furtherance of these purposes.
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Parent is a Delaware corporation and the Companys external manager. Parent is
a wholly-owned subsidiary of Hypo Real Estate Bank International AG, a German
corporation (which we refer to herein as Hypo International) that is a member of the
Hypo Real Estate Group, a leading commercial real estate, public and infrastructure
finance group.
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Hypo International is a wholly-owned subsidiary of Hypo Real Estate Holding AG,
a German corporation listed on the Frankfurt am Main Stock Exchange (which we refer to
herein as Hypo Holding).
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If the conditions to the Offer (including the Minimum Condition described below under
What Are the Most Important Conditions to the Offer?) are satisfied or waived as of the
Expiration Date (as defined below under The Tender Offer Section 1. Terms of the Offer;
Expiration Date), Purchaser will purchase all shares of the Companys common stock validly
tendered and not properly withdrawn pursuant to the Offer.
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What are the Securities Sought in the Offer?
(See Introduction and The Tender Offer Section 1.
Terms of the Offer; Expiration Date.)
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Purchaser is seeking to purchase any and all of the issued and outstanding shares of the
Companys common stock, par value $0.001 per share, that are not already owned by Parent
and its affiliates.
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How Much Are You Offering to Pay and What Is the Form of Payment? Will I have to pay any fees or
commissions?
(See The Tender Offer Section 3. Procedures for Tendering Shares of the Companys
Common Stock.)
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Purchaser is offering to pay an Offer price of $10.6506 for each outstanding share of
the Companys common stock that is not already owned by Parent and its affiliates, in cash
(without interest and less applicable withholding taxes), less the amount of any dividends
declared and paid with respect to the Companys shares of common stock on or between the
date of the Offer and the Acceptance Date (other than the $0.3494 dividend described
below).
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The Company expects to declare and pay a dividend immediately prior to the Acceptance
Date to the extent of the Companys taxable income for the period beginning January 1, 2008
and ending on the date immediately preceding the Acceptance Date. Such dividend will reduce
the Offer price as described above.
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In connection with the Offer, the Company has declared a $0.3494 per share dividend
payable to stockholders of the Company who hold shares of the Companys common stock at the
close of business on the last trading day immediately preceding the Acceptance Date. Such
dividend will not be paid if the Offer is not closed.
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If you are the record owner of your shares of the Companys common stock and you tender
your shares into the Offer, you will not have to pay brokerage fees or similar expenses. If
you own your shares of the Companys common stock through a broker or other nominee and
your broker or nominee tenders your shares of the Companys common stock on your behalf,
your broker or nominee may charge you a fee for doing so. You should consult your broker or
nominee to determine whether any charges will apply.
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Why Are You Making the Offer?
(See Special Factors Purpose of and Reasons for the Offer and the
Merger; Consideration of Alternatives.)
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Purchaser is making the Offer in order to obtain control of and acquire all of the
outstanding shares of the Companys common stock that are not already owned by Parent and
its affiliates. On January 28, 2008, Purchaser entered into the Merger Agreement with the
Company and Parent. Pursuant to the terms of the
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Merger Agreement, Purchaser is required to commence the Offer as the first step in its plan
to acquire all of the outstanding shares of the Companys common stock.
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After the completion of the Offer and the satisfaction or waiver of certain conditions,
Purchaser will be merged with and into the Company and the Company will be the surviving
corporation and become a wholly-owned subsidiary of Parent.
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What Are the Most Important Conditions to the Offer?
(See The Tender Offer Section 11. Certain
Conditions to the Offer.)
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Purchaser will not be required to accept for payment or, subject to any applicable rules
and regulations of the Securities and Exchange Commission (which we refer to herein as the
SEC), pay for any tendered shares of the Companys common stock and, subject to the terms
of the Merger Agreement, may terminate or amend the Offer, unless there have been validly
tendered and not properly withdrawn before the Offer expires a number of shares of the
Companys common stock which represents at least 55% of the sum of:
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(x)
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the total number of outstanding shares of the Companys common
stock not owned by Parent and its affiliates plus
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(y)
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the total number of shares of the Companys common stock
issuable upon exercise of outstanding options, warrants, conversion privileges
and other similar rights. We refer to this condition as the Minimum
Condition.
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Based on information provided by the Company, as of the date of this Offer to Purchase
and assuming that the Company complies with its covenants under the Merger Agreement,
approximately 9,237,379 shares of the Companys common stock would need to be validly
tendered and not properly withdrawn before the Offer expires in order to satisfy the
Minimum Condition.
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There is no financing condition to the Offer but the Offer is subject to several other
conditions.
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Do You Have the Financial Resources to Make Payment?
(See The Tender Offer Section 9. Source and
Amount of Funds.)
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As described in the preceding question and answer, there is no financing condition to
the Offer. We estimate that the total amount of funds necessary to purchase all shares of
the Companys common stock in the Offer and the Merger and to complete the related
transactions, including the payment of customary fees and expenses in connection with the
Offer and the Merger will be approximately $184.0 million. Hypo International, the parent
of Parent, has sufficient funds to pay this amount and will contribute to Purchaser
sufficient cash to make such payment with internally available funds.
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What is the Stand-by Facility and Why is it Being Provided by Parent?
(See Special Factors
Related Party Transactions-Stand-by Facility.)
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The execution of the Merger Agreement and the consummation of the transactions
contemplated thereby may present Wachovia Bank, N.A. with the ability to assert that there
is a default under the terms of the Companys Master Repurchase Agreement with Wachovia
(which we refer to herein as the Wachovia Facility).
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The Wachovia Facility is the Companys primary funding source for all of the
Companys currently financed assets and would be used by the Company to fund all of its
unfunded contractual loan commitments.
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Any loss of the Wachovia Facility or the use of margin calls or asset
foreclosures by Wachovia under the Wachovia Facility would have a material adverse
impact on the Companys business and operations.
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Accordingly, in connection with the execution of the Merger Agreement Parent agreed to
provide a backstop or other secondary or take-out credit facility to the Company to repay
Wachovia in the event Wachovia accelerated the Wachovia Facility following the announcement
of the transactions contemplated by the Merger Agreement.
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How Long Do I Have to Decide Whether to Tender into the Offer?
(See The Tender Offer Section 3.
Procedures for Tendering Shares of the Companys Common Stock.)
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You will initially have until 12:00 midnight, New York City time, on Wednesday, March
12, 2008, to decide whether to tender your shares of the Companys common stock into the
Offer. If you cannot deliver everything that is required in order to make a valid tender by
that time, you may be able to use a guaranteed delivery procedure, which is described later
in this Offer to Purchase.
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Can the Offer Be Extended and Under What Circumstances?
(See The Tender Offer Section 1. Terms
of the Offer; Expiration Date.)
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If the conditions to the Offer (including the Minimum Condition) have not been satisfied
or waived by Purchaser at the Expiration Date (or any subsequent Expiration Date),
Purchaser may, in its sole discretion, extend and re-extend the Offer on one or more
occasions for one or more periods of not more than 10 business days each, so long as the
last such extension does not cause Purchaser to accept and pay for the tendered shares
after April 30, 2008.
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Purchaser may also extend and re-extend the Offer for any period required by any rule,
regulation, interpretation or position of the SEC applicable to the Offer.
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In addition, if the Minimum Condition has been satisfied, but the sum of the number of shares validly tendered, when added to the number of shares of the Companys common stock
beneficially owned by Parent and its affiliates, does not constitute one share more than
90% of the outstanding shares of the Companys common stock (on a fully diluted basis),
Purchaser may, without the consent of the Company, extend and re-extend the Offer on one or
more occasions for an aggregate period of not more than 20 business days so long as the
last such extension does not cause Purchaser to accept and pay for the tendered shares
after April 30, 2008.
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Purchaser may, in its sole discretion, elect to provide a subsequent offering period for
the Offer pursuant to, and on the terms required by, Rule 14d-11 promulgated under the
Securities Exchange Act of 1934, as amended (which we refer to herein as the Exchange
Act).
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How Will I Be Notified if the Offer Is Extended?
(See The Tender Offer Section 1. Terms of the
Offer; Expiration Date.)
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If Purchaser extends the Offer, it will inform American Stock Transfer & Trust Company,
the Depositary for the Offer, of that fact and will make a public announcement of the
extension, not later than 9:00 a.m., New York City time, on the next business day after the
day on which the Offer was scheduled to expire.
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What Does the Companys Board of Directors Think of the Offer?
(See Special Factors Position of
the Company Regarding the Fairness of the Offer and the Merger.)
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The special committee of independent directors of the Company unanimously determined
that the Merger Agreement and the transactions contemplated thereby, including the Offer
and the Merger, are advisable, fair to and in the best interests of the Company and its
stockholders (other than Parent and its affiliates) and recommended to the Companys board
of directors that the Merger Agreement and the transactions contemplated by the Merger
Agreement, including the Offer and the Merger, be approved and declared advisable, fair to,
and in the best interests of the Company by the Companys board of directors (excluding
those directors who are employees of Parent or its affiliates other than the Company).
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The special committee is a committee of the Companys board of directors
comprised of directors who are not affiliated with Parent, Purchaser, Hypo
International or Hypo Holding. The special committee was formed on November 6, 2007 for
the purpose of reviewing, evaluating and, as appropriate, negotiating a possible
transaction relating to the sale of the Company.
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The board of directors of the Company (exclusive of members who are employees of Parent
or its affiliates other than the Company), upon the unanimous recommendation of its special
committee of independent directors, has unanimously determined that the Merger Agreement,
and the transactions contemplated thereby, including the Offer and the Merger, are
advisable, fair to and in the best interests of the Company and its stockholders (other
than Parent and its affiliates), approved the execution, delivery and performance of the
Merger Agreement and the consummation of the transactions contemplated thereby, including
the Offer and the Merger, and recommends that the Companys stockholders accept the Offer,
tender their shares of the Companys common stock into the Offer, and, if a vote is
required under Maryland law, vote for the consummation of the Merger.
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What is the Purpose of and the Reasons for the Offer and the Merger?
(See Special Factors
Purpose of and Reasons for the Offer and the Merger.)
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For Parent and Purchaser, the purpose of the Offer and the Merger is to effectuate the
transactions contemplated by the Merger Agreement and to acquire all of the outstanding shares of the Companys common stock while allowing the unaffiliated stockholders of the
Company, through receipt of the per share Offer price and Merger consideration and the
$0.3494 dividend payment from the Company, to immediately realize in cash the value of
their investment in the Company.
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For Hypo International and Hypo Holding, the purpose of the Merger is to benefit,
following the Merger, by virtue of their ownership, direct and indirect, of Parent, from
any future results of operations of the Company, including from the turnaround of the
Company following the implementation of a new business plan or the entrance into new or
tangential lines of business by the Company following the closing of the Offer and the
Merger.
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Parent, Purchaser, Hypo International and Hypo Holding all believe that, in the current
environment, it is in the best interests of Parent, the Company and all of the Companys
stockholders for Purchaser to acquire the Companys business through the transactions
contemplated by the Merger Agreement.
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What are the Plans for the Company After the Offer and the Merger?
(See Special Factors Plans
for the Company After the Offer and the Merger.)
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Parent expects that, upon consummation of the Offer and the Merger (other than the
transactions contemplated in connection with the Offer and the Merger as described in this
Offer to Purchase), the Companys operations will be conducted in substantially the same
manner as they are currently being conducted.
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What is the Position of Parent, Purchaser, Hypo International and Hypo Holding as to Fairness?
(See
Special Factors Position of Parent, Purchaser, Hypo International and Hypo Holding as to
Fairness.)
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Parent, Purchaser, Hypo International and Hypo Holding believe that the Offer and the
Merger are substantively and procedurally fair to the stockholders of the Company
unaffiliated with Parent, Purchaser, Hypo International and Hypo Holding, based upon the
factors set forth under Special Factors Position of Parent, Purchaser, Hypo
International and Hypo Holding as to Fairness.
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Did Parent or Purchaser Engage a Financial Advisor to Assist in the Evaluation of a Possible
Transaction with the Company?
(See Special Factors Summary of JPMorgans Preliminary Valuation
Overview.)
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Parent, Purchaser, Hypo International and Hypo Holding believe that the Offer and the
Merger are substantively and procedurally fair to the stockholders of the Company
unaffiliated with Parent, Purchaser,
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Hypo International and Hypo Holding, based upon the factors set forth under Special Factors
Position of Parent, Purchaser, Hypo International and Hypo Holding as to Fairness.
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Do the Companys Directors and Executive Officers have Different Interests in the Offer and the
Merger than the Companys Stockholders?
(See Special Factors Interests of the Companys
Directors and Executive Officers in the Offer and the Merger.)
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In considering the Offer and the Merger, you should be aware that certain of the
Companys directors and executive officers have interests in the transaction that are
different from, and/or in addition to, the interests of the Companys stockholders
generally. For example:
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Certain of the Companys directors and executive officers will be entitled to
payments in respect of their restricted shares and certain of the Companys independent
directors will be entitled to payments in respect of their deferred compensation units.
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Some of the Companys directors and executive officers own shares of the
Companys common stock, which they are entitled to tender in the Offer for the same
price per share as is available to the Companys other stockholders.
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Have any Stockholders Agreed to Tender Their Shares?
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We have not entered into any tender agreements, relating to the tender of shares of the
Companys common stock into the Offer, or voting agreements, relating to the voting of
shares in favor of the approval of the Merger and the Merger Agreement.
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As set forth in the Companys Solicitation/Recommendation Statement on Schedule 14D-9
under Item 4. The Solicitation or Recommendation
Intent to Tender, to the best of the Companys knowledge, after
reasonable inquiry, each executive officer, director, affiliate (other than Parent and
Purchaser) and subsidiary of the Company who owns shares of the Companys common stock
presently intends to tender in the Offer all shares that he or she owns of record or
beneficially, other than any shares that if tendered would cause him, her or them to incur
liability under the short-swing profits recovery provisions of the Exchange Act, other than
any shares over which, or with respect to which, any such executive officer, director or
affiliate acts in a fiduciary or representative capacity or is subject to the instructions
of a third party with respect to such tender.
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How Do I Tender My Shares of the Companys Common Stock?
(See The Tender Offer Section 3.
Procedures for Tendering Shares of the Companys Common Stock.)
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To tender your shares of the Companys common stock into the Offer, you must deliver the
Letter of Transmittal (or a facsimile thereof), properly completed and duly executed,
together with any required signature guarantees and any other documents required by the
Letter of Transmittal, to the Depositary at one of its addresses set forth on the back
cover of this Offer to Purchase. You must also either (i) deliver to the Depositary the
certificates evidencing tendered shares of the Companys common stock prior to the
Expiration Date or (ii) comply with the guaranteed delivery procedures described in this
Offer to Purchase.
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If you intend to tender your shares of the Companys common stock via a book-entry
transfer through the Depositary Trust Company, in lieu of sending a Letter of Transmittal,
you may deliver an electronic confirmation evidencing acceptance of and agreement to be
bound by the terms of the Letter of Transmittal. You must then tender your shares of the
Companys common stock pursuant to the procedure for book-entry transfer described in this
Offer to Purchase prior to the Expiration Date. No alternative, conditional or contingent
tenders will be accepted.
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If I Accept the Offer, When and How Will I Get Paid?
(See The Tender Offer Section 2. Acceptance
for Payment and Payment for Shares of the Companys Common Stock.)
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If the conditions to the Offer as set forth in the Introduction and under the caption
The Tender Offer Section 11. Certain Conditions to the Offer are satisfied or waived
and Purchaser consummates the Offer and accepts your shares of the Companys common stock
for payment, Purchaser will pay you, promptly following the expiration of the Offer, an
amount equal to the number of shares you tendered multiplied by $10.6506 in cash without
interest (and less applicable withholding taxes), less the amount of any dividends declared
and paid with respect to the Companys shares of common stock on or between the date of
this Offer and the Acceptance Date (other than the $0.3494 dividend described below).
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The Company expects to declare and pay a dividend immediately prior to the Acceptance
Date of the Offer to the extent of the Companys taxable income for the period beginning
January 1, 2008 and ending on the date immediately preceding the Acceptance Date. Such
dividend will reduce the Offer price as described above.
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In connection with the Offer, the Company has declared a $0.3494 per share dividend
payable to stockholders of the Company who hold shares of the Companys common stock at the
close of business on the last trading day immediately preceding the Acceptance Date. Such
dividend will not be paid if the Offer is not closed.
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Until What Time Can I Withdraw Previously Tendered Shares of the Companys Common Stock?
(See The
Tender Offer Section 1. Terms of the Offer; Expiration Date.)
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You can withdraw previously tendered shares of the Companys common stock at any time
until the Offer, as extended, expires and, if Purchaser has not accepted your shares for
payment by April 12, 2008, you may withdraw your shares at any time after April 12, 2008.
This right to withdraw will not apply to any subsequent offering period after the
expiration of the Offer.
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How Do I Withdraw Previously Tendered Shares of the Companys Common Stock?
(See The Tender Offer
Section 4. Withdrawal Rights.)
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To withdraw previously tendered shares of the Companys common stock you must deliver a
written notice of withdrawal, or a facsimile thereof, with the required information to the
Depositary while you still have the right to withdraw the shares.
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What is the Top-Up Option and When Could it be Exercised?
(See Special Factors The Merger
Agreement Top-Up Option.)
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The Company has granted Purchaser the irrevocable option (which we refer to herein as
the Top Up Option) to purchase, at a price per share equal to the Offer price (as such
price may be reduced by any dividends declared and paid with respect to the Companys
shares of common stock on or between the date of the Offer and the Acceptance Date, except
for the $0.3494 dividend being paid by the Company in connection with the Offer), a number
of newly issued shares of the Companys common stock equal to the number of shares that,
when added to the number of shares owned, directly or indirectly, by Parent or Purchaser at
the time of exercise of the Top Up Option, constitutes one share more than 90% of the total
shares that would be outstanding immediately after the issuance of all shares of the
Companys common stock subject to the Top Up Option.
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The purchase price per share for any shares of the Companys common stock purchased by
Purchaser pursuant to the Top Up Option would be equal to the price paid per share in the
Offer (as such price may be reduced by any dividends declared and paid with respect to the
Companys shares of common stock on or between the date of the Offer and the Acceptance
Date except for the $0.3494 dividend being paid by the Company in connection with the
Offer).
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The purchase price may be paid by means of a promissory note, which we expect would be
canceled in connection with the Merger. The Top Up Option may be exercised by Purchaser, in
whole but not in part, at any time on or after the expiration of the Offer and on or prior
to the fifth business day after the Expiration Date or the Expiration Date of any
subsequent offering period.
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7
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Ø
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The Top Up Option is subject to applicable SEC and New York Stock Exchange (which we
refer to herein as the NYSE) rules and other customary conditions, including that
Purchaser has accepted for payment and paid for all shares of the Companys common stock
tendered into the Offer and not properly withdrawn.
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Ø
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The Top Up Option is intended to expedite the timing of the completion of the Merger by
permitting Purchaser to effect a short-form merger pursuant to applicable Maryland law at
a time when the approval of the Merger at a meeting of the Companys stockholders would be
assured.
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Will the Offer Be Followed by a Merger if Not All Shares of the Company are Tendered into the
Offer?
(See Special Factors Purpose of and Reasons for the Offer and the Merger; Plans for the
Company After the Offer and the Merger; Consideration of Alternatives; Special Factors Certain
Effects of the Offer and the Merger; and Special Factors The Merger Agreement.)
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Ø
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If the Offer is consummated, Parent will transfer all of the shares of the Companys
common stock it owns to Purchaser and Purchaser will, subject to the terms and conditions
of the Merger Agreement, merge with and into the Company with the Company surviving the
Merger as a wholly-owned subsidiary of Parent.
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Ø
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If after the purchase of shares pursuant to the Offer and any subsequent offering period
and/or exercise of the Top-Up Option and the transfer by Parent of the shares it owns,
Purchaser owns at least 90% of the outstanding shares of the Companys common stock, then
once the other conditions to completion of the Merger are satisfied or waived, Purchaser
will merge into the Company in a short-form merger pursuant to applicable Maryland law.
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Ø
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The short-form merger does not require a vote of the Companys stockholders. However,
if after the purchase of shares pursuant to the Offer and any subsequent offering period
and/or exercise of the Top-Up Option and the transfer by Parent of the shares it owns,
Purchaser owns less than 90% of the outstanding shares of the Companys common stock (which
would only be likely to occur if Purchaser, with the Companys consent, reduces the Minimum
Condition), the Company will call a special meeting of stockholders to vote upon the
Merger, and Parent will cause Purchaser to vote all of the shares of the Companys common
stock owned by Purchaser to approve the Merger and the Merger Agreement.
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Following that vote and satisfaction or waiver of the other conditions to
completion of the Merger, Purchaser will then merge with and into the Company with the
Company surviving the Merger as a wholly-owned subsidiary of Parent. The Merger
Agreement is more fully described in Special Factors The Merger Agreement.
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Ø
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Upon consummation of the Merger, the Company will become a wholly-owned subsidiary of
Parent and, except as otherwise provided in the Merger Agreement, all of the remaining
stockholders of the Company will receive the Merger consideration of $10.6506 per share of
the Companys common stock in cash (without interest and less applicable withholding
taxes), less the amount of any dividends declared and paid with respect to the Companys shares of common stock on or between the date of the Offer and the Acceptance Date (other
than the $0.3494 dividend to be paid by the Company in connection with the Offer).
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The Company expects to declare and pay a dividend immediately prior to the
Acceptance Date to the extent of the Companys taxable income for the period beginning
January 1, 2008 and ending on the date immediately preceding the Acceptance Date. Such
dividend will reduce the Merger consideration as described above.
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Depending upon whether the Merger can be effected as a short-form merger, the
merger process may take several days to several months to complete following completion
of the Offer, and you will not receive the cash Merger consideration in respect of shares not tendered into the Offer until the completion of the Merger.
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8
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Ø
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Notice is hereby given pursuant to Section 3-106(d) of the Maryland General Corporation
Law (which we refer to herein as the MGCL) of the proposed Merger of Purchaser with and
into the Company, with the Company surviving the Merger, conditioned upon the ownership by
Purchaser of 90% or more of the outstanding shares of common stock of the Company as of the
time of acceptance for record of the articles of merger with the State Department of
Assessments and Taxation of Maryland.
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If I Decide Not to Tender, How Will the Offer Affect My Shares?
(See Special Factors Certain
Effects of the Offer and the Merger.)
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Ø
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As discussed in the following question and answer, you will not be entitled to exercise
appraisal or dissenters rights under Maryland law in connection with the Offer, and we do
not expect that you will be able to exercise appraisal or dissenters rights in connection
with the Merger.
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Ø
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If you decide not to tender your shares of the Companys common stock into the Offer and
the Merger is consummated, you will subsequently receive the same amount of cash per share
of the Companys common stock that you would have received had you tendered your shares
into the Offer, without any interest (and less applicable withholding taxes). Therefore, if
the Merger is consummated, the only difference to you between tendering your shares of the
Companys common stock in the Offer and not tendering your shares of the Companys common
stock in the Offer is that you will be paid earlier if you tender your shares in the Offer.
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Ø
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If you decide to tender your shares of the Companys common stock into the Offer and
Purchaser purchases the tendered shares, but the Merger does not occur, there may be so few
remaining holders of shares of the Companys common stock that the shares will no longer be
eligible to be traded through the NYSE and there may not be an active public trading market
for the shares, and this may affect the prices at which your shares trade.
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Will I Have the Right to Have My Shares of the Companys Common Stock of the Company Appraised?
(See Special Factors No Dissenters Rights.)
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Ø
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You will not be entitled to exercise appraisal or dissenters rights under Maryland law
in connection with the Offer, and we do not expect that you will be able to exercise
appraisal or dissenters rights in connection with the Merger.
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Ø
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The MGCL does not provide appraisal rights or other similar rights to stockholders of a
corporation in connection with a merger if the shares of the corporation are listed on a
national securities exchange on the record date for determining stockholders entitled to
vote on the merger, or with respect to a short form merger, if the shares of the
corporation are listed on a national securities exchange on the date on which notice is
given.
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Ø
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The shares of the Companys common stock are listed on the NYSE, which is a national
securities exchange, and Purchaser is hereby delivering notice pursuant to Section 3-106(d)
of the MGCL of the proposed Merger of Purchaser with and into the Company, with the Company
surviving the Merger, conditioned upon the ownership by Purchaser of 90% or more of the
outstanding shares of common stock of the Company as of the time of acceptance for record
of the articles of merger with the State Department of Assessments and Taxation of
Maryland.
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How Will My Outstanding Restricted Shares Be Treated in the Offer and the Merger?
(See Special
Factors Certain Effects of the Offer and the Merger.)
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Ø
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Immediately prior to the effective time of the Merger, each outstanding restricted share
of the Companys common stock issued under any of the Companys equity compensation plans
will vest, the restrictions thereon will lapse, and each restricted share will be cancelled
and converted into the right to receive the Merger consideration of $10.6506 per share of
the Companys common stock in cash (without interest and less applicable withholding
taxes), less the amount of any dividends declared and paid with respect to the
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9
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Companys shares of common stock on or between the date of this Offer and the Acceptance
Date (other than the $0.3494 dividend described below).
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The Company expects to declare and pay a dividend immediately prior to the
Acceptance Date to the extent of the Companys taxable income for the period beginning
January 1, 2008 and ending on the date immediately preceding the Acceptance Date. Such
dividend will reduce the Merger consideration as described above.
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Holders of restricted shares who hold their shares at the close of business on
the last trading day immediately preceding the Acceptance Date will also be entitled to
receive the $0.3494 dividend. Such dividend will not be paid if the Offer is not
closed.
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How Will My Outstanding Deferred Compensation Units Be Treated in the Offer and the Merger?
(See
Special Factors Certain Effects of the Offer and the Merger.)
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Ø
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Immediately prior to the effective time of the Merger, (i) each independent director of
the Company who holds any outstanding and unsettled deferred compensation units issued
under the Companys Independent Director Deferred Compensation Plan will become entitled to
a lump sum payment in cash, without interest, in the aggregate amount equal to the balance
credited to such holders deferred compensation account maintained by the Company under
such plan, and (ii) each such holders deferred compensation units will be cancelled and of
no further force and effect.
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Parent will pay, or direct the exchange agent for the transaction to pay, to
each such holder, his or her deferred compensation payment as promptly as reasonably
practicable following the effective date of the Merger, at which time such holder will
cease to possess any rights to any compensation from the Company or the surviving
company in the Merger.
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For the purpose of determining the deferred compensation payment, the Fair
Market Value of one share of common stock, as such term is used in the Companys
Independent Director Deferred Compensation Plan, is equal to the Offer price and,
accordingly, holders of deferred compensation units would be entitled to a payment
equal to the number of deferred compensation units they have multiplied by the $10.6506
Offer price (without interest and less applicable withholding taxes), less the amount
of any dividends declared and paid with respect to the Companys shares of common stock
on or between the date of the Offer and the Acceptance Date (other than the $0.3494
dividend to be paid by the Company in connection with the Offer).
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The Company expects to declare and pay a dividend immediately prior to the
Acceptance Date to the extent of the Companys taxable income for the period beginning
January 1, 2008 and ending on the date immediately preceding the Acceptance Date. Such
dividend will reduce the Offer price as described above.
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What Are the U.S. Federal Income Tax Consequences of the Offer and the Merger?
(See The Tender
Offer Section 5. Certain Material U.S. Federal Income Tax Considerations.)
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Ø
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If you are a U.S. holder (as defined in The Tender Offer Section 5. Certain Material
U.S. Federal Income Tax Considerations), the receipt of cash for your shares of the
Companys common stock that are tendered into the Offer or converted in the Merger will be
a taxable transaction for U.S. federal income tax purposes.
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Your receipt of cash in exchange for your shares of the Companys common stock
generally will cause you to recognize a gain or loss measured by the difference, if
any, between the cash you receive in the Offer or the Merger (determined before the
deduction of any applicable withholding taxes) and your adjusted tax basis in your shares of the Companys common stock.
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10
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The Company intends to treat the $0.3494 per share dividend as a dividend for
U.S. federal income tax purposes to the extent the Companys current and accumulated
earnings and profits are allocable to such dividend.
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If you are a non-U.S. holder (as defined in The Tender Offer Section 5.
Certain Material U.S. Federal Income Tax Considerations), the receipt of cash for your shares of the Companys common stock that are tendered into the Offer or converted in
the Merger generally will not be a taxable transaction to you for U.S. federal income
tax purposes unless you have certain connections to the United States or, in certain
circumstances, if you own more than 5% of the Companys common stock.
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For non-U.S. holders, the $0.3494 per share dividend generally would be treated
as an ordinary dividend distribution from the Company subject to U.S. withholding tax
at a rate of 30% (or a reduced rate prescribed by an applicable income tax treaty).
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Under U.S. federal income tax law, all holders will be subject to information
reporting on cash received in the Offer or the Merger unless an exemption applies.
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Backup withholding may also apply with respect to cash you receive in the Offer
or the Merger, unless you provide proof of an applicable exemption or a correct
taxpayer identification number and otherwise comply with the applicable requirements of
the backup withholding rules.
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Ø
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We recommend that you consult your tax advisor for a full understanding of how receiving
payment for your shares of the Companys common stock that are tendered into the Offer or
converted in the Merger and the $0.3494 per share dividend will affect your federal, state
and local and/or foreign taxes and, if applicable, the tax consequences of the receipt of
cash in connection with the cancellation of your options to purchase shares of the
Companys common stock and/or your restricted shares, including the transactions described
in this Offer to Purchase relating to the Companys other equity compensation plans.
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What Is the Market Value of My Shares of the Companys Common Stock as of a Recent Date?
(See The
Tender Offer Section 6. Price Range of Shares of the Companys Common Stock.)
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Ø
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The closing sale price of the Companys common stock on the NYSE on January 28, 2008,
the last trading day prior to the execution of the Merger Agreement and the public
announcement of the Offer and the Merger, was $7.96 per share.
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Ø
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The aggregate Offer price and Merger consideration of $11.00 per share, inclusive of the
$10.6506 per share (subject to reduction in the amount of any dividends declared and paid
with respect to the Companys shares of common stock on or between the date of this Offer
and the Acceptance Date) and the dividend of $0.3494 per share to be paid by the Company
represents a premium of approximately 38% to the closing price on January 28, 2008 and an
approximately 41% premium to the average closing price of the Companys common stock for
the 30 trading days ended January 28, 2008. On February 12, 2008, the most recent
practicable date before this Offer to Purchase was printed, the closing price for the
Companys common stock on the NYSE was $10.85 per share.
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Ø
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We advise you to obtain a recent quotation for the shares of the Companys common stock
before deciding whether to tender your shares into the Offer.
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Who Can I Call If I Have Questions About the Offer?
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Ø
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You can call Georgeson Inc., the Information Agent for the Offer, toll free at (866)
873-6981. Banks and brokers can call collect at (212) 440-9800.
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Ø
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JPMorgan is acting as the dealer manager for the Offer. The telephone number of the
dealer manager is set forth on the back cover of this Offer to Purchase.
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11
Item 2.
Subject Company Information
.
The section captioned INTRODUCTION beginning on page 11 of the Offer to Purchase is hereby
deleted in its entirety and restated in full on the page immediately following the end of the
section captioned SPECIAL FACTORS.
The fifth paragraph under the section captioned INTRODUCTION is hereby deleted and replaced
with the following paragraph:
For factors considered by the Companys board of directors and its special committee
of independent directors, see the Companys Solicitation/Recommendation Statement on
Schedule 14D-9 (as amended or supplemented from time to time, the Schedule 14D-9)
filed with the Securities and Exchange Commission (the SEC) in connection with the
Offer and which is being mailed to stockholders together with this Offer to
Purchase.
Item 5.
Past Contacts, Transactions, Negotiations and Agreements
.
The first sentence of the fourth paragraph on page 13 of the Offer to Purchase under the
section captioned Special Factors Background of the Offer and the Merger is hereby deleted and
replaced with the following sentence:
At the time of the Companys initial public offering, the Companys objective was to
provide attractive total returns to its stockholders by maximizing the difference
between the yield on its investments and the cost of financing these investments to
generate cash available for distribution and facilitate capital appreciation,
including appreciation in the value of any real property in which the Company holds
an interest.
The last sentence of the last paragraph that begins on page 14 of the Offer to Purchase under
the section captioned Special Factors Background of the Offer and the Merger is hereby deleted
and replaced with the following sentence:
Shortly thereafter, JPMorgan reviewed with Hypo Holding possible alternative courses
of action for engaging with the Company. JPMorgan recommended that Hypo Holding
consider communicating to the Company Hypo Holdings potential desire to acquire the
Company and Hypo Holdings willingness to participate in a transaction process of
the Companys choosing. JPMorgan also provided Hypo Holding with its calculation of
the Companys firm value, assuming acquisition of the Company at a purchase price
per share ranging from $9.52 to $15.
The first sentence of the third complete paragraph on page 15 of the Offer to Purchase under
the section captioned Special Factors Background of the Offer and the Merger is hereby deleted
and replaced with the following sentence:
At the Board meeting on November 6, 2007 the Companys board of directors
established a special committee to study and evaluate strategic alternatives
available to the Company.
The first sentence of the fifth complete paragraph on page 15 of the Offer to Purchase under
the section captioned Special Factors Background of the Offer and the Merger is hereby amended
and restated with the following paragraph:
On November 29, 2007, the Companys special committee officially engaged The
Blackstone Group (Blackstone) as its financial advisor in connection with its
study and evaluation of strategic alternatives, including a possible transaction
with Parent.
The third complete paragraph on page 21 of the Offer to Purchase under the section captioned
Special Factors Background of the Offer and the Merger is hereby deleted and replaced with the
following paragraph:
On January 27, 2008, Blackstone delivered an opinion to the special committee and
the board of directors of the Company (exclusive of the directors who are employees
and/or affiliates of Parent) that, as of the date of the opinion, the aggregate
Offer price and the Merger consideration of $11.00 per share, inclusive of the
$10.6506 per share in cash and the dividend of $0.3494 per share to be paid by the
Company were fair, from a financial point of view, to the holders of the Companys
common stock (other than Parent and its affiliates) and on January 28, 2008 verbally
confirmed to the board of directors of the Company (exclusive of the directors who
are employees
Item 8.
Interest in Securities of the Subject
Company
The
reference to the Companys Schedule 14D-9 on page 71 of the
Offer to Purchase is hereby amended and replaced with the following
reference:
Item
4. The Solicitation or Recommendation Intent to Tender,
12
of Parent or its affiliates) that nothing had come to its attention that would
change its opinion from the time issued on January 27, 2008.
Item 12.
Exhibits
.
Item 12 of the Schedule TO is hereby amended and supplemented by the addition of Exhibit
(c)(4) and, as so amended, is restated in its entirety as follows:
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Exhibit No.
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Description
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(a)(1)(A)
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Offer to Purchase, dated February 13, 2008.*
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(a)(1)(B)
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Letter of Transmittal.*
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(a)(1)(C)
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Notice of Guaranteed Delivery.*
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(a)(1)(D)
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Letter from the Dealer Manager to Brokers, Dealers, Commercial Banks, Trust
Companies and Nominees.*
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(a)(1)(E)
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Letter to Clients for Use by Brokers, Dealers, Commercial Banks, Trust
Companies and Nominees.*
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(a)(1)(F)
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Guidelines for Certification of Taxpayer Identification Number on Substitute
IRS Form W-9.*
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(a)(2)(A)
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Letter from the Chairman of the Special Committee of Independent Directors of
Quadra to the stockholders of Quadra enclosing the Solicitation /Recommendation
Statement on Schedule 14D-9 filed by Quadra on February 13, 2008
(incorporated by reference to Annex III to the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra with the SEC on February 13, 2008
in connection with the Offer).*
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(a)(2)(B)
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Information Statement pursuant to Section 14(f) of the Securities Exchange Act
of 1934 and Rule 14f-1 thereunder (incorporated by reference to Annex I to the
Solicitation/Recommendation Statement on Schedule 14D-9 filed by Quadra with
the SEC on February 13, 2008 in connection with the Offer).*
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(a)(2)(C)
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Item 3. Past Contracts, Transactions, Negotiation and Agreements Interests
of Certain Persons of the Solicitation/Recommendation Statement on Schedule
14D-9 filed by Quadra on February 13, 2008 (incorporated by reference to the
Solicitation/Recommendation Statement on Schedule 14D-9 filed by Quadra with
the SEC on February 13, 2008 in connection with the Offer).*
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(a)(2)(D)
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Item 4. The Solicitation or Recommendation Reasons for the Recommendation of
the Special Committee and the Quadra Board of the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra on February 13, 2008 (incorporated
by reference to the Solicitation/Recommendation Statement on Schedule 14D-9
filed by Quadra with the SEC on February 13, 2008, as amended by
Amendment No. 1 to the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra with the SEC on
March 4, 2008 in connection with the
Offer).*
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(a)(2)(E)
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Item 8. Additional Information Opinion of the Special Committees Financial
Advisor of the Solicitation/Recommendation Statement on Schedule 14D-9 filed
by Quadra on February 13, 2008 (incorporated by reference to the
Solicitation/Recommendation Statement on Schedule 14D-9 filed by Quadra with
the SEC on February 13, 2008, as amended by
Amendment No. 1 to the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra with the SEC on
March 4, 2008 in connection with the Offer).*
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(a)(2)(F)
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The information contained in Annex I to the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra on February 13, 2008 under the
heading Security Ownership of Certain Beneficial Owners and Management
(incorporated by reference to the Solicitation/Recommendation Statement on
Schedule 14D-9 filed by Quadra with the SEC on
February 13, 2008, as amended by
Amendment No. 1 to the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra with the SEC on
March 4, 2008 in connection
with the Offer).*
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(a)(3)
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None.
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(a)(4)
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None.
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(a)(5)(A)
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|
Joint press release of Quadra and Parent dated as of January 29, 2008,
concerning the Offer and the Merger (incorporated by reference to the Schedule
TO-C filed by Parent with the SEC on January 29, 2008).*
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13
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Exhibit No.
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|
Description
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(c)(1)
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Fairness opinion of The Blackstone Group, financial advisor to the special
committee of independent directors of Quadra dated January 27, 2008
(incorporated by reference to Annex II to the Solicitation / Recommendation
Statement on Schedule 14D-9 filed by Quadra with the SEC on February 13, 2008
in connection with the Offer).*
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(c)(2)
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Preliminary Valuation Overview of J.P. Morgan Securities Inc. to the Management
Board of Hypo Holding, dated December 11, 2007.*
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(c)(3)
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Valuation Range Update to the Preliminary Valuation Overview of J.P. Morgan
Securities Inc. referred to in Exhibit (c)(2), dated January 20, 2008.*
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(c)(4)
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Discussion Materials of J.P. Morgan Securities Inc., dated October 2, 2007.
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(d)(1)
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Agreement and Plan of Merger, dated January 28, 2008, by and among Quadra,
Parent and Purchaser (incorporated by reference to Exhibit 2.1 to the Form 8-K
filed by Quadra with the SEC on January 29, 2008).*
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(d)(2)
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Form of Registration Rights Agreement between Quadra and Parent (incorporated
by reference to Exhibit 10.1 to Amendment No. 2 to the Registration Statement
on Form S-11 (Registration No. 333-138591) filed by Quadra with the SEC on
February 1, 2007).*
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(d)(3)
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Form of Management Agreement between Quadra and Parent (incorporated by
reference to Exhibit 10.2 to Amendment No. 2 to the Registration Statement on
Form S-11 (Registration No. 333-138591) filed by Quadra with the SEC on
February 1, 2007).*
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(d)(4)
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Form of Restricted Stock Award Agreement under the Quadra Realty Trust, Inc.
Manager Equity Plan between Quadra and Parent (incorporated by reference to
Exhibit 10.9 to Amendment No. 2 to the Registration Statement on Form S-11
(Registration No. 333-138591) filed by Quadra with the SEC on February 1,
2007).*
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(d)(5)
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Confidentiality Agreement, dated November 16, 2007, by and between Quadra and
Hypo Holding. (incorporated by reference to Exhibit(e)(5) to the
Solicitation/Recommendation on Schedule 14D-9 filed by Quadra with the SEC on
February 13, 2008).*
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(d)(6)
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Form of Contribution Agreement between Quadra and Parent (incorporated by
reference to Exhibit 10.3 to Amendment No. 2 to the Registration Statement on
Form S-11 (Registration No. 333-138591) filed by Quadra with the SEC on
February 1, 2007).*
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(g)
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None.
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(h)
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Form of opinion of Bass, Berry & Sims, PLC regarding the REIT status of Quadra.*
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Item 13.
Information Required by Schedule 13E-3
.
Item 6.
Purposes of the Transaction and Plans or Proposal
.
The
first paragraph on page 22 of the Offer to Purchase under the section captioned Special Factors Purpose of and Reasons for the
Offer and the Merger; Consideration of Alternatives
is hereby deleted in its entirety.
Item 7.
Purposes, Alternatives, Reasons and Effects
.
The
last sentence of the third complete paragraph on page 68 of the Offer
to Purchase under the section captioned The Tender Offer Section
5. Certain Material U.S. Federal Income Tax Considerations is hereby deleted and replaced with the following sentence:
If you are a partner of a partnership holding the Companys common stock we
recommend that you consult your tax advisor regarding the tax consequences of the
Offer and the Merger.
The
fourth complete paragraph on page 68 of the Offer to Purchase under the section captioned The Tender Offer Section 5. Certain Material
U.S. Federal Income Tax Considerations is hereby
deleted and replaced with the following paragraph:
14
The U.S. federal income tax consequences set forth herein are not intended to
constitute a complete description of all tax consequences relating to the Offer and
the Merger, nor do they address all tax considerations applicable to holders of the
Companys common stock. Because individual circumstances may differ, we recommend
that each holder consult with the holders tax advisor regarding the applicability
of the rules discussed above to the holder and the particular tax consequences to
the holder (including the application and effect of any state, local or non-U.S.
income and other tax laws) of the Offer and the Merger.
The
following paragraph is hereby added as the last paragraph under the
section of the Offer to Purchase captioned Special Factors
Certain Effects of the Offer and the Merger:
The consummation of the Offer and the Merger will have the same effect as a purchase of all
the outstanding capital stock of the Company for cash. The Company will recognize no gain or loss
in connection with those transactions. Following the transaction, it is expected that Quadra will
either become a member of Parents consolidated U.S. federal income tax return or elect to be a
disregarded entity for U.S. federal income tax purposes in a transaction expected to be treated as a
liquidation for U.S. federal income tax purposes. In the event Quadra does not continue to have 100
shareholders for the required proportionate part of its 2008 taxable year ending as a result of the
actions taken in the preceding sentence, or otherwise does not distribute 90% of its net taxable
income for such taxable year, Quadra may fail to qualify as a REIT for such taxable year, and, as a
result, could be subject to tax as a regular corporation for such taxable year. Please see The
Tender Offer Section 5. Certain U.S. Federal Income Tax Considerations for a summary of the
material U.S. federal income tax consequences to the Companys common stockholders who participate
in the Offer or the Merger.
Item 8.
Fairness of the Transaction
.
The
first paragraph on page 25 of the Offer to Purchase under the section captioned Special Factors Position of Parent, Purchaser,
Hypo International and Hypo Holding as to Fairness
is hereby deleted and replaced with the following paragraph:
The following views of Parent, Purchaser, Hypo International and Hypo Holding as to
the fairness of the Offer and the Merger to the Companys unaffiliated stockholders
(meaning the Companys stockholders other than Parent, Purchaser and their
affiliates) should not be construed as a recommendation to any stockholder as to
whether such stockholder should tender its shares in response to the Offer or how
such stockholder should vote on the approval of the Merger and the Merger Agreement
(if a vote of the Companys stockholders is held).
The
second complete paragraph on page 27 of the Offer to Purchase under the section captioned Special Factors Position of Parent, Purchaser,
Hypo International and Hypo Holding as to Fairness
is hereby deleted in its entirety.
The
first clause of the first sentence of the third complete paragraph on page 27 of the
Offer to Purchase under the section captioned Special Factors Position
of Parent, Purchaser, Hypo International and Hypo Holding as to Fairness is hereby deleted and replaced with the following sentence:
Parent, Purchaser, Hypo International and Hypo Holding believe that the exercise by
Purchaser of the Top-Up Option would be substantively and procedurally fair to the
Companys unaffiliated stockholders based upon the following factors:
The
first clause of the first sentence of the fourth complete paragraph on page 27
of the Offer to Purchase under the section captioned Special Factors
Position of Parent, Purchaser, Hypo International and Hypo Holding as to Fairness is hereby deleted and replaced with the following sentence:
Parent, Purchaser, Hypo International and Hypo Holding believe that any open market
purchases effected by Parent, Purchaser or their affiliates following completion of
the Offer would be substantively and procedurally fair to the Companys unaffiliated
stockholders based upon the following factors:
Item 9.
Reports, Opinions, Appraisals and Certain Negotiations
.
The third complete paragraph on page 33 of the Offer to Purchase under the section captioned
Special Factors Summary of JPMorgans Preliminary Valuation Overview is hereby deleted and
replaced with the following sentence:
JPMorgan and its affiliates have performed in the past, and may continue to perform,
certain financial advisory, financing and other investment banking and commercial
banking services for Hypo Holding and its affiliates, all for customary
compensation. Past services have included a number of advisory and capital raising
assignments for Hypo Holding and its affiliates. The aggregate fees received by
JPMorgan during 2006, 2007 and 2008 for services it rendered to Hypo Holding and its
affiliates were approximately $5.5 million. In the ordinary course of their businesses,
JPMorgan and its affiliates may actively trade the debt and equity securities of
Hypo Holding, the
15
Company and their respective affiliates for their own accounts or for the accounts
of customers and, accordingly, they may at any time hold long or short positions in
such securities.
Item 13.
Financial Statements
.
The
chart titled Income Statement Data beginning on page 72
of the Offer to Purchase under the section captioned The Tender
Offer Section 7. Certain Information Concerning the
Company is hereby amended and restated in its entirety with the
following, which adds the line item Ratio of Earnings to Fixed
Charges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period from February 21,
|
|
|
|
Three Months Ended
|
|
|
2007
(1)
until
|
|
|
|
September 30,
|
|
|
June 30,
|
|
|
March 31,
|
|
|
September 30,
|
|
|
|
2007
|
|
|
2007
|
|
|
2007
|
|
|
2007
|
|
|
Income Statement Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from investment loans
|
|
$
|
15,417
|
|
|
$
|
9,922
|
|
|
$
|
3,059
|
|
|
$
|
28,396
|
|
Interest expense
|
|
|
(5,894
|
)
|
|
|
(2,080
|
)
|
|
|
0
|
|
|
|
(7,975
|
)
|
Total Net Revenues
|
|
$
|
9,523
|
|
|
$
|
7,842
|
|
|
$
|
3,059
|
|
|
$
|
20,421
|
|
Total operating costs and expenses
|
|
|
2,817
|
|
|
|
2,770
|
|
|
|
10,622
|
|
|
|
16,208
|
|
Net income (loss)
|
|
|
6,706
|
|
|
|
5,072
|
|
|
|
(7,563
|
)
|
|
|
4,213
|
|
Cash dividends declared per common
share
(2)
|
|
$
|
.10
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
.10
|
|
Average shares of common stock outstanding basic (in
thousands)
|
|
|
25,602
|
|
|
|
25,602
|
|
|
|
25,600
|
|
|
|
25,602
|
|
Ratio of Earnings
to Fixed Charges
|
|
|
2.14
|
|
|
|
3.44
|
|
|
|
n/a
|
|
|
|
1.53
|
|
|
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(1)
|
|
The Company commenced operations on
February 21, 2007.
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|
(2)
|
|
Two subsequent dividends were paid
by the Company in respect of fourth quarter earnings ($0.13 and
$0.19 per share).
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|
(3)
|
|
The ratio of
earnings to fixed charges was calculated by adding the Companys
interest expense and pre-tax income for the relevant period, and
dividing this sum by the interest expense for the relevant period.
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16
SIGNATURES
After due inquiry and to the best of their knowledge and belief, each of the undersigned
certifies that the information set forth in this statement is true, complete and correct.
Dated March 4, 2008
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|
HRECC SUB INC.
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|
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By:
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/s/ Thomas Glynn
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Name:
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Thomas Glynn
|
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|
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Title:
|
President
|
|
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|
|
|
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|
|
HYPO REAL ESTATE CAPITAL CORPORATION
|
|
|
By:
|
/s/ Thomas Glynn
|
|
|
|
Name:
|
Thomas Glynn
|
|
|
|
Title:
|
Authorized Signatory
|
|
|
|
|
|
|
|
|
HYPO REAL ESTATE BANK INTERNATIONAL AG
|
|
|
By:
|
/s/ Frank Lamby
|
|
|
|
Name:
|
Frank Lamby
|
|
|
|
Title:
|
Member of the Management Board
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Frank Hellwig
|
|
|
|
Name:
|
Frank Hellwig
|
|
|
|
Title:
|
Member of the Management Board
|
|
|
|
|
|
|
|
|
HYPO REAL ESTATE HOLDING AG
|
|
|
By:
|
/s/ Thomas Glynn
|
|
|
|
Name:
|
Thomas Glynn
|
|
|
|
Title:
|
Member of the Management Board
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Dr. Markus Fell
|
|
|
|
Name:
|
Dr. Markus Fell
|
|
|
|
Title:
|
Chief Financial Officer;
Member of the Management Board
|
|
|
EXHIBIT INDEX
|
|
|
Exhibit No.
|
|
Description
|
|
|
|
(a)(1)(A)
|
|
Offer to Purchase, dated February 13, 2008.*
|
|
|
|
(a)(1)(B)
|
|
Letter of Transmittal.*
|
|
|
|
(a)(1)(C)
|
|
Notice of Guaranteed Delivery.*
|
|
|
|
(a)(1)(D)
|
|
Letter from the Dealer Manager to Brokers, Dealers, Commercial Banks, Trust
Companies and Nominees.*
|
|
|
|
(a)(1)(E)
|
|
Letter to Clients for Use by Brokers, Dealers, Commercial Banks, Trust
Companies and Nominees.*
|
|
|
|
(a)(1)(F)
|
|
Guidelines for Certification of Taxpayer Identification Number on Substitute
IRS Form W-9.*
|
|
|
|
(a)(2)(A)
|
|
Letter from the Chairman of the Special Committee of Independent Directors of
Quadra to the stockholders of Quadra enclosing the Solicitation /Recommendation
Statement on Schedule 14D-9 filed by Quadra on February 13, 2008
(incorporated by reference to Annex III to the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra with the SEC on February 13, 2008
in connection with the Offer).*
|
|
|
|
(a)(2)(B)
|
|
Information Statement pursuant to Section 14(f) of the Securities Exchange Act
of 1934 and Rule 14f-1 thereunder (incorporated by reference to Annex I to the
Solicitation/Recommendation Statement on Schedule 14D-9 filed by Quadra with
the SEC on February 13, 2008 in connection with the Offer).*
|
|
|
|
(a)(2)(C)
|
|
Item 3. Past Contracts, Transactions, Negotiation and Agreements Interests
of Certain Persons of the Solicitation/Recommendation Statement on Schedule
14D-9 filed by Quadra on February 13, 2008 (incorporated by reference to the
Solicitation/Recommendation Statement on Schedule 14D-9 filed by Quadra with
the SEC on February 13, 2008, as amended by
Amendment No. 1 to the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra with the SEC on
March 4, 2008 in connection with the Offer).*
|
|
|
|
(a)(2)(D)
|
|
Item 4. The Solicitation or Recommendation Reasons for the Recommendation
of the Special Committee and the Quadra Board of the
Solicitation/Recommendation Statement on Schedule 14D-9 filed by Quadra on
February 13, 2008 (incorporated by reference to the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra with the SEC
on February 13, 2008, as amended by
Amendment No. 1 to the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra with the SEC on
March 4, 2008 in connection with the Offer).*
|
|
|
|
(a)(2)(E)
|
|
Item 8. Additional Information Opinion of the Special Committees Financial
Advisor of the Solicitation/Recommendation Statement on Schedule 14D-9 filed
by Quadra on February 13, 2008 (incorporated by reference to the
Solicitation/Recommendation Statement on Schedule 14D-9 filed by Quadra with
the SEC on February 13, 2008, as amended by
Amendment No. 1 to the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra with the SEC on
March 4, 2008 in connection with the Offer).*
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|
|
|
(a)(2)(F)
|
|
The information contained in Annex I to the Solicitation/Recommendation
Statement on Schedule 14D-9 filed by Quadra on February 13, 2008 under the
heading Security Ownership of Certain Beneficial Owners and Management
(incorporated by reference to the Solicitation/Recommendation Statement on
Schedule 14D-9 filed by Quadra with the SEC on February 13, 2008 in connection
with the Offer).*
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|
|
|
(a)(3)
|
|
None.
|
|
|
|
(a)(4)
|
|
None.
|
|
|
|
(a)(5)(A)
|
|
Joint press release of Quadra and Parent dated as of January 29, 2008,
concerning the Offer and the Merger (incorporated by reference to the Schedule
TO-C filed by Parent with the SEC on January 29, 2008).*
|
|
|
|
(c)(1)
|
|
Fairness opinion of The Blackstone Group, financial advisor to the special
committee of independent directors of Quadra dated January 27, 2008
(incorporated by reference to Annex II to the Solicitation / Recommendation
Statement on Schedule 14D-9 filed by Quadra with the SEC on February 13, 2008
in connection with the Offer).*
|
|
|
|
(c)(2)
|
|
Preliminary Valuation Overview of J.P. Morgan Securities Inc. to the Management
Board of Hypo Holding, dated December 11, 2007.*
|
|
|
|
Exhibit No.
|
|
Description
|
|
(c)(3)
|
|
Valuation Range Update to the Preliminary Valuation Overview of J.P. Morgan
Securities Inc. referred to in Exhibit (c)(2), dated January 20, 2008.*
|
|
|
|
(c)(4)
|
|
Discussion Materials of J.P. Morgan Securities Inc., dated October 2, 2007.
|
|
|
|
(d)(1)
|
|
Agreement and Plan of Merger, dated January 28, 2008, by and among Quadra,
Parent and Purchaser (incorporated by reference to Exhibit 2.1 to the Form 8-K
filed by Quadra with the SEC on January 29, 2008).*
|
|
|
|
(d)(2)
|
|
Form of Registration Rights Agreement between Quadra and Parent (incorporated
by reference to Exhibit 10.1 to Amendment No. 2 to the Registration Statement
on Form S-11 (Registration No. 333-138591) filed by Quadra with the SEC on
February 1, 2007).*
|
|
|
|
(d)(3)
|
|
Form of Management Agreement between Quadra and Parent (incorporated by
reference to Exhibit 10.2 to Amendment No. 2 to the Registration Statement on
Form S-11 (Registration No. 333-138591) filed by Quadra with the SEC on
February 1, 2007).*
|
|
|
|
(d)(4)
|
|
Form of Restricted Stock Award Agreement under the Quadra Realty Trust, Inc.
Manager Equity Plan between Quadra and Parent (incorporated by reference to
Exhibit 10.9 to Amendment No. 2 to the Registration Statement on Form S-11
(Registration No. 333-138591) filed by Quadra with the SEC on February 1,
2007).*
|
|
|
|
(d)(5)
|
|
Confidentiality Agreement, dated November 16, 2007, by and between Quadra and
Hypo Holding. (incorporated by reference to Exhibit(e)(5) to the
Solicitation/Recommendation on Schedule 14D-9 filed by Quadra with the SEC on
February 13, 2008).*
|
|
|
|
(d)(6)
|
|
Form of Contribution Agreement between Quadra and Parent (incorporated by
reference to Exhibit 10.3 to Amendment No. 2 to the Registration Statement on
Form S-11 (Registration No. 333-138591) filed by Quadra with the SEC on
February 1, 2007).*
|
|
|
|
(g)
|
|
None.
|
|
|
|
(h)
|
|
Form of opinion of Bass, Berry & Sims, PLC regarding the REIT status of Quadra.*
|
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